Chemical Company of Malaysia Berhad Sustainability Report 2018

Our Commitment To Sustainable Economic Practices At the Polymers Division, purchases on local items make up 20% to 30% of total spending. Local purchases are subject to product availability. When considering purchases, we always look for local suppliers who offer good quality products and materials. There’s no specific allocations for local procurement within CCM Polymers’ operational budget, as purchases are determined as per requirements. The Polymers Division engages 218 local suppliers comprising 96% of the total number of suppliers engaged. At the Chemicals Division, as of November 2018, of the total 727 suppliers, 91% were local vendors while 9% were overseas vendors. Total Suppliers Water Consumption (m 3 ) Total Number of Employees by Year Employee Distribution by Gender Employee Distribution by Age 3Rs PolymerWashedWater in MT andWashedWater Savings in RM Total Employee Gender Distribution Male Female Male Female 30-50 years Below 30 year 218 138 2017 2018 688,484 429,806 2017 2018 355 356 RM688,484 RM726,492 Chemicals 664 63 218 9 Polymers Local Foreign 10 13 8 22 73 69 47 114 Executive Non-Executive Senior Management Middle Management 15 27 23 76 43 18 89 54 engages about 90 suppliers whereas CCM Chemicals employs 68 logistics suppliers. For 2018, CCM Polymers witnessed the completion of the contracts for two of its third-party warehouse providers. These contracts were not renewed or extended due to the Division shifting its premises to a new strategic location in Bangi. Today, the new premises for the Polymers business can house more raw materials and packaging than that previously kept at the warehouses of both the third-party providers. ANTI-CORRUPTION PRACTICES [205-2] In recent years, we have been focusing our efforts on strengthening initiatives which will more effectively enable us to maintain sound business practices throughout our entire supply chain. These include implementing measures to prevent corruption including bribes and collusion with business partners and other external parties. Communication and training on anti-corruption policies and procedures are cascaded down throughout the Group through our Integrity Initiatives. In FY2018, two of the initiatives included revising our CCM Sponsorship and Donation Policy as well as Gift and Entertainment Policy. We also provide training for new employees on Ethics, Integrity and Values and for 2018, a total of 11 employees across the Group participated in this. We also communicated our anti-corruption policies and reporting procedures to 18 of our suppliers through an Integrity Pact Briefing which was carried out at our CCM Polymers office in Bangi. CCM Integrity Initiatives Particular Date of Event Venue Number of Participants Integrity Pact Briefing for CCM Polymers suppliers 14 August 2018 Polymers Office, Bangi 18 Annual BOD Training: ‘The NewWay of Doing Business in Malaysia’ by Dr. Mohd Nizam Bin Mohd Ali 20 September 2018 G-Tower Hotel, Kuala Lumpur 21 Training on Ethics, Integrity and Values for new employees at CCM, CCM Chemicals and CCM Polymers 12 December 2018 13 th Floor, Menara PNB 11 Revision of CCM Sponsorship and Donation Policy 14 December 2018 NA NA Revision of Gift and Entertainment Policy by including treatment of the gift in the Gift Declaration Form 12 September 2018 NA NA We are committed to implementing a culture of transparency and integrity in order to achieve supply chain management that is orderly and sustainable. At CCM Polymers, our supply chain starts with the purchases of raw material from various suppliers locally and overseas. The materials purchased are kept at our warehouse located in Bangi, Selangor and then sent to production for manufacturing processes. Our finished goods will be delivered to customers via a third-party logistics service. Our Polymers Division 30 SUSTAINABILITY REPORT 2018