145 ANNUAL REPORT 2025 MST GOLF GROUP BERHAD Component / Process Adoption by the Group Risk Assessment Identified events (i.e., risks) are assessed to determine their potential impact and likelihood of occurrence. Risks are evaluated using a structured risk assessment methodology to ensure a consistent and systematic approach across the Group. This process enables the Group to prioritise key risks and provides a basis for determining appropriate risk management strategies and control measures. Risk Response For each identified risk, the Group determines appropriate response strategies in line with its risk appetite and tolerance levels. Risk responses may include risk avoidance, reduction, sharing or acceptance, depending on the nature and potential impact of the risk. Control Activities For each identified risk, the Group establishes and implements appropriate policies, procedures and internal controls to ensure that risk responses are effectively executed. These control activities are embedded within business processes and include approvals, authorisations, verifications, reconciliations and segregation of duties, where appropriate. Information and Communication Relevant risk management information is identified, captured and communicated in a timely manner to enable informed decision-making. Clear reporting lines and structured reporting processes are in place to ensure that risk-related matters are communicated to the Management and the Board, including the relevant Board Committees. Monitoring The Group monitors and reviews its established objectives, identified risks, control activities, and the associated likelihood and impact assessments on a regular basis to ensure their continued relevance and effectiveness. This ongoing review process allows the Group to respond to changes in the internal and external environment in a timely manner. Risk management updates and key findings are reported periodically to the GRSC and the Board. In addition, the internal audit function provides independent assurance on the adequacy and effectiveness of the Group’s risk management and internal control systems and reports its findings directly to the AC and the Board. Sustainability Risks The Group’s ERM Framework incorporates sustainability-related risks arising from the eighteen material sustainability matters under the Group’s “CARES” pillars. These risks are assessed using the same structured methodology applied to other enterprise risks, including evaluation of their likelihood and potential impact. Appropriate control measures are established and implemented where necessary, and the sustainability risk register is reviewed and monitored regularly as part of the Group’s overall ERM process.
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