Risk Management

The Board of Directors is the highest decision-making unit for the Company's risk control, and directly supervises the Company's risk governance structure. In response to changes in the global economic environment and sustainable risks, the Company has established a complete risk management organizational structure and implementation promotion levels to identify and grasp the relevant risks that may affect the sustainable development of the Company based on the three major aspects of economy (including corporate governance), environment and society. Through relevant management strategies and response measures such as risk transfer, reduction and avoidance, possible risks are minimized and even transformed into operating opportunities.

Chroma defines various risks in accordance with the "Organizational Context Analysis and Risk Management Procedure" established by the Operation Management Center and the Company's overall operating policy, and establishes a risk management mechanism for early identification, accurate measurement, effective supervision and strict control. It prevents possible losses within the acceptable risk range, continuously adjusts and improves the best risk management practices based on changes in the internal and external environment, in order to protect the interests of employees, shareholders, partners and customers, increase the Company's value, and achieve the principle of optimizing the Company's resource allocation.

The corporate risk management process consists of three steps:

Step 1 Risk Category Identification

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1.1 Environmental Risk

1.1.1 These include greenhouse gas emissions risk management, carbon rights management, energy management and other related issues in response to climate change and natural disasters. The risks of compliance with international and local environmental laws and regulations such as air and water waste emissions and noise management or Environmental Impact Assessment are also included here.

Step 2 Risk Assessment

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Chroma, in accordance with the "Organizational Context Analysis and Risk Management Procedure" established by the Operation Management Center, conducts quantitative assessments of each risk item based on its severity and probability of occurrence. The importance is determined using the "Risk Analysis and Management Strategy Matrix" to identify major topics and evaluate key critical risk items. This enables Chroma to further take necessary response measures, such as transferring, accepting, reducing, or avoiding risks. Through the operation of the PDCA management cycle, the Company continuously and effectively improves and monitors various risk factors, aiming to reduce the probability and severity of risk-related losses.

Step 3 Establishing Risk Control Measures

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1.1 Environmental Risk

  1. Continuously improving processes to reduce carbon emissions in response to environmental protection issues.
  2. Showcasing the results of technological innovation in the superior performance and functionality of new products, and introducing green design at all stages of the product life cycle to reduce environmental impact, thereby fulfilling product responsibility and consumption.
  3. Setting the goal of "net-zero emissions at office sites by 2030; net-zero emissions across all sites by 2050."
  4. Starting in 2025, Chroma plans to increase the proportion of green electricity by an average of 5% each year and achieve RE30 by 2030.

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