MSM Malaysia Holdings Berhad Annual Report 2020

Enterprise Risk Management (ERM) System The Enterprise Risk Management framework enables the subsidiaries, operating units and support functions to exercise a consistent approach for risk identification and institutes a common platform to deliberate and manage risks. The Group has in place a continuous and systematic control structure and process for identifying, evaluating and managing significant risks pertinent to the achievement of the Group’s overall corporate objectives. The control structure and process which has been established throughout the Group is updated and reviewed from time to time to suit the changes in the business environment. Below are the steps of compilation of risk information conducted within the Group: Review & Update Risk Owner (RO) Review, update the Risk Register (RR) quarterly in line with the company’s strategies and objectives. Review, verify, confirm and revise Risk Champion (RC) Review, verify, confirm and revise the Risk Register (RR) that has been updated by Risk Owners (RO). RC selects the Top 10 Risks for the companies every quarter (Select from established Risk Registers). Review & Approve GCEO/GCOO/ HOO/HOD Review and approve/reject the RR & the top 10 risk for each subsidiary. Review & Determine Sector Risk Champion (SRC) Review and determine the top 10 risk for the sector. Review & Approve Sector Head (SH) Review and approve the top 10 risk for the sector. Report to Board Board Reporting on quarterly basis. 1 2 3 4 5 6 Principally, in the ERM System, the Group’s key risk factors are categorised as follows: Main Category Secondary Risks Geopolitical Risks Socio-Politics Legal Infrastructure Catastrophic Risks Environmental Extremes Man-made Disasters Violent Acts Market Risks Macro-Economic Development Sales-Market Development Procurement-Market Development Main Category Secondary Risks Strategic Risks General Strategy Supply Chain Structure and Cooperation Large Scale Strategic Project Reputational Financial Risks Profitability Funding Liquidity Operational Risks Technology, Process and Organisation Organisation Capability and Human Resource Compliance MSM MALAYSIA HOLDINGS BERHAD Annual Repor t 2020 115 SUSTAINABILITY REPORT EFFECTIVE LEADERSHIP CORPORATE GOVERNANCE FINANCIAL STATEMENTS ADDITIONAL INFORMATION DETAILS OF THE ANNUAL GENERAL MEETING