Climate Adaptation

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Climate Adaptation

Climate Adaptation

 

In signing support for TCFD, the Chairman & CEO of AUO specifically mentioned in the statement that

Facing climate emergency, the greatest challenge of sustainable development, AUO is proud to support climate-related financial disclosures and transparency, and strengthen stakeholder trust for the Company's sustainable development. That is why we would like to play a part in the low carbon economy, respond to the opportunities and the challenges of the energy transition by developing a solar energy business, and applying our core technologies to improve the resilience of the human lifestyle and value chain creation.
 
AUO TCFD Framework
 
Quantified financial impact of climate change risks

Based on the results of climate risk identication, we take account of internal and external environmental changes aecting the top three risks about product carbon footprint, market and product competitiveness, and business continuity. And quantify and assess financial impacts with reference to domestic and international corporate disclosure methodology.



Risks Risk-related financial quantification results Assessment method
Lowered product carbon footprint Renewable energy, carbon fees,supplier transfer..., those impacts increase the operating costs Setting of short-, medium-, and long-term goals until 2025, projected carbon savings of 5%, 10%, and 20%, ongoing efforts to reduce direct and indirect materials, equipment improvements coupled with decreased power consumption, quality verification, and additional carbon reduction value (use of renewable energy, purchase of certificates, development of carbon capture technologies, carbon capture through forestation)
Market and product competition Decreased order volume, reduced revenues and costs
  • Development of high-end products and increased added value through integrated product solutions Joint development of next-generation technologies in close cooperation with customers to maintain a leading technological edge
  • Adjustment of business models, increase of the market acceptance of diversified value solutions, ongoing adoption of market analysis and development capability mechanisms, precise investments, and profound alliances with business partners
  • Close monitoring of market supply and demand conditions, dynamic adjustment of optimal shipping volumes paired with differentiated product development
Operation dimension (Illustrated by the example of flooding risks) Increased holiday and overtime pay/ transportation allowances and delivery vehicle dispatch fees resulting in rising costs
  • Advance confirmation of required contingency plans, inter-plant support and resource allocation, and flexible outsourcing
  • Reinforced mechanism for the handling of risks associated with material supply disruptions affecting production lines (BCP) including alternative supply sources and off-site production
  • Optimization of product quality controls and return/exchange mechanisms
Climate Risk and Opportunity Analysis Matrix


The results of climate risk and opportunity nancial impact assessments as a percentage of annual turnover


Description of Climate Risks and Opportunities

ESG
Go Beyond CSR,
Create Shared Values