The 5nm chips do better per watt, which is part of the wow factor of the M1. It performs at a high level and delivers industry leading battery life.
TSMC's 5nm must be good enough for Apple to back it.
TSMC is conservative, but, with the continued guaranteed high-dollar buys from Apple, they have tremendous freedom to invest in R&D in an almost fearless way that any company would envy.
This is also why people trying to give all credit to TSMC for the performance of A-series chips are also selling Apple short on that side of the ball there too. TSMC would not be in the position they are right now without Apple's partnership powering their capital investments.
So in short, Apple's backing isn't proof that TSMC 5nm is good, it's actually a large part of why TSMC 5nm is good, and even exists in the first place.
Given that this TSMC 7nm->5nm process improvement has lead to the smallest gen-on-gen performance improvement for Apple's iPhone chips - the performance gains from the A13 to the A14 are the smallest in years - I really don't buy that at face value. Surely a better process helps a substantial percentage, but I think a 7nm M1 chip would have impressed in most of the same ways.