Climate-Related Financial Disclosures (TCFD) 

The frequency of extreme climate events continues to increase worldwide, while the sea levels are rising at a pace that exceeds previous expectations. with numerous extreme weather phenomena breaking through geographical boundaries and frequently appearing in regions previously considered low risk. As a leading international semiconductor components distributor, the impacts of climate instability on operations and the supply chain are deeply recognized. In addition to publicly supporting and following to the Paris Agreement to implement low-carbon operations, the Group is dedicated toward minimizing the environmental impacts of value chain activities.
In accordance with the management framework recommended by the Task Force on Climate-related Financial Disclosures (TCFD), the risks, opportunities, and financial impacts brought about by climate change on the global distribution network, warehousing safety, and supply chain stability are systematically identified and evaluated. These evaluations encompass short-, medium-, and long-term scenarios, and mitigation and adaptation actions are promoted to mitigate risks and enhance resilience. Furthermore, to align with international sustainability disclosure standards, WPG Holdings officially commenced the identification and assessment of sustainability-related and climate-related risks and opportunities in 2025 in accordance with the IFRS Sustainability Disclosure Standards (IFRS S1 and IFRS S2) implementation plan approved by the Board of Directors.

Governance
Regarding climate issues, the Board of Directors is the highest supervisory unit to oversee the strategic direction of overall climate strategies and monitor the execution of climate-related risk management by relevant units. Five functional task forces are established under the Sustainability Committee, with the Chief Sustainability Officer (CSO) serving as the convener, responsible for managing and supervising the implementation status of relevant climate risks and opportunities. Progress on climate and sustainable development initiatives, including implementation results and future planning, is reported periodically each year to the Board of Directors by the convener of the Sustainability Committee. Concurrently, in compliance with the regulations of the Financial Supervisory Commission's (FSC) "Sustainable Development Roadmap for TWSE/TPEx Listed Companies," the timeline planning for greenhouse gas inventories and verifications is submitted to the Board of Directors, and execution progress is reported to the Board of Directors on a quarterly basis.

Strategy

Referencing the TCFD guidelines, we identify 5 climate change risks and 5 opportunities for WPG Holdings through workshop discussions and assessments of climate related issues. The impact period of climate risk is divided into short-term (1~3 years), mid-term (3~10 years), and long-term (more than 10 years).

• Climate-Related Risks

• Climate-Related Opportunities

• Climate Change Management Policy and Response Actions

In response to the key risks and opportunities caused by climate change, WPG Holdings has established the following management plans to address the issues of low-carbon operations and promotion of green value chain:

Climate Change Scenario Analysis

In response to international initiatives, limiting the increase in global average temperature to 1.5°C has been established as a shared long-term global goal. Despite the remaining gaps in the differences in climate policies across various countries, WPG Holdings conducts climate scenario analysis to effectively assess and respond to the risks associated with a range of potential future climate pathways. Through this analysis, the risk impacts under various scenario assumptions—covering two physical risks (flooding disasters and rise in global average temperature) and one transition risk (carbon emission cost passthrough of goods transportation)—are evaluated. Concurrently, appropriate response strategies are formed to mitigate the potential impacts of climate risks.

• Acute Physical Risk - Flooding Damage

Extreme rainfalls have become increasingly frequent in recent years, concurrently causing large-scale flooding disasters. As a leading semiconductor components distributor in the Asia-Pacific market, with operational sites and logistics warehouses established globally, the flood disaster risk maps published by the National Center for Disaster Reduction (NCDR) Climate Change Disaster Risk Adaptation Platform are referenced by WPG Holdings. Scenario simulations are prioritized for the Taiwan region to evaluate the impacts faced by various sites under different climate scenarios. The selected scenarios encompass short-term climate scenarios of SSP1-2.6 and SSP5-8.5, while impact assessments are concurrently conducted targeting baseline current risks.

 >Scenario Assumptions

A total of six sites in the Taiwan region (including two warehouses) are analyzed regarding their flooding risks under the SSP1-2.6 and SSP5-8.5 scenarios. In simulation mapping, the hazard (torrential rain probability) and vulnerability (disaster potential) of flooding disasters are classified into five levels. Regions with a risk value— calculated by multiplying hazard and vulnerability—greater than or equal to 20 are defined as high climate risk, those between 7 and 19 as medium climate risk, and those less than or equal to 6 as low climate risk.
>Analysis Results
1. Under the baseline current scenario, 1 logistics warehouse was classified as high climate risk; 2 office sites were classified as medium climate risk; and 2 office sites along with 1 logistics warehouse are classified as low climate risk.
2. Under the SSP1-2.6 scenario, 1 office and 1 logistics warehouse were classified as high climate risk; 2 office sites and 1 logistics warehouse were classified as medium climate risk; and 1 office site is classified as low climate risk.
3. Under the SSP5-8.5 scenario, 1 office and 1 logistics warehouse were classified as high climate risk; 2 office sites and 1 logistics warehouse were classified as medium climate risk; and 1 office site is classified as low climate risk.

>Response Strategies
1.Strengthening Physical Protection for Logistics and Warehousing

Critical Asset Safety Protection: Considering the high sensitivity of semiconductor components to temperature and humidity, warehousing storage guidelines are comprehensively optimized. Products of higher-value were relocated to middle and high tiers of shelving, and automated floodgates along with high-efficiency pumping equipment were deployed in high-risk areas to minimize the threat of ground water seepage to assets.

Intelligent Warehouse Monitoring: Real-time water level monitoring and overflow alarm systems were established, and disaster early-warning models were constructed to secure more sufficient time for protective response.
2.Supply Chain Logistics Scheduling and Backup Plans
Dynamic Inventory Management: Tailored to periods of high climate risk (such as typhoon seasons), inventory transfer recommendations are proactively provided to customers. Diversification of Delivery Routes: An "Emergency Delivery Alternative Routes" database is
established for high-risk areas to ensure that when surrounding transportation is disrupted by disasters, logistics modes can be switched swiftly to maintain the continuity of channel services.
3.Deepening Business Continuity Management
Extreme Scenario Drills: Extreme scenarios are incorporated into annual business continuity training, and cross-site drill mechanisms are executed periodically. Financial Risk Pass-Through Strategies: Physical assets at various sites are inventoried and updated periodically to ensure that the coverage and policy limits of corporate property insurance are sufficient to address potential physical losses. Concurrently, the applicability of business interruption insurance is continuously evaluated to safeguard the rights and interests of shareholders and customers.
4.Flexible Working to Ensure Employee Safety
Remote working infrastructure and cybersecurity protections are implemented to ensure that employees can adopt flexible working arrangements under extreme weather scenarios, mitigating commuting risks.

• Chronic Physical Risk — Rise in Global Average Temperature

The most direct impact of the rise in global average temperature is the growth in energy demand through air conditioning. As a semiconductor components distributor, with operational sites primarily consisting of offices and logistics warehouses, energy utilization during operations is concentrated in intelligent warehousing systems and air conditioning equipment, among which electricity consumption by air conditioning equipment serves as the primary source of energy consumption. Therefore, the temperature changes across various locations under different global average warming environments, as well as the warming trends under different scenarios (RCP 2.6, RCP 4.5, RCP 6.0, and RCP 8.5), are referenced through the Network for Greening the Financial System (NGFS). Based on the electricity utilization status and average electricity costs of each site, the occurrence timing and financial impact amounts of the rise in global average temperature are projected.
>Scenario Assumptions
The growth in energy consumption at operational sites located across Taiwan, Hong Kong, China, South Korea, the United States, the United Kingdom, Singapore, Malaysia, Thailand, the Philippines, Vietnam, and India are projected through scenario analysis. Projections are conducted under the assumption that "Air Conditioning Electricity Consumption" accounts for 40% of total electricity utilization. Furthermore, it is assumed that future electricity rates under all scenarios will not vary with policy or energy transition progress, and the effects of equipment efficiency improvements are excluded, thereby evaluating the impact of the global temperature rise on energy expenses.

>Financial Impact Analysis and Evaluation
1. Under the RCP 2.6 scenario, due to controlled warming, the growth in air conditioning electricity consumption peaks by 2055. The increase in electricity expenses is projected to be approximately NTD 934,000 (accounting for
approximately 0.0000934% of total revenue).
2. Under the RCP 8.5 scenario, rising ambient temperatures are expected to drive a continuous increase in airconditioning demand across the Company's operations. As a result, electricity costs are projected to increase by approximately NT$1.391 million by 2050, representing approximately 0.000139% of total revenue. Overall, the projected increase in air-conditioning expenses resulting from global warming is expected to have a relatively limited financial impact on WPG Holdings. The Company will continue to review and update its financial impact assessments on a rolling basis, taking into account evolving international trends and national energy policies.
> Response Strategies
1.Strengthening Warehousing Facilities and Energy Saving Resilience
• High-Efficiency Equipment Replacement Plan: Energy efficiency evaluations are initiated; aging and highenergy- consuming equipment are improved or replaced, with maintenance and updates executed periodically.
• Green Site Benefit Evaluation: The feasibility of incorporating green building elements into operational sites is proactively evaluated. Cost-benefit analyses of cooling facilities, such as rooftop high-reflectivity thermal insulation paint and intelligent ventilation systems, are included to serve as a reference for environmental optimization negotiations with property owners.
2. Intelligent Energy Scheduling and Logistics Management
• Intelligent Energy Management System: The installation of automated sensors at operational sites is evaluated, combining outdoor temperature forecasts with real-time peak and off-peak electricity rates data to dynamically regulate the air conditioning operational periods of offices and intelligent warehouses.
3.Digitalization of Asset Operations and Maintenance
• Equipment energy efficiency reviews and preventive maintenance are conducted periodically to ensure the storage reliability of semiconductor components under constant temperature environments, thereby preventing high-value inventory damage caused by unstable power supplies or equipment failures.

• Transition Risk — Pass-Through of Commodity Transportation Carbon Emission Costs

To achieve global carbon reduction targets, the levying of carbon fees commenced domestically in 2025. Concurrently, international policies such as the European Union's Carbon Border Adjustment Mechanism (CBAM) indicate that the pricing of carbon emissions has become a global economic trend, compelling enterprises to balance environmental costs while expanding their business landscapes. Although not classified as a major greenhouse gas emitter as defined by competent authorities, substantial greenhouse gas emissions may still be generated during upstream and downstream logistics transportation processes. If carbon fees are levied on transportation emissions in the future, cost pass-through risks arising from the carbon cost burdens of logistics partners may be anticipated. Accordingly, variations in carbon fees under different transition scenarios are simulated by referencing the Network for Greening the Financial System (NGFS). Taking the threshold of 25,000 metric tons of CO2e set by competent authorities as the levying threshold, the potential pass-through expenses from logistics transportation are estimated based on the upstream and downstream transportation greenhouse gas emissions of each warehouse.
>Scenario Assumptions
Driven by greenhouse gas emission controls and in alignment with the 2050 net-zero emissions target, it is assumed that a carbon fee of USD 300 per metric ton is levied in 2050, and the carbon fees incurred by upstream and downstream logistics providers are passed through to transportation costs. Furthermore, due to limited technological advancement, the primary modes of transportation are assumed to remain dependent on fossil-fuel vehicles, with a transition to electric vehicles not yet achieved.

>Analysis Results
In 2025, the total upstream and downstream transportation greenhouse gas emissions reached approximately 16,700 metric tons of CO2e. Based on the NGFS model, variations in carbon fees under three scenarios—current policies, NDCs, and net-zero emissions by 2050—were analyzed. Following evaluation, under the hypothetical scenario where no transition of transportation vehicles is conducted by logistics providers and carbon fees are levied on greenhouse gas emissions generated by transportation activities as part of government emission controls, logistics transportation expenses are projected to grow substantially. Under the net-zero emissions by 2050 scenario, the pass-through costs generated by carbon emissions are estimated to exceed NTD 156 million in total.
>Response Strategies
Green Transformation of Transportation Modes
• Promotion of Multimodal Transportation Models: While ensuring customer delivery schedules, single high-carbon emission routes are replaced with multimodal transportation models to mitigate potential carbon tax costs at the source.
• Prioritization of Low-Carbon Transportation: Collaboration with logistics partners is established to formulate plans for transitioning to new energy vehicles, and the feasibility of utilizing Sustainable Aviation Fuels (SAF) is evaluated to reduce the carbon footprint during the transportation process.
Logistics Efficiency and Route Optimization
• Benefit Evaluation of Consolidation and Hub Centers: WPG Holdings continuously evaluates the feasibility of strengthening regional consolidation hubs to enhance logistics efficiency. By centralizing logistics operations and leveraging economies of scale, the Company aims to reduce overall transportation frequency, minimize energy consumption, and lower transportation-related carbon emissions.
• Intelligent Monitoring and Route Optimization: Delivery routes are optimized using intelligent distribution systems to shorten supply chain distances and improve load capacity, thereby directly reducing the carbon emission burdens generated by unnecessary energy consumption.
Carbon Cost Management and Pricing Strategies
• Continuous Evaluation and Expansion of Internal Carbon Pricing Mechanisms: Internal carbon cost evaluation models are established, and carbon pricing is integrated into long-term operational planning and cost accounting to ensure that financial stability is maintained under different climate scenarios.
Dynamic Review of National Carbon Pricing Regulations
• Progressive tracking of carbon fee collection progress and draft regulations across global operational sites is conducted to pre-simulate the impact levels of different carbon prices on logistics costs, ensuring that operational decisions remain forward-looking.
• In addition to promoting smart logistics services and enhancing logistics efficiency, multimodal transportation models are driven to shorten supply chain distances through intelligent distribution. Furthermore, WPG Holdings plans to establish consolidation hubs to reduce energy consumption through intelligent logistics planning and centralized transportation. Communication with partners (freight forwarders) is established to formulate plans for transitioning to new energy vehicles. Regarding aviation transportation, the utilization of Sustainable Aviation Fuels (SAF) for a specific proportion of services will be evaluated to reduce the corporate carbon footprint. 

Risk Management

The climate change risk management process has been integrated into the general risk management framework (for details, please refer to Section 2-2-2 of this report). Six major risks are defined through risk identification, including environmental risks (such as operational disruptions caused by natural disasters), and business continuity and emergency response procedures have been established. The climate risk management process is primarily divided into three stages: "Identification and Assessment," "Monitoring and Response," and "Reporting." Furthermore, annual greenhouse gas inventories have been conducted since 2021, and annual budgets are allocated accordingly. In 2025, the action costs invested in managing climate risks accounted for approximately 0.001% of the total revenue.

• Climate Change Risk Management Process

Net-Zero Vision and Roadmap
With the ultimate objective of achieving net-zero emissions by 2050, a comprehensive carbon emission inventory is conducted across the entire group. Referencing the science-based (SBTi) reduction pathways, a progressive transition toward net-zero is driven through a three-stage approach: "enhancing energy efficiency (energy saving), utilizing renewable energy, and executing removal via novel technologies or offsetting residual emissions through carbon credits."

To achieve the group's Scope 1 and Scope 2 net-zero targets by 2030, existing carbon reduction technologies are proactively integrated, and carbon reduction action plans as well as annual reduction targets are systematically formulated. Through clear carbon reduction pathways and resource allocations, a stable decline in carbon emissions is ensured. Concurrently, dynamic rolling management will be implemented to adjust strategies based on practical conditions, while carbon reduction performance will be monitored periodically to ensure the fulfillment of net-zero targets.

Biodiversity

WPG Holdings plans to adopt the internationally recognized AR3T framework (Avoid, Reduce, Restore & Regenerate, Transform) is planned for adoption as the core mechanism for managing future environmental impacts. Key initiatives include executing risk identification and monitoring, planning environmental impact mitigation programs, and collaborating across the value chain to fulfill ecological conservation commitments. Following the collection of stakeholder feedback, the formal policy text will be reviewed by the Sustainability Committee and subsequently submitted to the Board of Directors for approval prior to its public release.
Biodiversity Policy
In response to the Global Nature Positive movement and evolving international sustainability frameworks, biodiversity has been formally integrated into core corporate governance. Concurrently, in alignment with the core principles of the Taskforce on Nature-related Financial Disclosures (TNFD), the Science Based Targets Network (SBTN), and the Kunming- Montreal Global Biodiversity Framework (GBF), a Biodiversity Policy has been formulated to comprehensively manage the impacts of the value chain on the natural environment.
WPG Holdings plans to adopt the internationally recognized AR3T framework (Avoid, Reduce, Restore & Regenerate, Transform) is planned for adoption as the core mechanism for managing future environmental impacts. Key initiatives include executing risk identification and monitoring, planning environmental impact mitigation programs, and collaborating across the value chain to fulfill ecological conservation commitments. Following the collection of stakeholder feedback, the formal policy text will be reviewed by the Sustainability Committee and subsequently submitted to the Board of Directors for approval prior to its public release.

Biodiversity Impact Assessment

To further strengthen biodiversity management, WPG Holdings conducted a biodiversity impact assessment for 6 operational locations in Taiwan, including 2 warehouses. The assessment utilized biodiversity hotspot data from the Ecological Green Network provided by the Forestry and Nature Conservation Agency under the Ministry of Agriculture, to determine whether any sites are located within biodiversity hotspots. The results indicated that none of the Company’s operational sites are situated within biodiversity hotspots, suggesting that the current scope of operations has a relatively low direct impact on critical ecological environments. Nevertheless, WPG Holdings will continue to monitor the potential ecological impacts of its business activities and incorporate biodiversity considerations into site selection criteria for future construction or expansion projects, in order to minimize environmental disturbance.

Biodiversity Management and Future Planning

• Biodiversity Actions

• Through the WPG Ladies Open golf tournament, the Company actively promoted ESG and sustainability through its "One Bird, One Tree Initiative." From 2024 to 2025, a cumulative total of 2,500 trees were planted, contributing to the natural environment and providing essential habitats for various flora and fauna.
• Since 2021, the adoption of roadside trees in front of the WPG Nangang Headquarters Building has been maintained to assist in the maintenance and management of local green spaces.

• Biodiversity Material Topic Management

• Operational Sites and Operational Impact Assessment: Potential impacts of group operational activities on ecosystems are continuously tracked.

• Eco-Friendly Initiatives: The adoption of parks, green spaces, and vegetation is expanded to optimize habitat quality and protect local species.
• Biodiversity Education and Promotion: Employee awareness regarding biodiversity material topics is enhanced, transforming resource consumption reduction and biodiversity conservation into voluntary employee actions.

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