Concrete measures for supply chain management

Supplier assessment	Supplier evaluation
Vendors are required to pass an evaluation before becoming a qualified supplier. Preliminary review: The supplier's green product passed ISO9000, TS16949, or higher certification. Compliance with green product certification designated by customer. Monopolistic or oligopolistic market. Three consecutive batches in the trial production stage were not returned. General specifications products or brand companies. Second review (on-site evaluation): Formed by technology, quality assurance, and procurement units. Suppliers are listed as unqualified when they receive a "C" rating in their evaluation result.	Procurement and quality assurance units carry out supervision and evaluations every month, Quarterly assessments are conducted for "quality items" and "procurement items." Subjects: Suppliers of important parts. Raw materials and parts suppliers: Suppliers that account for the top 80% of quarterly transaction amount. Contractors: Top ten in quarterly transaction amount. B rating (75 points) and above is good and the company will continue to do business with the supplier, and C rating (74 points and under) requires improvement. Reviewed during supplier evaluation meetings.

Supplier assessment

Supplier evaluation

Vendors are required to pass an evaluation before becoming a qualified supplier. Preliminary review:

The supplier's green product passed ISO9000, TS16949, or higher certification.
Compliance with green product certification designated by customer.
Monopolistic or oligopolistic market.
Three consecutive batches in the trial production stage were not returned.
General specifications products or brand companies.

Second review (on-site evaluation): Formed by technology, quality assurance, and procurement units. Suppliers are listed as unqualified when they receive a "C" rating in their evaluation result.

Procurement and quality assurance units carry out supervision and evaluations every month, Quarterly assessments are conducted for "quality items" and "procurement items." Subjects:

Suppliers of important parts.
Raw materials and parts suppliers: Suppliers that account for the top 80% of quarterly transaction amount.
Contractors: Top ten in quarterly transaction amount.

B rating (75 points) and above is good and the company will continue to do business with the supplier, and C rating (74 points and under) requires improvement. Reviewed during supplier evaluation meetings.

Supplier audit	Supplier meeting
The quality assurance unit formulates an audit plan for parts manufacturers/production contractors that account for the top 80% of the delivery amount every year. On-site audit of quality assurance and procurement units. Audit items: Implemented according to the "contractor quality and GP audit report" and "two-phase supplier quality and GP audit report." Audit results: Deficiencies found in the previous audit must be reviewed. Termination of cooperation with suppliers who do not meet standards in audits or evaluations for three consecutive years will be recommended.	The Company holds supplier meetings every year, not only to communicate the Company's sustainability philosophy and goals, but also improve its quality policy and promote corporate social responsibility, GP policy, and integrity. At the end of each year, we recognize suppliers with outstanding performance and contributions in quality improvement, lowering cost, ensuring delivery, and sustainability performance. Commitment that all products delivered to SZS do not contain Tantalum, Tin, Tungsten, Gold, Cobalt, Mica that are illegally mined by armed conflict in the Democratic Republic of the Congo and its neighboring countries, or exploited human rights violations, the worst forms of child labor other metal minerals.And to ensure that the minerals provided will not directly or indirectly benefit armed groups that seriously violate human rights, the smelters/refiners of the minerals are all qualified smelters/refiners recognized by CFS (Conflict-Free Smelter).

Supplier audit

Supplier meeting

The quality assurance unit formulates an audit plan for parts manufacturers/production contractors that account for the top 80% of the delivery amount every year.

On-site audit of quality assurance and procurement units.

Audit items: Implemented according to the "contractor quality and GP audit report" and "two-phase supplier quality and GP audit report."

Audit results: Deficiencies found in the previous audit must be reviewed.

Termination of cooperation with suppliers who do not meet standards in audits or evaluations for three consecutive years will be recommended.

The Company holds supplier meetings every year, not only to communicate the Company's sustainability philosophy and goals, but also improve its quality policy and promote corporate social responsibility, GP policy, and integrity.

At the end of each year, we recognize suppliers with outstanding performance and contributions in quality improvement, lowering cost, ensuring delivery, and sustainability performance.

Commitment that all products delivered to SZS do not contain Tantalum, Tin, Tungsten, Gold, Cobalt, Mica that are illegally mined by armed conflict in the Democratic Republic of the Congo and its neighboring countries, or exploited human rights violations, the worst forms of child labor other metal minerals.And to ensure that the minerals provided will not directly or indirectly benefit armed groups that seriously violate human rights, the smelters/refiners of the minerals are all qualified smelters/refiners recognized by CFS (Conflict-Free Smelter).

Stakeholders

Concrete measures for supply chain management