FRONTKEN CORPORATION BERHAD 200401012517 (651020-T) ANNUAL REPORT 2025 37 Management Role Climate Responsibilities Reporting Frequency CSO — Dr Tay Kiang Meng Leads overall climate strategy; formulates mid-tolong-term management plans; identifies climate risks; oversees interdepartmental coordination. Quarterly to Board; annual to external stakeholders via Sustainability Report Chief Financial Officer Assesses financial implications of climate-related risks and opportunities; ensures accurate climate disclosures; manages capex allocation to sustainability projects; oversees the approximately 2–3% of Group annual revenue directed toward sustainability-related initiatives; reviews IFRS S2 financial effects disclosures. Quarterly to Board; integrated into financial statements Head of Operations Implements operational changes to reduce emissions; manages energy efficiency programmes; oversees ISO 50001 compliance. Monthly to CSO; quarterly to Steering Committee Head of Risk Management Integrates climate risks into ERM Programme; maintains climate risk register; coordinates with operations on mitigation. Quarterly to Audit Committee Head of research and development (“R&D”) Drives innovation in refurbishment technology; develops low-carbon process methods; manages Scope 4 avoided emissions methodology. Quarterly to CSO Facility ESG Coordinators (Taiwan/ Malaysia/Singapore) Collect and validate GHG inventory data; manage local compliance; implement site-level sustainability targets. Monthly to Head of Operations; annual inventory to CSO 3. STRATEGY 3.1 Business Model and Value Chain Founded in 1996, Frontken is a world-leading provider of advanced precision cleaning and surface treatment services for semiconductor process chamber parts, and repair and maintenance services for the oil and gas industry. Frontken's business model is inherently aligned with the circular economy: by refurbishing, recycling, and extending the lifespan of high-precision components, Frontken enables customers to avoid the significant GHG emissions associated with manufacturing new components — classified as Scope 4 (Avoided) Emissions. Frontken's value chain spans raw material suppliers, in-house refurbishment operations (Taiwan, Malaysia, Singapore), and semiconductor/oil and gas customers globally. Climate-related risks and opportunities have been identified across all segments of this value chain. The Group's core refurbishment model means that sustainability and commercial advantage are structurally aligned: as customers accelerate decarbonisation of their own supply chains, demand for Frontken's services grows. 3.2 Climate-Related Risks and Opportunities Frontken holds internal cross-functional reviews every six months to identify and assess material climaterelated risks and opportunities. Risks and opportunities are assessed across short (1–3 years), medium (3–10 years), and long (>10 years) time horizons and ranked by likelihood and potential financial magnitude within the Group's Enterprise Risk Management framework. Risk / Opportunity Category Time Horizon Potential Financial Impact GHG emissions control and carbon taxes/fees Transition Risk Short–Medium Restriction on production capacity expansion; increase in operating costs; estimated 1% of annual revenue Net zero emissions compliance requirements Transition Risk Medium–Long Increased capex on carbon reduction facilities and renewable energy; estimated 1-3% of annual revenue by 2050 Uncertainties in new energy-saving technologies Transition Risk Medium Higher operating costs if technology transitions are delayed; estimated 1-3% of annual revenue SUSTAINABILITY REPORT (CONT’D)
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