GIGABYTE is committed to mitigating the impacts caused by business operations on climate change. Visionary management policies and effective response plans have been adopted for effectually promoting climate-rated management and adaptation measures. The GIGABYTE Green Sustainable Development Committee, chaired by the Companyʼs chairman, serves as the highest level responsible for supervising organizational emission management, reduction target setting, and practical measures and action plans. The Sustainable Development Office under the Operation Management Center is in charge of execution and promotion of the measures, and reporting the progress and outcomes of climate-related management to the Center, the Committee, and the Board regularly.

The company established methods for assessing, quantifying, and monetizing the impacts resulting from climate-related risks and opportunities in 2019. GIGABYTE Sustainability Reports have adopted the Task Force on Climate-related Financial Disclosures (TCFD) framework since 2020, which enables transparency in climate governance, identified risks and opportunities, impact assessment and management, as well as targets and performance metrics related to climate. In response to external stakeholders’ increasing attention on climate issues, GIGABYTE released its first GIGABYTE TCFD Report independently in 2023. The Report aims to meet the expectations and information needs of stakeholders, comply with Taiwanese and international sustainability disclosure standards and regulations, and, by strengthening communication, contribute to the continuous optimization of GIGABYTE’s climate change responses, management capabilities, operational resilience, and market competitiveness.

Click here to download 2023 GIGABYTE TCFD Report

Click here to download GIGABYTE CDP Climate Questionnaire: 2023 2024

Group Climate Commitment and Management

GIGABYTE has set a greenhouse gas reduction target of a 50% reduction in carbon emission by 2025 with 2009 as the base year. A separate short-term target was set in 2016 under the “333 Reduction Plan” with GIGABYTE promising to reduce carbon emissions, water consumption, and waste production by 3% each compared to the previous year. The concise targets help us track our carbon reduction progress and performance.

The globe is now encouraging businesses to respond to the Science-based Targets Initiative (SBTi) and set up their emission reduction target through scientific methods that can ensure keep the global warming under 2°C. GIGABYTE has not publicly committed to setting a science-based target. However, We have introduced the tools and target criteria recommended by SBTi to analyze the gap of the pathway between the existing carbon reduction target and the target that meets science-based principles.

Climate Management Strategy

GIGABYTE has designated climate risk as a material operating risk. Climate change and global warming problems are affecting directly on the value chain as a whole from upstream suppliers to company operations and downstream demand. In addition, such sheer scope and scale of impact, there is also added urgency from the fact that human lifestyle, social culture, and economic activities around the world are already being impacted in tangible ways as well. To obtain a full picture of how climate risks may affect the Companyʼs operations or the opportunities that those may create, GIGABYTE identifies climate-related risks and opportunities that will significantly affect finances, change business strategies or models, or pose impacts on the value chain. The planning of corresponding response strategies and management measures are then prioritized. Annual reviews and re-assessments are also conducted through climate scenario analysis.

Process of Climate-related Risk Identification

2023 Climate Risk Matrix

2023 GIGABYTE Climate-related Risks and Opportunities

The following are summaries of identified climate-related risks and opportunities. For more details, please refer to the TCFD Report.

Transition Risk

Risk Description Taiwan carbon fee mechanism Requirements for group GHG inventory (incl. overseas subsidiaries) Requirements for renewable energy usage International carbon border adjustment mechanisms and carbon tariffs
Impact Timeframe Become subject to carbon fees in 3 to 5 years. GHG inventory boundary must be consistent with the boundary of consolidated financial statements by 2026. Become subject to the “Green Electricity Clause” in 3 to 5 years. Western markets expected to impose carbon-related taxes and fees on importers of electronic products, components, and parts in 5 to 10 years.
Impact and Scope Upstream: Higher production costs
Operation: Higher purchasing costs.
Downstream: Impact on product sale price or profits		 Operarion: Higher GHG management costs. Operation: Higher energy expenditure and energy-efficiency management costs. Operation: Higher product tax costs
Downstream: Impact on product sale price or profits
Financial Impact on GIGABYTE GIGABYTE carbon emissions are relatively low so the price level of carbon fees should not be too high. Fines for non-compliance with inventory and disclosure regulations. Payment of energy fees, purchase of certificates, or payment of charges for statutory compliance. Payment of carbon tariffs when importing products or participation in the local emissions control and carbon credit trading mechanism in accordance with the regulations of the target market.
Main Risk Responding Management Measures
  • The GIGABYTE Green Sustainable Development Committee continues to enhance the environmental management system by developing and supervising the implementation of sustainability strategy.
  • Conduct GHG inventory in accordance with the ISO14064-1 standard with third-party verification each year and continue to monitor emissions reduction performance.
  • Actively track domestic and overseas climate regulations to facilitate timely adjustment of climate policy direction to ensure compliance.
  • Replacement of outdated equipment and improvement of production efficiency at each operating location.
  • Active tracking of FSC regulations to facilitate timely adjustment of GHG inventory operations and ensure compliance.
  • Promote energy-efficiency proposals as well as replace old and energy-intensive equipment at each operating location, while also evaluating the potential for construction of in-house renewable energy supply.
  • Actively track domestic and overseas climate legislations to facilitate timely adjustment of climate policy direction and reduce compliance costs.
  • Use savings from energy efficiency to set up the “Sustainability Fund” and reward units for reduction performance in order to promote continued internal innovations in emissions reduction and improvements to resource utilization.
  • Set up a life cycle assessment system for all products to analyze 16 environmental impact indicators including carbon footprint for all product series.

Risk Description Low-carbon transformation of production processes
Impact Timeframe Low-carbon product requirements of developed markets will become more specific and substantial in 3 to 5 years
Impact and Scope

Upstream: Higher purchasing management costs.
Operation: Higher equipment investment and production costs.
Financial Impact on GIGABYTE EU/US markets have stricter requirements for environmentally friendly products, and they account for a relatively high proportion of GIGABYTE exports.
Main Risk Responding Management Measures
  • Allocate part of annual revenue to research and development to develop environmentally friendly products with high performance and low carbon footprint.
  • Found the “Sustainability Fund” to reward the development of low-carbon products and cultivate the capability to develop products with low environmental impact.
  • Implement and refine the scope 3 GHG inventory, voluntarily conduct product carbon footprints and life cycle assessment for all main product lines and publicize disclosure of product environmental information.
  • Supply chain source management to lower the environmental impact of the value chain as a whole.

Risk Description Increasing awareness of sustainable consumption
Impact Timeframe Sustainable consumption trends in developed markets are expected to have a more substantive impact on GIGABYTE products in 3 to 5 years.
Impact and Scope Operation: Failure to meet consumer expectations will affect product sales.
Downstream: Impact on product sales and revenue.
Financial Impact on GIGABYTE An increase in marketing costs to strengthen the Company’s image as a green brand when EU/US markets where there is greater awareness of sustainable consumption are important export markets for GIGABYTE.
Main Risk Responding Management Measures
  • Allocate part of annual revenue to research and development to develop environmentally friendly products with high performance and low carbon footprint.
  • Found the “Sustainability Fund” to reward the development of low-carbon products and cultivate the capability to develop products with low environmental impact.
  • Implement and refine the scope 3 GHG inventory, voluntarily conduct product carbon footprints and life cycle assessment for all main product lines and publicize disclosure of product environmental information.
  • Supply chain source management to lower the environmental impact of the value chain as a whole.

Risk Description Disclosures and compliance with sustainability-related requirements from customers
Impact Timeframe Already increasingly required by customers along with demand for more detailed disclosures.
Impact and Scope Operation: Failure to meet customer requirements will result in lost customers and orders.
Downstream: Impact on product shipments and revenue.
Financial Impact on GIGABYTE Stricter customer requirements on sustainable supply chain management when B2B products account for a growing proportion of GIGABYTE sales.
Main Risk Responding Management Measures
  • Set a short-term reduction target “333 Reduction Plan” to aim for annual reductions of 3% in carbon emissions, water, and waste, and adoption by supply chain partners.
  • Conduct GHG inventory in accordance with ISO14064-1 standard with third-party verification each year, continue to monitor GHG emissions, and investigate carbon emission hot spots.
  • Establish a life cycle assessment system for all main product lines to strengthen the ability to analyze and manage environmental data for products and the upstream supply chain.
  • Found the “Sustainability Fund” to reward the development of low-carbon products and cultivate the capability to develop products with low environmental impact

Physical Risk

Risk Description Increasing extreme weather events
Impact Timeframe The regions where our operating locations are located are now facing an increasing number of extreme weather events including heavy rainfall and unpredictable typhoon tracks.
Impact and Scope Upstream: Interruption to supply from suppliers of key parts due to extreme weather events.
Operation: Interruption to factory production due to extreme weather events.
Downstream: Supplier delivery schedule is affected by extreme weather events resulting in increased transportation costs and late-delivery penalties.
Financial Impact on GIGABYTE Loss of production from production interruption due to extreme weather events and cost of post-disaster recovery.
Main Risk Responding Management Measures
  • Establishment of the “Risk and Emergency Management Guidelines” in accordance with ISO 14001 as well as the devising of management and response measures for typhoons and flooding.
  • Diversification and distribution of product sources in the supply chain to improve the stability of material supply and strengthen the risk resilience of the supply chain.

Risk Description Change in precipitation pattern Increase in average temperature
Impact Timeframe Incidents of drought have already occurred and may become the norm in 3 to 5 years. The number of high-temperature days during summer is expected to increase in the next 3 to 5 years along with an extension in summer.
Impact and Scope Upstream: The production of key components is affected by drought, resulting in higher purchasing costs or supply chain disruption.
Operation: Interruption to business due to flooding or drought.
Downstream: River or sea freight routes are affected by drought resulting in higher transportation costs		 Upstream: An increase in overall energy consumption leads to higher production costs.
Operation: Increase in electricity consumption from cooling of production equipment and office air-conditioning.
Downstream: An increase in overall energy consumption leads to higher transportation costs.
Financial Impact on GIGABYTE Purchasing risk cost from an interruption in supply due to drought at critical suppliers located in regions with high water stress. More energy costs from an increase in operating time and cooling intensity of air-conditioning equipment due to high temperatures.
Main Risk Responding Management Measure
  • Water shortage drills are carried out in factories to prepare for water restrictions during the dry season
  • Establish water recycling systems at the Dongguan and Ningbo Factories in China.
  • Diversification and distribution of product sources in the supply chain to improve the stability of material supply and strengthen the risk resilience of the supply chain.
  • Replace old and worn AC and cooling equipment and improve the energy efficiency of AC equipment.
  • Optimize the power factor of electrical equipment to reduce power loss as well as stabilize and lower the load of the electrical system.
  • Set up and maintain the G-HOME GIGABYTE Sustainability Eco-Roof to effectively reduce the indoor temperature of the top floor by 2.5°C and the surface temperature on the rooftop by 25°C.

Climate Opportunities

Opportunity Description Enhancement of resource productivity through improving process energy efficiency
Impact Timeframe Greater penetration and acceptance of low-carbon products by developed markets are expected in 3 to 5 years.
Impact and Scope Operation: Higher equipment investment and production costs.
Downstream: Reduction in product carbon cost reduces the costs borne by or passed onto consumers by importers.
Financial Impact on GIGABYTE Annual savings in energy costs and avoidance of non-cost-effective investments required for achieving compliance with laws or customer requirements within a short time.
Main Risk Responding Management Measures
  • Conduct GHG inventory in accordance with the ISO14064-1 standard with third-party verification each year and continue to monitor energy efficiency.
  • Implement and refine the scope 3 GHG inventory, voluntarily conduct product carbon footprints and life cycle assessment, and publicize disclosure of product environmental information.
  • Found the “Sustainability Fund” to reward units with reduction performance in order to promote continued internal innovations in reduction and improvements of resource utilization.
  • Invest in management, personnel, and research resources for the analysis and reporting of science-based carbon reduction targets and performance assessments.

Opportunity Description Development and expansion of the low-carbon products market Diversification of products and business model
Impact Timeframe Global developments in 5G applications and AI technology mean that the IT products delivering high performance and low power consumption now hold an overwhelming advantage. Demand for high-performance servers and the development of the circular economy in the electronics industry is expected to grow even stronger in the next 3 to 5 years.
Impact and Scope Operation: Increased production costs from investment in new equipment and R&D of low-carbon products.
Downstream: Improvement in product energy efficiency reduces energy costs during use.		 Upstream: Customized materials and technical support are provided by suppliers in support of solutions.
Operation: Increased revenue by creating products and services with higher unit price levels through product diversification.
Downstream: Reduction in energy costs during product use and waste disposal costs.
Financial Impact on GIGABYTE Revenue created by high-value and low-carbon products as well as energy efficiency benefits customers. Revenue created by green and low-carbon products and services has high values and a recyclability ratio.
Main Risk Responding Management Measures
  • Allocate part of annual revenue to research and development to develop environmentally friendly products with high performance and low carbon footprint.
  • Analyze and calculate product carbon footprints, publish product environmental reports, provide public disclosures on the CSR website, and fulfill producer responsibility.
  • The GIGABYTE Green Sustainable Development Committee develops and supervises the implementation of sustainability strategy. Meetings are periodically convened to monitor and supervise implementation progress.

Opportunity Description Diversification of climate risk from materials and parts supply chain
Impact Timeframe The increasing severity of climate problems will further highlight the importance of climate risk management for the supply chain in the next 3 to 5 years.
Impact and Scope Upstream: Increased rigor of supplier selection system and adjustment of order distribution.
Operation: A risk diversification system ensures that the damage can be contained when a climate disaster occurs at critical suppliers.
Downstream: Reduce customer losses through punctual delivery.
Financial Impact on GIGABYTE Reduction or diversification of purchasing costs from vendors located in the regions with high climate-related risks.
Main Risk Responding Management Measures
  • “Supplier Sustainability Assessment Questionnaire” is distributed to key suppliers every year to assess their sustainability risks in six aspects: environmental protection, corporate social responsibility, labor practices and human rights, supply chain responsibility, fair business practices, and social engagement.
  • Recruit suppliers to support the GIGABYTE “333 Reduction Plan” of reducing carbon emissions, water use, and waste by 3% every year.

Greenhouse Gas Emissions Management Performance

GIGABYTE established an organizational greenhouse gas emission inventory mechanism in 2010 and conducts annual inventories on the scope 1 and scope 2 emissions of the Headquarters and all factories every year. As of 2021, the reporting boundary was expanded in response to the latest standards and regulations to encompass the Taipei Silicon Valley Park Offices, where the subsidiaries Bestyield International, G-style, and Selita Precision, and sub-subsidiary GIGAIPC are located, as well as scope 3 greenhouse gas emissions. All subsequently passed a third-party verification against the ISO14064-1: 2018 standard.

The Scope 1 and Scope 2 greenhouse gas emissions of GIGABYTE in the recent 4 years are as follow:

(Unit: t-CO2e) 2020 2021 2022 2023
Scope 1 Emissions 648.09 1,063.52 627.81 832.86
Scope 2 Emissions 28,123.84  28,874.43 27,283.64 26,606.40
Total (Scope 1+2) 28,771.93 29,937.95 27,911.44 27,439.26
Comparison with the Previous Year +1.10% +4.05% -6.77% -1.69%
Comparison with the Base Year (2009) -41.23% -38.85% -42.99% -43.95%

The Scope 3 greenhouse gas emissions of GIGABYTE in the recent 4 years are as follow:

(Unit: t-CO2e) 2020 2021 2022 2023
Indirect Emissions from Transportation
Employee Commuting 1,022.97 1,201.65✽ 1,867.53✽ 1,028.98✽
Business Travel 91.68 24.13✽ 128.35✽ 548.17✽
Upstream Distribution and Transportation 55.09 234.74 58.32 617.35
Downstream Distribution and Transportation  33,750.88 40,088.61  28,051.45 44,405.99
Indirect Emissions from Products Used by GIGABYTE
Purchased Goods 794,958.93 1,515,136.60✽  892,256.60✽ 1,213,983.28✽
Waste Generated in Operations 597.52 1,464.50✽ 1,238.66✽ 1,911.11✽
Capital Goods 3,771.61 1,860.45 1,217.49 3,188.28
Fuel- and Energy-related Activities (not included in scope 1 and 2) 541.29 739.74 776.94 580.91
Indirect Emissions Associated with the Use of GIGABYTE’s Products
Processing of Sold Products 2,119.04 1,722.91 2,312.99 1,541.80
Use if Sold Products 3,017,156.14 4,239,140.03✽ 5,689,602.28✽ 4,525,119.43✽
End-of-life Treatment of Sold Products 7,951.44 10,931.82✽ 8,089.73✽ 8,757.16✽
Total scope 3 emissions 3,862,016.59 5,812,545.17  6,625,600.33 5,801,682.44
Total scope 3 emissions verified by a third party — 5,767,898.72✽ 6,593,183.15✽ 5,751,348.11✽

Note:

1. For progress towards the greenhouse gas emissions reduction target, please refer to CSR Performance – Environmental Aspect.

2. Since 2021, the Scope 3 emission categories materially relevant to GIGABYTE have been verified by a third party. Figures that have been verified are marked with “✽”. Please find the verification statement at Quality and Environment Management Certificationt.