Chemical Company of Malaysia Berhad Annual Report 2019

Corporate governance priorities (2019 and beyond) As the Company strives forward, the Board will accordingly continue to implement improvement measures in the area of corporate governance. More specifically, the Board has identified the following forward-looking agenda items to propel the Group forward in its corporate governance objectives. Risk management The Board continually reviews the prevailing risk management framework with a view of reflecting the rationalised strategic direction of the Group. As the Group continues to streamline its business and accord greater focus on the chemicals and polymers segments as its principal business activities, the Group’s risk management framework has to be primed for these changes. In order to facilitate this process, the Group is seeking to deploy a more data-driven risk monitoring and reporting mechanism which can support and provide more granular insights for informed decision making. Advanced data analytics capabilities will enable clearer visibility into the challenges associated with managing the manifold risks in key areas such as operations, regulatory compliance and supply chain. Moreover, the Board and the Risk Management Committee will seek to proactively engage the Executive Risk Management Committee and the Group Risk, Integrity and Assurance Department in regular updates and discussions on risk-appetite dialogue so as to reinforce a two-dimensional risk management communication (i.e. top down and bottom-up risk management approach). Following the increased intensity of issues affecting the sustainability of the business, such as climate change, cybersecurity, global pandemic and the effectiveness of the Group’s business continuity plan is also a key focus area for review to maintain the financial viability of the Group. Strengthening the Anti-Corruption Initiatives The Company has always been in support of the Government’s initiatives in its fight against corruption. The signing of the Corporate Integrity Pledge in May 2014 marked the Company’s commitment to work towards creating a business environment that is free from corruption. The effort to combat corruption was also shared with suppliers when the Company introduced the Integrity Pact in 2015. In the subsequent years, trainings on integrity and anti-corruption were given to both internal and external stakeholders to build awareness. To prepare companies for the upcoming enforcement of the Corporate Liability Act in 2020, the National Centre for Governance, Integrity and Anti-Corruption (GIACC) has issued the Guidelines on Adequate Procedures (Guidelines) in December 2018. Action plans, based on the Guidelines, have been identified and formulated. One of the key initiatives to be conducted in line with the recommendations in the Guidelines is the ISO 37001 Anti-Bribery Management System (ABMS) certification. The GIACC has also recently launched the National Anti-Corruption Plan (NACP), which outlines the Government 5-year plan in addressing the issues on corruption. Whilst the initiatives in the NACP address mainly the public sectors, the elements on strengthening the Corporate Governance within the CCM Group will be looked into for implementation, where appropriate. | Corporate Governance Overview Statement | 88 CHEMICAL COMPANY OF MALAYSIA BERHAD