Climate Change Data

Environmental Metrics

ESG Focus Areas

• Economic Sustainability
• Environmental Sustainability
• Social Sustainability

Environmental Achievements

• Reduced CO₂ emission levels by 261 tonnes in 2020 through solar panel initiative
• Energy savings from energy efficiency initiatives
• Reduced LTIR by exceeding the set target by 16.41% in 2020

Social Achievements

• Awarded Kincentric COVID Resilience Award Malaysia 2020 for concerted effort to combat Covid-19
• Introduced several relief measures such as alternative repayment plans, free vehicle health checks, extended warranty coverage to assist customers during the pandemic
• Contributed food aid to 300 poor families in Klang Valley as part of Covid-19 relief efforts

Governance Achievements

• Established clear policies and standards to ensure all employees and directors exercise sound judgement
• Established various independent standing committees within the Board to avoid conflict of interest
• Implemented policies such as Code of Business Conduct & Ethics, Fraud Prevention Policy, Special Complaints Policy and Anti-Bribery & Anti-Corruption Policy

Climate Goals & Targets

Environmental Challenges

• Covid-19 pandemic wreaked havoc on the global economic scene, impacting sales and financial performance
• Uncertainties posed by the pandemic cast doubts on global economic recovery
• Sales tax exemption disruption
• Political instability in Myanmar
• Supply chain disruptions due to Covid-19

Mitigation Strategies

• Implemented various key costs containment measures and rationalisation of the businesses
• Launched the all-new Almera Turbo and new Nissan Navara to regain market share
• Implemented business continuity plans and business recovery plans to minimise risks
• Instituted more stringent working capital controls to achieve better operational cash flows
• Took various precautionary measures to ensure strict compliance with standard operating procedures for the safety and well-being of staff, customers, and business partners
• Accelerated digital technology adoption and focused on online platforms and virtual processes
• Implemented cost containment initiatives to maintain a sustainable financial position and drive business growth

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• Fully-electric model and hybrid model

Awards & Recognition

• Kincentric COVID Resilience Award Malaysia 2020

Environmental Metrics

ESG Focus Areas

• Economic Sustainability
• Environmental Sustainability
• Social Sustainability
• Governance Sustainability

Environmental Achievements

• Commissioning date of end December 2023 for the 20MW floating solar plant under the Large Scale Solar (“LSS”) Cycle 4. Once completed, the solar plant is expected to supply 883,000MWh of green electricity to Tenaga Nasional Berhad under a 25-year Power Purchase Agreement, contributing to a reduction of 725,000 tonnes of CO2 emissions to the environment, or equivalent to reducing 158,000 units of cars on the roads.
• Energy reduction activities by the Energy Management Committee (“EMC”)
• Establishment of Carbon Neutrality Road Map (target to achieve carbon neutrality by 2025)
• Rooftop solar panel system contributed to cost reduction of RM892,541 and estimated reduction of 815.36 tonnes of CO2 emissions in FY2022.
• Water usage intensity reduced from 8.87m3 in FY2021 to 6.15m3 per unit production due to increase in production volume in Malaysia.

Social Achievements

• Launched charitable initiative of donating essential items to “Viet Tri Orphans and Disabled Children Protection Center” in Vietnam.
• Organised a blood donation drive at our Vehicle Distribution Centre (“VDC”) located in Serendah.
• Established after-school day care centres to help improve the lives of underprivileged children.
• Initiated 5 scholarships and 19 sponsorships for the Technical and Vocational Education and Training (“TVET”) automotive certification to the B40 and M40 communities.
• Formally launched Succession Planning & Talent Management Process.

Governance Achievements

• Implemented a robust cybersecurity control process in protecting our systems, networks and programmes from cyberattacks.
• 100% of our workforce had completed and acknowledged the annual mandatory ABAC training.
• Established Corruption Risk Management Framework to guide the conduct of Corruption Risk Assessment (“CRA”).
• Established a compliance reporting channel for anyone to enquire, report or provide feedback on any improper conduct.
• Issued Suppliers’ Code of Conduct (“SCOC”) to ensure that the way businesses are conducted throughout the whole supply chain conforms to TCMH’s standards.

Climate Goals & Targets

Environmental Challenges

• Global supply chain disruptions due to geopolitical tensions across Europe and the prolonged conflict between Russia and Ukraine, as well as COVID-19 related disruptions in China.
• Shortage of supply from principals arising from prolonged global supply chain disruptions.
• Political uncertainty in Myanmar.
• Inflationary pressure, rising interest rate, weakening of the Ringgit against major currencies as well as supply chain disruptions.
• Higher logistic costs, inventory shortages, consumer loan limitation set by the Central Bank of Vietnam and higher interest rates.

Mitigation Strategies

• Undertaken various business recovery measures, right-sized our organisation, implemented stringent controls on new investments, and made improvements in efficiency and productivity across our core business processes.
• Introduced new models to excite the market and remain competitive.
• Took appropriate actions to penetrate the domestic and regional markets with other new product launches.
• Exercised prudence in managing our capital and operating expenditure and drive further cost rationalisation whilst capitalising on future growth opportunities.
• Managed resources prudently to cushion the impact of margin compression.
• Rationalisation of resources and the expansion of shared services between plants; Adoption of lean initiatives in manufacturing operations such as inventory control and cost reduction activities through waste identification and reduction to ensure optimal operating cost was achieved; Reduction on dependency of human workforce through investment in automation such as installation of spot and hemming robots at the Stamping Plant, which is in line with the Industrial 4.0 initiatives; Expansion of Integrated Factory Automation (“iFA”) with in-house developed Automated Guided Vehicle (“AGV”) for efficient parts supply and Low Cost Automation (“LCA”) such as Karakuri and Minomi racking systems to reduce non-value added motions of humans where both contributed to productivity improvement; Installation of Poka Yoke (Error-proof) Systems in Logistics (Guided Parts Picking With Light Signals), Logistics (Inventory Triggering), Body Shop (Spot Welding Integrated With Weld Counters) and Assembly Shop (Bolt and Nut Tightening Control) processes to avoid human error and guaranteeing the built in quality of processes performed; Continuous evaluation of automation opportunities in order to overcome labour shortage and to reduce labour dependency in order to improve productivity and cost efficiency; Implementation of Nissan Quality Assurance Requirements (“QAR”) / Quality Assurance Level (“QAL”) system to further enhance the quality level of vehicles assembled to meet customer demand; and Continue to explore other business opportunities for manufacturing and assembly services.

Supply Chain Management

Supplier Audits: 19 key suppliers reviewed in FY2022 to assess their conformity to the SCOC’s requirements.

Responsible Procurement

• Suppliers’ Code of Conduct (“SCOC”) covers prevention of child labour, forced labour, discrimination, fair compensation, freedom of association, reasonable working hours, ethical conduct, zero harm approach, environmental protection, and responsibility/accountability/transparency.

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products and services

Reporting Standards

Frameworks Used: Bursa Malaysia Securities Berhad’s Sustainability Reporting Guide, UN Global Compact, UN Sustainable Development Goals

UN Sustainable Development Goals

• Goal 4 (Quality Education)
• Goal 8 (Decent Work and Economic Growth)
• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)

Initiatives such as scholarships and sponsorships for TVET, focus on digitalization and automation, and the 20MW floating solar plant contribute to these goals.

Sustainable Products & Innovation

• Nissan Leaf
• Renault Zoe

Awards & Recognition

• Malaysia Technology Excellence Awards 2022 (General Insurance category - Digital)
• Frost & Sullivan Car Subscription Company of the year (two consecutive years)

Environmental Metrics

ESG Focus Areas

• Economic
• Environmental
• Social
• Governance

Environmental Achievements

• Launched a floating Large-Scale Solar Photovoltaic (LSSPV) plant, expected to reduce CO2 emissions by 610,221 tonnes annually.
• Retailing of new line-up of electric and energy-efficient passenger vehicles.
• Launched low carbon emission Euro 5 engines for UD Trucks.
• Total waste diverted from disposal: 95%

Social Achievements

• Continued long-term support for underprivileged families through childcare and education assistance.
• 71 students graduated from Tan Chong Technical Institute.
• Promoted employee involvement in social activities through volunteering.
• Collaboration with Komuniti Tukang Jahit (KTJ) in producing mooncake packaging, benefiting 10 women.

Governance Achievements

• 100% of employees completed Code of Business Conduct and Ethics training.
• 93% of 3rd Party/Vendors attended ABAC briefing and acknowledged the VIU.
• No incident reported (substantiated and investigated) on corruption in 2023.

Climate Goals & Targets

Environmental Challenges

• Under-performing financial results.
• Non-optimum assets utilisation and capital allocation.
• Unsustainable productivity.
• Lack of succession planning.
• Failure to satisfy customers.
• Ineffective customer outreach.
• Delay in automation and digitalisation.
• Lack of innovation in business.
• Violation to environmental regulations.
• Failure in emissions, waste and effluent management.
• Negative impacts from business operations on local communities.
• Discriminatory employment practices.
• Non-compliance to human rights requirements.
• Lack of talent development.
• Poor health and safety practices.
• Inadequate implementation of IT governance procedures.
• Weak corporate governance practices.
• Irresponsible practices throughout the supply chain.

Mitigation Strategies

• Continuously map out long-term strategic directions.
• Optimisation of assets utilisation and capital allocation.
• Fostering sustainable productivity.
• Succession planning.
• Digitalisation of after-sales service.
• Excellent customer outreach.
• Implementing automation and digitalisation.
• Implementing innovation and value-added services.
• Environmental compliance.
• Effective emissions, waste and effluent management.
• Effective community engagement programmes.
• A diverse and inclusive work culture.
• Upholding human rights commitments.
• Talent development.
• Cultivating employees' awareness towards safety and well-being.
• Robust and effective IT governance system and procedures.
• Uphold transparency, accountability and sound governance practices.
• Sustainable procurement.

Supply Chain Management

Supplier Audits: 100% completion of performance evaluation of at least 20 key suppliers

Responsible Procurement

• Supplier Code of Conducts (SCoC)
• Risk-Based Anti-Corruption Due Diligence Guidelines

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: Bursa Malaysia's Sustainability Reporting Guide (3rd Edition), Global Reporting Initiatives (GRI), UN Sustainable Development Goals (UNSDGs), Task Force on Climate-Related Financial Disclosures (TCFD)

UN Sustainable Development Goals

• Goal 4 (Quality Education)
• Goal 8 (Decent Work and Economic Growth)
• Goal 13 (Climate Action)

Various initiatives contribute to these goals through education programs, job creation, and renewable energy projects.

Sustainable Products & Innovation

• Electric vehicles (Nissan LEAF, Renault Zoe)
• Hybrid cars (Nissan Serena, Nissan X-Trail)