75 ANNUAL REPORT 2024 MST GOLF GROUP BERHAD Climate Scenario Analysis As part of our climate transition plan, MST Golf conducted a climate scenario analysis to assess the potential impacts of climate change on our operations, supply chain, and the broader golf industry. Guided by the IPCC, we applied three internationally recognised climate scenarios across the Representative Concentration Pathways (RCPs) and Shared Socioeconomic Pathways (SSPs), including RCP2.6/ SSP1-1.9 (strong mitigation), RCP4.5/SSP2 (intermediate mitigation), and RCP8.5/SSP5 (low mitigation), to evaluate both climate physical risks (e.g., extreme weather) and transition risks (e.g., policy shifts and changing consumer expectations). These scenarios were assessed across three strategic time horizons: • Short-term (2025–2030): aligned with our current operational and retail expansion planning cycle. • Medium-term (2030–2040): aligned with technology and supply chain transformation outlook. • Long-term (2040–2050): aligned with our Net Zero ambition and long-term strategic investment plans. This approach enables MST Golf to test the resilience of our strategy under different climate futures and ensures climate considerations are embedded in our broader business planning and capital allocation. The following table provides more details on the selected climate scenarios. Climate Scenario Projected Warming by 2100 Key Global Trends Environmental Impacts RCP2.6 / SSP1-1.9 (Strong Mitigation) 1.5°C to 2°C Strong global cooperation, rapid technological advancement, and significant emission reductions. Reduced extreme weather events, slowed polar ice melt, and less severe biodiversity impacts. RCP4.5 / SSP2 (Intermediate Mitigation) 2.5°C to 3°C Moderate global cooperation, mixed socioeconomic development, and moderate adaptation efforts. Moderate increases in extreme weather, gradual polar ice melt, and stress on ecosystems RCP8.5 / SSP5 (High Emissions, Business as Usual) 4°C to 5°C or more Rapid economic growth, high fossil fuel use, and severe environmental degradation. Catastrophic impacts, extensive polar ice melt, and severe agricultural and health impacts. MST Golf identifies climate-related risks through a structured process embedded within the Group’s Enterprise Risk Management (ERM) framework. Initial risk identification was conducted through consultations with the Sustainability Working Committee (SWC), which screened a range of potential physical and transition risks relevant to MST Golf’s operations, supply chain, and strategic outlook. These risks were then assessed and prioritised through our climate scenario analysis, which evaluated each risk’s potential impact and likelihood across multiple IPCC-aligned climate scenarios. Risks deemed to have low likelihood or limited impact under all scenarios were excluded from further consideration. This approach ensured that only risks deemed material across scenarios were retained for strategic analysis and disclosure. The following table presents our detailed climate scenario analysis, summarising the manifestation, severity, and strategic responses for each risk across short, medium, and long-term horizons.
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