Climate change mitigation and adaptation

The first electronic distributor to disclose TCFD in Taiwan 

 

Synnex is a distribution service provider in high-tech industry. Although we don't belong to manufacturing industry featuring high pollution, it's our duty to mitigate and adapt to the threats of climate change as a citizen on the earth.

 

In view of more frequent occurrences of global extreme climate, tightening up on climate-related regulations, and consumer's behavior changing nowadays, all conditions pose potential threats to our revenue, brand value, and reputation. Therefore, Synnex keep optimizing the measures of identifying and managing climate-related risks and opportunities, as well as developing strategies to improve the ability to low-carbon operation among itself and business partners, contributing to sustainable development of the world.

 

To uncover potential risks and opportunities, Synnex has followed the recommendations and framework of Task Force on Climate-related Financial Disclosures (TCFD) since 2019, and signed up as a TCFD supporter in Oct. 2021 to move ahead in environment protection and sustainable operation.

  

Synnex TCFD

 

Climate governance

Sustainability Committee: The top organization for climate change management

The Sustainability Committee is responsible for supervising and managing the company's overall sustainability issues and climate-related topics. It reports regular updates on progress to the Chairman. The plans and reviews are reported to the Board of Directors quarterly since 2022.

ESG Environment Team: Implement the projects in accordance with the strategies and objectives developed by the committee

 

Climate strategies

•Regular research: Environment team gathers feedback from each business unit.

•Identification and evaluation: Climate-related risks and opportunities

•Develop strategies:  Meetings are held to discuss appropriate measures in mitigating potential climate risks and grasp sustainable opportunities.

 

Risk management

•Based on the TCFD framework: Building up the identification procedure for SYNNEX's climate risk.

•Incorporate in operational strategy: Develop preventive maintenance plans to mitigate and adapt to climate change.

•Proactive approach: Adopt necessary set-up and investments to manage climate-related risks.

 

Metrics and Targets

•Anchor: Climate change related indicators of management.

•Review: Annual achievements and actual performance.

•Analysis: Annual achievements and improvements.

 

 

Results of identification of climate-related risks and opportunities in 2022

Aspect

Climate warming

Issue

Increasing  use of electricity or water

Description of potential risks

Increased use of electricity or water due to climate warming may result in increased operating costs

Expected impact time frame

Mid term/Long term

Potential financial impact

Cost increase without significant impact

Response measures

1.Evaluate the investment in energy conservation and renewable energy 

2.The new building of the headquarters adopts the multi-layer glass curtain system that automatically adjusts the lighting and air conditioning energy saving with the sun-chasing system, and pursues the gold-level green building mark as the goal

3.Replace equipment to improve energy efficiency

 

Aspect

Extreme weather events

Issue

Supply chain disruptions

Description of potential risks

As climate change intensifies, the chances of extreme weather events increase and we can disrupt our supply chains, resulting in delays in timely deliveries, resulting in lower revenues and reputational impacts.

Expected impact time frame

Mid term

Potential financial impact

Revenue declined but  no significant impact

Response measures

1.Establish standard operating procedures for emergency response 

2.A remote backup mechanism has been established to prevent disruption of commercial activities by climate variability or other factors

 

Aspect

Policy and regulations

Issue

Policy actions related to climate change continue to develop

Description of potential risks

Limiting any adverse impacts that may contribute to climate change and promoting climate change adaptation, policies and regulations may increase the company's operating costs. The risk of climate-related litigation is likely to increase as the losses caused by climate change increase.

Expected impact time frame

Mid term

Potential financial impact

Increased operating costs, penalties, and litigation cases without a significant impact

Response measures

1.Actively consult with competent authorities, relevant organizations and other stakeholders, and pay close attention to changes in domestic and foreign laws and regulations 

2.Establish an internal data inventory of electricity and water consumption, carbon emissions, etc., and regularly check the effectiveness of environmental protection measures

 

Aspect

Supply chain management

Issue

Green supply chain

Description of potential risks

The supply chain jointly pursues green sustainability, and greenhouse gas reduction management has become a necessary evaluation item in the procurement process. It is SYNNEX's responsibility to meet the needs of our customers and keep abreast  of ESG trends together with customers.

Expected impact time frame

Mid term

Potential financial impact

Increasing costs without a significant impact

Response measures

1.Pay attention to ESG trends

2.Evaluate and implement applicable International Standards (ISO, etc.)

3.Plan to obtain ESG-related certifications by third-party.

 

Aspect

Supply chain management

Issue

Pass-through costs from suppliers

Description of potential risks

Suppliers’ production costs increase due to climate changes. This may increase the purchase price of products. The price increase will affect the competitiveness of its products, which may affect our profitability.

Expected impact time frame

Long term

Potential financial impact

Increasing costs without a significant impact

Response measures

1.Optimize the portfolio of digital products and services

2.Provide supply chain service to  multiple brands and expand business scale

3.Improve the overall supply chain flexibility

4.The supply chain operation mode is to directly negotiate the price between the vendors and the downstream customer, so the cost will be directly passed on to the downstream, and the operation service mechanism provided by SYNNEX can slow down the increase in the overall operating cost of the supply chain.

 

Aspect

Reputational risk

Issue

Reputation management

Description of potential risks

Failure to actively respond to and invest in climate change issues of concern to stakeholders affects the company's image and credibility

Expected impact time frame

Long term

Potential financial impact

Revenue declined but  no significant

impact

Response measures

Set up communication channels to respond to the issues or needs that stakeholders are concerned about, which is transformed into a boost to support the company's development towards a sustainable and green enterprise.

 

Aspect

Technology Risk

Issue

Support low-carbon, high-performance technology improvement and innovation

Description of potential risks

There may be lower carbon alternatives to products or services, or the conversion of low-carbon technologies and renewable energy sources will lead to higher operating costs

Expected impact time frame

Mid term/Long term

Potential financial impact

Increasing costs without a significant impact

Response measures

1.Continue to promote low-carbon operations, implement carton recycling and digitalization 

2.Digitalization of operational processes (digital sign-off, digital operations, e-invoicing)

 

Aspect

Supply chain sustainability

Issue

Increased customer demand for low-carbon products and services

Description of potential opportunities

Promote the series of digital information in the service process, integrate the upstream, midstream and downstream into a highly digital and energy-saving green supply chain, meet the needs of original factories and customers seeking low-carbon services, and achieve Co-existence, Co-prosperity, and Co-benefits   of the industrial ecosystem!

Expected impact time frame

Mid term

Potential financial impact

Increasing revenue

Practical strategies

üManagement Service Platform (MSP) 

SYNNEX takes the initiative to play the integrated role of digital bridge, providing exclusive customized APP for hundreds of vendors, customers and partners, and expanding digital connection to financial service providers and logistics service providers, providing various business opportunity development services, business operation services, analysis and management information services, etc., to improve the efficiency of industrial chain operation and further reduce resource consumption and carbon emissions in supply chain operations. 

 

Aspect

Supply chain sustainability

Issue

Pay attention to supply chain sustainability and operational resilience, and build a cloud warehouse operation mechanism for carbon reduction and energy conservation based on maximizing resource utilization efficiency

Description of potential opportunities

Short-chain logistics has become a supply chain study, reducing the upstream and downstream physical logistics nodes of the supply chain, simplifying the supply chain process, and optimizing the efficiency of the application of earth resources, which is an excellent opportunity for SYNNEX to master important logistics resources.

Expected impact time frame

Mid term

Potential financial impact

Lowering costs

Practical strategies

1.Information transparency: Through the complete series of operation value information, real-time and comprehensive grasp of important information such as inventory fluctuations, sales pulses, market status distribution and service progress.

2.Mutual benefit of cloud warehouse: By sharing storage space and sharing distribution resources, cloud warehouse participants can share the operational benefits and resource utilization benefits brought by economies of scale. 

3.Energy-saving cargo flow: focus on managing cargo rights, keep accounts moving, reduce transportation energy conservation and carbon reduction 

4.Direct delivery: Goods are delivered directly to consumers, greatly reducing the time, distance and logistics cost of order processing. 

5.Automate business processes, eliminate inefficient manual operations through the concatenation of internal system information 

Promote simple business policies, use AI intelligent analysis, and focus resources on efficient business

 

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