CORPORATE SUSTAINABILITY

Green Products and Services

Green Product Statement

In addition to the dedication to providing core products with market competitiveness to meet our customers’ demands, as a citizen of the Earth, UMC has also taken on the responsibility of developing green products with efforts to cherish resources and protect the environment starting from the source. In addition to reducing resource consumption and unnecessary pollution during the production process, we have taken our efforts a step further to acquire green factory certificates to strive to be a good green role model.
UMC's promises:
1. In addition to complying with all applicable laws, regulations and standards, we have applied even higher standards for ourselves with the priority of replacing hazardous substances.
2. We will promote green purchasing with proper management of hazardous substances within the production process starting from the source.
3. Our product designs are heading towards slim and compact sizes to reduce material consumption, yet they also feature high performance and low power consumption.
4. We will promote reduction of greenhouse gas emission, saving of energy and resources, and reduction of waste generated during the production process.
5. We will promote the recycling and reuse of raw materials and product packaging materials.

Green Product Liability

In June 2006, UMC completed Hazardous Substance Process Management (HSPM) and has received IECQ QC080000 qualification, which made UMC the first semiconductor manufacturer in the world to achieve QC080000 HSPM for all fabs. To ensure the products provided to customers meet international standards and customer requirements like EU RoHS, EU REACH, Montreal Protocol on Substances that Deplete the Ozone Layer et al., we tried our best to reduce environmental impact and to reach customer request.

Regarding product safety, UMC poses no direct potential threats to its customers or the general public since UMC does not have its own end products. However, to ensure that products provided to customers meet international standards and customer requirements, UMC established a cross-divisional HSPM committee to improve the efficacy of green product management. We have completed third-party QC080000 IECQ certification for management of hazardous substances to ensure that UMC provides products that conform with RoHS directives and customers' requirements.

Hazardous Substance Management

The QC080000 IECQ HSPM standard is based on the "flow orientation" measure to manage the use of hazardous substances, which covers the stages from design and development, procurement, and manufacturing to shipment. The success of this system demonstrates UMC's capability in managing hazardous substances and ensures UMC provides environmental friendly products that are free of hazardous substances that conform to customers' requirements and international regulations.

Green Procurement Process of Raw Materials

Hazardous substances control is also applied to material merchandising. All materials that violate the control will be deemed as disqualified products and returned to the suppliers, who are then required to provide correction and prevention measures.

Constructed a New System for Evaluating Raw Materials

To effectively manage new materials used in newly developed manufacturing, UMC has constructed a sound process for evaluating new materials to determine if they are banned/ controlled toxic or hazardous substances and fully determine their impact on environmental safety and health.

Hazardous Materials Replacement Program

UMC has plans to phase out hazardous raw materials through replacement programs to reduce the impact of chemicals to the environment. The target substances are chosen based on international environmental protection trends, government laws and regulations, and customer requirements.

Usage reduction project and objectives for PFOS, PFOA, and PFOA related chemicals

CMR Substance Management

UMC started to promote CMR Substance Management in 2011, with the following key focus areas:

(1)

Continue researching and testing substitute gasses in semiconductor thin film process to lower the emission volume of greenhouse gasses.

(2)

Conduct inventory on existing chemicals in use and place Category 1 of CMR under control. UMC will identify departments that use such substance and establish plans to improve the usage

(3)

On the regulation of newly adopted CMR substances, in principle, use of category 1A is abandoned and use of category 1B requires protection measures

Life Cycle Assessment, LCA

LCA is a tool to improve products and the manufacturing process and reduce pollution. It helps decision makers to become involved with more environmental aspects. The steps to conduct LCA include: Scope Definition, Inventory Analysis, Impact Assessment, and Result Interpretation. In 2005, UMC authorized the Industrial Technology Research Institute (ITRI) to implement a Life Cycle Assessment in each fab.

The results of such an assessment would help UMC to meet the Ecological Design Directive (ErP Directive) vis-à-vis its products, understand the impact on the environment caused by customer products manufactured at UMC, and develop improvement plans. From raw silicon to chips, investigations were conducted targeting energy consumption, materials, and pollutants of each customer product. Through the evaluation of the environmental impact on the entire supply chain and manufacturing processes, the impact on the environment resulting from products is clarified and the result of evaluations is used as a reference for the environmental management system. The assessment results are open to the public and can be provided for reference upon customer request. According to inventory results, environmental impact is greater from manufacturing rather than from suppliers. As a result, UMC continues to improve its processes, reduce resource consumption and bulk materials, with the goal of minimizing environmental impact over time.

Carbon Footprint

Although UMC is not an end product manufacturer, it strives to help customers to produce green products with high quality and achieve environmental sustainability and coexistence. In order to establish the basis for UMC to further promote green products, green manufacturing processes and green design, UMC has actively implemented the Total Carbon Management Project, internal GHG emission inventory and verification, and Carbon Footprint Inventory Plan.

History for Promoting Carbon Footprint Management
• In 2009, delivered the world’s first certified carbon footprint wafer product; completed Type III Product Environmental Labels and Declarations verification.
• UMC participated in the EU Seventh Framework Programme (FP7) from 2011 to 2014 and worked with both private industries and academia to research and develop approaches and tools for a Simplified Life Cycle Assessment (SLCA) system, allowing our clients to quickly and conveniently predict product carbon footprints.
• In 2016, the carbon foot print was promoted according to the UMC LCA-to-go Project implementation content.

Water Footprint Verification

UMC recognized the importance of water as a natural resource very early on. Water resources are particularly important in Taiwan due to its mountainous topography, heavy rainfall along the mountain slopes, dense population, and extensive industrial and commercial developments. UMC complies with the Business Water Footprint Accounting standards developed by Water Footprint Network, an international NGO. In 2010, we completed business water footprint verification for our 8-inch and 12-inch wafer fabs and identified that water usage during direct processing was greater than that of the indirect supply chain. Blue water and gray water were the main sources of water used. In 2015, UMC began working with our suppliers to complete ISO 14046: Water Footprint Assessments of various products manufactured by UMC plants. In 2016 the water footprint inventory was launched throughout the company in accordance with new standards, and third-party verification was implemented in the representative fab.

Future directives:
1.Continue to improve water usage efficiency (WUE) within the plant, and reduce both water usage/wastewater generation to directly reduce water footprint of our products. 2.Work with suppliers to improve overall WUE of the entire supply chain to achieve joint water conservation and protect our planet.

SONY Green Partner

UMC became a Sony Green Partner in 2003, and passed and maintained qualification since then. These actions demonstrate that UMC's progress in hazardous substance management has gained recognition from our customers.

LCA to go project

The European market is one of the important markets for UMC. It's an advanced area with regard to the development of green measures. We are honored to participate in FP-7 as it gave us the chance to invest efforts in developing and establishing green measurement. Joining this project improved our ability to inventory and predict CFP, thus enhancing our foundry service to customers by providing them with specific CFP information. The simplified LCA tool that we developed could help SMEs quickly obtain CFP without incurring high costs.

To fulfill its duties as a global and corporate citizen, UMC has made efforts to promote carbon disclosure with significant investment of financial and human resources. With the help from Industrial Technology Research Institute (ITRI), in 2010 UMC became an official member of the FP7. We started working with 18 teams from 9 member organizations from industry, government and academia to jointly develop "Boosting Life Cycle Assessment use in SMEs: development of sectoral methods and tools." With extensive experience in carbon footprint and robust supply chains, UMC led the case study for carbon footprint tool applications for the semiconductor industry to build a "carbon footprint calculator" that includes a simple universal calculation method. With UMC's carbon footprint experience and the support of supply chain partners, our collaboration with the EU in green technology provides small and medium enterprises in Taiwan with comprehensive, tailored, low carbon services. We also help them acquire information on their products' carbon footprint with minimal time and resources to reduce negative impact from green trade barriers. At the same time, the results of the "LCA to go" project will promote carbon reduction and raise low-carbon competitiveness for the industry. With considerable efforts in recent years, UMC has achieved international standards in terms of green technology development and received wide recognition among different EU sectors.



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