UEM EDGENTA BERHAD Integrated Annual Report 2025 138 OUR APPROACH UEM Edgenta adopts a holistic and structured approach to supply chain management, beginning with a thorough assessment and due diligence, supported by clear expectations and close collaboration with suppliers. This approach emphasises transparency, capability-building and the use of technology for monitoring, data analysis and risk mitigation, enabling continuous improvement and alignment with regulatory requirements and stakeholder expectations. In 2025, the Group established an ESG Supplier Engagement Plan aimed at strengthening supplier capabilities and supporting progression towards higher levels of ESG maturity. This plan is complemented by the introduction of a Human Rights Policy that extends to suppliers, reinforcing expectations on fair treatment and responsible labour practices. As part of this plan, UEM Edgenta conducted supplier engagement sessions and training covering human rights, ESG practices and greenhouse gas (GHG) emissions management, enabling knowledge sharing and supporting suppliers in strengthening their ESG practices. These engagements also facilitated the collection of ESG data from more than 100 suppliers. Supplier conduct is governed through the Code of Conduct for Business Partners, the UEM Edgenta Human Rights Policy and the Sustainability Policy, supported by monitoring tools such as the Carbon Emission Platform. In addition, integrity, compliance and HSSE requirements — including the Code of Conduct for Business Partners, Business Partner’s Letter of Declaration and HSSE Management Requirements — are incorporated into procurement terms and conditions to reinforce expectations on anti-bribery, anti-corruption, safety and accountability from the early stage of engagement with suppliers and contractors. SUPPLY CHAIN MANAGEMENT WHY IT MATTERS Supply chain management is fundamental to UEM Edgenta’s service reliability and sustainability outcomes, as suppliers influence service standards, cost structures, and environmental and social performance. Effective oversight of ESG risks within the Group’s supply chain strengthens operational stability and improves the Group’s ability to adapt to changing operating conditions. Conversely, insufficient management of supply chain risks may lead to cost escalation, delays and reduced quality, placing pressure on client relationships and overall performance. Misalignment with sustainability priorities may also weaken environmental and social outcomes, diminish the Group’s industry influence, and heighten exposure to regulatory, financial and legal risks. Strategic priorities focus on value-driven enhancements to elevate ESG vendor management practices towards leading industry standards. This includes strengthening governance, expanding engagement with suppliers and improving transparency in monitoring and reporting practices. Vendor Development and Capacity Building UEM Edgenta complements its supplier governance and screening processes with targeted capability-building initiatives designed to strengthen supplier performance while advancing sustainability outcomes across the value chain. Through the Vendor Development Programme (VDP) and Projek Perintis, selected suppliers receive structured support to enhance technical capability, business readiness and sustainability awareness. The programme enables suppliers to improve service reliability, invest in more efficient and sustainable solutions and progress towards recognised certifications, while strengthening long-term commercial viability. This approach supports more resilient and responsible supply chains, aligns supplier practices with the Group’s sustainability expectations and contributes to shared value creation across operations. Supplier Screening and Selection Supplier selection processes across the Group integrate operational capability with ESG considerations. Assessments cover technical competence alongside baseline environmental, social and regulatory compliance requirements. Suppliers are expected to comply with applicable local laws, demonstrate acceptable environmental and social practices and, where relevant, hold recognised certifications or standards. SUSTAINABLE ECONOMIC GROWTH
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