Why is this important? Introduction of new and evolving regulations by BNM and Bursa Malaysia pose a challenge for compliance and adapting to regulatory changes. Potential impacts on the Group’s operations and external exposures due to climate change, including physical risks, regulatory changes, and reputational risks associated with sustainability. The need to align with customers’ increasing expectations for the Group’s involvement in climate change initiatives, which can affect customer satisfaction and loyalty. Risk of escalated operational costs due to rising energy prices and resource scarcity, which can impact the Group’s profitability and sustainability efforts. Risks Foster a culture of energy efficiency through targeted initiatives. Expand financing for green sectors and diversify our product and service offerings, empowering customers to make financial decisions that minimise their environmental impact. Initiate dialogue with customers facing significant environmental risks and actively assist them in transitioning towards more sustainable practices. Integrate ESG risk assessment into all stages of lending and investment decisions. Undertake scenario planning and stress testing exercises to better manage climate risks and identify green investment possibilities. Opportunities We recognise the financial imperative of managing carbon emissions. Climate change poses significant threats, including infrastructure damage and supply chain disruptions, which could undermine our long-term viability. Proactive environmental action mitigates these risks, ensuring a more resilient and sustainable future for our organisation. Business Context ENVIRONMENTAL EMISSIONS AND ENVIRONMENTAL IMPACT Why is this important? Increased preference for remote banking, potentially exposing vulnerable customers to financial fraud risks. Risks Place a strong emphasis on understanding customers’ feedback and preferences on banking needs. Facilitate customers’ interactions through multiple channels, ensuring convenience and efficiency. Deliver a seamless and personalised banking experience through innovation and technology. Our Approach Enhance the reliability and performance of GO by Bank Islam mobile banking app, ensuring a seamless and satisfying experience for our customers. Opportunities We prioritise customer-centricity as a strategic focus, showcasing our dedication to placing the customer at the heart of our decision-making processes. This not only fosters trust and loyalty but also drives growth in a dynamic financial landscape. Business Context CUSTOMER EXPERIENCE For more information on Customer Experience, please see pages 114-117. 50 Bank Islam Malaysia Berhad ◆ Integrated Annual Report 2023 Material Matters
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