MISC Integrated Annual Report 2020

SPECIAL FEATURE : THE CASTOR INITIATIVE An alliance of 4 key maritime industry players namely MISC, Samsung Heavy Industries (SHI), Lloyd’s Register (LR) and MAN Energy Solution was formed in January 2020 with an ambition to jointly develop commercially viable deep-sea Zero-Emission Vessels (ZEVs) by 2030.The Joint Development Project (JDP) is aligned with the International Maritime Organisation’s 2050 Greenhouse Gas (GHG) aspirations and Getting to Zero Coalition’s commitment. A key milestone of the collaboration was achieved in September 2020, as LR awarded Approval in Principle (AiP) to SHI for its ammonia-fuelled tanker design with the aim of commercialising these developments by 2024. Recently in February 2021, the JDP announced the addition of Yara International ASA (Yara) and Maritime and Port Authority of Singapore (MPA) into the coalition. The addition of Yara and MPA into the coalition now completes the representation of all key areas of the maritime industry ecosystem. The experiences and expertise of all key partners would be central to the success of the initiative, from conception to project realisation. The JDP partners further announced the name for the expanded coalition as ‘The Castor Initiative’. Partners of The Castor Initiative agreed to the name Castor because it is symbolic to the “star” Castor, which is uniquely formed by a system of 6 stars that shine brightly in unison. The 6 stars present in Castor symbolises the 6 partners of this perfect and complete alliance which has representation from all areas of the maritime ecosystem. A star based name was also selected because stars are traditionally linked very closely to the maritime world as seafarers look upon the stars to chart their onward voyage. As one looks up to the sky – Castor is seen as one, that’s how we would like to be seen as – “One” alliance that will shine the way forward for a greener future. The Castor Initiative was motivated by the partners’ shared belief that the maritime industry needs leadership and greater collaboration if shipping is to meet the IMO’s GHG ambitions. While ammonia is one of the fuels being considered by maritime stakeholders, the partners also recognise that the shipping industry will need to explore multiple decarbonisation pathways and hope their collaboration will spur others in the maritime industry to join forces on addressing this global challenge. The circular economy refers to the economic system that seeks to eliminate waste by continually using resources through a close-loop system. This system minimises the use of resource inputs and reduces waste, pollution and carbon emissions. The circular economy also leverages on the Waste-to-Value (WtV) concept where waste is either treated or processed into a valuable product. MISC aims to promote the elimination of waste and the continual use of resources, as well as increase the use of renewable resources within our operations and the value chain. We will drive our efforts by practising 4R (Refuse, Reduce, Reuse and Recycle), utilising the WtV concept wherever possible. We are also promoting greater utilisation of renewable resources throughout our operations. A key means by which we are promoting the circular economy is through our efforts at green ship recycling. This is in line with our commitment towards the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ship 2009 (the Hong Kong Convention). How Does MISC Conduct Ship Recycling? MISC is committed to recycling ships responsibly, when dismantling vessels that have reached the end of their operational lives. The aim is to ensure that the dismantling and breaking up of ships do not pose any unnecessary risks to human health and safety, and to the environment. Ship recycling refers to the dismantling and recycling of ships in a sustainable and environmentally sensitive manner. Appointed brokers or their site managers are required to perform the demolition and recycling of a vessel according to established recycling yards standards, operating procedures and industry best practices. MISC maintains an Inventory of Hazardous Materials (IHM) on each vessel. The IHM is a vessel-specific document that identifies and quantifies all potentially hazardous material on board a ship that poses health, safety and environmental risks. The document facilitates green ship life cycle management as it provides the ship recycler with the information they require to specifically identify and manage the hazardous materials appropriately in the vessel. ANCHORING SUSTAINABILITY @ MISC This strategic priority demonstrates MISC’s commitment to protect ocean health by rehabilitating marine biodiversity, specifically coral reefs and sea turtles. We are driving this strategic priority through collaborative partnerships that promote and conduct marine biodiversity programmes and activities. In 2020, we launched the Heart of the Ocean initiative, signifying our long-term commitment towards marine biodiversity conservation. We have introduced two signature marine biodiversity conservation programmes under the Heart of the Ocean initiative as follows: • • The MISC Biodiversity Conservation Flagship Programme, a reef conservation and marine debris and plastics management programme located on Mersing Island, Johor • • The UMT-MMS Sea Turtle Conservation Programme, led by our subsidiary, MMS, located on Pulau Redang, Terengganu Promoting Circular Economy Biodiversity Conservation SOCIAL PILLAR Our commitment under the social pillar is to promote health and safety, individual and team excellence, as well as positively impact communities. Our renewed commitment is a combination of the 2016-2020 Employee and Community Pillar mission statements with an enhanced focus on health and safety. Our efforts under this pillar is important as it provides the social license for us to operate as the programmes we have implemented are aimed towards contributing to the socio-economic development of communities, as well as strengthen our human capital. The strategic priorities for 2021-2025 under the Social Pillar are as follows: Health and Safety Under this strategic priority, MISC aims to provide a safe and healthy environment for employees, contractors and communities. This is being driven through our Behavioural HSSE culture (b-HSSE) where the leadership encourages all employees to embrace the ‘See it, Own It’ b-HSSE ethos. Our future plans are focused on enhancing our HSSE culture through the adoption of various health and safety initiatives and management processes, including Process Safety Management. Talent Excellence Our Talent Excellence strategic priority aims to futureproof our business by strengthening the outcomes of the MISC talent and leadership agenda. By accelerating talent potential, we will be able to advance our pipeline of high potential talents to the next level of leadership. We plan to enhance our competency development programmes by employing a more structured approach based on the MISC Group Competency Framework. Continued focus on Career Management Programmes will allow us to further drive our Talent Excellence agenda. In order to strengthen employee engagement, we will enhance communication with our employees, and diversify the channels of engagement. Moving into 2021 and beyond, Diversity and Inclusion (D&I) will be a key focus within this strategic priority. MISC believes that by embracing the diversity agenda, we can enhance performance, improve employee retention and is a means for us to access different perspectives and ideas. For MISC, diversity includes, but is not limited to, gender, age, ethnicity, religion, beliefs, origin and cultural background. Our diversity agenda leverages on a wide spectrum of skills, experiences and talents from different backgrounds to add to the strength of our Group. Our strategic focus areas within the D&I ambit are as follows: • • To grow our diverse talent base by building up gender and national representation that reflects our growing international footprint • • To foster an inclusive culture and work environment that emphasises on equity and meritocracy to provide opportunities for a multigenerational workforce • • To promote an ‘Inclusive Leadership’ culture founded on leadership accountability towards creating a workplace that is valued by a diverse talent base //// Highlights / Strategic Review / Sustainability / Financial Review / Business Review ///// MISC Berhad / Integrated Annual Report 2020 5 120 MISC Berhad / Integrated Annual Report 2020 5 121 ///// Business Review / Financial Review / Sustainability / Strategic Review / Highlights //// Section Section