Eco Design and Sustainability Liability of Product

Vision and Promise

In response to UNDP’s SDG 9 (industry, innovation, and infrastructure) and SDG 12 (responsible consumption and production), Advantech has established various eco design goals pertaining to raw materials, product design, manufacturing, and environmental management. We have introduced various standards aimed at improving the environment, minimizing environmental impacts from operations.

Management Guidelines for Major Topics/Management Structure

Phased Achievements and Future Goals of Eco Design

Actions in 2024

    • Advantech's silver medal for green eco design guidelines was introduced to form internal regulations
    • Advantech has established internal regulations for energy-saving design and eco materials (halogen-free requirements) to effectively increase the coverage rate of Advantech's green eco design products.
    • Energy Star goal setting
    • In response to Advantech's industry characteristics and the Energy Star voluntary energy-saving design adjustment goal, we set up suitable products for design.
    • Development of energy saving SW Utility
    • Assist energy-saving design not only from hardware but also through investment in energy-saving software development.
    • Re-optimization of green eco design products
    • Continue to standardize the silver medal for green eco design products into a mandatory requirement for new Advantech models, and actively design and develop Advantech gold medal models compliant with green eco design products.

2023 performance

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    • 37% of new products
    • Percentage of green eco design system products won the silver medal with the internal selfdeclaration mark.
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    • 9.74%
    • Percentage of annual revenue of mass-produced products achieved the silver medal of green eco design products/Advantech energy saving seal.
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    • 100 %
    • Completion of SPC-815, the first product carbon footprint verification, and 2 product carbon footprint inventories.
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    • 11.5%
    • Proportion of global waste recycling.
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    • 87 %
    • Percentage of halogen-free plastic parts sold by product organizations in the year.
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    • 79 %
    • Achievement rate of the EPE replaced with paper/plastic for products under 5kg.
Phased Achievements and Future Goals of Eco Design

Eco Design

Eco-Product following the LCA life cycle

Advantech always upholds the philosophy of products follow the life cycle and uses LCA and product carbon footprint to quantify the environmental impact of Advantech products. The assessment items cover the carbon emissions from the upstream raw material selection, manufacturing, transportation, and use stages until the final disposal. The Company will further set carbon reduction goals and take actions to implement the reduction, which is included in the Company's operational management goals.

Eco Product LCA Life Cycle

In the second quarter of 2023, Advantech obtained the SPC-815 carbon footprint ISO 14067 certification for its first product, which allows us to assess the depth of product material selection through LCA and identify the top five key materials with carbon footprints, and complete Advantech's product carbon footprint inventory. The inventory methodology has been established to lay the foundation for the internal development of LCA. Advantech will launch the establishment of Advantech's internal carbon footprint query system in 2024. We will complete the product carbon footprint inventory of representative products of each business group to serve as the material selection mechanism for the initiation of low-carbon products. In addition, Advantech develops its own eco product design mechanism and integrates the product life cycle process to develop Advantech's green eco product design guidelines to guide the product design department in eco product design.

Eco Product Design Management Mechanism

Advantech establishes standards from four major aspects of products: (1) green materials, (2) green packaging materials, (3) Product Recycling, (4) product energy saving, to evaluate the environmental impact at all stages from raw material selection, manufacturing, transportation, and use stages until the final disposal, and design innovative green eco design products to comply with international regulations and customer needs.

Eco Product Design Management Mechanism

Interdepartmental Committee

We set up an Eco Design Management Committee, with Advantech's Project Management Optimization (PMO) convening relevant departments to formulate standards and to oversee their implementation, management, and inspection.

Interdepartmental Committee

Setting of Standards

Based on international environmental regulations or international assessment tools (such as the U.S. Electronic Product Environmental Assessment Tool, EPEAT3 and our experience in serving brand customers, Advantech's eco-design guidelines and guidelines is formulated to improve energy efficiency, eco-design, and reduce environmental toxicity and hazards; as well as provide inspection standards and tools, and gold/silver medal will be awarded to applicants who pass the review.

New Product Development Stage Inspection

For all system standard products, in 2023, we introduced the four major aspects of green eco design criteria into all stages of design and development, and set up relevant departments to conduct inspection during product mass production to ensure that the products meet the green eco design goals. In 2024, Advantech will more actively introduce the silver medal standard as an internal regulations to effectively increase the coverage rate of green eco design products and provide customers with green eco design products of greater value.

Decision Check Points in Development Stages of Eco Product Innovation Design Projects

Decision Check Points in Development Stages of Eco Product Innovation Design Projects

Performance

In 2023, we continued to re-optimize green eco design products: Introduce the silver medal standard criteria for green eco design products into products whose energy consumption must comply with the ErP international norms, and gradually promote the internal requirements of green eco design from voluntary to the introduction of the standards, some performance results have been achieved. In 2024, in addition to introducing the silver medal standard as an internal regulations in the development process, we will actively design and develop gold medal models that meet the green eco design product criteria, and evaluate the introduction of other recycled materials, such as using recycled plastic and recycled metals for the mechanism casings, and transitioning from EPE foam plastic to paper-based materials for packaging. The reduction in packaging material and the selection of environmentally friendly materials for the first and second generation models are currently undergoing evaluation and implementation. The following is a description of performance and action plans for eco materials, product energy saving, eco recycling, and eco packaging materials.

Green Materials

Green Materials

Product energy saving

In addition to establishing Advantech‘s energy-saving internal regulations and introducing standardization, each business group also nominates products to meet the Energy Star design goal, and expects to develop energy-saving management software to improve carbon reduction performance: Carbon reduction performance is enhanced by developing the Energy Star technology, which is more carbon reduction efficient, and supporting software and hardware that can be quickly deployed in Advantech products.

Product energy saving

Green packaging materials

Green packaging materials

Product Recycling

Product Recycling

Percentage of revenue from products achieving the silver medal for green eco design products/Advantech energy saving label in 2023: 9.74%

Product Liability

Advantech established Green Supply Chain management in 2010. On this supply chain platform, suppliers must promise and guarantee that their products do not contain harmful substances listed by the Company, and supporting documents shall be provide for future reference. We optimize this platform every year, activate the database, and form an effective green supply chain. Advantech has introduced its hazardous substance management system since 2010. We uphold the spirit of strict quality management, continuously controlling every aspect of product responsibility. The products of Advantech are all in compliance with relevant regulations.

Green Supply Chain Management Platform GPMS

Green Supply Chain Management Platform GPMS

Green Supply Chain Management Process

Green Supply Chain Management Process

Advantech’s Green Policy - Hazardous Substance Reduction Program

Advantech’s Green Policy - Hazardous Substance Reduction Program

Advantech reviews the current status of hazardous substances management every year in accordance with international regulations, customer requirements, and trends in environmental protection in order to reduce environmental and ecological impact, fulfill corporate responsibility for environmental sustainability, meet the expectations of stakeholders, and continue to adhere to the requirements of international regulations. We have thus formulated Advantech's Green Policy (Hazardous Substance Reduction Program), and we regularly update Advantech's eco product rules for the management of hazardous substances. These in turn are managed through an green supply chain management platform.

Responsibility for Product End-of-Life : Product Recycling

The recyclable design of "recyclability, easy disassembly, low pollution, and energy saving" is injected into the early stage of product design. Advantech's green eco design products have a recycling rate of up to 90%; additionally, through recycling schemes required by regulations, the company promotes the reuse and recycling of electronic products. Commit to e-waste recycling and management in the spirit of producer responsibility.

Comply with local waste recycling laws and regulations in various countries, including Europe, the United States, Japan, Korea, Taiwan, and Kunshan. According to the "Global Transboundary E-waste Flows Monitor 2020 and 2022", the global e-waste reaches 53.6 million tons, and the recycling rate is only 17.4%. Including the recycling rate of 12% in Asia, 9% in the United States, and 42% in Europe. Use this reported recycling rate to convert Advantech's actual global product recycling percentage, and backtracked to calculate the data from 2020 to 2023.

In particular, in Europe, in response to the EU WEEE Directive and sustainable product design and development, we re-examined product recyclers we cooperated with. At the end of 2020, we changed product recyclers in Europe and expanded the inventory in 2022 (recycling countries expanded from 8 to 20 countries) product shipments and recycling. In addition to the annual expenses for the disposal of electronic product waste in Finland, we also received about EUR 1223 in rewards in 2023.