Words from the Chairman

Looking at the global semiconductor industry in 2017, the PC market has declined slightly, while communication and consumer electronics have remained stable. In addition, the demand for automotive, industrial, and Internet of Things (IoT) applications has increased, providing the global semiconductor industry with a profitable year. In response to the market sentiment, Nuvoton Technology continues to introduce new products and services, setting a new record with its operating results, causally demonstrating the company's solid operational capabilities. In addition to achieving good financial performance in 2017, we have also continued to deepen various policies for sustainable development in three major aspects: economic, environmental, and social, actively focusing on issues such as "Corporate Governance", "Customer Service and Supplier Management", "Environment-Friendly ", "Best Workplace" and "Philanthropy". We strive to utilize corporate influence to continue towards our corporate social responsibility vision of “providing a sense of safety, reassurance, and empathy”.

 Corporate Governance

We highly value corporate governance, sustaining the principle of integrity in establishing a robust corporate governance framework, while also continuing to strengthen management functions. In addition, through a robust internal control mechanism, we ensure financial information transparency while instantly revealing important information to prevent internal corruption. In terms of overall financial performance, Nuvoton’s 2017 consolidated revenue amounted to NTD 9.235 billion, up 11% from 2016; net income after taxes amounted to NTD 688 million, up 12% from 2016. Earnings per share (EPS) amounted to NTD 3.32. In the fourth corporate governance evaluation in 2017, Nuvoton ranked in the top 20% in all publically traded companies, affirming our efforts in corporate governance.

Customer Service and Supplier Management

Nuvoton provides diversified and innovative product solutions to enrich applications for customers, enhancing the competitiveness of customer products. We also implement a series of quality control mechanisms and customer satisfaction surveys to ensure the quality and reliability of products. The 2017 customer satisfaction survey shows average satisfaction at above 4 points. For sustainable supply chain management, we work closely with our supplier partners, regularly conducting quality assessments and corporate social responsibility (CSR) performance assessments for our key supplier partners. We put forward our best efforts to fulfill corporate social responsibility together with our suppliers.

Environment-Friendly

Complying with environmental laws, regulations, and international standards, Nuvoton is committed to continuous improvement as well as becoming a green enterprise with sustainable development. We strive to reduce the impact of production on the environment and eliminate any foreseeable environmental pollution risks through source reduction and company-wide participation to protect the natural environment. In 2017, Nuvoton received the “Excellent Environmental Protection Personnel” award and “Environmental Education Partner” award by the Hsinchu Science and Industrial Park, demonstrating the commitment of Nuvoton to corporate social responsibility. Committed to protecting the natural environment and cherishing the resources of the earth, we were the pioneers in the energy-saving movement of adding advanced ice machine systems. In 2017, we have implemented a total of eight major energy conservation measures, saving an estimated 2.16 million kWh in electricity consumption. As evident in our business operations and activities, we are committed to achieving a level of development that balances economic, social, and ecological factors.

Best Workplace

Employees are the cornerstone of corporate development, and Nuvoton places great importance on talent recruitment. With a comprehensive management system, competitive salary and benefits, as well as an excellent working environment, we attract new talent to join Nuvoton. Through diversified education and training, employees can continue to improve with the company with corporate sustainable development. In 2017, employees at Nuvoton received a total of 19,488 hours of training, with a total number of 12,946 attendees. In order to create a "work happily, live seriously" LOHAS workplace culture, we promote friendly workplace events, such as celebrity lectures, music appreciations, sports days, and company trips to enhance the physical and mental health and workplace happiness of our employees.

Philanthropy

In 2017, we have continued various public welfare projects, calling up our employees to participate in beach cleaning events for environment protection, as well as continuing to help the disadvantaged groups in society by organizing year-end donation events such as second-hand charity sales and used goods donations. The funds raised are mainly used to help the Genesis Social Welfare Foundation, Shih Guang Educational and Nursing Institution, Taiwan Fund for Children and Families, and the Children’s Hearing Foundation, as well as Nuvoton employees of need.

Looking to incoming future of emerging technology, such as artificial intelligence, big data, IoT, and cloud computing, Nuvoton continues to improve its research and development energy while developing various product applications and services. We are deeply rooted in our customer base and are committed to becoming an indispensable partner to our customers. We believe that we will be able to open up more business opportunities in the future and create long-term stable returns for shareholders, customers, and employees. We will also strive to implement our commitment to sustainable development, combining our core capabilities and sustainable development strategies to continuously improve our operational performance in the aspects of the environment, society, and governance to achieve the expectations that stakeholders have for Nuvoton, and advance toward our goal of sustainable development.

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