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1、TSMC 2022SustainabilityReportOverview4 Letter from the ESG Steering Committee Chairperson5 Letter from the ESG Committee Chairperson6 About TSMC7 Innovation Value9 Sustainability at TSMC10 Awards,Recognitions,and RatingsAn Innovation Pioneer37 Innovation Management56 Product Quality and Safety69 Cus
2、tomer RelationsA Practitioner of Green Power93 Climate and Energy108 Water Stewardship116 Circular Resources126 Air Pollution ControlA Responsible Purchaser75 Sustainable Supply ChainAn Admired Employer135 Diversity and Inclusion141 Talent Attraction and Retention149 Talent Development156 Human Righ
3、ts163 Occupational Safety and HealthPower to Change Society181 Social Impact183 TSMC Education and Culture Foundation192 TSMC Charity FoundationSustainable Business Practices12 ESG Implementation Framework13 ESG Management Platform17 Materiality Analysis and Stakeholder Engagement29 Sustainability I
4、mpact35 Carry Out the UN Sustainable Development GoalsOperations and Governance205 Corporate Governance210 Financial Performance212 Tax213 Information SecurityAppendix217 About this Report221 Sustainability Information Disclosure FrameworkGlobal Reporting Initiative IndexUnited Nations Global Compac
5、t IndexTask Force on Climate-related Financial Disclosures IndexSustainability Accounting Standards Board IndexWEF IBC Stakeholder Capitalism Metrics IndexContents222 Climate-related Information of Listed Companies224 Participation in Industry Associations and Non-Profit Organizations226 ESG Perform
6、ance Summary233 Independent Third Party Assurance Statement234 Contact InformationSustainability RolesOverviewSustainability is like weaving,pooling peoples collective strengths and consolidating resourcesWeaving a harmonious,symbiotic world by adopting a development model focused on the common good
7、Sustainability also connects people in rural and urban areas,fostering an exchange of mutual trust and mutual assistanceTSMC enables innovation and invites partners from all walks of life to weave a web of sustainabilityThrough technology and collaborationRealizing co-prosperity between people and n
8、ature as well the societyBuilding on the foundation of innovative vertical applications,TSMC aspires to create a horizontal expansion of the value chainEnsuring the resilience,breadth,and longevity of the sustainabilityWeaving a Sustainable Future TogetherLetter from the ESG Steering Committee Chair
9、personOver the past year,the world has faced numerous economic,social and geopolitical changes,including uncertainties in globalization and free trade,lockdowns caused by the COVID-19 pandemic,the war in Ukraine,global transportation bottlenecks,and inflationary pressures.This has tested the resilie
10、nce of the global supply chain and the adaptability of businesses.As a responsible global corporate citizen,TSMC has accelerated the adoption of ESG(Environmental,Social,and Governance)initiatives in its operations and industrial value chain,and continues to inject positive energy into society.Prosp
11、ering with the natural environment is the cornerstone of TSMCs sustainable operations,and a green and low-carbon supply chain is an important part of our 2050 net-zero emissions blueprint.As an industry leader,TSMC uses its green influence to continuously work with suppliers to deepen overall low-ca
12、rbon management.By providing suppliers with guidance on carbon inventory,energy conservation,and carbon reduction,we encourage them to adopt carbon capture equipment and reduce indirect carbon emissions in the value chain.In 2022,TSMC was again selected by the Carbon Disclosure Project(CDP)as a Supp
13、lier Engagement Leader,and we continued to drive the industry towards low-carbon sustainability.In the same year,TSMCs Southern Taiwan Science Park Industrial Reclaimed Water Plant started operations,and our Zero-Waste Manufacturing Center is expected to start operation in 2023.At our Arizona fab,we
14、 also plan to build an industrial recycled water plant to gradually achieve near zero liquid discharge,advancing toward our goal of circular economy.We continue to make every effort to minimize environmental externalities through prudent decision-making and coordinated global action on four major is
15、sues:climate and energy,water stewardship,circular resources,and air pollution control.As the leading provider of semiconductor process technology and manufacturing services,TSMC uses the power of semiconductor innovation to make products stronger,smarter,safer,more energy efficient,and more advance
16、d to enrich peoples lives and empower society for the common good.I am very proud of TSMCs employees across the company who work hard for this mission.Guided by our Human Rights Policy,TSMC continues to create a working environment that respects human rights.This means we provide a dignified workpla
17、ce that is diverse,equal,and inclusive(DEI)and promotes the integration of global talents,and we require our supply chain partners to follow the same standards.At the same time,we continue to deepen our connection with the society and wholeheartedly support global STEM education.Through the TSMC Edu
18、cation and Culture Foundation and the TSMC Charity Foundation,we deepen community relations,care for the disadvantaged,and preserve national art and culture,laying a solid foundation for social progress with common values.In 2022,we released the UN SDGs Action Report for the first time to disclose t
19、he companys SDGs action plan and progress.We also explained the companys management policy on major issues with our Materiality Analysis Report to enhance the transparency of sustainable information disclosure.In order to make the Board of Directors more comprehensive and transparent and achieve bet
20、ter corporate governance,we also prepared for the establishment of the Boards Nominating,Corporate Governance and Sustainability Committee,which was approved in February 2023,strengthening the effectiveness of its sustainability governance.The Board of Directors also decided to change the Audit Comm
21、ittee to the Audit and Risk Committee and the Compensation Committe to the Compensation and People Development Committee to expand and deepen its supervision and review responsibilities,making the corporate governance structure more robust.We have a deep understanding of TSMCs key position in the gl
22、obal semiconductor industry and its influence on many economies,and are keenly aware of our urgent responsibilities in sustainability that we shoulder as a corporate citizen.As TSMCs global business expands,we will deepen our partnership with stakeholders including employees,public associations,comm
23、unities,investors and shareholders,and our supply chain and customers,listen to the voices of all parties,and open a new chapter of sustainable development together.Mark LiuChairman and ESG Steering Committee Chairperson4Sustainable Business PracticesOverviewOperations and GovernanceAn Innovation Pi
24、oneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendix2022 Sustainability ReportLooking back on 2022,just as the COVID-19 pandemic showed signs of easing and people could see recovery on the horizon,geopolitical conflict threw the world into disar
25、ray amidst systemic risks from crises in energy,food,human rights,and environmental damage.Fortunately,substantive progress was achieved at the 27th Conference of the Parties of the UNFCCC(COP 27)and the 15th UN Biodiversity Conference(COP 15),so that we were able to continue forwards into an inclus
26、ive and sustainable future.Facing a volatile economic environment,TSMC focused on its core competitive advantages of Technology Leadership,Manufacturing Excellence,and Customer Trust.Strong demand from 5G cellular network and high-performance computing applications enabled our total wafer shipments
27、in 2022 to reach 15.3 million 12-inch equivalent wafers,and realize 12,698 product innovations for customers.We also delivered a 13th consecutive year of record revenue,driving sustainable development through profitable growth.TSMC responded to the call to action at COP 27 by making carbon reduction
28、 initiatives our top priority.During the course of 2022,we successfully implemented 823 energy-efficiency,water conservation,and waste reduction innovation projects.A target of Net Zero Emissions by 2050 was also set with annual progress reviews planned to dynamically adjust and set even more ambiti
29、ous carbon reduction pathways.We also drew up the Carbon Credits Quality Standards for Voluntary Emissions Reductions based on international guidelines and industry benchmarks to ensure that carbon credits are not obtained from sensitive regions.Furthermore,we leveraged our industry leadership to in
30、vite suppliers to participate in the CDP Supply Chain Program.The program complements suppliers existing carbon reduction actions to help us mitigate the global climate crisis together.In light of the close association between Climate Change and Biodiversity,we issued the Biodiversity Statement for
31、the first time in 2022 as a climate citizen of the new era.The statement commits TSMC to achieving Zero Deforestation,No Net Loss of biodiversity,and Net Positive Impact.Achieving Water Positivity was also set as a future strategy to enhance our climate resilience as part of a multi-pronged approach
32、.In addition to our environmental commitments,TSMC also works tirelessly to build a diverse,equal,and inclusive working environment.The first survey into salient human rights issues was completed in 2022,with the establishment of a trans-organizational human rights working group and due diligence sc
33、heduled for 2023.The subsequent promotion of preventive,mitigation and remedial measures as well as related education and training will ensure human rights protection from a stakeholder perspective.We also founded Womentsmc,an Employee Resource Group(ERG)primarily aimed at women,and a new dedicated
34、ERG was set up for foreign employees to build employee cohesion and promote career development.We also completed the first safety culture investigation,and introduced free health check-ups on contractor sites to build an inclusive workplace.Upholding the spirit of Leaving No One Behind,TSMC actively
35、 works to achieve UN Sustainable Development Goals(SDGs).In addition to continuously expanding the University Collaboration Programs,cultivating semiconductor talents,and helping to meet shortfalls in emergency assistance resources,we also worked to harness the power of employee volunteers for youth
36、 and rural empowerment,promotion of the arts,and assisting the disadvantaged through the TSMC Education and Culture Foundation and TSMC Charity Foundation.Using the Business for Societal Impact(B4SI)framework as a reference,we also evaluated the overall benefits of invested resources and identified
37、previously overlooked social needs,so that TSMC can become a force for positive change.TSMC is the only semiconductor company in the world to be included in the Dow Jones Sustainability Indices for 22 consecutive years.Nevertheless,we dont stop there.With the publication of the annual TSMC Sustainab
38、ility Report along with the Environmental Profit and Loss(EP&L)Report,TCFD Report,UN SDGs Action Report,and Materiality Analysis Report,we continue to adopt global trends in sustainability management,and transparently share TSMCs sustainability journey and accomplishments with stakeholders.Looking a
39、head,TSMC will embrace the ESG vision of Uplift Society to bring about positive change.Letter from the ESG Committee ChairpersonLora HoSenior Vice President and ESG Committee Chairperson5Sustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Prac
40、titioner of Green PowerAn Admired EmployerPower to Change SocietyAppendix2022 Sustainability ReportAbout TSMCIn the face of global climate change and geopolitical tensions,TSMC is committed to innovation to improve the well-being of human life.Upholding the three competitive advantages of Technology
41、 Leadership,Manufacturing Excellence,and Customer Trust,TSMC continues to fulfill its mission as a trusted technology and capacity provider to the global logic IC industry.In 2022,TSMCs consolidated income reached NT$2,263.89 billion,achieving a record high for the 13th consecutive year.In addition
42、to seeking the greatest achievements in its core business,TSMC adheres to its philosophy of responsible business,working together with employees,shareholders/investors,customers,suppliers/contractors,government/industry associations,and society to strive for excellence in the three dimensions of eco
43、nomy,environment and society.TSMC is determined to be a force that uplifts society and creates sustainable value.HeadquarterHsinchu Science ParkFounded in1987Number of Employees73,677$1,016.53 BillionNet income;70.4%increase from 2021(NT$)15.3 Million12-inch equivalent wafers total wafer shipments r
44、eached532 CustomersNeeds were satisfied through 288 distinct process technologies13 Consecutive YearsRecord high revenue53%Of TSMCs wafer revenue came from advanced manufacturing processes with geometries of 7nm and smaller,up three percentage points from 2021 30%Of worldwide semiconductor output va
45、lue(excluding memory)generated up four percentage points from 2021TSMC has fabs,subsidiaries or offices in Taiwan,North America,Europe,Japan,China,South Korea,and other countries to offer real-time services and technical support to customers around the worldRevenue Percentage by Customer HQ Location
46、Revenue Percentage by Product Platform North America Asia Pacific excluding Japan and China China Europe,Middle East,and Africa Japan High-performance Computing Smartphones Internet of Things Automotive Electronics Consumer Electronics Other Products11%5%5%68%11%41%39%9%5%3%3%6Sustainable Business P
47、racticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendix2022 Sustainability ReportInnovation ValueTSMC continues to advance semiconductor manufacturing technologies and services,enabling custo
48、mers to unleash more than 12,600 chip innovations in 2022.These innovations make products more advanced,capable,intelligent,energy-efficient,and safer,greatly increasing the quality of life and helping to build a sustainable society based on the common good.Innovations for Sustainability Continue to
49、 drive semiconductor scaling for both logic and specialty technologies Continue to expand specialty technology offerings Continue to advance and expand TSMC 3DFabric technology offeringsBenefits to Customer Product InnovationTechnology Development Focuses Boost product computing power Increase produ
50、ct energy efficiency Enable smaller form factors Provide greater chip design flexibilitySemiconductors power almost everything in daily life and have significantly changed the way people live and work in areas including communications,data processing,agriculture,transportation,healthcare,education,c
51、lean energy,and more.Through its five technology platforms-High Performance Computing(HPC),Smartphone,Internet of Things(IoT),Automotive,and Digital Consumer Electronics,TSMC provides customers with comprehensive and competitive logic process technologies,specialty technologies,IPs,and packaging and
52、 testing technologies to help them accelerate their product innovation and move society forward with technology.The global automotive industry focuses on the four major innovation trends of connected,autonomous,shared,and electric(CASE).Electric vehicles are powered by batteries and do not emit harm
53、ful exhaust gases on the road.This,combined with continued progress in advanced driver-assistance systems(ADAS),creates a safer and more environmentally-friendly driving experience.Continued advancement of agricultural drone technology is a key to sustainable agricultural development.GPS-fitted dron
54、es with a variety of sensors can help farmers to make timely adjustments to field management and improve farming efficiency and quality,as well as reduce waste.High-performance portable ultrasound scanners are becoming a common diagnostic tool.Unlike bulky traditional instruments,they are only the s
55、ize of a mobile phone,and feature faster and sharper imaging capabilities,which can help medical professionals around the globe save time in diagnosis and treatment,and improve overall health care efficiency.Photo:Courtesy of Butterfly NetworkA smartphone is a now a PC in our pocket.It can overcome
56、the limitations of time and distance to make work,communication,entertainment,and life more convenient,including video conferencing,online learning,banking,shopping,and travel booking,and telemedicine.Supercomputers,with powerful computing capabilities,are vital to powering digital transformation an
57、d the digital economy in the era of 5G and AI.They rapidly process and analyse vast amounts of data for a wide range of applications such as accurate weather forecasts and climate predictions,which helps protect us from the impact of increasingly severe storms,floods and snow.Photo:Courtesy of Fujit
58、su and RIKEN7Sustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendix2022 Sustainability ReportEnable 5G,artificial intelligence(AI),cloud,and datacenters to transfer and
59、 process vast amounts of data anywhere and anytime Central Processing Unit(CPU)Graphics Processor Unit(GPU)Field Programmable Gate Array(FPGA)Server CPU Artificial Intelligence/Machine Learning(AI/ML)Accelerator Network Processing Unit(NPU)High-speed Networking Chip,etc.Make communication more effec
60、tive and work,play,and learn anytime and anywhere Application Processors(AP)Baseband RF Transceivers Wireless Local Area Networks(WLAN)CMOS Image Sensor(CIS)Near Field Communication(NFC)Bluetooth Global Positioning Systems(GPS),etc.Empower innovations for artificial intelligence of things(AIoT)and a
61、ccelerate digital transformation to realize more convenient and greener living and improve health care quality Microcontroller Unit(MCU)Application Processors(AP)Baseband RF Transceivers Wireless Local Area Networks(WLAN)CMOS Image Sensors(CIS)Near Field Communication(NFC)Bluetooth Embedded Flash Me
62、mory Radio Frequency Identification,(RFID)etc.Make vehicles,including hybrid/electrical cars,safer,smarter,and greener Microcontroller Unit(MCU)Baseband RF Transceivers Wireless Local Area Networks(WLAN)CMOS Image Sensor(CIS)Near Field Communication(NFC)Radar Ethernet Switches Power Management ICs,e
63、tc.High Performance ComputingSmartphone Internet of Things(IoT)AutomotiveDigital Consumer ElectronicsEnable AI-powered smart devices Microcontroller Unit(MCU)Baseband RF Transceivers Wireless Local Area Networks(WLAN)CMOS Image Sensor(CIS)Near Field Communication(NFC)Bluetooth Embedded Flash Memory
64、Power Management ICs Timing Controllers(T-CON)for Smart 8K/4K Digital TV(DTV),4K Streaming Set-top Box(STB)/Over-the-top(OTT)services,Digital Single-lens Reflex(DSLR)Devices,and so onCustomer Products/ApplicationsTechnology PlatformImprove Quality of Life8Sustainable Business PracticesOverviewOperat
65、ions and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendix2022 Sustainability ReportSustainability at TSMC1.779 BillionInvested into social engagement(NT$)2,518,073People received employees training239.5 BillionTotal
66、 compensation and welfare for TSMC employees around the world,a 45%increase from 2021(NT$)2,291,030Beneficiaries of social engagement programs6,800Students around the world participated in TSMCs diverse industry-academia cooperation programsSocialNet Zero Emissions Overseas sites achieved net zero e
67、missions in Scope 1 and 2 1 S.T.S.P.Reclaimed Water Plant commenced operation the worlds first industrial reclaimed water plant for advanced semiconductor processes 96Waste recycling rate achieved and only 944 wafer technologies and 129 advanced packaging technologies available to customersPlease re
68、fer to Customer Relations in this reportInnovation ManagementProduct Quality and SafetyCustomer RelationsSustainable Supply Chain202022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admi
69、red EmployerPower to Change SocietyAppendixLikelihood and TrendImpactUpwardsSidewaysDownwardsAlmost CertainLikelyPossibleUnlikelyRareCatastrophicMajorModerateMinorInsignificantUnstable water supplies will limit production capacity,TSMC will therefore be unable to satisfy customer demandsAnomalies in
70、 effluents will pollute the environment and negatively impact company reputationPlease refer to Water Stewardship in this reportWater shortage or suspension,and environmental impact from wastewaterImproper use or failure of air pollution control equipment could result in excess emissions,penalties f
71、rom the authorities,and impact on company reputationPlease refer to Air Pollution Control in this reportEnvironmental impact from pollutant emissionsWaste management vendors failing to handle waste in compliance with regulations may subject TSMC to liabilities for waste cleanup and environmental rec
72、overy,impacting company reputationPlease refer to Circular Resources in this reportSuppliers failing to properly handle waste will pollute the environmentOperational impact from climate disasters,increasing GHG emissions,regulations against GHG emissions,and other requirementsIncreasing demands from
73、 stakeholders to increase usage of renewable energy could increase costs and,if demands are not met,fab construction progress and customer orders could be impactedPlease refer to Climate and Energy in this reportUnstable power supply will limit production capacity and impact company reputationCustom
74、ers trust could decline and result in fewer ordersPlease refer to Climate and Energy in this reportPower Shortage or OutageClimate and EnergyWater StewardshipCircular ResourcesAir Pollution ControlRisk Aspects/TypeRisk Evaluation and Mitigation MeasuresStrategyOperationHazard212022 Sustainability Re
75、portSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixLikelihood and TrendImpactUpwardsSidewaysDownwardsAlmost CertainLikelyPossibleUnlikelyRareCatastrophicMajorMod
76、erateMinorInsignificantThe Companys understanding of society and grasp of various aspects of the market may suffer if the mix of employees is unable to reflect the current social landscape,further impacting the Companys competitive advantagePlease refer to Diversity and Inclusion in this reportFailu
77、re to uncover TSMC employees full potentialsCompany operations could suffer from failure to attract and retain a sufficient number of high-quality talents when neededPlease refer to Talent Attraction and Retention in this reportFailure to attract or retain a sufficient number of high-quality talents
78、 when neededThe Companys competitive advantage and growth momentum will suffer if talents fail to progress with evolving landscapesPlease refer to Talent Development in this reportTalents failing to progress with evolving landscapesOccupational injuries,occupational diseases,and chemical hazardsEart
79、hquakes or firesEmployees could suffer from injuries and diseases due to non-compliance to safety guidelinesEarthquakes and fires could damage the Companys equipment and result in disrupted operations and financial lossesPlease refer to Occupational Safety and Health in this report and 6.3 Risk Mana
80、gement in the 2022 Annual ReportCluster infections of pandemic could result in disrupted operationsPandemicCompany reputation,employee morale,and talent recruitment could suffer from the lack of proper protection for the human rights of our employeesCompany reputation and customers interests could s
81、uffer from the lack of proper protection for the human rights of suppliersPlease refer to Human Rights and Sustainable Supply Chain in this reportFailure to protect the human rights of TSMC employees and suppliersDiversity and InclusionTalent Attraction and RetentionTalent DevelopmentHuman RightsOcc
82、upational Safety and HealthRisk Aspects/TypeRisk Evaluation and Mitigation MeasuresStrategyOperationHazard222022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Ch
83、ange SocietyAppendixStakeholder CommunicationEmployeesConcerned with the continued growth and success of the Company as well as meaningful work,a safe and healthy workplace,competitive compensation and welfare,opportunities to grow,and work-life balance73Silicon Garden Meetings (Labor-management mee
84、tings)4,218Cases handled through internal communication channels Corporate intranet(myTSMC),internal emails,and other announcement channels(such as promotion posters at facilities),TSMC Newsletter eSilicon Garden/as needed Human resources team/as needed Employee training/annually Communication meeti
85、ngs for various levels of managers and employees;e.g.the executives communication meeting,skip levels and communication meetings in individual functions or divisions/quarterly Employee suggestion channels,such as the Fab Caring Circle,Employee Opinion Box,Wellness Center,wellness website,employee PI
86、P&IT Security mailbox and hot line,etc./as neededEngagement Talent attraction and retention Diversity and inclusion Social impact Talent development Ethics/regulatory complianceIssuesFocus AreasResponses from TSMCTSMC provides employees with parenting resources and holds STEAM Holiday Optoelectronic
87、s,Audio,and Science Exploration CampCompany growth,success and contribution to the society Strengthen internal communication channel.Communicate with employees through 73 Silicon Garden Meetings,and 4,218 times exchange of opinions to let colleagues understand the Companys prospectsAn inclusive,dive
88、rsified and friendly working environment that can unleash talents potential Organized a training program on TSMCs Human Rights Policy:Say No to Sexual Harassment and Build up a Friendly Workplace to enhance awareness of respect and communion with completion rate of 97%Held Inclusive Leadership Works
89、hop to support senior executives in understanding the connotation of diversity and inclusion,and strengthen the awareness of unconscious bias The Research and Development organization established the Diversity and Inclusion CommitteeMore ESG activities and social participation opportunities for empl
90、oyees Leveraged TSMC ESG AWARD as a platform to promote sustainable thinking and action,and the event was expanded to overseas subsidiaries.A total of 1,880 sustainable innovation proposals were collected Fabs organized community engagement activities such as sending warmth to the disadvantaged,elde
91、rly care,and teaching in rural areas from time to timeWork-life balance and individual growth TSMC Child Care Benefit Program supported employees work-life balance.In 2022,TSMC had 2,368 newborns,accounting for 1.7%of Taiwans total infant population Established employee resource group Womentsmc to e
92、ncourage female colleagues to pursue career goals and self-growthLatest regulatory updates and compliance guideline,i.e.,zero tolerance of corruptions,avoiding conflict of interest,etc.Provided an Annual Ethics and Compliance Training Course covering various important regulatory compliance topics an
93、d a total of 67,922 employees(including employees in subsidiaries)completed this training course,reaching 99.9%completion rateMy children learn about the profoundness of science in the Companys holiday STEAM camp,and they cherish the models made in the course.This camp has made our familys life and
94、work more manageable during the winter and summer vacations.I am very proud of TSMC.Shou-Hau TsaiTSMC employee Ombudsman system,whistleblower reporting system,irregular business conduct reporting system,and sexual harassment investigation committee/as needed Employee Opinion Survey on Company Core V
95、alues,Employee Engagement Survey,employee pulse surveys and service satisfaction surveys,and employee welfare committee event questionnaire survey/as needed Silicon Garden Meetings(labor-management meetings)/quarterly232022 Sustainability ReportSustainable Business PracticesOverviewOperations and Go
96、vernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixShareholders/InvestorsConcerned with the investment value of TSMC including market prospects,growth strategy,profitability,dividend policies,shareholder returns,and sust
97、ainability performance363Institutional investors 281Conferences and meetings General shareholders meeting/annually Investor conference/quarterly Domestic and overseas brokerage conferences/as needed Face-to-face meetings,video conference calls,and telephone conference calls/as needed Annual Report,S
98、ustainability Report,and Form 20-F with the U.S.Securities and Exchange Commission/annually Major announcements on the Market Observation Post System/as neededEngagement Financial performance Risk management Innovation management Climate and energyIssuesFocus AreasResponses from TSMC2022 TSMC Annual
99、 General MeetingFrom governance and employee engagement to climate change strategy,TSMC has always exceeded our expectations in terms of promptness,level of disclosure and receptiveness to suggestions.Overall we feel very satisfied with the discussions we have had over the years with TSMC.Guido Giam
100、matteiPortfolio ManagerRBC Global Asset Management(UK)LimitedLong-term profitability In January 2022,TSMC raised its long-term financial targets to be gross margin of 53%and higher,and ROE of 25%and higherImpact of the international political and economic landscape on the business environment and co
101、rresponding measures Communicated the impact of international political and economic situation as well as related regulations on semiconductor demand in investor conferencesOverseas investment operation risk and its impact on long-term profitability Communicated the overseas fab construction plan an
102、d strategy in investor conferencesSupply-demand dynamics in the industry Continued to communicate with investors about TSMCs technology roadmap and mass production timeline in quarterly investor conferencesTechnology development and competitive advantage Continued to communicate with investors about
103、 recent development of technology in quarterly investor conferencesClimate change responsive measures and supplier management In 2022,TSMC achieved net zero emissions of Scope 1 and Scope 2 in overseas factories,and 100%use of carbon-neutral natural gas in Taiwan fabs.Also,required critical supplier
104、s to join CDP,receive third-party audits,continuing to strengthen low-carbon supply chain development242022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change
105、SocietyAppendixCustomersConcerned with TSMCs technology development and production planning,including production capacity,product quality and safety,that meets customer demands,comprehensive protection of proprietary customer information assisting customers with successful production application and
106、 gaining time-to-market advantage100Quarterly assessment meetings 1,200Customer meetings Business and technology assessment/quarterly Customer satisfaction survey/annually Customer meetings/as neededEngagement Innovation management Product quality and safety Customer relations IssuesFocus AreasRespo
107、nses from TSMCTSMC adheres to the values of Integrity,Innovation,Commitment,and Customer Trust,focusing on improving the core capabilitiesA long standing partner,trusted.They are someone we can count on to keep a commitment once the commitment is made.They are extremely professional.NVIDIA Corporati
108、on Technology development schedules and plans Offered 944 process technologies and 129 advanced packaging technologies in line with the technology roadmapProduct quality Continued perfecting production technologies and product quality.Reduced engineering deficiencies per one million 12-inch wafers t
109、o 35%of 2019Capacity planning and production information In 2022,around 3,000 person-times on average made use of the upgraded TSMC-Online to access comprehensive technology and production information services engineering everydayBusiness resilience and continuity management Held Crisis Management T
110、eam Staff Training to speed up decision-making and improve decision-making quality Fabs held the tabletop emergency response drill evaluation and result sharing activities,referring to FEMA Homeland Security Exercise and Evaluation Program(HSEEP)exercise planning standards,to strengthen organization
111、al resilience252022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixSuppliers/ContractorsConcerned with the development of new process techno
112、logies,improving product quality,ESH regulations,ethics and regulatory compliance,and information security;desire to strengthen and deepen partnerships for sustainable supply chain management178Supplier audit and communication meetings 201Suppliers participated in the Supply Chain ESH Training Forum
113、 Supply Chain ESH Training/annually Supply Online 360 Global Responsible Supply Chain Platform/as needed On-site support and audit/as needed Supplier meetings/as needed Supplier Information Security Association Meeting/monthlyEngagement Sustainable supply chain Ethics/regulatory compliance Product q
114、uality and safety Occupational health and safety Information management Climate and energyIssuesFocus AreasResponses from TSMCTSMC issues Certificate of Appreciation for the Energy Saving and Carbon Reduction Counseling Project to suppliersIn the face of drastic changes in the global climate and lim
115、ited resources,we uphold the values of innovation,responsibility,commitment,and customer partnership and work together with TSMC to develop green hydrofluoric acid for sustainable circular resources and sustainable development.Jian-Wei LinGeneral ManagerSUNLIT FLUO&CHEMICAL CO.,LTD Sustainable devel
116、opment is the foundation of our work,the core mission of improving productivity,and the key to creating value for TSMC and society.Jhong-Ming BaoGeneral ManagerUnited Industrial Gases Co.,Ltd.Sustainable actions and consistent improvement Launched four Supplier Code of Conduct lessons on TSMC Suppli
117、er Sustainability Academy of Supply Online 360,TSMCs global supply chain management platformTSMC regulations on ethics and the supplier code of conduct All tier 1 suppliers signed the Supplier Code of Conduct and complied with business ethics(completion rate 100%)Quality of raw material 60 critical
118、suppliers completed third-party supplier audits on sustainability risks by RBA-certified institutions;ten suppliers received consultation on process advancement and quality improvementEffective ESH management mechanisms Continued to enhance ESH and loss prevention capabilities in the supply chain an
119、d commended outstanding suppliers.In 2022,Chang Chun Group was awarded ESH Outstanding Supplier,and Jing He Science for ESH Advancement SupplierInformation security compliance,assessment results,and experience sharing Published four issues of Supply Chain Security Newsletter and reached over 350,000
120、 person-timesManagement of carbon emissions Required 137 raw material and equipment suppliers to participate in CDP supplier carbon disclosure project262022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner
121、of Green PowerAn Admired EmployerPower to Change SocietyAppendixGovernment/Industry AssociationsConcerned with the development of advanced process technologies,ESG actions,overseas investments,and environmental regulations revision trends;sharing of occupational safety and health management experien
122、ce and discussions on regulations39Government Administrations 102Associations Official correspondences and visits/as needed Offer industry experience and advice/as needed Conferences(e.g.,briefings,public hearings,symposia,seminars,meetups)/as needed Industry association communication platforms/mont
123、hlyEngagement Innovation management Ethics/regulatory compliance Climate and energy Circular resources Water stewardship Sustainable supply chainIssuesFocus AreasResponses from TSMCTSMC,as a member of Taiwan Carbon Capture Storage and Utilization Association(TCCSUA)changes experiences with the Japan
124、ese carbon capture and reuse demonstration plantIn addition to actively reducing carbon emissions,TSMC also exerts its influence and drives the value chain to work hard to mitigate climate change.The Company is indeed a model.James C.Liao PresidentAcademia Sinica Industry specification formulation/I
125、ntellectual property/Trade secret protection Introduce the semiconductor development trend of advanced process technology and TSMCs technologies to the US Patent Office Participated in Taiwan Association for Trade Secret Protection,providing regulatory revision and implementation suggestionsCorporat
126、e governance,regulatory compliances and risk management Participated in explanatory meetings on the latest regulations of export control,and conduct practice exchanges Formulate TSMCs Risk Management Policy and corporate risk management framework with reference to relevant guidelines of risk managem
127、ent stipulated by the Taiwan Stock Exchange CorporationCarbon credits transactions/Circular resources/Sustainable water stewardship Established a carbon credits working group to plan long-term purchases of carbon credits,and cooperated with industry associations to propose the establishment of carbo
128、n rights transactions to the government Cooperated with Environmental Protection Agencys Resource Recycling Waste Cleanup Plan Program to submit an application for circular resource demonstration cases,assisting the government to promote the program TSMC sites in Southern Taiwan Science Park began t
129、o use recycled water,and set a 2030 target of 60%of the Companys water resources came from recycled waterResponse,suggestion and promotion of environmental protection related regulations Represented Taiwan Semiconductor Industry Association to communicate with Environmental Protection Agency to assi
130、st the revision a more reasonable and feasible Semiconductor Industry Air Pollutant Emission Standard and Stationary Pollution Sources that Should Be Regularly Tested and Reported in Public and Private Occasions to promote the industrys positive developmentSupply chain sustainability and environment
131、al safety and health management improvement In addition to Supplier Environment,Safety and Health Forum,practical operation of fire protection equipment,observation of emergency response drills,on-site diagnosis and guidance of energy saving and carbon reduction,Environmental Safety and Health,Fire
132、Response,Fire Protection Self-training,Greenhouse Gas Inventory,Product Carbon Footprint Inventory Workshops,etc.were added in 2022272022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Ad
133、mired EmployerPower to Change SocietyAppendixSocietyConcerned with the support for remote education and the disadvantaged,Network of Compassion,Public Welfare Green Energy Project,and Cherish Food Program provided by the TSMC Charity FoundationConcerned with the resources for education and arts offe
134、red by the TSMC Education and Culture Foundation to cultivate well-rounded talents for the new era130Charity partners 171Charity programs Volunteer services/at least once per week TSMC LinkedIn/as needed TSMC Education and Culture Foundation and TSMC Charity Foundation websites/as needed Sending Lov
135、e charity platform/as needed Project cooperation and visits/as needed TSMC ESG Newsletter/monthlyEngagement Social impactIssuesFocus AreasResponses from TSMCNew Generation Talent Cultivation ForumTSMC Education and Culture Foundation inspires everyones ideals,enthusiasm and curiosity about science,s
136、o that everyone can find a stage.Chuan-Chin Chiao Director National Museum of Natural Science Thanks to TSMC Charity Foundation for co-organizing Technical and Vocational Talent Development Forum,and initiate the job matching program for vocational high school students.This endeavor garnered industr
137、y resources to initiate new thinking on talent development.Terry Tsao Global Chief Marketing Officer&President of Taiwan SEMI Young Generation Cultivation,Educational Collaboration,Arts and Culture Promotion In 2022,TSMC Education and Culture Foundation invested NT$100.2 million to expand supports f
138、or diverse education and the promotion of art and culture with three major axes:Young Generation Cultivation,Educational Collaboration,Arts and Culture Promotion.The seventh TSMC Udreamer Project themed Young and Sustainable Island encouraged young people to care about sustainability and put it into
139、 action.A total of 161 groups of students participated with an increase of 32%compared to 2021.The Foundation also held TSMC Journeys of Female Scientists Lectures to encourage high school girls to explore STEM.As of 2022,3,225 people have attended the event.Local community services,the needs of the
140、 underprivileged and education In 2022,TSMC Charity Foundation continued to committed itself to championing social causes of Care for the Elderly,Promote Filial Piety,and Protect the Environment,and renamed the focus Care for the Disadvantaged as Empower the Rural Community to strengthen their educa
141、tion and employment.In addition,the Foundation linked industry,government and academia resources to provide stable life and operational support for disadvantaged groups and institutions.It repaired 285 houses for Hualien and Taitung earthquake-stricken residents,and cared for 62 vulnerable household
142、s of seniors living alone.A total of 7,607 volunteers devoted in 2022,and the service hours accumulated reached 31,760 hours,with a total investment of NT$223.07 millionResponses to major incidents(e.g.,Hualien and Taitung Earthquake),volunteer services,and dedications in environmental education2820
143、22 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixGenerate economic value and returns through the effective management of financial resource
144、sFinanceStrengthen TSMCs knowledge capital through continued investment into innovative R&D and patentsIntelligenceReduce consumption of natural resources and maintain optimal usage efficiency through source management EnvironmentProvide services that customers need and carefully maintain manufactur
145、ing resources for equipment and buildingsManufacturingRecruit like-minded talent and strengthen talent cultivation so employees may grow with the CompanyHuman ResourcesGive back to society and obtain its trust through social participation SocietySustainability ImpactThe long-term value of a company
146、hinges on positive impacts generated and negative impacts mitigated for stakeholders,which includes driving output value from the semiconductor industry chain,helping customers leverage the competitive edge of products,protecting natural ecosystems and biodiversity,creating direct and indirect job o
147、pportunities,and preventing health or safety hazards.The Triple Bottom Line(TBL)is a sustainable impact management framework developed by TSMC.TBL is grounded in the Companys six major capitals,four core elements,six sustainable management competencies,and an Environmental Profit and Loss(EP&L)valua
148、tion model.It aims to,from an Outside-In perspective,measure changes and contributions to the well-being of humans from the Companys overall value chain and facilitate communication with stakeholders in the hopes of driving economic growth,reducing resource depletion,and further bettering the well-b
149、eing of society as a whole.Six Major CapitalsProcess and MethodsOperational Impact:Employee Cohesion Operational Risks Revenue Growth Customer SatisfactionValue Chain:Procurement TSMC Operations Customer UseInnovation R&D Innovation Management Product Quality and SafetyEnvironmental Management Clima
150、te and Energy Water Stewardship Circular Resources Air Pollution ControlHuman Resource Management Diversity and Inclusion Talent Retention and Cultivation Talent Development Human Rights Occupational Safety and HealthCustomer Service Customer RelationsSupply Chain Management Sustainable Supply Chain
151、Stakeholder Engagement Social ImpactSixSustainableManagementCompetenciesIntegrityLeadershipSenior Management SupportChairman Dr.Mark Liu is personally engaged in ESG efforts and has invited senior executives to lead their functional organizations in proposing sustainable solutions based on core comp
152、etencies in order to expand positive influenceESG GovernanceThe ESG Steering Committee and ESG Committee meet regularly to formulate long-term strategies,engage in interdepartmental communication and cooperation,as well as supervise program progress and performance to maintain momentum for sustainab
153、ility within the organizationMid-level Management ParticipationMid-level management is the backbone of the Companys pursuit of sustainability,cooperating across organizations and departments in the face of complex sustainability issues to bring about real changeFoster an organizational culture that
154、doesnt make commitments casually,but is fully devoted to the commitment when it does.Set long-term goals for sustainability issues,strive for change,review progress regularly,and continue to commit to doing better(continue on the next page)Four Core ElementsOrganization Culture292022 Sustainability
155、ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixTSMC has established a Sustainability Impact Strategy Map derived from causal relationships by converting al
156、l positive impacts(values)and negative impact(costs)into monetary values,beginning from the direct and indirect impacts of upstream procurement,TSMC operations,and customer use.Economic Impacts Environmental Impacts Social Impacts Operational Input/Output Measures to mitigate negative impacts Causal
157、 RelationshipIndirect ImpactDirect ImpactIndirect ImpactUpstream ProcurementCompany OperationsNegative Impact+Positive Impact Investors:Provide reliable dividends and returns to investors Customers:Help customers realize product application and success Suppliers/Contractors:Drive output value and tr
158、ansformation in the semiconductor industry Government/Industry Associations:Generate tax revenue and social welfare for the government Society:Protect natural capital through EP&L Employees:Create job opportunities and employee benefitIndustry Output Value Drive by TSMCCompensationOccupational Injur
159、yOccupational InjuryProcurementDemandEnergy-efficientSalesEnergy-efficientIndustry Supply&DemandProduction/OperationsOptimal Surface AreaResourceConsump-tionResourceConsump-tionCustomerDesignsJob Oppor-tunitiesJob Oppor-tunitiesHigh PerformancePollutantEmissionsPollutantEmissionsAdvancedProcessesSup
160、pliers GuidanceReduction GoalsSource ReductionEnergy Efficient ProcessesReuseTerminal ControlWater ConsumptionAir PollutionWater ConsumptionAir PollutionWasteEffluentsGreenhouse GasesGreenhouse GasesEffluentsNet RevenueDepreciation/AmortizationTaxesNetIncomeR&D PatentsCashDividendCompensationCorpora
161、te VolunteerEnergy-efficientProductsInnovative ProductsCustomer UseSustainability Impact Strategy MapNote302022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Cha
162、nge SocietyAppendixSustainable ValueImpacted Stakeholders:Shareholders/Investors Customers Suppliers Contractors Society Government/Industry Associations EmployeesESG Dimensions:Economic Environmental SocialImpact Attributions:Direct Impact Indirect ImpactHistory Data(20182022)Unit:NT$MillionMonetar
163、y ValueImpact Level1,000,000 500,000 to 1,000,000 100,000 to 500,000 50,000 to 100,000 10,000 to 50,000 1,000 to 10,000 100 to 1,000 0 to 100 IndicatorsImpact AttributionsESG DimensionsImpact LevelImpact TrendImpacted StakeholdersSupply Chain Output Value Driven by TSMC Supply Chain Employee Compens
164、ationNote 4 GHG from the Supply ChainNote 2 Air Pollution from the Supply ChainNote 2 Effluents from the Supply ChainThe methodology is developingWater Consumption from the Supply ChainThe methodology is developingContractor Employee Occupational InjuryNote 3 Cash Dividend Net Income Net Revenue Dep
165、reciation&Amortization Taxes Employee Compensation Occupational InjuryNote 3 Corporate VolunteersNote 5 GHGNote 1 Air PollutionNote 1 WasteNote 1 EffluentsNote 1 Water ConsumptionNote 1 R&D PatentsThe methodology is developingEnergy-efficient ProductsNote 6 Innovative ProductsThe methodology is deve
166、lopingUpstream Procurement TSMC Operations Customer Use Note 1:Environmental Profit and Loss(EP&L)presented in this section is the monetary assessment of possible external impacts from TSMCs purchasing and production.For the costs and economic benefits arising from the implementation of environmenta
167、l protection projects,please refer to Environmental Cost in TSMCs 2022 annual report.For the EP&L methodology,please refer to the TSMC 2022 Environmental Profit and Loss(EP&L)ReportNote 2:EP&L of the supply chain includes only Tier 1 suppliers which had more than three transactions with TSMC per yea
168、r and with amounts exceeding NT$10 million.A total of 1,050 suppliers meet the criteria.Their environmental impact is then calculated through Environmentally Extended Input Output(EEIO)analysisNote 3:Value of Occupational Injury=Cost of Occupational Injury+Medical Expenses+Amount TSMC is Willing to
169、Pay to Prevent Occupational DisastersNote 4:Supply Chain Employee Compensation=Procurement amount is input into the EXIOBASE 2 database and calculated using relevant compensation coefficients based on the suppliers industry and locationNote 5:Corporate Volunteer Value=Volunteer Service Hours*Average
170、 TSMC Employee Hourly IncomeNote 6:Product energy saving data is calculated based on the research model proposed by Industry,Science and Technology International Strategy Center,ITRI in 2020.Since the model predicts future scenarios using global power usage conditions up until 2020,the estimated cal
171、culation of product energy saving is calculated since 2020312022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixIn the upstream procurement
172、stage,TSMC leverages its leadership position in the global semiconductor industry to improve the technology and capability of local suppliers.TSMC employs an input-output model to assess output value,job opportunities,and income created from TSMCs procurement demands as well as the resulting economi
173、c growth and improvements in living conditions.To address supply chain sustainability issues,TSMC is actively promoting a responsible supply chain,using environmentally extended input-output(EEIO)analysis to identify environmental hot spots in the supply chain,and evaluating raw material suppliers w
174、ith Life Cycle Assessment(LCA)to identify the environmental impact from production and service processes.TSMC aims to collaborate with suppliers to uncover opportunities for change and growth to help drive sustainable transformation.In 2022,TSMC created an output value of NT$2,070.8 billion in the s
175、upply chain through procurement,generated 309,000 job opportunities and NT$238.52 billion in payroll through the supply chain.Contractors occupational injuries resulted in NT$1.72 million in social costs.The environmental footprints and resource consumption generated from raw material supply resulte
176、d in an environmental cost of NT$16.5 billion environmental cost.Through consultation and goal setting,TSMC will cooperate with suppliers to uncover the opportunities for process optimization and environment footprint minimization.For details,please refer to the TSMC 2022 Environmental Profit and Lo
177、ss(EP&L)Report.In the operation stage,TSMC uses a Gross Value Added(GVA)approach to assess the positive impact generated for stakeholders by operations.Such positive impact may include equal employment opportunities,competitive compensation and benefits,cash dividends,taxes,depreciation and amortiza
178、tion,and others.TSMC also applies Willingness to Pay(WTP)and Value Transfer to evaluate the social cost and benefits of occupational injury and volunteer activities.Meanwhile,the Company continues to employ environmental profit and loss(EP&L)to measure the negative impacts generated from energy/reso
179、urce consumption and pollution from the production process.In 2022,TSMC generated NT$2,263.9 billion in operating revenue,booked NT$437.3 billion in depreciation and amortization,and issued NT$285.2 billion in cash dividends.TSMC not only helped customers succeed,but also offered good returns to its
180、 investors.In the social dimension,TSMC paid NT$340.9 billion in taxes and payroll,supported the government in expanding infrastructure and social welfare,improved quality of life,and drove economic growth.Volunteer services from TSMC also created NT$52.86 million in social benefits,while occupation
181、al injuries resulted in NT$9.3 million in social costs.In the environmental dimension,environmental footprints and resource consumption generated from production process or when delivering services resulted in an environmental cost of NT$17.89 billion.To mitigate the environmental impact,TSMC proact
182、ively drives green manufacturing by working on creating positive impact through source reduction,energy conservation in manufacturing process,circular economy,and terminal control.For details,please refer to the TSMC 2022 Environmental Profit and Loss(EP&L)Report.In the customer use stage,TSMC conti
183、nues to develop world-leading energy-efficient semiconductor technologies to help customers produce advanced,energy-efficient products and facilitate the evolution of energy-saving ICT technologies and product applications to fulfill the commitment to green manufacturing from the inside out.The Indu
184、stry,Science and Technology International Strategy Center(ISTI)conducted a model analysis based on global energy consumption,GDP,and the number of electronic products,and found that the products TSMC produces for customers will conserve 217,100 GWh in 2030,representing four times the energy consumed
185、 during production and a positive impact of NT$174.2 billion generated.TSMC effectively facilitates global energy conservation by continuing to innovate semiconductor technologies to realize smart applications for a wide range of electronic products.TSMC deployed 288 distinct process technologies,an
186、d manufactured 12,698 products for 532 customers in 2022 to continue to bring significant contributions to the advancement of modern society.For details,please refer to Innovation Management in this Report.TSMC continues to innovate in green technology and strives to reduce the environmental impact
187、from its operations322022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixTSMC is dedicated to reducing environmental and social impacts and
188、introduced EP&L in 2018 to evaluate environmental externalities and resulting social costs created from the production process.In 2019,TSMC further applied EP&L to the upstream supply chain,converting the environmental impact generated from product life cycles into external social costs,identifying
189、significant environmental impact factors to formulate improvement measures and reduce the environmental externalities and social costs generated from TSMC procurement.In terms of TSMC operations,in 2022,environmental externalities were mainly derived from GHG emissions(96.5%),followed by air polluti
190、on(1.2%)and waste(1%).TSMCs overall and unit environmental externalities increased from 2021 by 10.6%and 1.3%,respectively,but unit environmental externalities decreased by 12.5%compared with 2018.To reduce GHG emissions,TSMC continues to promote low-carbon manufacturing,increase energy efficiency,a
191、nd expand use of renewable energy.In 2022,overseas production locations achieved net zero emissions in Scope 1 and Scope 2 for the first time.To mitigate air pollution,TSMC adopts Best Available Technologies(CAT)to reduce emissions of two major pollutants acid&alkali gases and volatile organic gases
192、 and further develops new technologies to reduce PM2.5 and nitrous oxide emissions.To prevent and control water pollution,TSMC continues to focus on introducing new treatment technologies to lower chemical oxygen demand(COD)in wastewater and reduce the water pollution composite indicator.In terms of
193、 the supply chain,environmental hot spot analysis of the supply chain reveals the most significant externalities as particle pollutants impact on human health,followed by the social cost of carbon from GHG emissions.To reduce impacts from air pollution emitted by the supply chain,TSMC helps supplier
194、s mitigate pollutant emissions from the source through environmental protection audit programs.For example,TSMC helps suppliers convert oil burners to natural gas burners,effectively reducing PM2.5 and GHG emissions,and this successful case study was shared with other suppliers at the TSMC Supplier
195、Sustainability Forum.In addition,TSMC found that chemical materials account for 43.2%of environmental externalities produced by the supply chain,as such,the Company conducted audits on critical raw material suppliers.As of 2022,TSMC has audited 95 raw materials and discovered that OSAT and Substrate
196、 the largest number of environmental externalities out of all raw materials.TSMC continues to roll out a variety of green and innovative practices to reduce environmental impacts from production processes at TSMC facilities.TSMC is also asking suppliers to establish management systems as well as ene
197、rgy saving,water conservation,GHG emissions,and waste reduction goals.The company hopes to work with suppliers to create a green,low-carbon supply chain,reduce environmental impacts from operating activities,and create positive influence on society together.For more details,please refer to TSMC 2022
198、 Environmental Profit&Loss(EP&L)Report.12.5%Decrease in environmental externalities per unit product(compared with 2018)1,050Tier 1 suppliers analyzed for environment hot spot 95Accumulated critical raw material audited(22 items increased in 2022)Environmental Externalities TrendsGHGAir PollutionWat
199、er ConsumptionEffluentsWasteEP&L Intensity(NT$/12 wafer mask layer)202115.580.040.240.180.15202014.570.040.210.170.12201913.160.030.210.120.0912.430.030.250.100.092018Unit:NT$billion202217.260.05 0.220.170.18Environmental Hotspot Analysis of the Supply Chain 7.5%8.1%1.8%2.8%43.2%9.0%ChemicalsOthers
200、NotePollution ControlMetalsElectronic ComponentsConstruction EngineeringMachinery&Equipment27.6%Note:Others include:Textile products,paper products,printing and reproduction of recorded media,plastic products,computers,electronics,and optical products,electrical equipment,retail,land transport,trans
201、port auxiliaries&storage,food&beverage,communication services,telecommunication services,information services,professional,scientific,and technical services,rental,support services,medical care&healthcare,and other services26.8128.2425.1023.1823.47332022 Sustainability ReportSustainable Business Pra
202、cticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixTSMC shares experiences on energy conservation with suppliers to strengthen sustainability actionsCase StudySupply Chain Energy Conservati
203、on and Carbon Reduction InitiativesIn 2022,TSMC leveraged EP&L analysis to compare chemical and gas suppliers against peers producing the same products and using the same raw materials to conduct variance analysis.TSMC discovered that suppliers with ISO 50001 Energy Management System certificates ha
204、ve significantly better energy use efficiency than those without.Given such findings,TSMC has formulated three major initiatives to help the supply chain conserve energy and reduce carbon emissions.TSMC hopes to help suppliers evaluate environmental risks and opportunities,reducing resource consumpt
205、ion through a series of initiatives targeting energy conservation and carbon reduction.This can further strengthen the supply chains green performance and resilience,striving towards a low-carbon economy.Three MajorInitiatives to Help the Supply Chain Conserve Energy and Reduce Carbon Emissions23Req
206、uire critical energy-intensive suppliers to obtain ISO 50001 Energy Management System certificates and include ISO 50001 as a requirement in TSMC Supplier Sustainability StandardsContinue to work with Industrial Development Bureau of Ministry of Economic Affairs(MOEA)to roll out energy conservation
207、and carbon reduction support programs targeting critical suppliers and share TSMCs energy conservation experiencesHelp critical suppliers introduce energy conservation and low-carbon concepts when designing new facilities.Main programs include adopting low-carbon raw materials and energy-efficient e
208、quipment,as well as complying with green building standards and ISO 50001 Energy Management System1342022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change So
209、cietyAppendixCarry Out the UN Sustainable Development GoalsTo support the United Nations Sustainable Development Goals(UN SDGs)and trends in corporate disclosure,TSMC has complied with Integrating the Sustainable Development Goals into Corporate Reporting:A Practical Guide jointly published by the G
210、lobal Reporting Initiative(GRI)and The United Nations Global Compact to identify SDGs relevant to the Company,and has published CSR Reports since 2017.In 2022,TSMC further adopted five disclosure categories Plans,Commitments,Actions,Progress,and Suppliers defined by GRI and Support the Goals to disc
211、lose TSMCs practices and progress toward SDGs.The Company also decided to expand the single stakeholder from supplier to also cover employees,shareholders/investors,customers,contractors,governments/industry associations,and the society to connect more resources and extend the scope of influence.Ach
212、ievements in related actions have been published in TSMCs first UN SDGs Action Report.In 2023,TSMC will issue the second UN SDGs Action Report to demonstrate our support for The 2030 Agenda for Sustainable Development.Under the leadership of ESG Steering Committee Chairman Mark Liu,TSMC continued to
213、 spotlight nine SDGs:SDG 3(Good Health and Wellbeing),SDG 4(Quality Education),SDG 6(Clean Water and Sanitation),SDG 7(Affordable and Clean Energy),SDG 8(Decent Work and Economic Growth),SDG 9(Industry,Innovation and Infrastructure),SDG 12(Responsible Consumption and Production),SDG 13(Climate Actio
214、n),and SDG 17(Partnership for the Goals).TSMC has initiated 23 ESG actions and set 52 measurable long-term goals for 2030 to effect change through tangible actions.An Innovation PioneerAs the worlds largest dedicated IC foundry,TSMC works with customers to accelerate and unleash innovation through i
215、ts its pioneering business model and robust R&D capabilities to drive infinite possibilities in technological progress and sustainable developments through the ubiquitous semiconductorA Responsible PurchaserTSMC is committed to responsible purchasing and works closely with supply chain partners on t
216、echnology,quality,delivery,human rights,and environmental protection.In the face of serious climate change challenges,the Company will further strengthen green innovation and climate resilience and strive to create a low-carbon semiconductor supply chainA Practitioner of Green PowerTSMC aspires to b
217、e a world-leading benchmark organization in environmental protection and actively integrates green management into daily operations.The Company applies innovative technologies to climate and energy,water management,circular resources,and air pollution control,promoting a comprehensive range of susta
218、inable actions to strengthen environmental protection and act on our firm belief in prospering with the earths ecosystemAn Admired EmployerTSMC values its commitment to employees and works to foster a humanistic workplace culture with open communications.The Company is dedicated to promoting a diver
219、se,inclusive,safe,and fun workplace where employees can continue to learn.TSMC also provides competitive compensation and welfare,striving to be a company that employees can be proud ofPower to Change SocietyCommitted to uplifting society,the TSMC Education and Culture Foundation and TSMC Charity Fo
220、undation spotlight the changing social landscape and its needs.The two foundations integrate and invest internal and external resources to empower young students of all ages,care for remote areas and the disadvantaged,elderly people living alone,and foster art and cultural literacy to lay the founda
221、tion for a society with common good,beauty,and kindnessTSMC identifies the link between SDGs,the five sustainability roles,and value chain stages through the following three steps:Understand&Prioritize SDGs,Goals&Integration,and Disclosure and Communication.Long-term goals and action plans are then
222、formulated accordingly.TSMC Sustainability RolesProcess and Reporting23Sustainable Actions台積公司採購 原 物 料、設備及相關服務 Cooperate with stakeholdersDeclare support for SDGsSet measurable goalsTake actionsTrack progressCooperationProgressCommitmentPlanActionUpstream Procurement TSMC purchases raw materials,equ
223、ipment,and related services TSMC offers wafer fabrication and packaging/testing services TSMC provides fully-produced customer productsDrive Green ManufacturingImplement green production,innovate high-efficiency semiconductor technologies to mitigate climate change,and pursue sustainable development
224、Build a Responsible Supply ChainCollaborate with suppliers and contractors to promote sustainable operations and manufacturing standardsCreate a Diverse and Inclusive WorkplaceEstablish a safe and healthy workplace that respects human rights and unleashes employees full potential Develop TalentSuppo
225、rt career development and collaborate with academia to develop STEAM(Science,Technology,Engineering,Art and Mathematics)programs that cultivate talent Care for the DisadvantagedAggregate resources to deploy educational,cultural and social programs that reduces inequality and uphold the common goodES
226、G Directions52Long-term Goals9SDGsUnderstand and Prioritize SDGs1Goals and Integration2Disclosure and Communication 3TSMC OperationsCustomer Use2022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green
227、 PowerAn Admired EmployerPower to Change SocietyAppendix35Provide customers process technologies/advanced packaging technologies944/129Innovative testing methods developed for quality and reliability to enhance product,technology and quality272Patent applications globally/trade secrets registered8,5
228、00/40,000As the worlds largest dedicated IC foundry,TSMC works with customers to accelerate and unleash innovation through its pioneering business model and robust R&D capabilities to drive infinite possibilities in technological progress and sustainable developments through the ubiquitous semicondu
229、ctor.An Innovation PioneerInnovation ManagementProduct Quality and SafetyCustomer Relations2022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppen
230、dix36Innovation Management2030 Goals2023 Targets2022 AchievementsMaintain Technology Leadership Continuous investment in advanced technology development to maintain TSMCs technology leadership in the semiconductor industryMaintain TSMCs technology leadership and invest 8.5%of revenue into R&D expens
231、es annuallyMaintain TSMCs technology leadership and invest 8.5%of revenue into R&D expenses annuallyInvested 7.2%of revenue into R&D Target:8.5%Note1Begin volume production of enhanced 3nm process(N3E)3nm process technology in volume production Target:3nm process technology in volume productionProte
232、ct Intellectual PropertyPatent protection:Strengthen quality and quantity driven patent management,apply early for patents on next-generation process technologies,and expand the patent protection network to maintain TSMCs technology leadershipTrade secret protection:Strengthen business operations an
233、d intellectual property innovation by recording,consolidating,and utilizing trade secrets with competitive corporate advantages through trade secret registration and managementOver 80,000 global patent applicationsExceed 7,500 global patent applicationsSubmitted over 8,500 global patent applications
234、 Target:6,600Over 200,000 trade secret registrationsExceed 40,000 trade secret registrationsRegistered over 40,000 trade secrets Target:25,000 Share TSMCs trade secret registration mechanism with eight companiesShared TSMCs trade secret registration mechanism with 17 companies Target:6Assist six com
235、panies to successfully build a trade secret registration and management systemAssisted 12 companies to successfully build a trade secret registration and management system Target:2Exceed 500 green trade secret registrationsEnhance Industry-Academia CollaborationLink academic institutions in Taiwan a
236、nd overseas by investing resources in university programs based on a long-term mechanism for interaction to cultivate the next-generation semiconductor talentCultivate more than 8,000 undergraduate and graduate students globally through university programs that deepen industry-academia collaboration
237、 Note 2Cultivate more than 8,000 undergraduate and graduate students globally through university programs to enhance industry-academia collaborationLaunched a variety of industry-academia collaboration projects,reaching 6,800 undergraduate and graduate students globallyTarget:5,500Cultivate more tha
238、n 35,000 undergraduate and graduate students globally through university programs that deepen industry-academia collaboration between 2021 and 2030 NEWCultivate more than 10,000 undergraduate and graduate students globally through university programs that deepen industry-academia collaboration betwe
239、en 2021 and 2023 NEW Exceeded Achieved Missed TargetNote 1:Since 2013,TSMC has consistently set new revenue and R&D expense records every year.The decline in R&D expenses to revenue percentage in recent years can largely be attributed to revenue growth outpacing growth in R&D expenses.In 2022,R&D ex
240、penses amounted to US$5,472 million,3.4 times more than ten years ago.For historical data on revenue and R&D expenses,please see Continuous Investment in R&DNote 2:Industry-academia collaboration projects include various academic programs,internships,cooperative education programs,etcStrategies37202
241、2 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixOriginating from Dr.Morris Changs ground-breaking idea of being everyones foundry,TSMC beca
242、me the worlds first dedicated IC foundry in 1987 and has since given rise to a thriving fabless IC design industry.TSMC continues to drive innovation and improve peoples lives and societies with technology.Innovation remains,to this day,a proud corporate value and integral cornerstone for technology
243、 leadership.Within the Company,TSMC encourages employees to innovate by launching innovation-sharing platforms,contests,and other incentives for different organizations.Outside of the Company,TSMC explores product innovation with customers,fosters new talent with schools and research institutes,and
244、advocates for a green supply chain with upstream and downstream suppliers.TSMC remains consistently devoted to innovation both internally and externally.Innovation Management Framework Idea Forums with participation from organizations including Operations R&D Quality and Reliability Corporate Planni
245、ng Finance Innovation Cases TSMC Enables More Than 1,500 Startup Customers Worldwide to Plant Seeds of Innovation Strengthen Yield Monitoring System with AI;Effectiveness of Auxiliary Recognition Model Reaches 98%Consistent Efforts to Optimize Energy Efficiency in EUV Tools Save 60 GWh Electricity p
246、er Year Open Innovation Platform(OIP)Collaboration with world-class R&D Institutes Industry-Academia Collaboration University Research Center Industry-Academia Joint Development Project University Shuttle Program National Academy for Key Fields of Research Technology Leadership Intellectual Property
247、 Protection Comprehensive Patent Management Mechanism Trade Secret Protection Intelligent Precision ManufacturingAccumulate Internal Innovation EnergyInnovate through Cross-Sector CollaborationEnable Innovation Course Collaboration Semiconductor Programs FinFET Academic Design Foster Package(ADFP)Ca
248、reer Guidance TSMC Ph.D.Scholarship TSMC High School Semiconductor Mini Courses TSMC Girls in STEM Program for High School Total Quality Excellence and Innovation Conference(TQE)ESG AWARD Technology Board Conference Corporate Research Seminar Green Energy Cycle:2.2 kWh of Green Energy from 1 Metric
249、Ton of Organic Sludge Improve Corona Technologies in Air Pollution Control Equipment to Reduce Alkaline Gases and PM2.5 by over 90%Artificial Intelligence(AI)Job Hazard Analysis Technology Enhances Workplace Safety382022 Sustainability ReportSustainable Business PracticesOverviewOperations and Gover
250、nanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixMaintain Technology LeadershipIn 2022,TSMC continued to increase R&D investments,with annual R&D expenses accounted for 7.2%of total revenue,a 22.5%growth from last year.Th
251、e Company has expanded R&D organization which now has 8,558 employees,a 9.6%growth from last year.TSMCs R&D investments paralleled those of world-leading tech companies.To address the challenge with Moores Law,TSMCs R&D organization provides customers with advanced technologies and design solutions
252、to help them achieve product success.In 2022,N3E,the enhanced 3nm process technology,entered risk production.In the same year,TSMC also pioneered 2nm technology development by successfully entering the stage of baseline setup and yield learning.TSMC will continue to conduct exploratory research into
253、 technology innovation beyond 2nm.In addition to CMOS logic technology,TSMC is also developing a wide range of semiconductor technologies to meet customer demands on SoCs for mobile and other applications.The existing scope of application includes integrated interconnect and packaging solution,micro
254、controllers,virtual reality,edge-computing,etc.In 2022,TSMC continued to work closely with world-class research institutes and world-leading universities such as the Semiconductor Research Corporation(U.S.),Interuniversity Microelectronics Centre(Belgium),etc.,to develop semiconductor materials and
255、design transistor structures.We aim to uphold Moores Law and cultivate talent to usher in a new angstrom era for the semiconductor industry.Continuous Investment in R&DRevenue(US$1 million)R&D Expenses(US$1 million)Percentage of R&D Expenses in Consolidated Revenue(%)201217,1201,366201834,2002,85020
256、1425,1701,875202045.5103,720201629,4302,211202275,8815,472201320,1101,621201934,6302,959201526,6102,067202156,8204,465201732,1052,6517.57.97.27.88.27.48.58.18.38.08.3R&D and Revenue Growth Ratio over the YearsRevenue Growth RateR&D Expenses Growth Rate 2002020046%283
257、%377%132%226%125%172%170%100%160%136%275%338%128%229%116%183%176%100%164%392022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendix20202021Techn
258、ology Leadership and InnovationCMOS Logic TechnologiesSpecialty Technologies/Interconnect and Packaging TechnologiesReceived CoWoS-S certification for Gen-3 HBM,silicon interposer now contains sub-micron routing layers and integrated capacitors(iCap)so that various chiplets such as SoC,HBM can be pl
259、aced on itSuccessfully qualified InFO-PoP Gen-8 for mobile applications with enhanced thermal performance;launched R&D for next generation InFO PoP,which will introduce backside redistribution layerSuccessfully qualified InFO-oS Gen-4,which provides more chip partition integration with larger packag
260、e size and higher bandwidthOptimized quality factors of 5V components on 55nm BCD targeting power switches for portable devices;continued to expand 40nm,22nm,and 0.13 micron BDC technologies to meet automotive market demands28nm eFlash entered volume production,which can support mobile HPC and high-
261、performance low-leakage platforms Successfully risk-produced the worlds smallest voltage domain global shutter CMOS image sensor chip with 3-wafer stack technology for near infrared and security cameras marketPrepared 22nm RRAM for volume production as a low-cost embedded non-volatile memories solut
262、ion for price-sensitive IoT marketsQualified the fifth-generation chip on wafer on substrate(CoWoS)with record-breaking Si interposer area up to 2,500 mm2,which can accommodate at least two SoC logic and eight high bandwidth memory(HBM)chiplet stacksSuccessfully qualified InFO-PoP Gen-7 for mobile a
263、pplications with enhanced thermal performance Initiated high-volume manufacturing of InFO-oS Gen-3,which provides more chip partition integration with larger package size and higher bandwidthExpanded the 12-inch BCD technology portfolio on 90nm,55nm,40nm,and 22nm processes,targeting diverse mobile p
264、ower management ICs applications with different integration levelsMaintained stable high yield and achieved technical qualification of 28nm eFlash for consumer electronics grade and automobile electronics grade-1 applicationsAchieved 13%pixel size scaling down on Quad Phase Detection(QPD)CMOS image
265、sensors structure for the mobile imaging market28nm and 40nm RRAM entered volume production as a low-cost solution for the price-sensitive IoT market2022Pioneered the industrys first 5nm process technology in volume productionPioneered the industrys first 3nm technology in risk productionPioneered t
266、he industrys first 3nm process technology in high volume productionN3E,the enhanced 3nm technology,successfully entered risk productionAccomplished process validation of TSMC-SoIC for both chip-on-wafer(CoW)and wafer-on-wafer(WoW)stacking using micron-level bonding-pitch processes with promising ele
267、ctrical yield and reliability resultsEntered high-volume manufacturing of InFO-PoP Gen-5 packaging for mobile application processors and successfully qualified InFO-PoP Gen-6 for mobile applications with enhanced thermal performanceDeveloped InFO-oS Gen-3,which provides more chip partition integrati
268、on with larger package size and higher bandwidth Expanded the 12-inch Bipolar-CMOS-DMOS(BCD)technology portfolio on 90nm,55nm,and 22nm processes,targeting a variety of fast-growing applications for mobile power management ICs with various levels of integrationAchieved technical qualification of 28nm
269、 eFlash to support automobile electronics and MCU applications CMOS image sensors technology entered volume production,with shrunk sub-micron pixel size and sensors meeting automotive grade reliability complianceBegan production of 28nm RRAM technology as a low-cost solution to support the price-sen
270、sitive IoT marketAchieved technical qualification of 22nm magnetic random access memory(MRAM)technology to successfully volume produced MRAM and received the Flash Memory Summit 2020s Best of Show award for the most innovative AI application402022 Sustainability ReportSustainable Business PracticesO
271、verviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendix3nm Fin Field-Effect Transistor(FinFET)(N3)technologyCustomer products in high volume production with the industry-leading yieldLed the industry
272、by introducing the most advanced products4nm Fin Field-Effect Transistor(FinFET)(N4)technologyLed the industry to start volume production for customer productsIntroduced products with the industry-leading performance and energy efficiencyThe performance-enhanced 5nm FinFET technology N5PEntered its
273、second year of volume production for various customers products Introduced products with the industry-leading performance and energy efficiency6nm FinFET(N6)technology Widely adopted in mobile,high performance computing,and consumer electronics productsIntroduced products with the industry-leading p
274、erformance and energy efficiencyN6 radio frequency(N6 RF)technologyReceived multiple customer product tape-outs Introduce products with the industry-leading RF performance and cost-effectiveness16nm FinFET Compact(N16FFC)MRAM(Magnetoresistive Random Access Memory)TechnologyCompleted reliability qual
275、ification,with one million cycles endurance and reflow capabilityIntroduced the industry-leading high performance microcontroller unit(MCU)for automotive and industrial applicationsCMOS Image Sensor(CIS)technologyContinued to help customers gain market leadership by introducing the worlds smallest p
276、ixel size productsLed the industry by introducing the most advanced productsTSMC-SoIC(System on Integrated Chip)Chip-on-Wafer(CoW)technologyLed the industry to start volume production for customer products,with significant power and performance improvements Introduced products with the industry-lead
277、ing performance and energy efficiencyIntegrated Fan-Out with local silicon interconnect(InFO_LSI)technologySuccessfully integrated 5nm SoCs with ultra-high density die-to-die interconnects and entered volume production in 2022Led the industry by introducing advanced productsProcess TechnologiesProdu
278、ct ApplicationsInnovation/BreakthroughCustomer SuccessFoundry Technology Leadership and Innovation in 20225G mobile communicationsHigh performance computing Consumer electronics True wireless stereo(TWS)WiFi Digital TV/Set-Top Box(STB)Automotive zonal control used new electrical/electronic architect
279、ure(EEA)for software defined vehicle Smartphones High performance computing applications412022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppend
280、ixTSMC Continues to Advance Technology to Unleash Customer InnovationSemiconductors have been playing a vital role in the development of human economic civilization,lifestyle and social evolution with greater computing power and better energy efficiency through innovations and breakthroughs.As the t
281、rusted dedicated semiconductor foundry service provider,TSMC continues to deliver the industry-leading,next-generation semiconductor technologies,with higher chip density and lower power consumption.The Company also offers comprehensive specialty technologies and leading 3D chip stacking and packagi
282、ng services to help customers unleash different types of innovation and deliver more advanced,more capable,more energy-efficient,and more affordable electronic products.One noteworthy example is our collaboration with AMD on building its leadership high-performance and adaptive computing products to
283、 help address the fast-growing compute demand from increasing adoption of cloud computing services,digital transformation,transition to exascale supercomputing,and the growing deployment of AI and high-speed 5G networks.In 2022,combining AMD design innovation and TSMCs industry-leading 5nm technolog
284、y process,AMD brought its 4th Gen EPYC processors to market.With up to 96 cores in a single processor,the 4th Gen EPYC processors power the most energy efficient x86 servers.They offer leadership performance,energy efficiency and next-generation architecture,to accelerate data center modernization f
285、or high application throughput and more actionable insights.The 4th Gen EPYC processors can also help companies advance sustainability goals by deploying efficient,powerful servers to meet workload demands and help reduce power,energy costs,and server footprint.In addition,in the November 2022 Top50
286、0 list,Frontier supercomputer at Oak Ridge National Laboratory(ORNL)in the US,powered by AMD optimized 3rd Gen EPYC processors and AMD Instinct MI250X accelerators using TSMCs 7nm process technology,topped the list with 1.1 exaflops for the second consecutive time.Frontier is the worlds first superc
287、omputer that breaks the exascale barrier,and it is more than twice as powerful as the next system on the list and more powerful than the next four systems combined.Comparison of Chip Die Size on Different TechnologiesNote:The logic chip/SRAM/IO(input/output)ratio,which affects die size and power con
288、sumption,was re-aligned55nm110nm0.06328nm0.255nm0.03540nm0.487nm0.04716FFC/12FFC0.113nm0.026Comparison of Chip Total Power Consumption on Different TechnologiesNote:The logic chip/SRAM/IO(input/output)ratio,which affects die size and power consumption,was re-alignedN55LP(1.2V)110nm(0.75V)0.056N28HPM
289、(0.9V)0.35nm(0.75V)0.022N40LP(1.1V)0.67nm(0.75V)0.03416FFC/12FFC(0.8V)0.073nm(0.75V)0.015 Die size shrinks as line width shrinks More power saved as line width shrinksCollaborate with Customer to Push the Envelope in High-Performance Computing422022 Sustainability ReportSustainable Business Practice
290、sOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixOn the energy efficiency front,the Frontier Test&Development System at ORNL,also powered by AMD optimized 3rd Gen EPYC processors and Instinct
291、MI250X accelerators using TSMCs 7nm process technology,achieved an efficiency score of 62.68 GFlops/Watts,which was at the top of the June 2022 Green500 list and at the No.2 spot of the November 2022 list.According to the Green500 November 2022 list,AMD powers 75 percent of the top 20 most energy ef
292、ficient super computers.In addition,using TSMCs process technology leadership,AMD received a 2022 SEAL Sustainable Product Award for innovative and impactful products purpose-built for a sustainable future in data centers and was honored in the Best Sustainability Innovation in HPC category in the a
293、nnual HPCwire Readers and Editors Choice Awards.With the close collaboration with AMD,TSMC is glad to take part in contributing to the innovation and advancement in supercomputing to ensure scientists and researchers working on solving the worlds toughest and most complex challenges,such as climate
294、change,health care,and transportation,have the most cutting-edge tools for their research.In total,TSMC deployed 288 distinct process technologies,and manufactured 12,698 products for 532 customers in 2022,making continuous contribution to the advancement of modern society.Customer ProductImpact on
295、SocietyProduct Innovation and BreakthroughTSMCs Role AMD 4th Gen EPYC(codename Genoa)processor With up to 96 cores in a single processor,the 4th Gen EPYC processors power the most energy efficient x86 servers Provide industry-leading 5nm process technology with best performance and power advantages
296、Establish a dedicated team to enable deep technology and design co-optimization(DTCO)to speed up product design and volume production Enable datacenters to deploy more efficient and powerful servers to meet workload demands Help lower power,energy costs,and server footprint to advance corporate sust
297、ainability goalsAMD collaborates with TSMC to deliver breakthrough 4th Gen EPYC(Genoa)5nm processor to power the most energy efficient x86 servers(Photo courtesy of AMD)432022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible Purch
298、aserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixCase StudyTSMC Enables More Than 1,500 Startup Customers Worldwide to Plant Seeds of InnovationTSMC is the worlds first dedicated semiconductor foundry,and this innovative business model has changed the landscape of t
299、he global semiconductor industry and enabled the global fabless IC companies to flourish.Todays heavyweight technology companies,including Broadcom,Marvell,and NVIDIA,have been collaborating with TSMC since their early days to continue to unleash innovation around the worldwide.In 2000,TSMC formed a
300、 dedicated Emerging Accounts team to support startup companies to accelerate their product innovation.To date,TSMC has worked with more than 1,500 startup companies to advance applications in communication,computing,healthcare,transportation,clean energy and many other new applications.Currently,ove
301、r 85%of startup companies in the semiconductor industry are engaging with TSMC to develop their prototype products.TSMC strives to be a long-term important partner that customers can trust and rely on for their success.Driven by the passion to enable startup customers success,TSMC hosted a dedicated
302、 Innovation Zone for the first time at the 2021 TSMC Online Technology Symposium.In the Innovation Zone of the 2022 in-person/online Technology Symposium,a total of 37 startup customers showcased a wide range of disruptive innovations that aim to make peoples lives better and more sustainable,includ
303、ing cashier-less retail,high-performance computing interconnect,cloud and edge AI,power electronics,augmented reality,satellite-mobile communication,battery-free devices,in-vehicle networks,software-defined touch sensing,5G private networks,and more.Through the interactive demonstration of products,
304、startup customers vividly showcased the splendid future of next-generation semiconductor innovations.Turning the spotlight to Kinara,which was awarded the first Innovation Zone Demo of the Year Award elected by Symposium attendees,showcased a cashier-less retail solution enabled by its edge AI platf
305、orm.The platform uses a camera and AI system to identify consumers actions and their purchases in real-time with better energy efficiency.The cashier-less retail solution not only brings a convenient shopping experience to consumers but also creates meaningful work for retail cashiers,transforming t
306、hem into sales consultants who provide value-added advice or retail system administrators.This inspiring story exemplifies how technology drives amazing changes.2022 Innovation Zone Customer Demo By ApplicationTSMC hosted the first in-person Innovation Zone at the 2022 Technology SymposiumU.S.compan
307、y Kinara received the first Innovation Zone Award for its cashier-less retail solutionHPCSmartphoneOthersDCEAutomotiveIoT11%19%30%16%21%3%442022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green Pow
308、erAn Admired EmployerPower to Change SocietyAppendixtechnology as an example,TSMC introduced 16nm FinFET process technologies in 2013 and became the first to fabricate both 7nm and 5nm FinFET products.In the early stages of FinFET development,TSMC had already filed patent applications.Over the cours
309、e of 20 years,TSMC has accumulated over 14,000 FinFET patents as it systematically built up patent protection coverage to ensure technology leadership.500 invention patent applications,thus concluding the Groundwork Era.In 1999,the Company entered the Growth Era and filed 1,000 patent applications i
310、n 2011.Starting in 2012,the IP team began setting patent application goals based on annual R&D investments,bringing TSMC into the Exponential Growth Era.As of 2022,TSMC has filed over 85,000 global patent applications and consistently reached record highs again and again.Using FinFET Protect Intelle
311、ctual PropertyIP-based development strategies are increasingly important under trends of globalized economic and trade competition.To fulfill TSMCs vision of sustainable operations,the Company seeks to strengthen its three competitive advantagesTechnology Leadership,Manufacturing Excellence,and Cust
312、omer Trustby protecting technological innovations and proprietary information through two approaches:patents and trade secrets.For technology leadership,TSMCs IP and R&D teams work closely throughout each step from the beginning of technology planning to risk production and volume production.Such te
313、amwork enables TSMC to build an IP portfolio for each generations critical innovative technology ahead of schedule,including the latest 3nm and 2nm process technologies,to ensure the Companys technology leadership in the semiconductor industry.In manufacturing excellence,TSMC uses rigorous protectio
314、n measures to secure critical information such as capacity planning,manufacturing process management,and information related to intelligent operations in the form of trade secrets,while also actively applying for patents for manufacturing technology with strategic value to secure the Companys compet
315、itive advantage obtained through manufacturing excellence and quality assurance.In maintaining customer trust,TSMC protects confidential information concerning the Company and its customers while maintaining strategic leadership in the global patent ranking.These efforts translate into business succ
316、ess,ensuring the freedom of TSMCs operations around the world and strengthening partnerships with customers.TSMC Patent HistoryThe history of TSMCs robust patent portfolio can be divided into three eras.In 1987,the Company applied for its first patent and has since increased patent applications ever
317、y year.In 1998,TSMC filed Patent Achievements with Quality and Quantity in 2022Exploratory R&D Patent ApplicationsPatent Applications Patents GrantedPatent Quality8,500global patent applications5,500Worldwide patents granted and the only Taiwanese company in the U.S.top 100100%U.S.patent allowance r
318、ate and ranked first among top 10 patentees1stPlace among Taiwan Patent Applicants for seven consecutive years 3rdPlace among U.S.Patentees,setting a new company record 2ndPlace among U.S.Patent Applicants and remained the only Taiwanese company in the top 1001stPlace among Taiwan Patentees for thre
319、e consecutive yearsPatent GrantsPatent ApplicationsTechnologies2000320022000420006201820172009 2000nm65nm28nm16nm7nm3nm10nm5nm40/45nm20nm0.13mPatent Applications85,000+Patent Grants56,000+452022 Sustainability ReportSustainable Business Practice
320、sOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green PowerAn Admired EmployerPower to Change SocietyAppendixComprehensive Patent Management MechanismTSMCs patent performance stems from its robust patent management institutions and patent management sy
321、stems.The Company maps out short-,mid-,and long-term patent blueprints using innovative patent strategies and diverse risk control;monitors and evaluates competitive information by patent map navigation;hosts advanced invention workshops to uncover innovations in core technologies;expands the patent
322、 family by targeting key technological indicators;and manages patent prosecutions by invention tiers.Through managing the quality of patent applications and expanding patent protection coverage,TSMC has been able to consistently construct a global strategic patent portfolio with equal attention to q
323、uality and quantity.In 2022,TSMC was the only Taiwanese company ranked in the top 100 for U.S.patent applications and grants.The patent team has also designed a range of incentive systems including awards for patent invention submission and a big annual IP award ceremony.The Prolific Inventor Award
324、recognizes employees that have received over 100 U.S.patents during their employment at TSMC.As of 2022,there have been 141 Prolific Inventor Award recipients,one of whom holds over 1,000 U.S.patents.A total of 360 patents have been issued from 384 employee inventors that received the New Inventor A
325、ward in 2022.In 2022,the patent team also launched a series of patent campaigns,including the Annual Patent Competition,which received 1,663 invention submissions;16 on-site education and training sessions to help employees ideate valuable patents;and the Online Patent Quiz,which saw the participati
326、on of around 2,000 employees.Widespread Recognition of Patent Success and Industry IP UpgradesTSMCs patent performance has been recognized by many international IP institutes.The Company ranked first in the semiconductor manufacturing category for IEEEs Patent Power Scorecard,became the first and on
327、ly company to receive the highest Taiwan Intellectual Property Management System(TIPS)certification(AAA),and ranked in the Clarivate Global Top 100 Innovators and LexisNexis Global Top 100 Innovation Momentum for two consecutive years by index of patent portfolio size and citation strength.In additi
328、on,TSMC continues promoting technology and IP upgrades in the industry by communicating with various IP authorities and legal courts,collaborating with academic institutes to develop technology and IP indicators,and spearheading IP strategy alliances for the industrys supply chain.TSMC also helps fo
329、rmulate and amend IP laws and provide suggestions on industry policies to help create a robust patent protection landscape.StrategiesImplementationsDeployment StrategiesEvaluation SystemApplication StrategiesReward SystemMaintenance StrategiesEducation and PromotionUtilization StrategiesTalent Culti
330、vation Industry-academia ExchangeInfringement CountermeasuresPatent Management GuidelineInstitute IP management-oriented operationsStrengthen IP portfolioProtect TSMCs IPs and respect others IPsEnhance IPs and technologies in the industryEnsure freedom of operations around the worldProtect R&D inves
331、tment and achievementsStrengthen market competitivenessEstablish IP reputation in the industryIP Management Policies IP Management Targets462022 Sustainability ReportSustainable Business PracticesOverviewOperations and GovernanceAn Innovation PioneerA Responsible PurchaserA Practitioner of Green Pow
332、erAn Admired EmployerPower to Change SocietyAppendixIntegrated with Human Resources SystemTSMCs trade secret registration system is integrated with the Companys human resources system and automatically updates employees registration information in their personnel file.This serves to highlight employ
333、ees contributions to TSMCs technological innovations and is an important indicator for supervisors to consider for performance evaluation and promotion.Intelligent Reminder FunctionThe trade secret system automatically compares employees trade secret registration records and reminds them to complete the registration process in a timely manner.Technology ClusterSystematically categorize and annotat