Kenanga-Sustainability-Report-2022

30 31 Environmental Stewardship About This Report Who We Are Progressing Towards A Sustainable Future Managing Our Sustainability Risks Good Governance Sustainable Economic Growth KENANGA INVESTMENT BANK BERHAD Sustainability Report 2022 Awards and Recognitions Empowering People and Communities GRI Content Index ESG Performance Data STRATEGY We have maintained the Group’s CCRM Framework, which was established in FY2021 to introduce a climate change and principles-based taxonomy for the classification of climate-related risks and opportunities. Our highlight as follows: Guided by our Sustainability Roadmap 2023-2025 and regulatory expectation on BNM CCPT implementation, we aim to incorporate climate risk management and scenario analysis into our enterprise risk management framework, in efforts to classify our climate-related risks on our investment and lending activities as guided by BNM’s CRMSA. Moving Forward RISK MANAGEMENT We are working towards to better understand the climate impact on our business operations and have further expanded our risk exposure analysis. We will identify specific climate-related risks and opportunities relevant to our business for each time horizon (short, medium and long-term), and further integrate them across our investment and financing activities. Moving Forward Transition Risk Occurs as a result of adjustment to a low-carbon economy. The adjustment may translate into:- • Financial risk • Reputational risk • Changes in public policy and strategy • Increase in operational cost • Refinancing risk Liability Risk Stems from legal risk and claims on damages and losses incurred from inaction or lack of action that results in the effects of physical and transition risks:- • Legal • Claims Physical Risk Arises from acute (event-driven) and chronic (long term shift) climate-related events that:- • Damage property • Reduce productivity • Disrupt trade • Increase financial risk to the Group • Impacts collateral values CLIMATE CHANGE RISKS MANAGING OUR SUSTAINABILITY RISKS MANAGING OUR SUSTAINABILITY RISKS METRICS & TARGETS In our previous report, the Group detailed all Scope 1 and 2 GHG emissions in tCO2e resulting from business operations at our headquarters, Kenanga Tower. We adhere to the GHG Protocol Corporate Standards in the calculations of emissions factor. We have since expanded our data collection scope for this reporting period to include our 34 branches throughout Malaysia. Additionally, we have also started to include Scope 3 GHG emissions disclosure. As a start, our Scope 3 emission calculations are based on business travel in non-company owned vehicles. Furthermore, we have established the following mid- and long-term climate-related targets: Achieve carbon neutrality by 2025 by transitioning operational energy needs from renewable sources We aim to develop a Climate Strategy with a focus on enterprise-wide including portfolio decarbonisation strategy. To support this initiative, we aim to engage our Business Units to further understand their portfolio exposure on climate risk as well as overall ESG factors. Moving Forward Achieve Net Zero by 2050 Developed Sustainability Targets and Goals, as well as Sustainability Roadmap 2023-2025 in 2022 which focuses on climate risk management including management of our environmental footprint on GHG emissions, to account Scope 1, 2 and 3, where applicable Integrated Climate Change RAC as part of our investment risk assessment process Trained relevant senior management and executives, on CCRM Framework and Climate Change RAC application in 2022 “Climate risk has increasingly become an important element in the process of investment decision-making. The key motivation behind the practice of making climate risk as part of the process for investors is to gain an in-depth understanding of the companies in which they invest.” TEH SEAH JADE Risk Analyst, Kenanga Investment Bank Berhad

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