Integrated Annual Report 2021

GOVERNANCE AND INTEGRITY Description To manage and safeguard the Group against litigation risks, financial disputes and impacts, as well as reputational damage, it is imperative that the Group ensures that all parties comply with critical laws and regulations including any form of bribery and corruption, data protection, conflict of interest, infringement of human rights and modern slavery, breach of economic sanctions and export control regulations. Mitigation/Response • Ensuring strict adoption and implementation of policies such as Anti-Bribery and Corruption (ABC) as well as Code of Conduct and Business Ethics (CoBE). • Carrying out structured implementation of compliance initiatives with the aim of creating a mature compliance and ethics culture, where ethics and integrity become part of all business conduct and transactions. This includes the involvement and commitment across all levels, and up to the Board and Management. • Performance and adherence towards compliance with laws, related regulatory and standard requirements will be embedded into the overall key performance measurement to ensure strong assurance in complying with governance related requirements. • Implementing tight internal controls and conducting assurance activities to monitor adherence to regulations and policies, including annual declaration by employees on any potential conflicts of interest. VALUES AND GOVERNANCE/RISK MANAGEMENT HUMAN/FINANCIAL Material Matters: Capitals Affected: Trend: Neutral HEALTH AND SAFETY Description The Group places the highest priority on Health, Safety, Security and Environment (HSSE). Any major HSSE incidents may result in injury or loss of life, asset or environmental damage, financial or adverse reputational impact. Mitigation/Response • A strict HSSE policy is adopted and embedded into the Group’s working culture. • HSSE assurances are diligently performed on the Group’s assets to verify, evaluate and review HSSE operational activities to ensure asset integrity and reliability are maintained at all times, consistent with international regulations, HSSE controls and internal policies. • The GHSSE council continuously monitors all HSSE-related risks and matters as well as implementation of improvement initiatives. HEALTH AND SAFETY/CUSTOMER SATISFACTION HUMAN/SOCIAL & RELATIONSHIP Material Matters: Capitals Affected: Trend: Neutral STRATEGIC REVIEW CYBERSECURITY Description Cybersecurity is intensifying as a threat with the accelerated pace of digital transformation, and increasing demand for improved and new technologies for businesses as well as operations. Fast-paced digitalisation, automation and growing online business and operational models have exponentially increased cybersecurity risks and exposure. Mitigation/Response • Formulation of a five-year MISC Cybersecurity Strategic Plan under the MISC Sustainability Strategy 2025 (Governance Pillar) to provide a roadmap for the continuous maturity of cybersecurity for the Group. • Implementation of a strong cybersecurity governance framework which specifies cybersecurity control standards and ensures a consistent approach to managing cybersecurity across the Group. • Periodically perform detailed cybersecurity assessments to identify potential vulnerabilities and weaknesses and testing of information systems’ susceptibility to attacks and closing any gaps identified from the assessments for continuous improvements. • Detailed assessments and remedials performed for all projects and implementation of IT facilities prior to handing over to operations to manage all cybersecurity risks. • The GHSSE council closely monitors the Group’s cybersecurity risks and provide direction on the implementation of improvements in our IT security and environment. RISK MANAGEMENT FINANCIAL Material Matters: Capitals Affected: Trend: Upward TALENT DEVELOPMENT AND RETENTION Description Talent attraction and retention in the maritime industry is a perennial challenge with stiff competition for experienced maritime personnel. There is also a risk of an insufficient pool of readily available successors to assume critical Group positions. Inability to retain a strong human capital team and develop knowledge and skills in line with industry demands may affect our business plans and growth, as well as reduce the Group’s competitiveness. Mitigation/Response • Undertaking detailed succession planning and initiatives to ensure a sustainable pipeline of talent is available to meet the Group’s requirements, including identifying and developing future leaders. • Deploying a structured and holistic development process with the objective of continuously building employee competency and capability levels. This ultimately caters for the need of readily available successors at all levels. • Providing clear direction and career growth opportunities to employees, in addition to keeping up to date with employee schemes and rewards that are competitive within the industry. • A structured Functional Competency and Leadership Competency framework is implemented with the main objective of maintaining a competent and capable workforce throughout the Group. Any competency gaps identified will be addressed immediately and improvement plans are designed and worked upon by both the employee and employer. • Our maritime academy, ALAM, has a readily available and strong in-house pool of ready, high-quality talent through our cadet sponsorship programme. • Implementing Diversity and Inclusion programmes and practising equal talent opportunities. EMPLOYEE ENGAGEMENT/DIVERSITY AND INCLUSION/SKILLED WORKFORCE HUMAN/INTELLECTUAL Material Matters: Capitals Affected: Trend: Neutral OUR RISKS AND MITIGATION STRATEGIES MISC Berhad 82 Integrated Annual Report 2021 MISC Berhad Integrated Annual Report 2021 83