Sustainability | Climate Risk and Opportunity Management

To understand the risks and opportunities that climate change brings to the enterprise, MediaTek follows the Task Force on Climate-related Financial Disclosures (TCFD) recommendations and references the International Financial Reporting Standards Sustainability Disclosure Standards IFRS S2 Climate-related Disclosures framework, addressing management measures and related actions across four dimensions: governance, strategy, risk management, and metrics and targets.

Business Continuity Management

MediaTek takes the initiative in identifying risks caused by climate change (incl. water and power shortages, typhoons, and flooding) and relies on a business continuity management mechanism for the devising of contingency strategies for potential risks and thereby effectively control operational impacts and damage triggered by extreme climate patterns.

We develop contingency strategies for a wide range of incidents that could potentially occur at our operating sites including natural disasters, typhoons, earthquakes, fire, power supply interruptions, and water shortages through our business continuity management mechanism to ensure rapid resumption of operations after disasters. For instance, we immediately launch emergency response procedures if operational impacts and damage caused by climate change involve production or supply issues affecting the supply chain.

A dedicated task force closely monitors potential risks affecting suppliers and adopts contingency measures (a key link of business continuity planning) as required to gain an effective grasp of supplier production and shipping conditions. Suppliers, on the other hand, are required to develop comprehensive emergency response plans. In case of natural disasters, MediaTek is notified immediately and concerted action is initiated to minimize potential damage and ensure prompt resumption of production.

For more details about Business Continuity Management, please refer to the section on "Climate risks, impacts, corresponding measures, indicators, and targets".

Climate Governance Framework

The Audit Committee serves as the Company’s highest governing body for risk management, identifying “climate change risks” in accordance with the “Risk Management Policy and Procedures.”

The Corporate Sustainability Committee conducts material identification and management based on TCFD climate-related financial disclosure recommendations and referencing the IFRS S2 climate-related disclosure framework. The Environmental Task Force reports quarterly to the Corporate Sustainability Committee members on climate risk assessments, energy efficiency plans at operational sites, and various environmental impact assessments and target settings within the supply chain. Annually, it reports to the Corporate Sustainability Committee and the Committee Chairperson (Vice Chairman & CEO) on the current year’s implementation plan and reviews past performance. Discussion and execution results are reported annually to the Board of Directors.

Climate Change Risk and Opportunity Assessment

To comprehensively assess the risks and opportunities that climate change may bring to the Company’s operations and strategy, we reference research reports from the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC). After considering our own operational characteristics and external market changes as transition factors, we adopted four scenarios for analysis: IEA’s Net Zero Emissions (NZE) scenario, Stated Policies Scenario (STEPS), IPCC Shared Socioeconomic Pathway very high emissions scenario (SSP5-8.5), and IPCC Representative Concentration Pathway high emissions scenario (RCP 8.5). We also compiled climate risks and opportunities relevant to the semiconductor industry and based on the TCFD and referencing the IFRS S2 framework, identified climate issues most relevant to MediaTek and its supply chain, including transition risks (policy and regulations, market), physical risks (immediate), and opportunities (resource efficiency, products and services). The climate-related risk and opportunity assessment scope includes subsidiaries within the group, consistent with financial reporting boundaries.

To further identify the impact of various climate issues on the Company across different time horizons, we define the time horizons as short-term, medium-term, and long-term. Through assessment by the Corporate Sustainability Committee’s cross-departmental task force and further consideration of the Company’s industry nature with external experts, we identified the following issues highly relevant to the Company in the short-term (1-2 years), medium-term (up to 2030), and long-term (up to 2050).

Time horizon

Time horizon	Description
Short-term 2024-2025	Based on assessments by the Company's ESG Committee cross-departmental task forces and further consideration of the Company's industry nature with external experts, the short-term period is set at 1-2 years.
Medium-term 2026-2030	Based on international reports from IPCC and IEA, the energy transition and reduction pathway analyses in relevant scenarios are based on 2030 as a dividing point, thus, 2026-2030 is defined as the medium term.
Long-term 2031-2050	Current major international climate-related scientific reports indicate that to achieve the goals of the Paris Agreement, net-zero emissions should be reached by 2050 to limit global warming to 1.5° C.

Climate scenario analysis

Application type

Scenario

Description of scenario analysis

Transition risk

IEA'S NZE

scenario

Assumes that global net-zero greenhouse gas emissions are achieved by 2050, to limit global warming to within 1.5° C. MediaTek uses the NZE scenario to analyze the impact of transition risks, such as carbon pricing mechanisms and regulatory changes on the Company.

Physical risk

IPCC high

emissions

scenario

SSP5-8.5

Assumes that a lack of effective global climate policies leads to continuous increases in greenhouse gas emissions. There is a high probability of global warming exceeding 2° C between 2041 and 2060, resulting in more frequent and severe extreme weather events. MediaTek refers to extreme climate factors in this scenario (eg, extreme high temperatures, heavy rainfall, sea-level rise) and uses climate change disaster risk maps published by TCCIP and the Aqueduct Floods tool to assess physical risks at domestic and international sites and for suppliers.

Note: MediaTek's greenhouse gas emissions trajectory includes a BAU (Business As Usual) baseline and a regulated policy emissions pathway. The BAU baseline is estimated based on the compound annual growth rate of electricity consumption, while the regulated policy pathway is estimated based on currently planned reduction measures.

Climate Risk Analysis Matrix

No.	Category	Type	Time horizon	Risk Issue
T1	Transition risk	Market Policy and regulations	Short-term Long-term	Low Carbon transition
T2		Policy and regulations	Long-term	End-use electronic products subject to regulations, requiring continuous improvement in IC product energy efficiency
T3		Technology	Long-term	Incresed R&D investment to strengthen low-power design of IC products and develop products/services in emerging application areas
T4		Market	Long-term	Meeting stakeholder demands, committing to or joining climate-related Initiatives
T5		Market	Medium-term	Increased raw material and energy costs in the supply chain
T6		Reputation	Long-term	Increased stakeholder attention to sustainability-related things
P1	Physical risk	Acute	Long-term	Flooding/inundation events caused by extreme weather events
P2		Chronic	Long-term	Changes in precipitation patterns causing water scarcity
P3		Chronic	Long-term	Extreme high temperatures causing increased electricity consumption
P4		Chronic	Long-term	Sea-level rise causing disruption at low-lying operational sites

Climate Opportunity Analysis Matrix

No.	Category	Type	Time horizon	Opportunity Issue
01	Opportunity	Resource efficiency	Medium-term	Encouraging supply chain to improve resource use efficiency
02		Resource efficiency	Medium-term	Energy management efficiency
03		Products and services	Medium-term	Products and services
04		Market	Long-term	Participate in public sector carbon reduction incentives or subsidy policies
05		Resilience	Medium-term	Diversify energy sources to reduce operational impact when a single energy supply is affected

Materiality Assessment

MediaTek references the ISO 31000 risk management framework. Senior managers from relevant departments corresponding to climate risk and opportunity issues, along with external experts, further consider the Company’s industry nature. They assess the time horizon, likelihood, and impact level of each issue based on their responsibilities and professional experience. This information is then compiled by the Corporate Sustainability Committee’s cross-departmental task force and ranked according to each department’s evaluation results. Scores are categorized into five risk and opportunity levels from low to high, establishing MediaTek’s climate risk and opportunity matrix.

Climate Risk and Opportunity Management-07

Signiﬁcant Climate Risk and Opportunity Management

Climate Risk Management System

MediaTek considers significant climate risks as major risks faced in operational activities, incorporating them into the organization’s existing risk management policy and procedures. Following the Company’s prescribed risk management policy and procedures, it integrates major risks encountered during operational activities. Each operational unit is responsible for actual execution of risk management plans, including risk identification, risk analysis, risk assessment, risk response and control, and self-monitoring. Furthermore, transition risk management implemented through sustainable supply chain management and ISO 14001 Environmental Management System: Supplier screening through ESG dimensions, confirming supplier management systems, conducting annual on-site/document audits, arranging training or improvement meetings, and hosting supplier conferences to recognize excellent suppliers; following the PDCA management cycle for systematic environmental protection.

Operational and Financial Impact Analysis

MediaTek further analyzed the more significant climate-related risks and opportunities identified: low-carbon transition (T1), physical risks (P1, P2, P3, P4), energy management efficiency (O2), and products and services (O3). The following details their impacts on business models/value chains, resource allocation, strategies, and financial impacts.

Climate-Related Risks and Opportunities	Primary Affected Value Chain	Impact on Business Model/Value Chain and Financial Impact	Strategy and Response Measures
T1 Low-carbon transition	Direct operations	Short-term Medium-term long-term Expansion of GHG emission pricing regulations and rate increases, leading to increased operating expenses Regulatory requirements for GHG emission information, requiring investment to improve GHG inventory Failure to accurately report complete emissions will not satisfy regulatory requirements and customer expectations, leading to compliance risks while inability to meet customer needs affecting business partnerships	Current and Expected Continue to improve GHG inventory procedures and quality Increase renewable energy usage ratio and continue promoting energy-saving measures Annually collect suppliers' renewable energy usage (ratios) and GHG emissions for MediaTek product lines Regularly review overall supply chain emissions annually, continue requiring suppliers to reduce carbon
P1 Flooding/ inundation events caused by extreme weather events	Supply chain Direct operations	long-term Increased frequency of flood events due to extreme weather may cause equipment damage at MediaTek’s operational sites, or impact supply chain production facilities leading to delayed supply or disruption	Current and Expected Supply chain: Ensure suppliers have established business continuity plans addressing climate physical risks, periodically conducting emergency response drills and reviews If climate disasters may involve MediaTek product production or supply issues, emergency response procedures will be immediately activated Direct operations: Property insurance coverage Establish response teams before extreme weather events impact, implement typhoon and flood prevention measures, activate standby mechanisms during events, and conduct recovery actions after events Establish employee remote work mechanisms
O2 Energy management efficiency	Direct operations	Medium-term Expected reduction in energy usage, reducing annual operating expenses To achieve net-zero scenario targets, continued investment in energy-saving measures will increase capital expenditure	Current and Expected Invest in energy-saving projects to reduce electricity consumption at each site; construct new buildings to green building standards
O3 Products and services	Supply chain Direct operations Customers	Short-term Medium-term long-term Products designed toward low power consumption can help end consumers reduce energy use during the usage phase	Current and Expected Chip system architecture adjustments, algorithm optimization, and accelerated adoption of advanced processes to achieve the goals of reducing product energy consumption and miniaturization, thereby reducing environmental impact

Metrics and Targets

The Company has established climate-related metrics and targets, regularly reported to the Corporate Sustainability Committee to track performance and achievement status, as detailed in the table below. To actively manage sustainability targets, they have been incorporated into the Company’s senior executive performance and compensation evaluation as one of the environmental considerations of sustainability development goals.

Climate Management Dimension	Corresponding Risks/Opportunities	Metric	Target	Performance and Achievement
Improve product sustainability	O3	Product energy consumption ratio	Continue to improve energy consumption of main products	Main products achieved 13% energy consumption ratio reduction in 2025 compared to 2024
Improve product sustainability	O3	Product volume	Continue to advance chip miniaturization design for main products	Main products achieved 4% volume reduction in 2025 compared to 2024
Energy conservation	T1, O2	Power-saving ratio	2026 power saving target of 35.9%	Parent company power saving ratio reached 16.7% in 2025, exceeding the 2024 target of 16.5%
Reduce GHG emissions	T1	GHG emission reduction ratio	By 2030, reduce Scope 1 and Scope 2 GHG emissions by 40% compared to 2020 baseline; reduce Scope 3 (purchased goods/services, fuel and energy-related activities, use of sold products) GHG emissions by 25% compared to 2020 baseline, and achieve net-zero GHG emissions by 2050	Group-wide GHG emissions decreased approximately 6.2% in 2025 compared to 2024, mainly due to implementation of energy-saving and carbon reduction measures and increased renewable energy use. Will continue to increase renewable energy usage ratio to achieve operational emission reduction targets. Additionally, jointly established annual GHG reduction targets of over 2% emission intensity reduction with key suppliers to progressively achieve Scope 3 emission reductions
Expand renewable energy use	T1, O2	Renewable energy electricity usage ratio	By 2030, global group offices (excluding data centers) achieve 100% renewable energy electricity	Completed construction of four rooftop solar power plants at Hsinchu Science Park in 2025 for self-consumption, with installed capacity of 709 kW and annual generation of 860,000 kWh. Additionally built 235 kW rooftop solar at Tongluo data center
Expand renewable energy use	T1, O2	Renewable energy electricity usage ratio	Continue to build renewable energy installations	The Company will continue planning renewable energy usage targets within two years to progressively achieve corporate GHG reduction goals
Strengthen climate physical risk resilience	P1	Operational disruption days	Zero days of operational disruption due to climate-related risks	No operational disruptions due to climate-related risks occurred in 2025
Strengthen climate physical risk resilience	P1	Supply chain disruption events	Zero supply chain disruption events caused by physical risks	No supply chain disruption events caused by physical risks occurred in 2025

Internal Carbon Pricing Mechanism

To proactively improve carbon reduction effectiveness, the Company introduced an internal carbon pricing mechanism starting in 2025. The initial phase adopts the shadow price method, referencing the carbon fees set by competent authorities at main operational sites to establish internal carbon price ranges, planned for use in major energy equipment procurement.

Climate Risk and Opportunity Management