MISC BERHAD INTEGRATED ANNUAL REPORT 2025 08 09 10 01 02 03 04 05 06 07 12 13 SEC 11 GOVERNANCE 10 236 www.miscgroup.com 237 www.miscgroup.com #deliveringProgress MISC Group adopted the International Association of Oil & Gas Producers Life Saving Rules in 2023 to enhance safety awareness, prevent accidents, and ultimately save lives by promoting strict adherence to these rules throughout operations. MISC Group has also introduced the new HSSE Rules and Commitments to create a secure and healthy workplace, ensuring compliance with relevant laws and regulations. Reflective learnings are carried out for high-risk incidents to reinforce the learnings from the incidents. The HSSE Incident Management process has been translated into an e-learning platform where a mandatory module has been developed to be completed by all employees to ensure they understand the implications of any HSSE incidents. The HSSE Lessons Learnt process has been improved through conversion into an interactive learning series of videos. The HSSE culture of MISC Group reflects the values, attitudes, perceptions, competencies, and behaviours of our workforce, shaping the Group’s overall commitment to HSSE. MISC Group continues to strengthen a Generative HSSE Culture where everyone does the right thing at all times, even when no one is watching. Various initiatives have been implemented to reinforce positive HSSE behaviours, cultivate the right attitudes and skills, and promote forward accountability across the Group. GROUP INTERNAL AUDIT MISC’s GIA supports the BAC by providing an independent review of the adequacy of risk management, governance, as well as the efficiency and effectiveness of the internal control systems. The authority, responsibilities and scope of work are defined in the approved Internal Audit Charter, which is aligned with the principles outlined in the Global Internal Audit Standards issued by the Institute of Internal Auditors. In performing its audit engagements, GIA refers to the internal control framework and guidelines issued by the Committee of Sponsoring Organisations of the Treadway Commission (COSO). COSO is an internationally recognised organisation providing guidance on internal control, ERM and governance. To safeguard independence and objectivity, the Head of GIA reports functionally to the BAC and administratively to the President & Group CEO, with unrestricted access to records, systems and personnel as provided under the MISC Internal Audit Charter. GIA is adequately resourced with suitably qualified auditors, supported by established audit procedures and digital audit tools. Audit engagements are carried out in accordance with the annual risk-based audit plan approved by the BAC. Further information on the internal audit function is set out in the Statement of Internal Audit function on pages 206 to 207 in the BAC Report of this Integrated Annual Report. JOINT VENTURES AND ASSOCIATES With regard to the associate companies and jointly controlled entities, the Board does not regularly review their internal control systems as the Board has no direct control over their operations. Nevertheless, MISC’s interests in the associate companies and jointly controlled entities are served via representations on the boards as well as review of management accounts and enquiries thereof. AFFIRMATION BY THE BOARD The Board acknowledges its responsibility for maintaining a sound risk management and internal control framework and continuously reviews the adequacy and effectiveness of the Group’s systems. In discharging this responsibility, the Board considered multiple layers of assurances across both financial and non‑financial risk areas covering the Group’s principal operations, excluding joint ventures and associates. STATEMENT ON RISK MANAGEMENT & INTERNAL CONTROL In forming its view, the Board evaluated the credibility and sufficiency of the assurance provided by the President & Group CEO and the Chief Financial Officer and considered the assurance mechanisms outlined in the preceding sections, including but not limited to quarterly reporting and oversight by the BSRC and BAC, internal audit reviews, risk and compliance attestations, self‑assessments, and the independent review performed by the external auditors. The assurance scope encompassed operational, HSSE, cybersecurity, financial reporting, as well as legal and regulatory compliance controls, encompassing the full financial year ended 31 December 2025 up to the date of this Statement. Based on these inputs, the Board concludes that the internal control and risk management systems of the Company and its subsidiaries for the year under review and up to the date of approval of this Statement, are functioning adequately and effectively in all material respects. During the financial year under review, there was no significant control failure or weakness that would result in material losses, contingencies or uncertainties requiring separate disclosure in this Integrated Annual Report. REVIEW BY EXTERNAL AUDITOR The external auditor, Messrs. Ernst & Young PLT, has reviewed this Statement on Risk Management and Internal Control for inclusion in the Integrated Annual Report for the financial year ended 31 December 2025, in compliance with paragraph 15.23 of the Listing Requirements in accordance with guidelines issued by the Malaysian Institute of Accountants and reported to the Board that nothing has come to their attention to cause them to believe that the Statement intended to be included in the Integrated Annual Report is not prepared, in all material respects, in accordance with disclosures required by the Statement on Risk Management and Internal Control: Guidelines for Directors of Listed Companies, or that the statement is factually inaccurate. CONCLUSION For the financial year under review, based on enquiry, information and assurance provided, the Board is satisfied that the internal control and risk management systems were generally satisfactory. Measures would continuously be taken to ensure ongoing adequacy and effectiveness of the internal control and risk management systems, and to safeguard the Group’s assets and shareholders’ investment. This statement is made in accordance with the resolution of the Board of Directors dated 23 February 2026. STATEMENT ON RISK MANAGEMENT & INTERNAL CONTROL
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