MISC 2050 is a strategic roadmap which lays out our 30-year journey in reimagining the economic and social role of MISC come the year 2050. More specifically its goal is to identify and develop new opportunities that will enable us to build new businesses and asset portfolios to be added to our present business portfolio mix by capitalising on energy transition opportunities as the world evolves towards a circular economy. Medium to long term (Beyond 5 years) While our five-year corporate and sustainability strategies set us on a clear path towards achieving positive medium-term outcomes that will generate recurring revenue for the Group over the next 10 to 20 year period, we recognise that the next phase of our growth will be towards a decarbonised future. Climate change is a threat that the global community has to combat to ensure the planet’s long-term sustainability and has accelerated the energy transition. By embracing change and innovation, MISC will be able to take advantage of opportunities in the form of new products and services, as well as business models, that will transition our business to remain relevant and resilient in the long-term future. MISC’s long-term plans to build our resilience to climate change and to prosper in a circular and net-zero economy is premised on evolving our business through the following two means: • Net-Zero GHG Commitment - We plan to decarbonise our operations to meet growing market demands for eco-friendly solutions, which will sustain the growth of our existing portfolio. • MISC 2050 – Alongside the decarbonisation of our operations, we will simultaneously explore new income streams through our MISC 2050 long-range strategy that will enable the Group to remain relevant in a future that is being shaped by the energy transition and the shift towards a circular economy. OUR STRATEGIC FOCUS STRATEGIC REVIEW Net-Zero GHG Commitment MISC Group is committed to achieving net-zero GHG emissions by 2050 within both our own operations and across our value chain through the following climate strategy Progressively converting our fleet and ensuring all newbuilds are zero-carbon emission vessels from 2030 or sooner if possible Retrofitting carbon removal technologies on recent (vessels with remaining lifespan of 15 years) low methane slip, LNG dual-fuel vessels Increasing the use of renewable energy on our vessels, offshore assets and land operations Continuously deploying digital energy-efficient technologies and increasing operational efficiencies MISC 2050 THE NEED FOR A LONG-RANGE STRATEGY The world is undergoing a fundamental shift that is being accelerated by increasing pressure from various stakeholders to address the threat of climate change. While we believe that energy transition will assist in reducing the world’s climate change issues, much of that should be addressed by how we extract and use resources, produce, distribute and manage the waste output, thus giving rise to the circular economy. These are key risks that will affect MISC’s long-term financial sustainability as the global shift towards the use of renewable energy sources will limit the long-term growth prospects of our current businesses. If left unaddressed, it may even result in the erosion of value for our Group. As such, it is imperative for us to future proof our business sooner rather than later, and we have developed MISC 2050 as our long-range strategy to thrive in the global circular economy of 2050. MISC 2050 addresses these long-term threats, while our current five-year rolling business plans focus mainly on our present business portfolios. MISC 2050 must be pursued alongside MISC’s current fiveyear rolling business plans as the latter will help generate funds and sufficient resources for MISC to establish a foundation to ideate and develop new income streams for the former. • Global shift in energy transition - driven by pressure to achieve netzero and circular economy in 2050 • Sustainability of MISC - Limit long term growth prospects of our current business. Worse case, may even result in a contraction leading to 2050 WHY MISC 2050? The fundamental objective of MISC 2050 is to identify new growth opportunities that will allow us to build new businesses and asset portfolios to be added to our present business portfolio mix. Thus, our dual-pronged approach of executing our five-year rolling business plans alongside our longer-range strategy will eventually allow us to transform into a resilient and financially-sustainable business model that can thrive in a circular and net-zero economy come 2050. To create value through trusted stakeholder relationships Sustainability Pillars Key Focus Areas Strategic Priorities Material Matters • Collaborate with strategic partners • Promote sustainability awareness • Communicate effectively through identified platforms • Feedback sought regularly from stakeholders • Transparency through disclosures on sustainability-related frameworks • To identify new business opportunities and build new income streams to be added to our business portfolio mix Stakeholders For more details on our Net-Zero GHG Commitment, please refer to our Sustainability Report 2021. MISC Berhad 58 Integrated Annual Report 2021 MISC Berhad Integrated Annual Report 2021 59
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