1,756 vendors For the year under review, we have achieved the following performance on local supplier procurement: a. Percentage of procurement budget spent on total vendors As an additional mark of our commitment to support our supply chain partners, we have also collaborated with HSBC Amanah to develop a Syariah-compliant Supplier Financing Programme (“SFP”) that helps fund the growth aspirations of SMEs by providing them with affordable financing without collateral. The launch of the SFP took place on the 30th of August 2022 at our Learning Centre and was graced by the Malaysian Minister of Entrepreneur Development and Cooperative. Since the first phase of its implementation, over 380 SMEs and MSME vendors have been offered to join the programme, with more vendors in the pipeline expected to be onboarded. 1,605 vendors 817 vendors 41.8% 65.0% 47.3% p.129 1 2 3 4 5 6 7 8 9 SUSTAINABILITY STATEMENT SUSTAINABLE ECONOMIC GROWTH p.128 UEM EDGENTA BERHAD INTEGRATED ANNUAL REPORT 2022 SUSTAINABLE ECONOMIC GROWTH In this similar vein, we have taken a forward-looking approach and planned various initiatives as per our “Focus Material Matter: Supply Chain Management ” section in our Sustainability Roadmap., Some of the initiatives include carrying out more comprehensive supplier evaluations to gauge ESG maturity levels further, expanding on the scope of the ESG awareness webinar rolled out in 2022, planning capacity-building and training for suppliers, and conducting extensive, multi-point due diligence checks on vendors. Meanwhile, our Property and Facility Solutions division (Operon Middle East) plans to implement ISO 14001 in 2023 and carry out supplier environmental screening in 2023. PROVIDING BUSINESS OPPORTUNITIES While we remain focused on developing our local supply chain, our approach has simultaneously allowed us to further extend support to local vendors by establishing the BVDP during the year under review. The BVDP, which was derived from the government’s Bumiputera Empowerment Agenda, aims to elevate local entrepreneurial communities with training modules designed in-house, allowing underserved Bumiputera businesses that meet our governance and policy requirements to participate competitively in the local and global markets. Currently, there are seven vendors participating in this programme. Besides, every year, we set out to meet the government’s goal of awarding at least 30% of all contracts to Bumiputera vendors through its Bumiputra Vendors Contract Award programme. Nonetheless, through our transparent tender and negotiation process which enables the Group to make optimal decisions on our business partners, we have gone beyond this target by granting 47% of contracts to Bumiputera vendors during the year. In order to ensure that sustainable procurement decisions are securely anchored within our supply chains, mindful selection of suppliers with similar principles of entrepreneurial responsibility to our own will continue to be our primary focus, especially in this era of geopolitical tension and global supply chain disruptions. During the year, no suppliers selected or contracted were subjected to due diligence processes for environmental impacts. To further demonstrate our commitment towards BDVP and the sustainability of the small and medium industry players who form part of our value chain, targets set to encourage the growth of these businesses is tracked as part of our MD/CEO’s key performance indicators. In conclusion, our local procurement and supply chain financing policies will continue to be a catalyst to unlock further economic value for the Group and our stakeholders at large. The amount spent on vendors, total number of vendors, and total contracts outsourced to Bumiputera vendors dropped between 2021 and 2022 as there were major healthcare maintenance contracts (the recipients of which were mainly Bumiputera vendors) awarded for the contractual period of three years in 2021. Hence, by contrast, there is an overall decrease in large healthcare maintenance contracts in 2022. b. P ercentage of the procurement budget used for significant locations of operation that is spent on suppliers local (within Peninsular and East Malaysia) to that operation, such as percentage of products and services purchased locally. 2020 2021 2022 Total number of vendors Contracts outsourced to Bumiputera vendors over total procurement (%) Products and services purchased locally 2020 99.7% 2021 2022 99.9% 99.4%
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