STRATEGIC RISK (i) Description Potential Impact Key Mitigation Lower crop production at the Tawai Business Unit as a result of the ageing profile of oil palms, low stand per ha, inadequate terrace construction and challenging hill terrain. • Lower FFB production • Possible revenue loss • Implementing the Group’s Replanting Programme • Continuously improving workers’ welfare and amenities • Mechanising operations STRATEGIC RISK (ii) Description Potential Impact Key Mitigation Operational challenges in Sarawak arising from land disputes, field blockades, ageing profile of oil palms, adverse weather conditions and labour shortages. • Low profitability • Legal liability • High unit production cost • Reputation loss • Lower productivity • Continuously improving workers’ productivity • Mechanising operations LEGAL AND COMPLIANCE RISK Description Potential Impact Key Mitigation Emerging laws and regulations, particularly those related to our ESG compliance. • Heavy fine • Legal liability • Reputation loss • Unfavorable financial rates • Erosion of investor confidence • Adherence to Bursa’s Sustainability Disclosure Requirements • Maintaining certifications for sustainable palm oil • Enhancing awareness of ESG principles and practices • Exploring Green Loan financing from banks • Utilising SPOTT and FTSE4Good Bursa Malaysia Index for ESG benchmarking • Adherence to the International Labour Organization’s Task Force guidelines for monitoring and tracking labour compliance. • Raising awareness on grievance mechanism • Establishment of BPlant Gender Committee Integrated Report 2023 059
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