88 WASCO BERHAD SECTION 4 SUSTAINABILITY JOURNEY SUSTAINABILITY RISK MANAGEMENT At Wasco, we acknowledge the growing impact of sustainability-related risks on our operations, supply chains, and stakeholders. Our Risk Management Strategy is crafted to proactively identify, assess, and mitigate these risks, safeguarding our business resilience and fostering long-term sustainability. The Group adopts a structured five-step risk management process aligned with ISO 31000:2018, as illustrated below: Identification Identify risks across our full risk universe. This includes: • Strategic risks • Operational risks • Financial risks • Sustainability risks – Environmental (e.g. climaterelated physical and transition risks) – Social (e.g. HSE, labour, and human rights) – Governance (e.g. ethics and regulatory compliance) Analysis We assess the likelihood and potential impact of each identified risk. This analysis is shaped by our double materiality assessment and incorporates both qualitative and quantitative evaluations. We use tools such as risk heat maps to visualise the significance of each risk to our business and stakeholders. Evaluation We prioritise risks against our defined risk appetite. The Risk Management Committee (“RMC”) evaluates these prioritised risks to determine the appropriate level of response. This ensures that management attention and resources are focused on the most critical risks that could impact our strategic objectives. Mitigation We develop and implement mitigation strategies for prioritised risks. For each principal risk, a clear action plan is developed, and a risk owner is assigned to oversee its execution. These mitigation strategies range from implementing operational controls to making strategic investments, as detailed in the subsequent sections of this report. Monitoring, Review and Reporting We continuously monitor risks and the effectiveness of our mitigation plans, tracking key risk indicators and the progress of our action plans. Regular reports are submitted to the RMC and the BSC to ensure robust oversight, facilitate timely adjustments, and drive continuous improvement in our risk management process. Sustainability-related risks and opportunities are identified, assessed, and managed within Wasco’s Risk Management Framework, in alignment with the approach applied to all other risk categories. The Board and Senior Management Team actively identify, review, and monitor these risks and opportunities as part of our strategic planning, investment decisions, and regular financial and operational performance reviews throughout the year. Stage 02 Stage 04 Stage 01 Stage 03 Stage 05 SUSTAINABILITY JOURNEY
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