MISC BERHAD 118 INTEGRATED ANNUAL REPORT 2023 119 www.miscgroup.com ANCHORING SUSTAINABILITY SECTION 10 Anchoring Sustainability SUSTAINABILITY GOVERNANCE Our sustainability journey relies on a robust governance framework, serving as a foundation for the execution of our Sustainability Strategy and Roadmap. This framework is not merely a corporate commitment but a catalyst for cultivating sustainable business practices and upholding high integrity in MISC. It underscores transparency, accountability and ethical conduct across all facets of our operations. By integrating ESG considerations into decision-making processes, our goal is not only to create enduring value for shareholders and stakeholders alike, but also to recognise the far-reaching impact of our decisions today on the future. The Board of Directors retains its central role as the highest governing body, providing strategic direction and oversight for the Group’s Sustainability Strategy. At MISC, sustainability embodies our responsibility towards environmental stewardship and dedication to meeting the needs of society. Guided by MISC’s Sustainability Strategy and our rolling business plan, which is aligned to 11 relevant SDGs, we are constantly refining our strategies with shifting customer requirements, regulatory standards and stakeholder expectations, to achieve our MISC 2050 Vision. Throughout the year, we continued to integrate sustainability-related KPIs across our businesses, continuously monitoring progress and fostering a culture of sustainability. Our ability to adapt has been instrumental in creating value and this will continue to be critical in meeting our Net-Zero target by 2050. Anchored on our rich history and experience in the maritime industry, we remain focused on realising our business and sustainability goals, recognising this dual commitment as integral components in strengthening our resilience. Anchoring Sustainability Roles and Responsibilities: Board of Directors • Sets the strategic vision for sustainability and aligns goals with the company’s mission • Oversees sustainability reporting and actively manages ESG risks • Advocates sustainability within the organisation and the broader business communities • Cultivates a culture that values responsible practices and encourages the pursuit of innovative, sustainable solutions Board Sustainability & Risk Committee (BSRC) • Regularly assesses sustainability performance by rigorously evaluating metrics, targets and key performance indicators for initiative impact • Drives accountability and fosters a culture of continuous improvement in sustainability practices by driving compliance with existing regulations and anticipate emerging sustainability regulations • Mitigates risks and capitalise on innovation opportunities • Approves budgets, investments and resources for implementing sustainable practices across the organisation Board Audit Committee (BAC) • Oversees the internal control framework • Reviews Group HSSE Audit and Assurance Bi-Annual Reports, focusing on the efficiency and effectiveness of maintaining the Group’s vessels and floating assets • Examines reports on key strategic and operational risk issues from quarterly Risk Management Committee meetings, including identifying enterprise-level risk appetite and reviewing mitigation plans Board Nomination & Remuneration Committee (BNRC) • Conducts performance appraisals on the Company and President/Group CEO, covering financial, strategic initiatives, operations, people development and Health, Safety, Security, Environment and Sustainability (HSSES) • Provides recommendations to the Board based on performance against the balanced scorecard for approval Health, Safety, Security, Environment and Sustainability Council (HSSES Council) • Oversees all HSSES-related aspects, encompassing group-wide policy, strategy, initiatives, systems, targets, performance and management review • Meets on a monthly basis and acts as the primary authority for HSSES matters Management Development Committee (MDC) • Deliberates on talent performance, career development programmes, succession planning, competency assessments and other people development-related issues Risk Management Committee (RMC) • Assesses significant risks and ensures the implementation of appropriate risk management plans • Examines adequacy and effectiveness of controls, along with the robustness of mitigation strategies • Deliberates on risk-related matters quarterly and presents findings to the Board Group Health, Safety, Security and Environment (GHSSE) • Drives, coordinates and monitors progress on MISC’s sustainability strategic priorities, leveraging cross-functional working groups at the business unit and subsidiary levels • Manages external sustainability disclosures and reporting • Conducts group-wide sustainability materiality assessments • Oversees sustainability-related stakeholder engagements • Supports and advices business units and subsidiaries on implementation of sustainability strategies, monitoring performance and disclosures Sustainability Custodians/Focal Champions • Ensures implementation of identified sustainability initiatives For more information, please refer to the Sustainability Governance section on pages 30 to 32 in MISC’s 2023 Sustainability Report. SUSTAINABILITY GOVERNANCE STRUCTURE AT MISC GROUP BOARD OF DIRECTORS Board Nomination & Remuneration Committee Board Audit Committee Board Committees Business Units/ Subsidiaries Board Sustainability & Risk Committee Human Resource Strategy and Planning Unit Compliance Focal Champions Governance and Assurance Sustainability Focal Champions HSSE Functions CROSS FUNCTIONAL WORK GROUPS Human Resource Corporate Planning Legal, Corporate Secretarial and Compliance Corporate Functions Group Health, Safety, Security and Environment Management Development Committee Management Committee Risk Management Committee Health, Safety, Security, Environment and Sustainability Council Management Committees Sustainability* PRESIDENT/GROUP CEO Procurement/ ICT/Finance Project Risk Assessment Sub-Committee * The Sustainability department will be moved under Corporate Planning effective 1 February 2024.
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