Delta has set climate-related performance indicators with sound climate governance and organization, and actively takes real actions to fulfill its commitment to sustainability. We analyze the climate-related risks and opportunities based on the latest internal and external regulations, scenario analysis, and strategies, and implement management on the basis of "mitigation", "adaptation" and “Innovation”. The mitigation measures include the measurement and the settings for commitments and objectives. We also strengthen actions to support the circular economy, renewable energy, and energy-saving products. In terms of adaptation, we have focused on water resource management and the taxonomy of Delta's products for addressing climate change. Delta uses the TCFD and decision-making tools such as internal carbon pricing mechanisms to continue to encourage low-carbon innovation. We continuously uncover business opportunities through technologies to respond to climate change challenges and we regularly disclose our climate-related management results and performance.

Delta met its science-based target (SBT) set in 2017 four years ahead of schedule in 2021. We continued to actively pursue a 1.5°C reduction pathway in 2022 in accordance with the Net-Zero Standard published by the Science Based Targets initiative (SBTi) at the end of 2021. We obtained the SBTi validation in the same year and became the first high-tech hardware equipment company in Asia and the 125th company globally to pass the review for net-zero science-based targets.

We proposed our SBT with 2021 as the baseline year for reducing absolute Scope 1 and Scope 2 emissions by 90%, reducing absolute Scope 3 emissions by 25% by 2030, and attaining net-zero emissions in global operation sites by 2050. We also continue to implement emission reduction measures for limiting global warming to 1.5°C to reduce carbon emissions in internal operations, empower the internal low-carbon transition, and develop innovative products and services.

Scope 1 and 2 emissions from Delta's global operation sites in 2023 decreased by 39% compared to the baseline year of 2021. Delta has attained SBT for each phase for two consecutive years, which demonstrates Delta's resolve and long-term commitment to attaining SBT and work with value chain partners to promote the growth of the low-carbon economy.

Since 2007, Delta has participated in CDP to disclose the Group's greenhouse gas emissions. Delta overall production plants have passed ISO 14064-1 certification. We gradually expand the scope of certification to buildings, overseas operations, and subsidiaries. Our global operation sites have achieved the ISO 14064-1 certification.

Direct emissions and indirect greenhouse gas emissions of Delta's global operation sites in 2023 was 132,275 metric tons CO2e (market-based), which was a 29.5% reduction compared to the previous year and a 39.0% reduction compared to the baseline year of 2021. Our global operation sites can be divided into seven regions including Taiwan, Mainland China, Southeast Asia, Northeast Asia, India, Europe, the Middle East & Africa (EMEA), and the Americas. In market-based terms, Southeast Asia (approximately 35.4%), China (approximately 34.0%), and Taiwan (approximately 15.4%) are the main regions of Delta's GHG emissions. The reason for Delta's continuous attainment of SBT is the successful internal carbon fee mechanism launched in 2021, which has effectively empowered active internal carbon reduction. By continuously implementing energyconservation projects and increasing the ratio of renewable electricity, we increased the use of renewable electricity in global operation sites to 76% in 2023.

Since 2020, Delta has identified the significant emissions and calculated GHG emissions based on the requirements of ISO 14064-1:2018. We have also conducted an inventory of indirect GHG emissions in each category in accordance with the GHG protocol methodology. We completed the calculation for all categories for the first time in 2022. The total emissions from all categories of Scope 3 in 2023 were 7,160,049 metric tons CO2e, up 2.8% from the previous year and an increase of 37.6% compared with the baseline year of 2021. It was mainly due to the increase in product sales in 2023. The main categories for Scope 3 are Category 11 use of sold products (approximately 57.8%) and Category 1 purchased goods & services (approximately 26.2%). In the future, Delta will continue to focus on reducing emissions in three key areas including low-carbon product development, low-carbon supply chain engagements, and low-carbon transportation.

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In 2023, the use of renewable electricity at Delta's global operation sites reached 76% Delta announced in 2021 that it has joined the global renewable electricity initiative RE100 as a Gold Member, and pledged to achieve the goal of 100% renewable electricity and carbon neutrality by 2030 for all of Delta's global operation sites. Delta officially established the Delta Global RE100 Committee in 2021 with the Chairman, Vice Chairman, CEO, COO, and CSO as the main members who oversee eight work groups in more than 30 countries. Each work group is led by the president of regional operations, who establishes a regional promotion organization to expand management to all locations. It is responsible for the promotion and attainment of renewable electricity targets for all locations in each region.

Delta's global operation sites continued to promote renewable electricity in 2023. The sites studied and reviewed local renewable electricity regulations and policies, market trends, prices and costs, and the integrity of traceability information, and gradually consulted renewable electricity suppliers or electricity retailers. They also considered the long-term demand for renewable electricity and evaluated the benefits and feasibility of constructing or investing in renewable power plants. Each working group also identified bottlenecks for the usage ratio of renewable electricity in the process. They learned about the reasons for these bottlenecks and actively sought opportunities for improvement.

In 2022, the attainment rate of the use of renewable electricity was included for the first time as a performance indicator for the Chairman, CEO, and Region Heads of each working groups and it now accounts for 5% to 15% of their total remuneration and incentives. To ensure data quality, Delta included electricity data statistics from global operation sites for the ISAE 3000 assurance for the first time in 2023. All renewable electricity sources and types must comply with the RE100 technical criteria, and obtain complete traceability information to prove the source and quantity.

Delta strategically promotes renewable power by setting procurement priorities and linking different types of procurement projects to their internal carbon fees. In terms of the methods for attaining the targets, Delta uses energy conservation as the basis for reducing electricity consumption and adopted a strategy of self-generated and consumed renewable electricity as the highest priority. The second category is direct purchase of renewable power (e.g., Power Purchase Agreements (PPAs) and green electricity products) with bundled renewable electricity and certificates. The third category is unbundled energy attribute certificates (unbundled EACs). In full compliance with the RE100 technical manual, Delta developed other categories of innovation to encourage innovative measures for increasing the percentage of renewable electricity use. The mechanisms are also partially linked to the internal carbon pricing system to encourage all sites to prioritize the use of self-generated and consumed renewable electricity and bundled renewable electricity.

In 2023, the use of renewable electricity at Delta's global operation sites reached 76%, which exceeded the internal target of RE65. The global operation sites total electricity consumption was 747,828 thousand kWh, including 568,595 thousand kWh of renewable electricity. The sources of renewable electricity as a proportion of total electricity consumption included 34,484 thousand kWh (5%), from self-generated and consumed solar power, 103,999 thousand kWh (14%) from direct purchase of PPAs electricity, 250,450 thousand kWh (33%) from green electricity products, and 179,662 thousand kWh (24%) from unbundled EACs.

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