Supplier and Contractor Management



To protect the environment and emphasize society's obligation, labor rights, security, health and the goal of a continually developing supply chain.


To manage vendor's quality, cost leadership, delivery, service/response, and sustainability. To fulfill demand in accordance with UMC and promote the spirit of competition.


To regard vendor as a partner, and guide vendor for the long-term cooperation. To corporately build up the eternal supply chain of the steadily developmental semiconductor.


To cooperate with upstream & downstream vendors and collaboratively create business opportunities.


Ensure that the products and supply chain are free from conflict minerals supplied from the Democratic Republic of Congo (DRC) or adjoining countries.



To firmly believe the key point of an enterprises management is to fulfill economic, environmental, and society obligations. To voluntarily reinforce the enterprise's commitment to these obligations, and promote the benefits to customers, employees, suppliers & the community.


To monitor fire and earthquake damage, security risks & hygiene, environment, and labor rights. Supply chain risk management is also a competitive capability; as such, the company shall focus on supply chain vendors risks and voluntarily provide any assistance, if necessary.


To ask suppliers to conduct the survey and management of the current business operating status, material sourcing diversification and the geographic dispersion of suppliers' production. To reduce the material shortage risks from extreme climate or serious natural disasters.


To build up our risk evaluation program for supply chain vendors and establish an eternal evaluation method for them. To regard the method as the risk evaluation element and become one of the most important UMC procurement strategic references with elements of delivery date, quality, finance and business operation.


To respect and protect the rights of intellectual patent property and conduct fair trade, advertisement and competition.


To commit to business integrity and forbid any inappropriate profit acceptance, corruption, extortion, or defalcation. To establish an identification and penal security mechanism.

UMC is a party to the global consensus for supporting supply chain and source management and uses certified sources of minerals from non-conflict areas. UMC also requires suppliers to ensure that their products and supply chain are free from conflict minerals. When selecting new suppliers or assessing existing suppliers, UMC shall exercise due diligence in supply chain audits to exclude the use of conflict minerals from the Democratic Republic of Congo (DRC) or adjoining countries.

Conflict Minerals Management

At UMC, we enforce conflict minerals management according to the Disclosures Relating to Conflict Minerals prescribed in Rule 13p-1 of the U.S. Securities and Exchange Act of 1934 of the US Securities and Exchange Commission (SEC). During new supplier selection, UMC requires new suppliers to introduce assessment systems and to present sourcing of minerals from conflict regions. Existing suppliers are also required to actively investigate and verify specified materials (gold, tantalum, tin, and tungsten), sign agreements prohibiting the use of conflict minerals, or provide a declaration thereof. UMC also exercises due diligence when implementing our investigations, and annual supplier audits were carried out to check whether upstream smelters / refiners of the suppliers utilize conflict minerals. Lot traceability for the supply chain is in place to ensure that no conflict minerals have been used. UMC is also an active participant of global advocacy groups such as the Conflict-free Sourcing Initiative (CFSI) of EICC-GeSI. Information on suppliers that meet conflict mineral requirements was acquired from the Conflict-free Smelter Program (CFSP) as a basis for supply chain and source management. Suppliers were also required to refer to the latest Conflict Minerals Reporting Template of EICC to provide information related to conflict minerals. Dedicated UMC personnel were assigned to verify a supplier’s compliance to EICC standards for ensuring the total exclusion of conflict minerals usage.

In addition to implementing conflict minerals management according to corporate policy and commitment, UMC also submits Specialized Disclosure (SD) forms to the U.S. SEC while publishing the completed forms on its official website to declare the outcomes of conflict minerals management efforts and demonstrate our commitment to corporate social responsibilities.

The latest SD forms may be downloaded through the link at the right of this web page.

Supply Chain Management Approach

a. Total supply chain management

UMC has 4 major aspects in place to guide management and guidance. The purpose is to establish continuous growth of the supply chain management mechanism.

New supplier

For supplier quality/financial/human rights/environmental/Labour price-oriented assessment

UMC require conditions are met, may become a UMC supplier

Supplier education
and training

Non Regular dealer training course

Advocate and communicate with UMC extended supply chain management practices

Supplier evaluation/

Score based on supplier assessment

Evaluation scores below UMC require dealer, UMC will stop purchasing or Cancellation of qualified supplier qualification

Supplier classification guidance

Suppliers of class distinction made base on the basis of characteristics and risk

According to their hierarchy when competition in the annual audits

Evaluation results based on guidance to meet the company requirements

b. Evaluation to Qualify New Suppliers

To evaluate the supplier qualification from the aspects of quality, finance, price, environment, and labor rights. Suppliers shall be qualified in accordance with the terms of UMC's conditions.

To evaluate the supplier qualification from the aspects of quality, finance, price, environment, and labor rights. Suppliers shall be qualified in accordance with the terms of UMC's conditions.


b-1.The Environmental-oriented Claim
To conduct the supplier's carbon/water examination management and provide the necessary guidance and assistance of greenhouse gas for the major suppliers in Taiwan. To establish the ability of self-examination for the goal of carbon footprint and water footprint calculation assignment afterwards. Furthermore, to be well prepared to reduce waste discharge.


b-2.The Financial-oriented Claim
b-2-1.To periodically survey the supplier's ability of quality, delivery date and continuous business management. To ask suppliers to keep improving activities in accordance with the terms of UMC's conditions.
b-2-2.The suppliers shall sign the「Confidentiality Acknowledgement」and Non-Corruption Acknowledgement」. The description of the regulation states that suppliers must faithfully perform any business transaction behavior. It forbids damaging UMC's image or profits. Moreover, vendors shall commit to not provide any profits for UMC employees and their relatives in private.


b-3.The Society-oriented Claim
b-3-1.To concentrate on labor rights of suppliers and also continuously pay attention to labor rights of the supply chain on the basis of the EICC.
b-3-2.UMC is aggressively adapting the EICC standard regulations and asking suppliers to follow the terms related to environment, security and hygiene, labor rights and labor conditions. To ensure environmental and society regulations are followed by the suppliers, the performance examination items for suppliers shall be combined with the margin power of procurement.

c. Supplier Training Course

The supplier is a very important part of the Green Supply Chain Management System. Hence, it's necessary to hold training courses for suppliers periodically and communicate about the policies and methods of UMC's Green Supply Chain Management System. This practice helps align UMC with suppliers for the green production, cooperating to achieve a win-win policy.

d. The supplier evaluation mechanism and classification assistance

To evaluate suppliers of various raw material on the basis of 「The quality index」、 「The price index」、 「The delivery date index」、 「The service index」、and especially on 「The sustainability index」, which refers to the evaluation basis of the supply chain's collective responsibilities.. The purpose is to raise the consciousness of environmental protection, to improve security and hygiene, and to respect human labor rights to collaboratively achieve enterprise society responsibility.

Supplier Risk Management


To concentrate on supply chain risk management and voluntarily provide any assistance if necessary. It is important to examine and control the management of the business operations, the material sourcing diversification and the geographic dispersion of supplier production lines, after experiencing natural disasters such as the Thailand flood, Japan tsunami and nuclear power plant damage and the global financial recession. The purpose is to reduce the material shortage risks of extreme climate or serious natural disaster circumstance.


UMC shall strengthen risk evaluation for supply chain vendors and establish a continuous evaluation method for them. To regard the method as the risk evaluation element and become one of the most important UMC procurement strategic references with elements of delivery date, quality, finance and business operation.


UMC shall conduct continuous risk investigation, audit and evaluation for raw material suppliers of wafer, gas, chemical, quartz, mask and cleaning parts. The raw material procurement cost exceeds 95% of UMC's spending. It fully represents the commitment and inseparable cooperation for UMC and suppliers on promoting values to the whole supply chain.


The risk index for suppliers has 5 different levels as follows: H: High Risk Supply. M: Mediate Risk Supply. ML: Mediate-Low Risk Supply. L: Low Risk Supply. LL: No Risk Supply. According to the latest supply risk evaluation result, UMC has no suppliers in the high risk supply category.


According to the risk evaluation on economics, environment and society, the risk value on the 3 aspects is relatively low; as such, there's no risk concern.

The supplier risk management mechanism claims and assistance.


Business Continuing Operation Plan: To require suppliers to have an instant backup plan and procedure for potential natural or artificial threats that may damage production capabilities. To ensure the entire business operation can continue and reduce the impact of accidents to UMC.


Earthquake Risk: To voluntarily provide any help or assistance for suppliers, and suggest and advise them how to reinforce their plants with anti-quake engineering and implement an announcement system. During disasters, the suppliers can immediately report the latest damage situation and continuously update the recovery progress for UMC to be fully updated on the recovery status.


The Risk of Climate Change: To ask suppliers to prepare backup solutions like material sourcing support, production plans, increasing stock amount, etc. To reduce the impact of the accidents.


The Risk of Fire: To share experiences and provide assistance for suppliers to improve anti-fire protection.

The Green Procurement Management.

The relevant claims for UMC green procurement are entirely through the e-Procurement system. The purchase order will be delivered to the suppliers along with the claims on the regular basis of the green procurement management. Furthermore, suppliers will upload the inspection report of every single batch material to UMC via the e-Procurement system. UMC will respond and provide solutions immediately for the early alert of any inconsistent operation.

To continuously promote the procurement ratio of environmental production and reusing material, recycling, low pollution or energy saving production. UMC has already achieved the certification standard of EPA (Environmental Protection Administration Executive Yuan, R. O. C) for several years.

Circular Economy

In 2016, UMC planned to work closely with its suppliers in the green supply chain management system, proposing the UMC 3R League; Reuse (resource), Recycle (resource), and Reduce (waste, energy and resource). Depending on the characteristics of each product, it is hoped that the resources needed for making the product can be used effectively via processes such as maintenance, reutilization, remodeling, and reproduction. The idea is based on the fact that waste from one industry may be the essential energy or resource for a different industry. If such mutual-benefit network can be built, not only we can prevent damage to the environment but also save significant amount of money for waste treatment. By doing so, both the value of product and resource can be maximized to achieve win-win situation.

In 2017, UMC leads a three-year special project for organizing the UMC 3R League which will involve suppliers from major chemical raw materials (9 suppliers), waste treatment (6 suppliers), parts & components cleaning and maintenance (7 suppliers). In this project, a unified quantitative index across UMC supply chain will be established to build a better future through experience sharing and mutual information exchange.

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