Yinson Annual Report 2019

SUPPLY CHAINMANAGEMENT At Yinson, supply chain management is an important aspect of how our operations, and those of our contracted goods and services providers, maintain good business conduct. Our suppliers are integral to our ability to deliver high- quality goods and services in a timely manner. To ensure safe and efficient operations, we work to build long term relationships with reliable suppliers. These relationships are built on a foundation of trust, with enhanced trust enabling better cost and time efficiency within our operations. This translates to corresponding benefits for our clients, to whomwe are able to deliver well- priced and reliable services. The strength of our relationships with vendors and suppliers comes from regular engagement throughout the tender, project execution and operational phase. These connections are further reinforced through our regular attendance at conferences that gather key players and service providers in the industry. We take these opportunities as a way to build stronger links with vendors within the industry. We contract both local and foreign suppliers, with suppliers defined as such relative to the locations in which our vessels are operating or undergoing construction. Wherever possible, we endeavour to prioritise local suppliers and service providers in order to support local economies and empower local communities. This not only creates value for Yinson by making our supply chains more cost- effective but also serves to protect the global environment by reducing transportation-related vehicular emissions. Our long term commitment is to continuously work to improve and strengthen the links between our supply chain and local suppliers and resources. In FYE 2019, we engaged a combined 435 local suppliers for our two key operating FPSOs and one FPSO currently under construction. Our supplier management approach for new and existing suppliers focuses on high quality, cost effectiveness, honesty and responsibility. Supply contracts are primarily awarded based on a potential supplier’s ability to provide products and services that meet the requested specifications. Depending on the nature of the purchase, including criticality in terms of safety, risk of pollution, or influence on operational uptime, the purchase is evaluated and categorised for further steps. Yinson is in the midst of registering all our suppliers through our Vendor Registration Platform (“VRP”). Through the VRP, Yinson is able to receive information on certificates and relevant policies to ensure adherence to the local content requirements of the country in which the current phase of the project is located. The VRP is also used for screening our suppliers based on social and environmental criteria, including fair labour practices, human rights aspects, health and safety practices and environmental policies. Vendors are further required to read and understand our ABAC Policy and sign a Certificate of Compliance to the ABAC Policy. Every year we perform several supplier audits where we assess the quality of goods and services, check relevant certificates and verify that contractual terms are being met. 47 Yinson Group Overview Strategy and Sustainability Governance Accountability Annual General Meeting