108 YINSON HOLDINGS BERHAD SUSTAINABILITY REVIEW Furthermore, we ensure that suppliers and contractors comply with Yinson’s health and safety guidelines through our supplier contracts. The VRP undergoes rigorous internal and external audits and we continue to implement improvements to enhance supplier engagement and streamline the onboarding and approval process. Assessing environmental and social impacts Pre-qualified suppliers must also undergo the VRP’s ESG module, which screens for criteria aligned with global standards including GRI, International Organization for Standardization, Value Reporting Foundation, Sustainability Accounting Standards Board (”SASB“), SDGs and CDP. These criteria include third-party sanctions, negative media monitoring, Health, Safety, Environment and Quality (HSEQ) risk assessments, employee training, adequacy of health and safety, management systems, fair labour practices, safety culture and pollution prevention. In addition to mitigating risks associated with practices such as environmental degradation or human rights violations, these assessments allow us to identify gaps within our supply chain and take proactive steps to address them. ESG non-compliances identified through the VRP are referred to the Sustainability Team, which works with suppliers to address and resolve the issues. For ABAC non-compliance, the Compliance Team conducts reconciliation exercises with affected suppliers to support completion of the assessment process. Corporate Governance & Business Ethics, pg 104. During the year in review, 100% of our pre-qualified suppliers underwent ESG screening via the VRP’s ESG module. In 2024, Yinson conducted two site audits on Tier 1 suppliers to monitor the implementation of our ESG requirements, bringing the total number of site audits to five since their initiation in FY2024. These audits help to raise awareness of our ESG policy and compliance standards and ensure alignment with our long-term ESG goals. They help to mitigate risks related to environmental degradation, and human rights violations as well as to identify and address other supply chain vulnerabilities. Reinforcing our local supply chains Yinson prioritises the engagement of local suppliers in our areas of operation, in line with our purpose of empowering communities and driving economic growth. This approach enhances supply chain resilience and sustainability while delivering shared value for both Yinson as a business and the communities we serve. By strengthening local partnerships, we contribute to the improvement of socio-economic standards, fostering a more conducive business environment. In FY2025, 85% of quotations requested for our offshore operations were sourced from local suppliers. This led to 66.4% of procurement spending being directed to local suppliers. These figures exclude FPSO Atlanta operations, as it only came into operation on 31 December 2024. Supply chain engagement initiatives We organise engagement opportunities with our key suppliers through supplier relationship meetings, business review sessions, strategic events and supplier town halls. These initiatives serve as valuable platforms for networking, sharing insights and fostering collaborative partnerships. They also help us to gain a deeper understanding of mutual concerns and jointly develop effective solutions. These engagements also act as key touchpoints to discuss ESG compliance, processes, ABAC policy implementation and other relevant matters. We are committed to engaging 100% of our Tier 1 suppliers through supplier events, trainings or workshops by 2030. In FY2025, this engagement rate doubled to 80% from the previous reporting period. Moving forward, we remain dedicated to strengthening our supply chain, continuously exploring new opportunities to create additional value for both Yinson and our suppliers. Our commitment to sustainability remains central to our engagement with the supply chain. We will endeavour to refine and optimise supply chain management to boost our operational efficiency, build resilience and ensure business continuity. We will further engage with our suppliers to help improve environmental performance and operational practices, working towards building a thriving environment where their businesses can flourish.
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