Our Strong Leadership Paves The Way 22 FGV HOLDINGS BERHAD Chairman’s Statement From an environmental perspective, we have continued our conservation efforts with the launch of the Sun Bear Management Guidelines with our partners; PERHILITAN, Malaysian Nature Society (MNS) and Universiti Kebangsaan Malaysia. FGV is also looking forward to expand the circularity approach to sustainability by strengthening our waste-to-wealth initiatives. In this regard, we are actively seeking collaborations with local manufacturers to convert our Empty Fruit Bunches (EFB) into EFB pellets that can serve as an alternative renewable energy solution. Seeking alternative renewable energy is one of our efforts in combatting climate change, which is currently the most pressing issue in the world. The negative effects of global warming due to human activities have intensified and impacted all industries and global supply chains. Plantation, which is our core business, is one of the industries that has been significantly affected by the effects of climate change. In view of the urgent need to combat climate change, we committed to the Science-Based Targets initiative (SBTi) and net zero ambition in 2021 to accelerate our transition to a low-carbon economy. Going forward, we aspire to embark on the Task Force on Climate-related Financial Disclosures in the coming financial year to identify our climate-related risks and opportunities. FGV IS THE FIRST AGRIBUSINESS COMPANY IN MALAYSIA TO BE A SIGNATORY OF THE WOMEN’S EMPOWERMENT PRINCIPLES (WEPs), A SET OF GUIDELINES DEVELOPED BY THE UNITED NATIONS GLOBAL COMPACT AND UNITED NATIONS WOMEN, IN LINE WITH OUR AGENDA ON GENDER EQUALITY AND WOMEN’S EMPOWERMENT. At FGV, our commitment to governance is unwavering, and we strive to cultivate a culture that aligns with our PRIDE values. To embed best practices in corporate governance and foster a culture that upholds it, we keep ourselves abreast of the latest developments and practices in the field. Our framework sets clear boundaries and defines the various committees that govern different aspects of the business. Throughout the year, we reaffirmed and communicated the FGV Governance Framework to set clear expectations and alignment of conduct by our subsidiaries with the Board’s risk appetite, where certain reserved matters for FGV have been spelt out for adherence by the subsidiaries. At the Board level, we deliberated on many issues including strategy, risk and sustainability. This included continuous monitoring of FGV governance arrangements and ensuring that all of our people acted with openness, honesty and transparency. We recognise that as we continue to grow, it is crucial to maintain a strong culture that aligns with our vision, strategy and values. We pay particular attention to Anti-Bribery and Anti-Corruption initiatives as we have a zero-tolerance stance against bribery and corruption. In 2022, we further reinforced our Corruption Risk Management (CRM) programme, extending coverage to 32 companies, compared to 28 in 2021, and conducted an Anti-Bribery Internal Audit on FGV-identified sites. Additionally, we engaged third-party experts to evaluate our performance. We achieved a score of 91% on documentation and 85% on implementation for compliance with the Malaysian Anti-Corruption Commission’s (MACC) Section 17A Adequate Procedures and successfully underwent SIRIM Berhad’s 2nd Surveillance Audit. We also took proactive steps to strengthen our integrity efforts by appointing two former officers from the MACC to lead our Whistleblowing and Grievance initiatives. As a result of our strong commitment to uphold good governance, we received several awards and recognitions as a testament to our efforts in good practices. This year, FGV revised and strengthened its Guidelines and Procedures for Responsible Recruitment and Employment of Migrant Workers to align its practices with international standards, including committing to No Recruitment Fees for its migrant workers. By eliminating these fees, our migrant workers will not be required to pay recruitment fees to third parties. This is a commendable initiative as it aims to protect and respect the rights of migrant workers and ensure fair and ethical employment practices. We also continued to work closely with labour-related non-profit organisations such as the Fair Labor Association (FLA), Project Liber8, the International Labour Organization (ILO) Malaysia and the Malaysian Trades Union Congress (MTUC) to promote greater recognition and understanding of the issue of child labour and forced labour among plantation workers. The Group has also successfully negotiated 16 Collective Agreements with its workers’ unions, comprising internal unions and the National Union of Petroleum and Chemical Industry Workers Peninsular Malaysia, covering the period 2022 to 2024. These agreements, which are renegotiated every three years, will ensure that our workers continue to have salaries and benefits commensurate with the market. For our smallholders, we launched the Independent Smallholders Consultation Programme which focuses on creating awareness on the role of smallholders in the sustainable palm oil industry and understanding the industry’s challenges and ways forward. In giving back to society, FGV has invested around RM17.18 million in corporate social responsibility activities for underprivileged groups and educational initiatives that have benefitted students all around the country. Environmental Social Governance
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