Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate change
• Natural resources preservation
• Pollution & waste
• Health & safety
• Community engagement
• Employee relations
• Board independence
• Transparency & disclosure
• Shareholder rights

Environmental Achievements

• Reduced GHG emissions (specific figures vary by company and sector, e.g., AIS reduced GHG emission intensity by 25% YoY in 2020)
• Increased renewable energy usage (specific figures vary by company and sector, e.g., AIS increased RE sources to 3% of total energy consumption in 2021)
• Reduced waste (specific figures vary by company and sector, e.g., AIS reduced waste generated by 32% in 2020)
• Implemented various projects to manage fuel consumption and lower usage (Air Transport)
• Expanded solar energy projects (Cement)
• Achieved zero hazardous waste-to-landfill ratio (Oil & Gas)

Social Achievements

• Launched online marketplace initiatives to support worker incomes (Air Transport)
• Organized numerous projects for surrounding communities (Air Transport)
• Implemented various sustainability-linked loans and issued bonds to fund projects related to the SDGs (Banks)
• Provided principal and/or interest payment holiday for affected customers (Banks)
• Launched campaigns to promote environmental sustainability (Consumer Financing)
• Developed health and wellness products and services (Commerce)
• Implemented projects to improve the local economy (Commerce)
• Implemented healthier choice policy to improve products (Food & Beverage)
• Set up corporate social responsibility and sustainable development committees (Food & Beverage)
• Continued investing in community development projects (Oil & Gas)
• Implemented smart home solutions (Property)
• Participated in community development (Property)
• Expanded mobile coverage and high-speed broadband in rural areas (Telecommunications)
• Launched various initiatives during COVID-19 pandemic (Telecommunications)
• Offered local recruitment opportunities, scholarships, and internship programs (Tourism)
• Launched private hotel schools (Tourism)

Governance Achievements

• Issued sustainability bonds (Road & Rail Transit)
• Established group sustainability councils (Banks)
• Implemented the Code of Conduct in nine areas (Banks)
• Complied with Thai and international labour standards (Commerce)
• Implemented anti-corruption policies (Commerce)
• Developed anti-corruption measures (Consumer Financing)
• Integrated corporate governance into management framework (Food & Beverage)
• Established whistleblowing procedures (Food & Beverage)
• Complied with international standards of good corporate governance (Property)
• Established code of conduct in line with corporate governance guidelines (Road & Rail Transit)
• Uphold relatively high standards of corporate governance (Telecommunications)

Climate Goals & Targets

Environmental Challenges

• Lack of historical and comparable ESG data
• No designated global regulator for ESG standards
• Subjectivity in ESG quantification process
• Variety of ESG data vendors with different indicators and scores
• Climate change impacts on various sectors (e.g., agriculture, tourism)
• Supply chain management challenges
• Data privacy concerns with increasing digitalization
• Excessive household debt and lack of financial literacy
• Waste management, especially e-waste
• Digital divide in telecommunications
• COVID-19 pandemic impact on various sectors

Mitigation Strategies

• Developing ESG data and methodologies (RHB's ESG scoring system)
• Using ESG analysis to assess risk and estimate impact on earnings
• Integrating ESG analysis into valuation
• Encouraging companies to publish disclosures in line with sustainability accounting standards
• Encouraging companies to disclose climate-related risks in line with TCFD recommendations
• Implementing sustainable water management practices (Food & Beverage)
• Setting sustainable packaging goals (Food & Beverage)
• Implementing various measures to improve consumption efficiency and circularity (Oil & Gas)
• Adopting sustainable sourcing principles (Banks)
• Improving cyber resilience (Banks)
• Promoting financial literacy (Consumer Financing)
• Developing online platforms to reduce paper consumption (Consumer Financing)
• Improving office buildings to save energy (Consumer Financing)
• Implementing various initiatives to reduce GHG emissions (Telecommunications)
• Expanding mobile coverage and high-speed broadband in rural areas (Telecommunications)
• Implementing various initiatives to reduce single-use plastic (Tourism)
• Implementing various measures to manage and minimize discharges (Tourism)
• Implementing various measures to reduce GHG emissions (Utilities)
• Expanding renewable energy portion of power used (Utilities)

Supply Chain Management

Responsible Procurement

• Sustainable sourcing principles (Banks)
• Sustainable raw material sourcing (Tourism)
• Purchasing raw materials that can be traced back to the source (Food & Beverage)
• Working with suppliers to enhance safety standards (Cement)

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Drought
• Flooding

Transition Risks

• Regulatory changes
• Market shifts towards renewable energy

Opportunities

• Development of renewable energy projects
• Development of energy-efficient products and services

Reporting Standards

Frameworks Used: UNGC, TCFD, GSMA’s “Zero by 2050” commitment, UN SDGs, Paris Agreement, ASEAN Green Bond Standards, ASEAN Social Bond Standards, ASEAN Sustainability Bond Standards, Green Bond Principles, Social Bond Principles, Sustainability Bond Guidelines, Green Loan Principles, ISO 14001, ISO 9001:2015, ISO 14001:2015, ISO 50001, ISO 14011

Certifications: ISO 14001, ISO 9001:2015, ISO 14001:2015, ISO 50001, ISO 14011, Safety and Health Administration (SHA)

UN Sustainable Development Goals

• SDG 3
• SDG 7
• SDG 9
• SDG 12
• SDG 13

Various initiatives contribute to these goals, depending on the company and sector.

Sustainable Products & Innovation

• Bio-degradable and recycled plastics (Oil & Gas)
• Eco-products (Commerce)
• Smart home solutions (Property)
• Energy-saving equipment (Commerce)

Awards & Recognition

• The Best Green Bond Award (Road & Rail Transit)
• Four Asia Excellence Awards from Corporate Governance Asia (Food & Beverage)

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Heineken Malaysia: Implementing initiatives to reduce GHG emissions and reliance on natural resources.
• Kelington Group: Reducing electricity, water, and CO2 consumption; managing material usage to reduce waste.
• Samaiden Group: Ensuring works comply with environmental laws and regulations; monitoring subcontractors and suppliers to avoid environmental incidents.
• Central Pattana: Designing project landscapes to harmonize with ecosystems; applying Green Building guidelines.

Social Achievements

• Heineken Malaysia: Enhancing health and safety awareness among stakeholders; ensuring a safe working environment.
• Kelington Group: Maintaining zero fatalities related to work-related injuries; active community engagement and efforts to uplift employee relations.
• Samaiden Group: Adopting human resource policies to build a conducive work environment; funding staff training.
• Central Pattana: Applying the “center of life” strategy to develop retail malls into lifestyle destinations; encouraging tenants and partners to grow with the community.
• Supalai: Committed to CSR; focusing on creating a better quality of life for residents.
• Delfi: Committed to employee well-being and occupational health and safety.
• Food Empire: Supporting employees and protecting their livelihoods; no retrenchment during COVID-19.
• HRnetGroup: Embracing gender diversity; promoting diversity and equal opportunities.
• AKR Corporindo: Supporting regional government by prioritizing employment from surrounding communities.
• Kencana Energi Lestari: Implementing various corporate social responsibility programs.
• Mitra Keluarga Karyasehat: Implementing corporate social responsibility programs; complying with regulations on employee health, safety, and welfare.
• Sumber Alfaria Trijaya: Interacting closely with consumers and communities; implementing corporate social responsibility initiatives.

Governance Achievements

• Heineken Malaysia: Ensuring accountability in managing sustainability matters through a sound sustainability governance structure.
• Kelington Group: Applying and adopting company codes and policies encompassing board policy, corporate code, and sustainability policies.
• Samaiden Group: Applying best practices of the Malaysian Code on Corporate Governance; adopting a board diversity policy.
• Central Pattana: Attained the highest score on the Dow Jones Sustainability World Index 2023.
• Supalai: Board of directors has a corporate governance policy handbook; annually reviews the code of conduct.
• Delfi: Maintaining a strong corporate governance framework.
• Food Empire: Implementing a group-wide grievance mechanism via its whistleblowing policy.
• HRnetGroup: No material data security or privacy issues; board of directors comprises independent directors.
• AKR Corporindo: Governance complies with international and domestic standards.
• Kencana Energi Lestari: Board of commissioners performs and functions independently.
• Mitra Keluarga Karyasehat: Complying with current regulations; ensuring equal distribution of public information to shareholders.
• Sumber Alfaria Trijaya: Consistent application of good corporate governance best practices.

Climate Goals & Targets

Environmental Challenges

• Heineken Malaysia: Weaker-than-expected consumer sentiment; sharp rise in input costs.
• Kelington Group: Weaker-than-expected earnings; project execution delays; lower-than-expected LCO2 demand and orderbook replenishment.
• Samaiden Group: Dependence on government policies and initiatives on RE; competition risks; unexpected increases in project costs.
• Central Pattana: Delays in opening new projects; popularity of online trading channels; slower-than-expected consumption and tourism recovery; uncertainties like natural disasters.
• Supalai: Country’s high household debt; commercial banks’ strict lending measures; high revenue exposure to upcountry projects.
• Delfi: Lower-than-expected consumer demand for snacks; decline in raw material prices; negative effect of changes in the USD/IDR rate.
• Food Empire: Disruption of operations due to the Russia-Ukraine conflict; swings in the value of the RUB and currencies of other Commonwealth of Independent States.
• HRnetGroup: Slower-than-expected recovery in key labor markets.
• AKR Corporindo: Execution risk due to delays in JIIPE developments; unfavorable changes in government regulations.
• Kencana Energi Lestari: Exposure to changes in macroeconomic conditions; risks related to changes in laws affecting the company’s business.
• Mitra Keluarga Karyasehat: Slower expansion plans; market competition; risks related to diversification to ex-Java areas.
• Sumber Alfaria Trijaya: Execution risks due to slower-than-expected expansion plans; weaker-than-expected purchasing power; unfavorable changes in government regulations.

Mitigation Strategies

• Heineken Malaysia: Prudent operating cost control; production efficiency gains; premiumisation strategy.
• Kelington Group: Focus on higher-margin UHP projects and the industrial gas business.
• Samaiden Group: Focus on RE projects within the National Energy Transition Roadmap; securing new assets in CGPP and FiT biomass segments.
• Central Pattana: Record 2024F core profit; possible 3% increase in rental rate revision; more casual leasing; lower utility costs.
• Supalai: Transfer of five condominium projects; higher revenue proportion from high-margin luxury condominium project.
• Delfi: Entering into forward-pricing arrangements with distributors; locking in long-term purchase prices and volumes with suppliers.
• Food Empire: Controlling margins via promotion spend, raw material hedging, selling price adjustments, and product resizing.
• HRnetGroup: Expecting more permanent hiring to take place, improving revenue from permanent placement and boosting gross margins.
• AKR Corporindo: Strong cash flow generation; diversified business.
• Kencana Energi Lestari: Strong funding secured; fair interest rates on bank loans.
• Mitra Keluarga Karyasehat: Improved patient traffic; opening of a new center of excellence; adding beds to existing hospitals; improvement of the coordination of benefits (COB) scheme.
• Sumber Alfaria Trijaya: Greater scale leading to stronger bargaining power over suppliers; reviewing logistics costs and employee productivity levels; digitalisation strategies.

Supply Chain Management

Climate-Related Risks & Opportunities

Awards & Recognition

• Central Pattana: Highest score on Dow Jones Sustainability World Index 2023