MISC BERHAD INTEGRATED ANNUAL REPORT 2025 08 09 10 01 02 03 04 05 06 07 12 13 SEC 11 GOVERNANCE 10 216 www.miscgroup.com 217 www.miscgroup.com #deliveringProgress BOARD SUSTAINABILITY & RISK COMMITTEE REPORT Risk Management • Reviewed and endorsed Risk Appetite, including the Financial Risk Appetite Setting (FRAS) FY2025 Indicator for the Group. • Assessed the status of the Group’s Risk Appetite, against the approved risk appetite thresholds, covering five (5) key areas: strategic; financial; operational; legal and regulatory and reputation through the ERM quarterly reports. • Received quarterly updates on the FRAS indicators for the Group. • Assessed the Group’s risk status across the seven (7) risk categories: financial; operational; governance and compliance; health, safety and security; environment; human resource; and cybersecurity, through the ERM quarterly reports. • Evaluated key risk areas which has the potential to materialise in the near to medium term, strengthening forward-looking risk visibility. • Reviewed the MISC Risk Register and assessed the primary risk events to ensure all material and strategic risks, including sustainability risks faced by the Group are managed and addressed. • Assessed the SROs arising from the adoption exercise of IFRS S1 and S2 and the integration to the ERM process. • Assessed the Group’s HSSE performance through quarterly reports. • Received updates on MISC Cybersecurity maturity. • Reviewed the revision to MISC Investment Hurdle Rate. • Reviewed the proposals, strategies and project risk assessments related to proposed participation in new projects/tenders and/or other corporate exercises and provided appropriate recommendations to mitigate any identified risks. • Reviewed Post Implementation Economic Review (PIER) reports for major projects to assess the achievement of project economics when the asset is already in operation. This includes assessing actual economic returns against mandated economic returns during the project approval stage. • Received updates on the status of ongoing tenders, projects and/or transactions. • Reviewed updates on progress of MISC’s investments and provided the necessary steer on the way forward. SUMMARY OF THE BSRC’S WORK IN 2025 During the year under review, the BSRC discharged its functions and duties through the following activities: Sustainability • Reviewed and endorsed MISC Group’s Sustainability Strategy 2026-2030. • Reviewed and endorsed MISC Group’s Commitment to Net Zero GHG Emissions by 2050. • Reviewed and endorsed MISC’s Climate-related Financial Disclosures for FY2024. • Reviewed and endorsed MISC Group’s SROs, CROs and methodology of financial impact quantification. • Received yearly updates on MISC’s sustainability performance, including ESG ratings and Sustainability Dashboard. • Reviewed and endorsed the MISC Human Rights Policy. • Reviewed and endorsed MISC’s Material Sustainability Matters. • Reviewed and endorsed extension of Heart of the Ocean (HOTO) programme for 2026-2030. • Reviewed and endorsed MISC’s Modern Slavery Statement 2025. BOARD SUSTAINABILITY & RISK COMMITTEE REPORT Compliance and Ethics • Received quarterly updates on compliance and ethics initiatives which cover policy-related matters, communication and training, as well as monitoring and assurance including updates on compliance with MISC’s Regulatory & Legislation Register, employees’ conflict of interest disclosures, as well as other compliance dashboard. Governance • Reviewed the BSRC Report, Statement of Directors’ Responsibility, Statement on Risk Management and Internal Control and Corporate Governance Overview Statement for inclusion in the MISC Integrated Annual Report 2024. • Reviewed the Corporate Governance Report 2024. • Reviewed and endorsed the revision of the TOR of the BSRC. FOCUS AREAS FOR 2026 The BSRC recognises its role in providing effective checks and balances through strategic oversight and guidance for matters under its purview. In 2026, the BSRC will continue to enhance the Group’s ERM practices by maintaining timely reviews of MISC Group’s Risk Appetite, Corporate Risk Profile and Risk Registers to monitor key strategic and emerging risks. Alongside this, the BSRC will continue to strengthen the Group’s sustainability governance in response to an evolving regulatory environment, including the introduction of Malaysia’s National Sustainability Reporting Framework (NSRF). Key priorities include oversight of SROs, implementation of the Group’s five-year Sustainability Strategy aligned with the enterprise strategy, and further integration of SROs within the ERM Framework to reinforce risk foresight, resilience and long-term value creation. The BSRC will also oversee the Group’s community investment agenda through the extension of the Heart of the Ocean (HOTO) 2026–2030 programme, while continuing to monitor developments across key regulatory and disclosure areas, including HSSE, business ethics, cybersecurity, human rights and climate-related reporting, to ensure the Group remains well-positioned to meet stakeholder expectations and deliver on its long-term sustainability commitments. The BSRC shall also continue to play a pivotal role in reviewing proposals, strategies and project risk assessments during proposed participation in new projects/tenders and/or any new business ventures or opportunities, including any potential corporate exercises within the MISC Group. DATIN NORAZAH MOHAMED RAZALI Chairperson Board Sustainability & Risk Committee
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