To continue upholding human rights, FENC launched the human rights due diligence in 2022. The result identifies health and safety as well as the elimination of long working hours as significant human rights issues for FENC employees. The Company has established corresponding mitigation and remediation measures with quantified short-, mid- and long-term targets, including reaching the goals of zero grievance claims regarding long working hours, zero occupational safety and health violations and 100% coverage for occupational safety and health training to enhance human rights management.

During the reporting year, FENC also conducted training and shared case studies on the prevention of workplace violence for the management level. In addition, the Company offered training on human rights policy, human rights management, human rights mitigation and remediation measures based on the FENC Human Rights Policy and external case studies. For more details, please refer to Human Rights Protection.

FENC is a key strategic partner of lululemon, the leading multinational retailer of high-end athletic apparel. Nylon 66, a featured product for lululemon, is the fruit of FENC’s vertically integrated supply chain spanning across Taiwan, mainland China and Vietnam. With FENC’s one-stop operation, the filament goes through dyeing and finishing, turning into textured yarn and eventually finished garments.

Between 2021 and the first half of 2022, delivery to lululemon was impacted due to power outage, pandemic restrictions and Lycra shortages in mainland China. To ensure on-time delivery, FEDZ conducted face-to-face meetings with Lycra suppliers twice a month and adjusted the dyeing and finishing machines to address customer demand. The plant managed to maintain consistent production flow and quality amid the power outage. With flexible production scheduling, stringent quality control and timely communication, FEDZ turned the crisis into opportunities. Its ability to shield customers from losses caused by material shortages was praised by lululemon, which presented the 2022 Raw Material Operational Excellence Award to FEDZ, the only supplier in the world to receive this honor.

As the COVID-19 pandemic wanes, global apparel brands are shifting towards more supply chain stability. FENC has seized the moment, becoming a major supplier for lululemon by leveraging customer engagement efforts and maximizing its vertically integrated supply chain to establish close partnerships and growth strategies.

Occupational Safety and Health Administration, Ministry of Labor (OSHA) devotes ongoing efforts to the promotion of workplace sustainability, safety and health. A dialogue was conducted with Tzu-Lien Tzou, Director-General of OSHA, B.C. Chang, Chief Operating Officer of Polyester Business and Chao-Yung Huang, Director of Future Business, CommonWealth Magazine and Chief Editor of the magazine’s CSR platform to explore healthy workforce, the key to corporate sustainability.

In recognition of FENC’s full disclosure of the leading and lagging indicators for occupation safety and health, the Company was the only corporation invited by Director-General Zhou. With years of experience in the field, Chief Operation Officer Chang made a point of stressing the need for industry attention on the management of change and bringing employees into the dialogue. Additionally, the management should look beyond the superficial and get to the root cause of every accident to ensure safety.

He also highlighted FENC’s support for governmental measures. The Company leverages its resources to coach suppliers, instituting corporate mentorship to help them improve safety management and the overall occupational safety and health.

FENC firmly believes that employees are a company’s greatest asset, holding itself to the highest standards regarding the care for the physical and mental health of all employees and workers. Care provided includes comprehensive healthcare, training, risk recognition and assessment and emergency drills to ensure occupational safety and health. The insightful exchange between FENC and Director-General Zhou demonstrates the Company’s dedication to occupational safety and health. It is also a call for more corporate attention towards the issue to create a safe workplace for all.

FENC collaborated with the Industrial Technology Research Institute (ITRI) and SGS Taiwan (SGS) to provide training for suppliers with long-term partnership with FENC. The special training targeted suppliers with limited experience in GHG inventory, however, posing a significant impact on FENC’s scope 3 emissions, including suppliers of primary and secondary raw materials as well as those with their own boiler equipment or major electricity consumption. The two-day workshop on corporate carbon reduction aimed to guide the suppliers to contribute to GHG reduction. The training helped them understand the importance and urgency of carbon reduction and gave them step-by-step instructions on conducting GHG inventory and verification so that they, too, may contribute to net zero 2050.

Chung-Yu Chen, Researcher from the Industry, Science and Technology International Strategy Center of ITRI and Dr. Guan-Lin Lu from SGS were invited to lead the workshop, which covered trends and demand in carbon reduction from international brands and supply chains; introduction and applications of ISO 14064-1:2018 GHG inventory standards; corporate GHG inventory and verification practices. A total of 27 participants completed the training and obtained the certification as auditors for ISO 14064-1.

FENC has been channeling over 30 years of experience in PET bottle recycling into technologies that transform post-consumer bottles into food packaging. The bottles go through FENC’s exclusive production process – sorting, washing, decontaminating and viscosity improvement to be transformed into rPET, the raw material for food and non-food applications, such as PET bottles as well as packaging for fresh, frozen and microwavable food.

The decontamination process is vital in terms of whether the rPET could be approved for food contact articles. FENC collaborates with the Plastics Industry Development Center on the assessment and verification of the decontamination process as well as the safety of the recycled plastic production system. The Company submitted an application to the U.S. Food and Drug Administration (FDA) for review. The rPET production process is designed based on the FDA requirements in terms of safety and feasibility. The Company provided product samples, production design and parameters as well as analytical data from all stages. The Plastics Industry Development Center provided assistance in data analysis and verification, as well as issuing the third-party assurance.

In July 2022, FENC received the final approval from FDA. The production process has been registered on the FDA website, further enhancing FENC’s green competitiveness through the proprietary rPET production technology with key data from the decontamination process.

To support the Financial Supervisory Commission’s (FSC) promotion of digitalization and as an anti-pandemic measure, FENC held a hybrid shareholder meeting in 2022. The Company initiated the implementation immediately after the policy took effect and embraced shareholder activism to enhance corporate governance. The hybrid format reduced the number of shareholders present at the in-person meeting, making it advantageous for FENC’s pandemic-fighting efforts by minimizing the risk of cluster infection.

The planning of the hybrid shareholder meeting was a joint effort between FENC and Oriental Securities Corp., its stock agent and an affiliate of Far Eastern Group. The meeting was held through the Shareholder Video Conferencing Platform offered by Taiwan Depository and Clearing Corporation (TDCC). The platform offers advanced registration for shareholders, and they simply need to check in on the day of the meeting, join the video conferencing and view the live stream. They may also submit questions through typing and cast votes on the agenda items. The format provides shareholders with an alternative to in-person meetings.

Since FENC was holding the shareholder meeting through video conferencing for the first time, several rehearsals were conducted with TDCC during preparation to ensure that the hybrid meeting would proceed as planned.

The 2022 hybrid shareholder meeting concluded successfully. A total of 37 shareholders joined the meeting through the virtual option. The COVID-19 pandemic has pushed behavioral and cognitive boundaries of the past, and accelerated digital development, as reflected in the 2022 shareholder meeting. The virtual option gives shareholders a more efficient alternative, allowing them to voice their rights without being physically present. The implementation demonstrates FENC’s aggressive strides towards ESG and boosts its corporate governance performance.