Social issues

Impacts of social issues on a company's operation can be of no less importance than environmental risks. Under the ESG Reporting Guide, aspects under both “Social” and “Environmental” are subject to the same “comply-or-explain” basis. Issuers should consider their own business value chain and identify social aspects that are material to them for disclosure. In this section, we have chosen practices in relation to supply chain (see Aspect B5 of the ESG Reporting Guide) and product quality control (Aspect B6 of the ESG Reporting Guide) for illustrative purposes.

Social issues:

Commentary

Vitasoy (00345), Sustainability Report 2020/21 (p.41-42)
Vitasoy Sustainability Report 2020 21_1

Commentary

The issuer has developed sustainability guidelines and principles for its suppliers. Suppliers were classified into three groups based on their impact on the issuer's product quality. Suppliers that could significantly affect the manufacturing process were subject to more detailed requirements and assessments, including a self-assessment questionnaire on suppliers' ESG performance. The issuer also disclosed that it has conducted a supply chain sustainability assessment.

These disclosures could boost readers' confidence that the issuer has proper measures in place to manage suppliers' ESG matters.

Social issues:

Commentary

VTech (00303), Sustainability Report 2021 (p.33)

To improve the quality, durability and performance of our products, we have set up our in-house product quality and reliability validation laboratories (labs) at the manufacturing sites of our product lines. All our products must go through reliability tests during different design stages.
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The reliability lab of TEL products is designed based on the international requirements and standards, and our UL Safety Lab is the first telecommunication manufacturing facility to comply with UL 60950 in Guangdong. Our in-house physical and chemical laboratory of ELPs is a China National Accreditation Service (CNAS) certified laboratory for ASTM F963 & EN71-1 (specific test items) standards since 2011 and complies with ISO 17025 standards.
...

Commentary

The issuer provided extensive disclosure on its process of quality control and testing along its value chain, from sourcing of materials to after-sales quality management.

The disclosure also stated clearly the standards that its quality control laboratories have complied with.