INTEGRATED ANNUAL REPORT 2025 • QL RESOURCES BERHAD INTEGRATED ANNUAL REPORT 2025 • QL RESOURCES BERHAD pg.80 pg.81 03 04 05 06 07 08 01 ABOUT THIS REPORT QL AT A GLANCE CHAIRMAN’S STATEMENT MANAGEMENT DISCUSSION AND ANALYSIS SUSTAINABILITY STATEMENT LEADERSHIP & GOVERNANCE FINANCIAL STATEMENTS APPENDICES 02 03 04 05 06 07 08 01 ABOUT THIS REPORT QL AT A GLANCE CHAIRMAN’S STATEMENT MANAGEMENT DISCUSSION AND ANALYSIS SUSTAINABILITY STATEMENT LEADERSHIP & GOVERNANCE FINANCIAL STATEMENTS APPENDICES 02 SUSTAINABILITY STATEMENT SUSTAINABILITY STATEMENT Board’s Oversight The Board of Directors oversees climate-related matters and provides strategic guidance through the endorsement of the Group’s Climate Change Policy and key climate-related initiatives. In FY2025, the management team, through the SRW and SSC, initiated Project IFRS S2 i.e. a structured climate risk assessment process aligned to TCFD Framework and IFRS S2 Standard. This included a series of business pillar-specific workshops designed to identify and deliberate on climate-related risks and opportunities across QL’s operations. Strategy With deeper understanding of the potential impacts of climate change on our operations and value chain, QL continues to develop strategies that support the Group’s transition toward a low-carbon, climate-resilient future. As the Group carries out the climate risk assessment, business pillars are learning about the potential physical as well as transition risks and opportunities. The sources of climate related information include World Bank’s Climate Change Knowledge Portal, WRI’s climate and water risk tools, and NAHRIM’s climate projections. During the first phase of Project IFRS S2, Management conducted qualitative assessment to derive the following: Climate related Risks and Opportunities Time Horizon Physical Risk Chronic Extreme Precipitation is identified as a risk that could affect some locations of operations. Some locations may be affected by Water Stress. Some of the costal areas are expecting Sea Level Rise. Short to Long Term Acute Some locations of operations are anticipating exposure to Urban Flood, Coastal Flood, River Flood, Wildfire and Extreme Heat. Short to Long Term TCFD DISCLOSURES Strategy (continued) Climate related Risks and Opportunities Time Horizon Transition Risk Policy & Legal Climate related regulatory requirements are expected to evolve e.g. on emissions-related tax, circular economy, waste management/pollution control, plastic usage and requirements for certification and standards. This may bring about higher regulatory scrutiny and could result in higher compliance cost. Short to Long Term Market Customer preferences may change in accordance with their increased awareness on climate change. These potential changes are monitored closely to ensure that the products and services delivered by the Group continue to meet market demands. Short Term Technology Availability of low carbon technology related to our business nature could be limited. In addition, the cost of adopting some of these low carbon technologies could be high. Short to Long Term Opportunities Resource Efficiency QL sees adopting circular economy principles as an opportunity. This is demonstrated through implementation of chicken manure composting for use as fertiliser. Short Term Energy Source Where possible, energy saving systems are explored for usage and renewable sources of energy are used where feasible. QL continues to maximise solar power installation within the regulatory provision. Short Term Products & Services There is a limited market for sustainable product which could be an opportunity for exploration. For instance, sustainable certification could be obtained to meet the need of certain oversea market. Short Term Markets The second phase of Project IFRS S2 will be conducted in a more comprehensive manner to assess climate-related financial impacts through scenario analysis and financial modelling. The assessment will be data-driven and the response to the identified risks will take into consideration of long-term business resilience. Risk Management QL practices the Enterprise Risk Management (“ERM”) framework as a broader risk governance for long term business resilience. The aforementioned risks and opportunities were identified through process that is aligned with the ERM Framework. QL monitors the relevance of our transition and physical climate risks by keeping abreast with emerging climate science, evolving regulatory landscapes and shifts in business strategy. This ongoing review process ensures that QL proactively addresses the evolving climate related risk to mitigate potential impacts and diligently capitalises on the opportunities in a timely manner. The respective Entities are addressing risks on the day to day basis and as illustrated in the Statement on Risk Management and Internal Controls (at page 116), status of the risk is reported upward for monitoring and review by Business Pillar Risk Units, Risk Management Unit and the Risk Management Committee. Metrics and Targets Climate-related performance targets are formulated at the Group level and systematically cascaded across QL’s diverse portfolio of business segments. Each subsidiary is responsible for tracking and reporting environmental data, which is compiled in the environmental section of disclosures in this report. • Energy consumption (refer to pg 41) • Greenhouse gas (GHG) emissions (Scope 1, Scope 2, and Scope 3) (refer to pg 42) • Water consumption (refer to pg 43) • Waste generation (refer to pg 43-44)
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