FGV Annual Report 2017

ANNUAL INTEGRATED REPORT 2017 LETTER FROM OUR CHAIRMAN 23 With this renewed clarity, FGV will be able to move forward with the systems and processes that support a well-managed organisation firmly in place. We are always cognisant of our dual role, firstly as a listed company and secondly, as the champion of Smallholders interests. The first role as a listed entity comes with a responsibility to our Shareholders to deliver returns for their investment and trust in us. The second role, is equally important and is part of our corporate responsibility to all our Stakeholders. The Smallholders are our partners and in many instances, also our Shareholders. We have an extended responsibility towards them in terms of operational support, technical advice and the networks we provide to link them into the international commodity markets. At FGV, we believe these are complimentary roles that define us further as responsible planters. OUR PEOPLE ARE OUR GREATEST ASSET We realise that the events of 2017 took its toll on our people too, affecting morale and causing unnecessary distractions. Thus, we have renewed our focus on strategy and performance management, emphasising the need to set clear goals and targets. FGV’s Strategic Plan (SP20 (V2)), was approved by the Board at the start of 2018 and we will track performance to ensure that we meet both our aggressive internal expectations, and those of all our Shareholders as well. At the time of writing this message to you, I have visited many of the estates owned or managed by FGV and talked to our people on the ground personally. You will be pleased to know that we have some exceptional talent across the Group, many of whom are already driving themselves and their colleagues towards a better 2018. They are the backbone of the company; the fruits of their labour allow us to be successful. Having good people is one thing, ensuring that they are supported is another. Thus, an important focus area of SP20 (V2) is human capital management, to secure FGV’s sustainability in the long term. Aside from seeking to improve our competitive edge and productivity through skills development programmes, we are implementing plans to empower our people to make measured and timely decisions that will ensure they meet their targets, and therefore the Group’s. We have also instilled a sense of urgency to implement all the new measures and necessary corrective steps, so that FGV can regain its footing and momentum. I am pleased that there is a healthy level of awareness of the impact of poor implementation, or even inaction, on financial performance. We are now moving forward at the right pace, with clear goals in mind and within sight. SUSTAINABILITY IS A GIVEN Sustainability is in our DNA. FGV was founded upon the success of the FELDA scheme, which was one of the most successful poverty alleviation programmes in the world. The core of FELDA, and thus FGV, is the elimination of poverty, the very first of the United Nation’s Sustainable Development Goals (SDG). At FGV, we have taken it a step further; we believe in social equity. Today, FGV is among the largest supporters of Smallholders in the world. We partner, support and sustain over 112,000 Smallholders who sell their fresh fruit bunches to us. Historically, Smallholder yields are far lower than those of more efficient corporates. Therefore, one of the key strategies we have identified is a yield improvement programme for our Smallholders. As this programme is rolled out, it will bring great benefit to both Smallholders and the Company. As we strive towards achieving social equity, we understand the need for responsible development and environmental stewardship. FGV published its Sustainability Policy in 2016 and is now in the process of further improving its commitments. To achieve this, we are working with all Stakeholders, especially local communities in our areas of operation and our customers. REWARDING OUR SHAREHOLDERS After taking into account the operating landscape and our improved performance, the Board has approved the payment of an interim dividend of 5 sen per share. APPRECIATION Finally, I wish to record my appreciation to my fellow Board members for their insights and contributions over the past several months. I would also like to thank our Group President/Chief Executive Officer, Dato’ Zakaria Arshad, and the management team for their unwavering resolve to always do what was right and best for FGV. My gratitude goes also to all our people, who have continued to deliver despite the challenging environment. Their hard work and perseverance contributed greatly to the improved performance in the last financial year. I would also like to thank all our Stakeholders, especially our partners and customers who remained steadfast and resolute, despite the tumultuous events of 2017. We look forward to their continued support in the years ahead. Datuk Wira Azhar Abdul Hamid Chairman STATEMENT FROM THE CHAIRMAN EC GE HR YI