MONITORING AND REPORTING Compliance Attestation In 2021, we rolled out the Head of Department (HOD) Compliance Attestation initiative on a bi-annual basis to further demonstrate our ‘Tone from the Top’ approach and Management’s commitment towards a robust compliance culture throughout our operations. This self-assessment attestation programme will boost our level of transparency in line with the Guidelines on Adequate Procedures. The Compliance Attestation programme aims to: • Assure the Board and Management of MISC’s compliance with all applicable laws and regulations; and • Immediately document and address any concerns that may lead to a potential or actual breach. MyAssurance – Critical Legal Areas (CLA) An Integrated Assurance platform called MyAssurance is in place to capture all lines of assurance throughout the business. The CLA Functional Checklist embedded in the MyAssurance is a self-assessment tool to assess our operations’ legal compliance status and identify potential areas of weakness, non-compliance and/or unsound practices, including bribery and corruption, money laundering, conflicts of interest, economic sanctions, export controls, competition, human rights, modern slavery and data protection. Corrective actions are put in place to address any identified gaps. Code of Conduct and Business Ethics Our CoBE applies to all our Directors, employees and third parties. Employees must act in the best interests of MISC and not engage in conduct or activities that may harm the Company. We believe the CoBE reflects the Group's commitment for a strong corporate governance compliance. Bribery And Corruption Risk Management MISC Berhad, MHB and AET have been certified with the ISO 37001:2016 Anti-Bribery Management System (ABMS). Having an effective ABMS may act as a defence to the corporate liability against anti-bribery and corruption laws. Annual ISO ABMS internal and external audits are part of the ISO ABMS standard requirements. Each year, Group Internal Audit (GIA) will conduct the internal audit to ensure effective implementation of the ABMS. Subsequently, an external certification body SIRIM QAS, performs the Annual Surveillance Audit (ASA), which includes a review of the Internal Audit Report and findings. Complementing our internal audit, in 2021 the ASA confirmed that our ABMS was implemented effectively. No non-conformance was found during the audit. Further details on our approach to compliance and business ethics can be found in Ethics, Governance and Sustainability section of the Sustainability Report. For more elaborated explanation on our human rights, please read our Sustainability Report Respecting Human Rights at Sea and Shore section. Third Party Due Diligence To assess our third party, we are guided by our Third Party Compliance Due Diligence Operational Guidelines (TPCDDOG). MISC conducts compliance due diligence on new and existing third parties and business partners as part of the Know-Your-Counterparty (KYC) process to better understand the counterparties, evaluate and ensure that they are in compliance with all applicable laws and MISC CoBE requirements, policies and obligations. Conflict of Interest (COI) Annual Declaration All MISC Berhad employees have completed the 2021 Annual COI Disclosure and our Directors, employees and third parties are required to declare any conflict of interest through: • A dedicated email address coideclaration@miscbhd.com; or • During the Annual Conflict of Interest Declaration Whistleblowing Management MISC encourages its employees and members of the public to report suspected unethical, unlawful conduct and/or CoBE noncompliance. In 2021, there were 14 cases raised through the whistleblowing channels. All cases were investigated and deliberated by the Whistleblowing Committee, with 12 cases closed with no disciplinary action. However, two cases were still under investigation as at January 2022. OPERATING RESPONSIBLY BUSINESS REVIEW DATA PRIVACY EXPORT CONTROLS COMPETITION LAW HUMAN RIGHTS ETHICS AND INTEGRITY SANCTIONS Mandatory Training and Awareness In 2021, MISC delivered 26 awareness and engagement programmes pertaining to the CLA. These sessions reinforced the Group’s expectations of employee conduct in their daily business and work functions. In addition, we conducted annual CoBE Refresher Trainings which are mandatory for Directors and employees with a minimum passing mark. We also extended our annual CoBE trainings to our third parties to ensure that they are aware of MISC CoBE and other requirements, and our expectations that they comply according to our high standards. Third parties are required to complete a mandatory assessment post the training. In 2021, 70 third parties attended the CoBE training session of which 29 are critical suppliers. Compliance and Ethics Feedback Understanding the importance of obtaining feedback, moving forward in 2022, a simple compliance feedback form will serve as a guidance during the employees performance review session that compliance cultures are embedded in MISC. Regulatory and Legislation Register At MISC, the identified and monitored six CLA that poses potential risks to the Group are international laws with extra-territorial effects, which if breached could result in high civil and criminal penalties with severe reputational impact to the Company. COMPLIANCE RISK MANAGEMENT Continuous Improvement Continuous improvement is necessary when it comes to detecting and mitigating potential non-compliance. We continually improve the suitability, adequacy and effectiveness of our compliance and ethics programmes through reviews by the internal audit including the annual ISO ABMS internal and external audits. All of our compliance and ethics-related matter are monitored and reported on a regular basis. • Compliance and Ethics related matters are reported quarterly to the Board via Board Governance and Risk Committee as the governing body for good governance to ensure the objectives of the Governance Pillar strategic priorities are effectively implemented. • Whistleblowing related updates are reported quarterly to the Board via the Board Audit Committee in line with the highest standards of integrity expected of the Company and its employees, as well as the Malaysian Code on Corporate Governance 2021. HUMAN RIGHTS Upholding and respecting human rights throughout our operations is essential to our ethical business conduct. As we embark on our Net-Zero Greenhouse Gas Emissions 2050 Commitment, we are cognisant that human rights play an important role in ensuring that everyone has the right to health, wellbeing, safety, clean air and environment, among others. We are guided by the principles set out in the United Nations Guiding Principles on Business and Human Rights that provide the global framework to prevent and address human rights impacts related to business which also include impacts from climate change. We also comply with the guidelines of The International Labour Organisation (ILO) Declaration and The Maritime Labour Convention (MLC). MISC Berhad 196 Integrated Annual Report 2021 MISC Berhad Integrated Annual Report 2021 197
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