Multi-stakeholder Approach Matters to Supply Chain Responsibility: Lessons Drawn from the ASE’s Controversies

Abstract

Environmental protection is part of the Corporate Social Responsibility (CSR) commitment that all companies are eager to secure. However, a growing level of scrutiny over the CSR practices of the electronics supply chains has followed the global trend of extensive outsourcing. Studies have shown that there is still a huge gap on the interpretation of legal compliance and numerous inconsistencies regarding to the auditing process for this CSR commitment. In this study, we investigated the CSR disputes involving the world's largest integrated circuit (IC) assembly and test services provider in Taiwan, Advanced Semiconductor Engineering (ASE) Inc. We analyzed the responses from ASE, the concerned citizens and civic groups, the local government and its policy schemes, and the brand-name companies surrounding the ASE environmental violations and controversies. This paper demonstrated that the fabless brands were unable to monitor or document the actual CSR practices of their suppliers without engaging the concerned local stakeholders. By leaving out the local citizen groups from the auditing processes, the firms made little progress to fundamentally change their practices and would easily resume business as usual. Our research showcased the importance of using a multi-stakeholder approach to fill the void left by insufficient regulations and incompetent agencies as well as to improve supply chain management. Furthermore, the information disclosure and stakeholder participation provisions should be emphasized and reinforced as a part of the supply chains' obligations.