Taiwan Semiconductor Manufacturing Co Ltd

TSMC oversees its sustainable development efforts through the Board of Directors/Nominating, Corporate Governance, and Sustainability Committee. It has established two key management platforms: the ESG Steering Committee and the ESG Committee. The Chairman of the Board leads the ESG Steering Committee, while the Chairperson of the ESG Committee acts as the Executive Secretary. Together with the management team, they conduct quarterly reviews of ESG issues relevant to the Company's operations. They then establish mid-to-long-term development strategies and goals for each sustainability issue in line with the vision and mission outlined in the TSMC ESG Policy. The ESG Committee carries out resolutions from the ESG Steering Committee, pools resources across departments, and instructs the ESG Department, the responsible organization, and representatives from various management sectors to jointly identify material issues relevant to TSMC's operations and stakeholders' concerns. The ESG Committee assembles task forces for each issue, linking competitive advantages and core functions to formulate strategies, targets, and action plans. Every quarter, the Chairperson of the ESG Committee reports to the Board of Directors' Nominating, Corporate Governance, and Sustainability Committee on the progress of ESG initiatives and future plans for their feedback and advice. In 2023, the ESG Committee oversaw the progress of 75 sustainability projects and continued to host the ESG AWARD to cultivate a companywide ESG culture. This ensures full integration of ESG strategies into TSMC's daily operations, aligning actions with global sustainability trends and embodying the ESG vision to 'Uplift Society.'

In compliance with the vision and mission of the TSMC ESG Policy, TSMC is fulfilling its responsibility as a corporate citizen and has established the ESG Steering Committee Note, the highest level ESG decision-making center. TSMC's Chairman chairs the ESG Steering Committee and the ESG Committee chair acts as the executive secretary. Senior executives from various functions work alongside the two committee chairs to evaluate the Company's core operational capacity, establish mid-to-long term ESG goals, and align UN SDGs with the Company's core advantages for a development blueprint. [...] The ESG Committee is an interdepartmental communication platform that serves to ensure ESG Steering Committee decisions are upheld. ESG Committee members are senior executives appointed to the Committee by Chairman Mark Liu and are tasked with the goal of aligning with international standards, gaining insight into international trends, and building a top-down operation model across the company. ESG Committee members will also spearhead annual SDG objectives and strategies across different committees, track performance, and balance stakeholder interests to ultimately ensure that ESG Strategies are fully integrated into the Company's daily operations.

During the materiality analysis process, TSMC ranks ESG issues by priority in consideration of stakeholder concerns and impact on operations as well as impact on sustainability on the economy, environment, and people (human rights). To confirm the objectivity of results, in addition to stakeholder perspectives and TSMC's ESG priorities in recent years, the ESG Committee also consults with internal/third-party advisors to determine material issues, which are then reported to the Board of Directors. [...] Confirmation Issues identified by the materiality analysis as material issues will be reported to the ESG Committee and Board of Directors to confirm the importance of the issues. Factors the ESG Committee considers, at this point, are whether the issue is a focus of ESG development at TSMC, does the issue align with long-term sustainability goals, and is the issue met with high expectations from stakeholders. The ESG Committee can choose to elevate an ESG issue to a material issue in compliance with the aforementioned factors to ensure that TSMC is disclosing and setting long-term management targets.

TSMC's guiding principles to address climate change [are the TSMC ESG Policy, Climate Change Statement,](https://esg.tsmc.com/download/file/esg_policy_e.pdf) [and Environmental Policy, all signed and released by](https://esg.tsmc.com/download/file/esg_environment_e.pdf) Chairman Dr. Mark Liu as we act to fulfill our commitment to environmental sustainability. At TSMC, the Board is responsible for overseeing climate change governance and the management framework; ESG Steering Committee for formulating mid-to-long term climate change management strategies; ESG Committee for integrating interdepartmental resources for climate action; Energy Saving and Carbon Reduction Committee for formulating quarterly adaptation and mitigation plans in response to climate change, reviewing progress, discussing future plans, and reporting to the Board via the ESG Committee; RM Executive Council is responsible for identifying TSMC's climate risks, management focuses, and countermeasures, as well as executing the plan upon the approval by the RM Steering Committee, who will then report annual progress to the Board. [...] The ESG Steering Committee is TSMC's top organization in climate change management. The ESG Steering Committee is chaired by the Chairman of TSMC, and the chair of the ESG Committee serves as the executive secretary. It reviews TSMC's climate change strategies and goals and reports quarterly to the Board of Directors. The Risk Management Steering Committee briefs the audit committee each year on the ever-changing risk environment facing TSMC, the focus of the Company's enterprise risk management, and risk assessment and mitigation efforts. The audit committee's chairperson reports on the risk environment and risk mitigation actions to Board of Directors. Under oversight from the ESG Steering Committee and the Risk Management Steering Committee, TSMC manages action plans for climate-related issues through the ESG Committee, Risk Management Executive Council, and Energy Saving and Carbon Reduction Committee.

In terms of implementation, the ESG Steering Committee is TSMC's top-level organization for climate change management, with myself serving as the Chairman. Each quarter, the ESG Steering Committee reviews TSMC's strategies and goals related to corporate social responsibility, and reports to the Board of Directors on carbon management actions, as well as climate action and results. Starting in 2020, TSMC examined operational impact through carbon inventory, carbon footprint calculation, and life cycle evaluation, reviewed scope one, two, and three risks as well as mitigation strategies, and carried out carbon asset management to reduce the effect of climate change on our operations. The Committee has set the 2030 objectives of quadrupling the computing energy efficiency of TSMC's advanced processes from 2015 levels by 2030, and restoring greenhouse gas emissions to 2020 levels. For energy conservation and carbon reduction issues, the Energy Saving and Carbon Emission Reduction Committee led by TSMC's management team sets specific carbon reduction schedules and plans. [...] TSMC's climate change governance and management framework is under the direct supervision of the Board of Directors; The ESG Steering Committee is responsible for establishing the Company's mid to long-term climate change management strategies; The ESG Committee integrates the resource and development of interdepartmental climate actions; The Energy Saving and Carbon Emission Reduction Committee formulates climate change adaptation and mitigation management plans, reviews implementation status and discusses future plans, and reports to the Board of Directors through the ESG Committee every quarter. At the same time, the risk management organization briefs the audit committee each year on the ever-changing risk environment facing TSMC, the focus of the Company's enterprise risk management, and risk assessment and mitigation efforts. The audit committee's chairperson reports to the Board of Directors on the effectiveness of implementation. Healthy corporate governance is the foundation of TSMC's ESG.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]TSMC has committed to Net Zero by Chairman. TSMC's climate change governance and management framework is under the direct supervision of the Board of Directors; The ESG Steering Committee is responsible for establishing the Company's
mid to long-term climate change management strategies; The ESG Committee integrates the resource and development of interdepartmental climate actions; The Energy Saving and Carbon Emission Reduction Committee formulates climate change adaptation and mitigation management plans, reviews implementation status and discusses future plans, and reports to the Board of Directors through the ESG Committee every quarter.

Does your organization have a public commitment or position statement to conduct your engagement activities in line with the goals of the Paris Agreement?[…]Yes