58 YINSON HOLDINGS BERHAD | INTEGRATED ANNUAL REPORT 2024 The energy industry continues to be subjected to mounting pressure from all directions, including from intergovernmental organisations, governments, the financial community, and the ESG movement. This has resulted in increased regulatory requirements that aim to balance the multilayered and complex interests of all parties. The rising costs of compliance and new regulations, such as Global Minimum Tax, could pose challenges for companies which have inadequate cash buffers and regulatory experience. In this respect, the investment that Yinson has made over the years to build strong corporate functions and practices allows us to respond ahead of our peers. 2023 brought about a seismic change in the ESG and climate landscape, with the world upping the ante on everything from greenwashing to stricter climate target disclosures, alongside increased politicising of ESG investing. Investor scrutiny and expectations on ESG performance is higher than ever before, greatly affecting access to capital. We believe that these conditions favour players with a strong transition story and track record. Yinson has mapped out a clear transition plan and are committed to disclosing our progress against those plans. With this, we have built a track record that demonstrates our capabilities of meeting our ESG targets, opening up opportunities to access capital and execute our growth plans. WE MAINTAIN OUR POSITION AS A TOP-RATED ESG COMPANY, MARKING STEADY IMPROVEMENTS Y-O-Y S&P CSA (OIE Energy Equipment & Services) ESG Score: 58 (Without modeling. Modelling score contribution: +4) Y-o-Y improvement: 23.4% 2023 58 2022 47 2021 32 FTSE4GOOD (Oil Equipment & Services) ESG Rating: 3.8 Y-o-Y improvement: Maintained 2023 3.8 2022 3.8 2021 2.7 SUSTAINALYTICS (Oil & Gas Equipment) ESG Risk Rating: 14.5 (Low Risk) Y-o-Y improvement: 16.7% 2023 14.5 2022 17.4 2021 21.7 MSCI (Energy Equipment & Services) ESG Ratings: BB Y-o-Y improvement: Maintained 2023 BB 2022 BB 2021 B CLOSING REMARKS Risks and opportunities are always evolving, and Yinson continues to adapt our strategies in tandem. Throughout, we always keep our goal of providing energy security to countries and communities in sight. This has led us to take a careful, yet bold approach to our growth, where we balance innovation and disruption with sound governance and data-based decisions. We are confident that our strategic decisions allow us to manage our key risks moving forward, while providing a clearer direction on the opportunities we should consider. We thank you for partnering with us on our journey towards a sustainable, equitable, and energy-secure future for all.
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