What are the material issues the company has identified?

In its 2021 Sustainability Report ST identified a range of material issues, such as health & safety, human rights, GHG emissions, ethics, energy efficiency. Among these, promoting sustainability across its supply chain stands out as a key material issue for ST.

Stakeholder engagement in accordance with the GRI Standards

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups ST engages with:

Stakeholder Group	Method of engagement
Employees	·      Seminars, conferences, forums ·      VP communication meetings ·      Recognition, awards, contests ·      Intranet, internet, news, emails, videos ·      Training, workshops ·      Employee surveys ·      Application week, EHS week
Customers	·      Trade shows ·      Conventions, technical seminars ·      Audits and sites visits ·      Joint seminars, conferences, blog, technodays, workshops, webinars ·      Meetings
Investors & analysts	·      Investors and analysts day ·      Annual reports ·      Extra-financial questionnaires
Suppliers	·      Meetings ·      Audits ·      Supplier training ·      Surveys ·      EHS week ·      Technical roadshows
Media	·      Conferences, conventions, meetings ·      Press releases
Industry associations	·      Memberships in public-private partnerships, international and European associations ·      Participation in consortiums, in working groups of electronic industry associations ·      Meeting, conferences, seminars
Academic & laboratories	·      Internships, scholarships, PhDs ·      Joint R&D projects, joint labs ·      Conferences, technical seminars ·      Site visits
National & local authorities	·      Partnerships with municipalities ·      Meetings, conferences, seminars ·      Annual reports ·      Site visits
Local partners	·      Partnerships ·      Conferences, conventions, meetings ·      Site visits ·      Donations, training, volunteering, local initiatives

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics ST conducted a survey among its nine categories of stakeholders, collecting 344 survey results.

What actions were taken by ST to promote sustainability across its supply chain?

In its 2021 Sustainability Report ST reports that it took the following actions for promoting sustainability across its supply chain:

• Assessing suppliers
• ST’s Responsible Supply Chain programme is based on the Responsible Business Alliance (RBA) methodology, adopted in 2005 and deployed progressively in its supply chain since then. It comprises three main steps:
  • Suppliers declare their commitment to ST’s RBA-based standards.
  • Suppliers complete an RBA self-assessment. The results enable ST to identify areas that require attention.
  • Suppliers receive an RBA audit to monitor and control compliance and address areas of non-compliance.
• Overall, for both direct and indirect suppliers, 95% of eligible tier 1 suppliers have signed a commitment letter (step 1). In total, since the start of the programme in 2015, ST’s suppliers have undergone 265 RBA-based audits (step 3), +49% compared to 2019. In addition, ST regularly evaluates its suppliers’ performance on social, environmental, and health and safety criteria, and deploys specific programmes to address environmental and safety topics.

• Protecting vulnerable workers
• In every action it instigates in its supply chain, ST’s priority is to detect and address the most severe impacts for vulnerable workers. ST has a zero-tolerance policy towards forced labour and maintains strict control of working hours and wages to ensure decent living conditions and avoid any risk of coercion. In 2020, ST focused on addressing some of the most impactful risks it had detected:
  • Impact of lockdowns on foreign migrant workers in Malaysia due to the pandemic: ST communicated with direct manufacturing suppliers to verify that salaries were maintained to ensure basic needs and that annual leave entitlements were not affected.
  • Recruitment fees for foreign migrant workers in Taiwan: ST launched a zero-recruitment fees campaign with five suppliers to accelerate their adoption of a zero-fee recruitment policy.
  • Supplier corrective actions for priority findings on forced labour: ST closely monitored the corrective actions for priority findings involving foreign migrant workers, such as reimbursing fees, payment of incomplete wages and contract substitution, requiring suppliers to complete their closure audits within the year.
• Addressing such systemic and complex issues may be challenging, but ST has noticed an increasing willingness to collaborate and improve the overall situation from its suppliers.

• Supporting suppliers towards compliance
• ST is not only committed to controlling its suppliers, but also to supporting them in raising their awareness and capability to comply with required standards. ST’s aim is to help its suppliers improve their performance sustainably, through dedicated e-learning on risks in areas such as labour (including working hours and forced labour), ethics, health and safety, environment and management systems. Along with the customised supplier e-learning paths ST launched in 2019 through the RBA platform, its worldwide community of experts supports suppliers’ continuous improvement through ongoing dialogue and sharing best practices. For example, at ST Bouskoura (Morocco), after encountering difficulties in reducing the working hours of security services below 72 hours per week, ST launched a new bidding process that included criteria for working hours compliance. In 2020, ST chose a new service provider and, by working closely together, reduced working hours to 60 hours per week, with a strong positive impact on workers’ lives. ST also organised online meetings to share best practices between its sites in Malaysia and China and some major manufacturing suppliers. Topics included how to better manage working hours and how to organise supply chain controls.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?

The GRI Standards addressed in this case are:

1) Disclosure 308-1 New suppliers that were screened using environmental criteria

2) Disclosure 308-2 Negative environmental impacts in the supply chain and actions taken

3) Disclosure 414-1 New suppliers that were screened using social criteria

4) Disclosure 414-2 Negative social impacts in the supply chain and actions taken

 

Disclosure 308-1 New suppliers that were screened using environmental criteria does not correspond to any SDG.

Disclosure 308-2 Negative environmental impacts in the supply chain and actions taken does not correspond to any SDG.

Disclosure 414-1 New suppliers that were screened using social criteria corresponds to:

• Sustainable Development Goal (SDG) 5: Gender Equality
• Targets: 5.2
• Sustainable Development Goal (SDG) 8: Decent Work and Economic Growth
• Targets: 8.8
• Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
• Targets: 16.1

Disclosure 414-2 Negative social impacts in the supply chain and actions taken corresponds to:

• Sustainable Development Goal (SDG) 5: Gender Equality
• Targets: 5.2
• Sustainable Development Goal (SDG) 8: Decent Work and Economic Growth
• Targets: 8.8
• Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
• Targets: 16.1

 

78% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.

7 GRI sustainability disclosures get you started

Any size business can start taking sustainability action

GRI, ISEP, CPD Certified Sustainability courses (2-5 days): Live Online or Classroom  (venue: London School of Economics)

• Exclusive FBRH template to begin reporting from day one
• Identify your most important impacts on the Environment, Economy and People
• Formulate in group exercises your plan for action. Begin taking solid, focused, all-round sustainability action ASAP. 
• Benchmarking methodology to set you on a path of continuous improvement

See upcoming training dates.
References:

This case study is based on published information by ST, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original please revert to the following link:

https://sustainabilityreports.st.com/sr21/_assets/downloads/entire-st-sr21.pdf

Note to ST: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us.

What are the material issues the company has identified?

In its 2018 Sustainability Report ST identified a range of material issues, such as health and safety, labour and human rights, innovation, risk management, sustainable profit, energy and climate change. Among these, promoting business integrity stands out as a key material issue for ST.

Stakeholder engagement in accordance with the GRI Standards              

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups ST engages with:

Stakeholder Group	Method of engagement
Employees	·      Seminars, conferences, forums ·      VP communication meetings ·      Recognition, awards, contests ·      Intranet, internet, news, emails, videos ·      Training, workshops ·      Employee surveys ·      Application week, EHS week
Customers	·      Trade shows ·      Conventions, technical seminars ·      Audits and sites visits ·      Joint seminars, conferences, technodays, workshops ·      Meetings
Investors & analysts	·      Investors and analysts day ·      Annual reports ·      Extra-financial questionnaires
Suppliers	·      Meetings ·      Audits ·      Suppliers’ trainings ·      Surveys ·      EHS week ·      Technical roadshows
Media	·      Conferences, conventions, meetings ·      Press releases
Industry associations	·      Memberships in public-private partnerships, International and European associations ·      Participation in consortiums, in working groups of electronic industry associations ·      Meeting, conferences, seminars
Academic & laboratories	·      Internships, scholarships, PhDs ·      Joint R&D projects, joint labs ·      Conferences, technical seminars ·      Site visits
National & local authorities	·      Partnerships with municipalities ·      Meetings, conferences, seminars ·      Annual reports ·      Site visits
Local partners	·      Partnerships ·      Conferences, conventions, meetings ·      Site visits ·      Donations, trainings, volunteering, local initiatives

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics ST carried out an online survey among 694 internal and external stakeholders, who were asked to rate the importance of each topic for them.

What actions were taken by ST to promote business integrity?

In its 2018 Sustainability Report ST reports that it took the following actions for promoting business integrity:

• Implementing a Code of Conduct
• The values and principles contained in ST’s Code of Conduct are the top-level reference for guiding ST’s behaviour, decision making and activities:
  • Integrity: ST conducts its business with the highest ethical standards, honour its commitments, delivers on its promises, is loyal and fair, and stands up for what is right.
  • People: ST behaves with openness, trust and simplicity, ready to share its knowledge, encourage everyone’s contribution, develop its people through empowerment, teamwork and training, with each one committed and personally involved in the continuous improvement process.
  • Excellence: ST strives for quality and customer satisfaction and creates value for all its partners; ST is flexible, encourages innovation, develops its competences, seeks responsibility and is accountable for its actions, acting with discipline and basing its decisions on facts, focusing on the priorities.

• Raising compliance awareness
• In 2017 ST continued its Compliance & Ethics awareness and communication campaign (branded ‘Building trust together’), focusing on the importance of integrity and ethical conduct. This initiative establishes clear expectations and invites all employees to speak up, without fear of retaliation. Over a period of 18 months (2016- 2017), ST’s Chief Compliance Officer held 27 town-hall meetings, gathering more than 1,700 employees on 23 sites, and carried out one-to-one interviews with more than 100 employees and managers in 14 different countries. In addition to face-to-face meetings, a variety of tools have been used by ST’s Compliance & Ethics team to engage with employees, managers and third parties. These tools include e-learning modules, dedicated intranet, articles, posters, targeted emails, and short videos available in 10 languages. In Q4 2017, the first ST Integrity Application (available on the Apple Store and Google Play) was launched, to provide employees with easy access to important and useful information, push notifications, fun quizzes, and training materials, as well as a link to ST’s misconduct reporting hotline and other useful contact information.

• Combatting bribery and corruption
• ST has a zero-tolerance approach to bribery and corruption, regardless of the identity or position of the originator or recipient of any bribe. It is also strictly forbidden for anybody in ST to use Company funds or assets to make a political contribution. ST’s Code of Conduct and Anti-Bribery and Corruption policy, which are available in the corporate governance section of ST’s website, provide clear definitions regarding instances of bribery and corruption, and include detailed descriptions of ST’s rules for engaging with third-parties. They also explain how to report actual or suspected violations and outline the potential disciplinary actions and legal consequences of non-compliance. In 2017, ST deployed a new tool to perform third-party due diligence, to enhance its ability to manage the inherent risks of doing business with external parties, including corruption, bribery, and reputation-related risks. 

• Encouraging misconduct reporting
• ST encourages everyone, including external business partners, to express, in good faith, any concerns they might have regarding possible violations of ST’s Code of Conduct, the Company’s policies, or the law. Managers are accountable for maintaining a working atmosphere where employees are comfortable about speaking up and expressing their concerns freely. ST’s misconduct reporting process is communicated to all employees through the Code of Conduct and a dedicated intranet web page. In addition to internal local and corporate reporting channels, ST has an independent multilingual misconduct reporting hotline and in 2017 deployed a new online reporting tool, operated by an independent third-party provider, which can be reached 24 hours a day/7 days a week, either online or by phone.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?

The GRI Standard addressed in this case is: Disclosure 205-2 Communication and training about anti-corruption policies and procedures

Disclosure 205-2 Communication and training about anti-corruption policies and procedures corresponds to:

• Sustainable Development Goal (SDG) 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
• Business theme: Anti-corruption

 

78% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.

7 GRI sustainability disclosures get you started

Any size business can start taking sustainability action

GRI, ISEP, CPD Certified Sustainability courses (2-5 days): Live Online or Classroom  (venue: London School of Economics)

• Exclusive FBRH template to begin reporting from day one
• Identify your most important impacts on the Environment, Economy and People
• Formulate in group exercises your plan for action. Begin taking solid, focused, all-round sustainability action ASAP. 
• Benchmarking methodology to set you on a path of continuous improvement

See upcoming training dates.

 

References:

1) This case study is based on published information by ST, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:

http://database.globalreporting.org/

2) https://www.globalreporting.org/standards/gri-standards-download-center/

Note to ST: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us.