2024 UEM Edgenta Annual Report

WHY IS IT IMPORTANT? As an organisation engaged across diverse business segments, we remain deeply conscious of climate change, our commitment to embracing it, and its impact on our business. Climate change poses a substantial risk, as it has the potential to disrupt the balance of our business ecosystem and give rise to other farreaching impacts. Natural disasters such as floods and landslides may increase the cost of our operations and disrupt our supply chains. In response, the pursuit of Net Zero drives our efforts to lower emissions across our operations. The proposed introduction of a carbon tax by 2026 by the Malaysian government further reinforces the need to accelerate our decarbonisation journey. We have embedded climate considerations into our business strategies, with a clear focus on reducing our environmental footprint and mitigating climate-related risks. Our approach extends beyond our internal operations to supporting our clients in enhancing the sustainability of their business assets. To uphold this ambition, we have established comprehensive policies that reflect our commitment in embracing climate change and addressing its impact on our business, while ensuring that our business partners and procurement activities adhere to the same high standards. In support of this, we leverage our risk management framework to systematically identify and manage climate-related risks. These risks include flooding, shifting weather patterns, evolving climate regulations, carbon tax implications, and the impact of rising energy costs on business operations. Beyond risk mitigation, our risk assessment process also enables us to capitalise on emerging opportunities. These include delivering energy efficiency solutions to clients, providing preventive maintenance services for critical assets, accessing green financing options, supporting the development of green infrastructure, and driving organisation-wide awareness on the long-term implications of climate change. Failure to address climate change and energy-related risks may lead to UEM Edgenta facing increasing operational costs due to the rising frequency of natural disasters, such as floods and landslides. These could disrupt both our operations and supply chains. Additionally, the lack of proactive decarbonisation effort could result in non-compliance with evolving regulations, including the upcoming carbon tax regulation that will be imposed by the Government of Malaysia, leading to financial penalties and reputational damage. Our failure to act could also undermine our long-term competitiveness, as stakeholders and investors increasingly prioritise sustainability and climate resilience in their decision-making processes. WHAT IS OUR APPROACH? In 2023, we reaffirmed our commitment to mitigating climate change and reducing greenhouse gas (GHG) emissions, establishing our Net Zero Targets, which include achieving net zero GHG emissions by 2050. From 2023 to 2028, our decarbonisation strategy primarily focuses on energy efficiency solutions, green transportation, and green building initiatives. In the short term, we aim to reduce carbon by 18.45% (year-onyear by 3.69%) for Scope 1 and Scope 2 until we hit our medium term target of 26% cumulative reduction in Scope 1 and Scope 2 by 2030, and in the long term we aspire to reach net zero by 2050 by tapping more into renewable energy sources and finally using carbon credits to offset our remaining hard-to-abate emissions. Our climate goals are aligned with the International Energy Agency’s (IEA) Net Zero Emissions by 2050 Global Pathway. We also reinforced our commitment to integrating Task Force on Climate-related Financial Disclosures (TCFD) recommendations into our reporting structure. As climate related risks are becoming increasingly important to our investors and regulators, we have started integrating Task Force on Climate related Financial Disclosures (TCFD) recommendations into our reporting framework and have further started the process to assess how the upcoming IFRS’s implementation of S1 and S2 requirements can be mainstreamed in our financial reporting process. CLIMATE CHANGE AND ENERGY OUR DECARBONISATION STRATEGY At UEM Edgenta, we remain steadfast in our commitment to addressing climate change, recognising its profound impact on global ecosystems, economies, and societies. Guided by our Net Zero Strategy and the principles of the FTSE4Good Environmental, Climate, and Carbon (ECC) framework, we have adopted a proactive strategy to minimise our environmental footprint and contribute to global decarbonisation efforts. This commitment drives us to embed sustainability into every facet of our operations, ensuring that environmental stewardship becomes an integral part of our business resilience and growth. We are committed to meeting our Net Zero Targets by rigorously collecting and monitoring Scope 1 and Scope 2 emissions data across the UEM Edgenta Group, including our international offices. This ongoing initiative ensures we stay aligned with our climate goals, providing a foundation for meaningful change. With that in mind, we incorporate our decarbonisation strategy into both our annual carbon budgeting and financial planning processes, aligning it with our ESG Key Performance Indicators (KPIs). Our decarbonisation strategy focused on key areas such as Green Materials, Energy Efficiency, Green Transport, Green Building, Clean and Renewable Energy, and Carbon Removal and Offsetting. UEM EDGENTA BERHAD 146 Integrated Annual Report 2024 Minimising Environmental Impact

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