MISC Annual Report 2018

HIGHLIGHTS OF THE YEAR OUR BUSINESS OUR LEADERSHIP OUR PERFORMANCE OUR COMMITMENT TO SUSTAINABILITY OUR GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 50 TH ANNUAL GENERAL MEETING 145 MISC BERHAD ANNUAL REPORT 2018 144 MISC SUSTAINABILITY FRAMEWORK Development of MISC Sustainability Framework, which sets out the commitment /principles to sustainability, taking into account the most material issues for us SUSTAINABILITY STEERING COMMITTEE Representation of key individuals from across the Group, with the purpose of providing valuable inputs and direction to assist the Group in achieving its sustainability objectives BEST FIRST-TIME REPORTING AWARD Following MISC’s inaugural standalone Sustainability Report published in 2014, we were proud to have been named the Winner for Best First-Time Reporting at the ACCA Malaysian Sustainability Reporting Awards (MaSRA) 2014 FTSE4GOOD BURSA MALAYSIA ENVIRONMENT, SOCIAL & GOVERNANCE (ESG) INDEX Became a constituent of the FTSE4Good Bursa Malaysia ESG index upon its launch in December 2014. This was in recognition of our leading approach in addressing ESG issues amongst Malaysian public listed companies BURSA MALAYSIA CAP10 SUSTAINABILITY SYMPOSIUM MISC’s President/Group CEO addressed regulators, the investor community and other public listed companies at the Bursa Malaysia CAP10 Sustainability Symposium in October 2015, on the subject of ‘The value of sustainability practices and reporting to stakeholders’ REFRESHED VISION & MISSION STATEMENTS The incorporation of sustainability elements into our revised Mission Statements for the Group to demonstrate our commitment towards sustainable value creation for each stakeholder group MISC SUSTAINABILITY STRATEGY The five-year MISC Sustainability Strategy was officially endorsed and approved in December 2016. The strategy will essentially act as our roadmap to guide us further in conducting business as a responsible corporate citizen ROLL OUT OF MISC SUSTAINABILITY STRATEGY Formal roll out and implementation of the various programmes and initiatives of each pillar under the MISC Sustainability Strategy. The progress of these are tracked, measured and managed based on our internally developed frameworks and systems CARBON EMISSIONS REDUCTION TARGETS SET Established our carbon intensity targets to be achieved in 2020 from a 2016 baseline. The targets are a six percent reduction from the LNG fleet, a nine percent reduction from the petroleum fleet and a one percent reduction from the product fleet IMPROVED SCORE ON FTSE4GOOD BURSA MALAYSIA ESG INDEX MISC scored 3.5 on the FTSE4Good Bursa Malaysia ESG Index with the highest score since inception in 2014. We have been progressively enhancing our efforts in championing our sustainable development agenda and this achievement reflects the constant improvements we have made in adhering to good ESG practices FLEET RENEWAL WITH GREEN VESSELS MISC named its two state-of-the-art LNG dual-fuelled Aframax tankers, running on cleaner fuel, and took delivery of the final two of five Moss type Seri C Class LNG carriers with a strong green footprint, and four newbuild green petroleum tankers, comprising two Aframax and two Suezmax vessels 2014 2015 2016 2017 2018 2012 Sustainability is an integral component in MISC's operations, from the way we conduct our business, manage our employees, reduce impact on the environment, deliver sustainable returns to our investors and shareholders, and strive to exceed the expectations of our customers, to the way we create positive impact for the local communities. Focusing on Sustainability will better position us to manage our non-financial risks, exploit opportunities for increasing efficiency, explore new markets, as well as enhance our reputation and position in the industry. This section will provide a review of the identification and management of material areas, the governance structure in place to manage sustainability and progress updates of the MISC Sustainability Strategy. The scope of our report and basis of the scope can be found within the About this Report section on pages 6 to 7. Further details and information can be found in the sustainability section of our corporate website at www.misc.com.my/sustainability. SUSTAINABILITY MILESTONES At MISC, the concept of sustainability permeates all aspects of our current existence and future planning. Since 2012, we have been formalising this concept of sustainability so that it infuses our decisions on financial management an investment, human resources, knowledge-based intangibles, key relationships, our assets, and the environmental health of our oceans. Our key sustainability milestones and achievements include: SUSTAINABILITY OVERVIEW & MILESTONES