Environmental Care

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In recent years, the growing occurrence of severe weather events has heightened the awareness of the global warming threat. Furthermore, international research reports and the escalating government focus on climate change have underscored the importance for corporations to integrate climate change into their operations. This can be achieved by prioritizing regulatory compliance and adapting to changes in laws and regulations that can have a significant impact. In addition to learning how to identify operational risks caused by climate change, Taisun has also consulted the TCFD (Task Force on Climate-Related Financial Disclosures) issued by the Financial Stability Board (FSB). We have integrated the four essential disclosures of “Governance,” “Strategy,” “Risk Management,” and “Indicators and Targets” into our operational management. Furthermore, we have disclosed the effects of climate change-related risks and opportunities, along with the corresponding measures to address these impacts, in our Sustainability Report.

1. Management Methods

  1. Governance
    The Sustainability Committee discusses and evaluates the Company’s climate change-related discussions and management. Climate change-related actions are resolved jointly by the Sustainability Committee and approved for implementation by the Chairman.
  2. Strategy
    ● Transition Risks – Policies and Regulatory Risks
    The Climate Change Response Act will introduce a carbon fee on high-emission products that have direct or indirect emissions starting in 2024. This may lead to higher operating costs for our company, but it will not affect our overall operations. By 2020, the Company had completed education and training on greenhouse gas inventories and implemented management policies, including energy equipment replacement. The Company intends to establish carbon reduction targets that are both reasonable and attainable by 2023.
    Following the centennial drought, there has been a widespread agreement among the public and various community sectors regarding the implementation of a water consumption charge by the Water Resources Agency. In 2022, the Company was included in the national fee system for groundwater through the introduction of the “Water Consumption Fee”. Additionally, the Company has actively collaborated with government regulations to decrease water usage by implementing measures such as water conservation and recycling.
    These efforts have been applied across various aspects of our operations, including product cooling, package material enhancements, and employee water consumption. Throughout these initiatives, our top priority has
    been ensuring food safety.

    ● Physical Risk – Immediate
    The rise in extreme weather events has caused an uptick in the occurrence of typhoons, rainstorms, lightning, and high temperatures. Despite the plant’s location in a central, near-mountainous area where the
    likelihood of wind and flooding used to be relatively low, the elevated temperatures could potentially trigger spontaneous combustion of oil waste if not effectively controlled. Additionally, the storms and heavy rainfall will amplify the operational consequences on the plant’s water treatment for cleanliness and equipment integrity, ultimately leading to financial losses.
    Although there have been few instances of major floods and storms in the factory equipment storage area, Taisun remains committed to prioritizing waste recycling management, regular maintenance of the factory drainage system and equipment, waterproofing and disaster prevention system construction, as well as increasing storage space and adjusting flexibility. Our aim is to ensure stable production and shipments, while also developing a disaster handling mechanism for our consumer food and livestock customers’ warehouses, in order to maintain operations and minimize immediate and significant risks.
    The Company anticipates that extreme weather conditions will have an impact on the acquisition of raw materials and products, as well as disruptions in transportation both upstream and downstream. This is likely
    to lead to a temporary rise in costs. To address these challenges, the Company is collaborating with various procurement channels, consolidating transportation orders and routes, and exploring subcontracting alternatives.
    These measures aim to minimize carbon emissions, prevent product and manpower losses, and ensure personnel safety.

    ● Resource Efficiency Opportunities
    In addition to complying with the government’s water conservation policy, the Company has initiated discussions regarding the implementation of a water recycling system. However, the Sustainable Development Committee has not yet assessed the most suitable treatment plan due to considerations related to the equipment system and recycling site. It is anticipated that this initiative may lead to an increase in operating costs in the short term. Nevertheless, in the long run, it remains an effective solution for promoting environmental friendliness and reducing the annual extraction of raw water for clean water.

  3. Risk Management
    The Company’s Sustainability Committee initiated TCFD Climate Change Related Financial Disclosure training in 2022. Additionally, the committee regularly convened relevant members to discuss and identify transition risks, including policy and regulations, technology, market, and reputation. They also examined physical risks, both immediate and long-term, as well as opportunities related to resource efficiency, energy sources, products/services, market, and resilience.
  4. Indicators and Objectives
    a. From 2020 onwards, we promoted the greenhouse gas inventory in accordance with ISO 14064-1:2018.
    b. We have replaced our outdated equipment with new and improved models. Annually, we create budgets for process improvement and equipment renewal, and we prioritize the use of energy-saving equipment to minimize energy consumption.
    c. To promote the reduction of electricity consumption year by year, it is important to prioritize the analysis of purchased electricity, which is one of the main sources of carbon emissions, along with the average electricity
    consumption in relation to the number of boxes produced annually.
    d. The ratio of annual carbon emissions to total sales volume is utilized as the benchmark for reducing carbon emissions each year.
    e. Increase the irrigation status of pennisetum using pasture waste liquid to reduce treatment water consumption.
    f. Establish management and personnel culture to achieve the goal of increasing the recycling rate of business waste (currently >95%).
2. Annual Result Analysis
During the fourth quarter of 2022, the Sustainability Committee conducted a comprehensive assessment of the potential risks posed to the company by climate change. This assessment encompassed the identification of risk sources, analysis of risks, assessment of their potential impact, and the implementation of measures to mitigate these risks. The committee also continued its efforts to minimize the company’s overall environmental footprint. The climate change risk and opportunity impact assessment results for the short-to-mid term in 2022 are as follows:
 
Sorting Risk and
Opportunities
No. NO Issue
1 Transition Risks Market R10 Rising Raw Material Costs
2 Opportunities Resource Efficienc O5 Reducing Water Use and Consumption
3 Physical Risks Long-term R14 Changes in Rainfall (Water) Patterns and Extreme Changes in Climate Patterns
4 Physical Risks Long-term R15 Average Temperature Increase
5 Opportunities Energy sources O6 Use of Low-Carbon Energy Sources
6 Opportunities Products and
Services
O13 Development Of New Products And Services
For R&D And Innovation
7 Physical Risks Immediate R13 Increased Severity of Extreme Weather Events Such as Typhoons and Floods
8 Opportunities Resource
Efficiency
O2 Utilization of More Efficient Production and Distribution Processes
9 Opportunities Products and
Services
O15 Changes In Consumer Preferences
10 Opportunities Resource
Efficiency
O3 Recycle and Reuse

3. Short- to Mid-Term Corresponding Measures to the Top Ten Issues

Issues regarding
Risks and
Opportunities
mpact on the Company’s
Operations and Finances
Corresponding Measures
R10
Rising Raw
Material Costs
1. Climate change will impact the availability and price stability of raw materials, potentially causing disruptions in the supply chain and increasing costs.
As a result, the Company’s
profitability may be affected

2. Rising costs due to ESGrelated requirements.

1. Expand thedevelopment of alternative suppliers and develop alternative principles and response programs.

2. Expand the warehouse space and increase raw material inventory to stabilize prices based on volume.

3. Stabilize prices through contract farming or own production, and ensure sufficient and relatively stable sources of raw materials. Monitor price
fluctuations and control purchasing schedules to minimize the risk of future price fluctuations.

4. Make inventory adjustments within a
reasonable time and product range when raw material costs continue to increase.

5. Research and development of new formulas to reduce the demand for high-priced raw materials and sensitivity to fluctuations.

O5
Reduced
water use and
consumption
1. Water saving equipment
management improvement

2. Water recycling equipment

3. Process management
improvement

1. Installed water recycling equipment for each production line.

2. The new plant incorporated a water recycling system to achieve 12% reduction.

3. Promoted the certification of ISO 14046 water footprint principle requirements and guidelines.

4. Oil-fired boilers increased efficiency and reduced water consumption.

5. Increased usage of waste liquid for watering Pennisetum and reduced water consumption for treatment.

R14
Changes in
rainfall (water)
patterns and
extreme changes
in climate
patterns

1. Increased equipment damage and maintenance costs

2. Increased energy consumption of water treatment equipment

3. Water shortages hinder
production

4. Increase in penalties on contractual deliveries

5. Increased risks in personnel commuting and work safety

1. Installation of water recycling equipment for each production line.
2. The new plant incorporated a water recycling system to achieve 12% reduction.
3. Promoted the certification of ISO 14046 water footprint principle requirements and guidelines.

4. Increased groundwater source water rights and tap water facilities.

5. The farm has added a wastewater-saving highbed hog barn.

R15
Average
temperature
increase
1. Increased customer complaints from refrigerator temperature
increase

2. The shelf life of refrigerated products is shortened.

3. Increased risk of spontaneous combustion of oil waste

4. Overheated rooms/storage spaces

5. Increased warehouse
management costs

1. Warehouse temperature monitoring and control (cold chain management production end to logistics and distribution management).

2. Product cooling insulation conditions and safety period adjustment.

3. Monitor process productivity, efficiency and quality improvement.

4. Shorten the treatment time of oil waste.

5. Improvements in the space to keep the waste and temperature.

6. Regularly monitor the energy efficiency of refrigeration equipment in order to decrease electricity consumption and carbon emissions.

7. Invest in automated warehousing facilities to minimize temperature changes caused by product movement.

O6
Use of low-carbon
energy sources
1. Reduced operating costs (e.g. using carbon reduction measures with the lowest costs)

2. Reduced exposure to future fossil fuel price increases

3. Reduced risk of greenhouse gas emissions and mitigated
sensitivity to changes in carbon pricing

4. Returns on investment in low carbon technologies

5. Increase in capital required for low carbon manufacturing

6. Increased reputation and demand for goods/services

1. Improve production and management efficiency, reduce costs and expenses, and minimize the impact of carbon tax increase.

2. Pay attention to policy developments and low carbon subsidy applications.

3. Enhanced the ratio of green energy use (e.g., solar energy equipment installation) and developed low-carbon plant and equipment replacement (e.g., oil-fired boiler replacement). Continuously enhanced the value of our products to increase gross profit margins and minimize the impact of cost increases.

4. Low-carbon incentives for raw materials and monitoring of long-term benefits (e.g., use of low-carbon feeds on farms and meat exchange rates)

5. Obtained ISO 50001 energy management system certification to control energy consumption compliance.

6. Continuing to study new energy sources and promote alternatives to non-fossil fuels, including biomass, hydrogen, geothermal, and energy storage.

O13
Development of new products and
services for R&D and innovation
1. Increase in R&D testing costs

2. Cost of marketing and testing

1. New product development takes into account issues related to sustainability and cultivates employees’ awareness of sustainable development.

2. We continue to study ESG-certified raw materials or related packaging materials, and develop products with ESG-related concepts.

3. We continue to develop ESG products and sales models.

4. We keep abreast of new consumer trends and actively develop and introduce new products to meet consumer demand

R13
Increased severity
of extreme
weather events such as typhoons
and floods
1. Increased equipment damage and maintenance costs

2. Increase in penalties on contractual deliveries

3. Increased risks in personnel commuting and work safety

1. Review and revise the Emergency Response Management Plan on a regular basis.

2. Promote ISO 45001 Occupational Safety Management System certification to strengthen management processes and talents.

3. Comprehensively strengthen disaster prevention measures for both personnel and equipment.

4. The operation and maintenance of the pump in the basement avoids flooding, and a waterproof drainage system is added.

5. Aquafeed plants have set up remote county and city warehouses (e.g., Tainan, Pingtung) to increase safety stock levels, and emergency response plans have been set up for employee dormitories on the farm.

6. Aquafeed plants are located in the southern part of Taiwan, and most of the farms have satellite farms in various areas.

O2
Utilize more
efficient
production and distribution
processes
1. Improve automated
production equipment

2. Personnel training and
education

3. Improvement of distribution processes

1. Enhance production efficiency through equipment improvement and monitoring.

2. Increase warehouse capacity and centralize production.

3. Strengthen education and training in each unit to develop agents (multi-skilled worker) for equipment and work.

4. Conduct research on the planning and investment of production line automation equipment and the integration of related support (talent and equipment), and the construction of a highly efficient product distribution process system.

O15
Changes in
consumer
preferences
1. Increase in consumer
marketing costs

2. Increase in domestic and international market research costs

3. Frequency of consumer trend analysis surveys

1. We conduct regular surveys on customer needs, study domestic and international consumer trends, and research for appropriate products in accordance with those trends.

2. Regularly monitor and study the effectiveness of the use of imported raw materials versus the use of local raw materials.

3. Incorporate ESG concepts to enhance commodity value.

O3
Recycle and reuse
1. Equipment improvement expenses

2. Improvement of waste
management process

1. Establish management and staff cultured that increase the recycling rate of business waste (currently >95% at this stage).

2. Research and experimental improvement of recycled water schemes (cooling water for tin
cans in food factories, watering with waste water from farms)

3. Research and experimental improvement of exhaust vapor reuse.
4. Promote the ISO 14001 environmental management system.

5. We are working with manufacturers to promote the reuse of waste products and achieve the goal of zero waste.

Taisun is actively working towards three waste treatment goals: minimizing waste output, maximizing resource recycling, and optimizing plant management. The plant operates on the principle that reducing waste is preferable to treating it, and that controlling waste at its source is preferable to recycling. To achieve this, the company implements production process control and operational methods aimed at minimizing waste and reducing the cost of waste treatment. Additionally, the company conducts annual audits of contracted manufacturers and transportation management to ensure compliance with legal waste treatment practices and prevent illegal waste disposal. These audits also serve to fulfill the company’s responsibilities for waste removal, treatment, and flow management, as well as to monitor manufacturers’ implementation of waste treatment and resource recycling. The findings of these audits are reported to the Sustainability Committee, and the business waste cleanup plan serves as the primary tracking mechanism for these efforts.

Taisun Enterprise’s Waste Disposal Flow Chart

  1. Food Plant Management Results

    A. On November 1, 2022, the manufacturer audit for the reuse of food 
          sludge was conducted. The audit covered the composting and
          fertilizer production process, and the qualified fertilizer manufacturing
          certificate was added to the waste manufacturer selection list.

    B. In 2022, the total output of non-resource waste from food plants was 29
         metric tons, a decrease of 9 metric tons compared with the previous
         year.

    C. The food plant produced a total of 1,513 metric tons of resource-based
         waste in 2022 with a 98.1% recycling rate.

  2.  Aquafeed Plant Management Results
    In 2022, the aquatic feed plant (including farm) generated a total annual business waste output of 208.54 metric tons. Out of this amount, 205.93 metric tons were successfully recycled and reused, resulting in a recycling rate of 98.75%.

    Note: In 2022, the value of dry pig manure at Beidou Ranch was calculated in metric tons,
    whereas in previous years,
    it was mistakenly calculated based on the number of vehicles.
    (Disclosure Indicators have been revised in accordance with the principle of consistency)

    Aquafeed plants are actively promoting the use of bulk feed and discouraging the use of plastic packaging materials in bagged feed. To support this initiative, incentives are being offered to subsidize the installation of new bulk barrels. This not only helps clients save manpower and time during the breeding stage, but also indirectly reduces the
    consumption of plastic packaging materials, contributing to the overall
    reduction of plastic usage in Taiwan. In 2022, the aquafeed plant successfully decreased the use of plastics by a total of 5,892.08 kg, resulting in a corresponding reduction of 18,501.12 kg of carbon emissions.

 

 

As a prominent food plant, Taisun relies on water to facilitate various operations, including washing raw materials, manufacturing beverage contents, and cleaning machinery. Therefore, effective water management is of utmost importance. Taiwan is currently grappling with climate change and its environmental consequences. These include irregular rainfall patterns, a higher likelihood of intense downpours, inadequate drainage infrastructure, reduced reservoir capacity due to siltation of rivers and streams, resulting in droughts, water scarcity, and flooding during heavy rainfall events. Additionally, there has been a noticeable decline in the availability of clean, unpolluted water sources in rivers and streams. Taisun primarily utilizes underground water for its production processes.
This water is carefully treated and sterilized through a water treatment system to regulate water consumption.
Additionally, the effectiveness of water conservation is improved through meticulous process control.

Wastewater generated by the food manufacturing industry comprises suspended solids, oils and fats, and sugar derived from raw materials. Once discharged from production, this wastewater is no longer suitable for reuse within the facility and must undergo purification via the wastewater treatment process prior to being released into the drainage system. Taisun’s wastewater needs to pass through a buffer tank → filtration → adjustment tank → primary sedimentation tank → pumping well → buffer tank → anaerobic tank → live bacteria sludge tank → final sedimentation
tank before it can be discharged to the controlled discharge outlet to ensure that wastewater discharges will not impact on the neighboring farmland and sewers. The biological oxygen demand (BOD), chemical oxygen demand (COD), and suspended particles of wastewater are routinely monitored. The sludge is regularly reported and registered on waste disposal orders, and then transported for disposal in compliance with the law.

The table below presents the data on water intake and discharge of production water resources at the Taisun plant. The total water intake amounted to 762,200 tons, while the total water discharge reached 470,650 tons. Consequently, the total water consumption was 291,550 tons.


The Food Plant has initiated an assessment of the investment potential for recovering secondary cooling water on the production line in order to enhance internal water recovery in 2023. The food plant submitted reports on wastewater discharge tests four times in 2022, and all test results demonstrated compliance.

Beidou Ranch filed reports on wastewater discharge tests in 2022 two times, and all the test results showed compliance.

  1. Food Plant Management Results

    A. On November 1, 2022, the manufacturer audit for the reuse of food 
          sludge was conducted. The audit covered the composting and
          fertilizer production process, and the qualified fertilizer manufacturing
          certificate was added to the waste manufacturer selection list.

    B. In 2022, the total output of non-resource waste from food plants was 29
         metric tons, a decrease of 9 metric tons compared with the previous
         year.

    C. The food plant produced a total of 1,513 metric tons of resource-based
         waste in 2022 with a 98.1% recycling rate.

  2.  Aquafeed Plant Management Results
    In 2022, the aquatic feed plant (including farm) generated a total annual business waste output of 208.54 metric tons. Out of this amount, 205.93 metric tons were successfully recycled and reused, resulting in a recycling rate of 98.75%.

    Note: In 2022, the value of dry pig manure at Beidou Ranch was calculated in metric tons,whereas in previous years, it was mistakenly calculated based on the number of vehicles.(Disclosure Indicators have been revised in accordance with the principle of consistency)

Aquafeed plants are actively promoting the use of bulk feed and discouraging the use of plastic packaging materials in bagged feed. To support this initiative, incentives are being offered to subsidize the installation of new bulk barrels. This not only helps clients save manpower and time during the breeding stage, but also indirectly reduces the consumption of plastic packaging materials, contributing to the overall reduction of plastic usage in Taiwan. In 2022, the aquafeed plant successfully decreased the use of plastics by a total of 5,892.08 kg, resulting in a corresponding reduction of 18,501.12 kg of carbon emissions.

 

 

The Company must consistently apply the PDCA (Plan-Do-Check-Act) cycle in both management and technical aspects to continuously enhance and optimize energy management. This will lead to reduced energy consumption, improved energy efficiency, and a contribution to the reduction of greenhouse gas emissions,
thereby mitigating the impact on the global environment. By lowering energy costs, we can enhance the Company’s competitive advantage and ultimately achieve the objective of sustainable development and environmental stewardship.

1. Factory Management

The total energy consumption of each plant was 224,153.71 GJ. Purchased electricity accounted for 20.54% of the total energy, while Taisun Food Plant utilized biomass boilers for renewable energy, which accounted for 62.39% of the total energy consumed. Taisun’s energy management primarily centers around biomass energy, with electricity serving as the primary source of carbon emissions. Our goal is to manage and reduce annual electricity consumption by regularly monitoring internal energy consumption statistics. We will promptly replace or modify outdated machinery and implement process improvements to control energy consumption.

Remarks:
1. The coefficients used, except for biomass energy, which is based on external test reports, and the calorific values used for the other categories are based on the Environmental Protection Administration’s Greenhouse Gas Emission Factor Management Table, version 6.0.4; Electricity 1kWh = 3,600 KJ; Boiler oil 1L = 9,600 kcal; Natural gas 1M3 = 8,000 kcal; Liquefied petroleum gas 1L = 6,635kcal; Diesel fuel 1L = 8,400kcal; Biomass energy 1KG = 4,475kcal.
2. The calculation of diesel fuel consumption for generators was determined by considering the model number and frequency of usage. Similarly, the calculation of diesel fuel consumption for forklifts was based on the average price of diesel fuel in 2022, as provided by the Bureau of Energy’s Petroleum Price Information Management and Analysis System.
3. The supplier uses wood pellets as fuel.

A. Food plant
The food plant installed a new production line for canned foods on December 29, 2021. As a result, the unit electricity consumption in 2022 increased by 1,083 GJ compared to the previous year. Additionally, the total production volume increased by 265,000 cases, leading to a decrease of 0.23% in unit electricity consumption. In 2022, the food plant’s total energy consumption, ranked in descending order, was as follows: 1. biomass energy, 2. electricity, 3. fuel
oil, 4. natural gas, 5. liquefied petroleum gas, and 6. diesel fuel. To decrease carbon emissions, the food plant plans to replace its oil boilers with natural gas boilers by 2023.


B. Oil plant
In 2022, the oil plant experienced a 99.1 GJ increase in electricity consumption per unit compared to the previous year. Additionally, total production decreased by 112,000 cases, resulting in a 10.45% increase in electricity consumption per unit. This increase can be attributed primarily to the heavy oil products industry. To address this issue, improvements will be implemented to reduce additional electricity consumption.

C. Aquafeed plant
The annual electricity consumption per unit at the aquafeed plant increased by 0.02 GJ/ton in 2022, as compared to 2021. Due to the pandemic, the high cost of raw materials, coupled with a decrease in customer demand, has hindered
our ability to focus on production. As a result, there has been a 7.14% increase in electricity consumption, although it remains within a manageable range of 90 kWh per ton. The Beidou Ranch’s electricity consumption per unit in 2022 increased by 0.006 GJ/ton compared with 2021. (Annual renovation to increase fan equipment to keep the pigs cooler).

D. Beidou Ranch

2. Greenhouse Gas Emission Management
The internalization of greenhouse gases into the environmental costs of enterprises demonstrates that reducing greenhouse gas emissions can effectively lower operating costs and enhance profitability. This confirms that reducing greenhouse gases can enhance business performance and promote the concept of sustainable management. In 2022, the addition of the 3rd food plant led to an increase in equipment and capacity. Consequently, there was a rise in carbon emissions, resulting in the following statistics for Scope 1 and Scope 2 carbon emissions:


Intensity trends of greenhouse gas emissions

The Taipei headquarters implemented changes to the company car fleet starting in May 2022. As a result, the data for Scope 1 will see a significant decrease. However, the emission data for the production unit will increase due to the operation of the three new food factories’ production lines. Moving forward, we will closely monitor production efficiency and explore various improvement solutions. These include centralized production management for materials and production-related scheduling, as well as efforts to reduce carbon emissions from cleaning, conversion, and transportation.

Industrial production processes generate gaseous pollutants, primarily through the combustion and production of gas emissions in the atmosphere.
These pollutants include sulfur oxides (SOx), nitrogen oxides (NOx), and other gases. Particulate pollutants, such as suspended particulates and smog, are also present, primarily resulting from fuel combustion and industrial processes.
Taisun conducts regular gas emission tests, reduces emissions through equipment improvement and process control, explores alternative energy sources, strengthens fuel quality and supplier management, enhances process efficiency and fuel quality management, and reduces the weight of plastic packaging materials.

In 2022, the air pollution emission testing and reporting of biomass boilers in food plants adhered to the prevailing environmental protection regulations for suspended particulates, sulphur oxides, nitrogen oxides, heavy metals (lead, cadmium, mercury), and dioxin. Similarly, the testing and reporting of oil-fired boilers in food plants complied with the current environmental protection regulations for suspended particulates, sulphur oxides, and nitrogen oxides. Natural gas boilers were exempt from testing and reporting. The reduction of air pollution emissions from the food factory in 2022 compared to 2021 was -113kg of suspended particles, -2,771kg of sulfur oxides, and -1,705kg of nitrogen oxides.

The emission test report for the oil-fired boiler at the aquafeed plant in 2022 indicates that the levels of suspended particulates, sulfur oxides, and nitrogen oxides meet the requirements set by current environmental protection laws and regulations. In comparison to 2021, the aquafeed plant experienced a slight increase of 0.52kg in suspended particulates emissions, while there was a significant decrease of 56.79kg in sulfur oxides emissions and 157.38kg in nitrogen oxides emissions.