Shin Kong Mitsukoshi sustainability

Shin Kong Mitsukoshi places great importance on customer service and values communication with stakeholders, engaging and communicating with stakeholders with our Sustainability Committee and three planning teams. In 2021, we followed the five principles of the AA1000 Stakeholder Engagement Standard: Dependence, Responsibility, Influence, Diverse Perspectives, and Tension to identify the eight major stakeholders of SKM.

In 2022, we incorporated international retail, department store, and e-commerce industry trends by conducting research and comparing ourselves with eight leading international companies and benchmarking against domestic industry peers. Based on this analysis, we have made the following adjustments to our stakeholder groups, which now include consumers, shareholders/investors, employees, government agencies, counter vendors, suppliers, media, communities, and NGOs.

2021 Stakeholders	2022 Stakeholders	Reason for Changes
Consumers	Consumers	N/A
Shareholders/Investors	Shareholders/Investors	N/A
Colleagues	Employees	Changed term from "Colleagues" to "Employees"
Government Agencies	Government Agencies	N/A
Counter Vendors	Counter Vendors	N/A
Suppliers	Suppliers	N/A
Media	Media	N/A
Public & Communities	Communities & NGOs	SKM has long worked with various NGOs to promote art education, therefore, "Public & Communities" was changed to "Communities & NGOs"

Responses to Stakeholders & Material Topics

The following table summarizes the key concerns and communications for our eight major stakeholders. We uphold integrity, transparency, and diversity in our communication with various stakeholders. Through regular tracking, timely response, and feedback, we strive to optimize our company's management policies and processes.

Stakeholder Engagement in 2022

Consumers

Consumer satisfaction is the driving force behind continuous growth and innovation. By meeting consumer expectations, we strive towards our vision of sustainable business operations.

Sustainability Issues of Concern to Stakeholders	Communication Channel & Frequency	Department	Outcomes of Stakeholder Engagement in 2022
Customer relationship management Sustainable consumption initiatives Information security and privacy protection Innovative digital services Product quality and responsibility	Social Media / As needed Consumer Surveys / As needed Advertisements & Campaigns / As needed Customer Service Systems / Immediate, as needed	Customer Service Department E-Commerce Department Digital Development Department Marketing Department Merchandising Department Department of Security and Surveillance Information Technology Department	SKM social media followers: LINE: 1.41 million; Facebook: 1.31 million; Instagram: 730,000 Customer feedback: 20,844 cases Organized events across all departments stores in Taiwan to engage in close communication with consumers Passed ISO 27001 verification with plans to obtain ISO 27701 certification in 2023

Shareholders/Investors

Creating favorable value returns for shareholders/investors and ensuring stable operating funds for SKM make shareholders/investors crucial partners on the path to sustainability.

Sustainability Issues of Concern to Stakeholders	Communication Channel & Frequency	Department	Outcomes of Stakeholder Engagement in 2022
Corporate governance and ethical management Operational performance Risk Management Social Good and Arts & Culture Promotion	Board of Directors & Functional Committees / Quarterly Shareholders' Meeting / Annual	Finance Department	Convened nine board meetings Convened one shareholders' meeting

Employees

Employees are invaluable assets in our commitment to outstanding services and sustainable competitiveness.

Sustainability Issues of Concern to Stakeholders	Communication Channel & Frequency	Department	Outcomes of Stakeholder Engagement in 2022
Operational performance Corporate governance and ethical management Talent Cultivation and Development Talent Attraction and Retention Fair and Healthy Workplace	Labor-management Meetings / 4 times/year Daily Announcements / As needed Meetings & Communication / As needed Education & Training / As needed Employee Feedback /Immediate, as needed	Human Resources Department Employee Welfare Committee Department of Security and Surveillance Occupational Safety and Health Department	Held four labor-management meetings and deliberated seven motions Held 11 security and surveillance meetings and deliberated eight motions Held 48 Occupational Safety and Health Committee meetings and deliberated 24 motions

Government Agencies

Government regulations and laws, coupled with efforts from SKM, contribute to achieving sustainable business guidelines.

Sustainability Issues of Concern to Stakeholders	Communication Channel & Frequency	Department	Outcomes of Stakeholder Engagement in 2022
Corporate governance and ethical management Product quality and responsibility Customer relationship management Fair and Healthy Workplace Sustainable supply chain Low-carbon Energy Management	Government/Association Correspondences / As needed Panels & Discussions / As needed/li> On-site Safety Inspections / As needed Telephone & Mail Feedback / Immediate, as needed	Finance Department	No material announcements

Counter Vendors

Working together with counter vendors to create excellent services and products for customers and establish sustainable trends in the department store industry.

Sustainability Issues of Concern to Stakeholders	Communication Channel & Frequency	Department	Outcomes of Stakeholder Engagement in 2022
Customer relationship management Product quality and responsibility Sustainable consumption initiatives Sustainable supply chain Innovative digital services	Morning Meeting Announcements / Daily Vendor Visits & Key Corporations / As needed Supplier Service Section / As needed Vendor Kickoff & Exchange Conference / Annual Telephone & Mail Feedback / Immediate, as needed	Merchandising Department	In 2022, the Lunar New Year celebration for business partners was canceled due to COVID-19.

Suppliers

Suppliers are integral to creating a safe and satisfactory shopping environment.

Sustainability Issues of Concern to Stakeholders	Communication Channel & Frequency	Department	Outcomes of Stakeholder Engagement in 2022
Customer relationship management Product quality and responsibility Sustainable consumption initiatives Sustainable supply chain	Supplier Coordination Meetings / As needed Suppler Promotion Events / As needed Telephone & Mail Feedback / Immediate, as needed Corporate / As needed Supplier Service Section / As needed	Marketing Department Owned & Distributed Brands Department	In 2022, company party was canceled due to COVID-19. Conducted 34 occupational safety and hygiene assessments on vendors in 2022

Communities & NGOs

Adhere to the principle of "giving back to society" and leverage our influence through caring for local communities and collaborating with NGOs.

Sustainability Issues of Concern to Stakeholders	Communication Channel & Frequency	Department	Outcomes of Stakeholder Engagement in 2022
Operational performance Customer relationship management Product quality and responsibility Sustainable consumption initiatives	On-site Events / As needed In-person Visits / As needed Telephone & Mail Feedback / Immediate, as needed	Administration Headquarters Marketing Department Foundation	Collaborated with 27 units 280,000 participants

Media

Media coverage and marketing impact company reputation and stakeholder perception.

Sustainability Issues of Concern to Stakeholders	Communication Channel & Frequency	Department	Outcomes of Stakeholder Engagement in 2022
Operational performance Customer relationship management Product quality and responsibility Sustainable consumption initiatives	Media Luncheons or Dinners / Biannually Press Conference / As needed Telephone & Mail Feedback / Immediate, as needed	Marketing Department	Organized two media luncheons or dinners Held 36 press conferences

Stakeholder Engagement