Fraser & Neave Holdings Bhd Annual Report 2020

060 FRASER & NEAVE HOLDINGS BHD INCLUSIVE GROWTH COVID-19 has reaffirmed the importance of our stakeholders to our business sustainability, placing greater urgency on managing the environmental and social risks that could affect them. It pleases me to share that, as a result of having in place an inclusive growth strategy, we were able to build on and further strengthen various initiatives that create stakeholder value. RESPONSIBLE SUPPLY CHAIN We are reinforcing our social and environmental stewardship by ensuring positive impacts along our supply chain. This year, we achieved three milestones in this regard: • F&NHB became part of the world’s first fully sustainable end-to-end sugar supply chain through the Buyers Supporting VIVE Programme. • Having completed our target of purchasing Roundtable on Sustainable Palm Oil (RSPO) credits for all our palm oil requirements, we now target to use only RSPO-certified palm oil by 2025. • We have become a foundingmember of a coalition of manufacturers that seeks to promote a more sustainable future through the recycling of post- consumption packaging waste. REDUCING OUR CARBON FOOTPRINT We recognise the critical need to mitigate climate change and fully support the Government’s target of reducing the country’s greenhouse gas (GHG) intensity. Towards this end, we are installing 10 MWp of solar energy capacity at our plants in Malaysia. Once completed in 2021, this will generate clean energy equivalent to the electrical consumption of 3,700 typical households in the country. Come 2022, we will achieve at least 20 per cent clean energy requirements for Malaysia. Our capex projects further reduce our carbon footprint. The installation of the ASRS in our warehouses in both Malaysia and Thailand means less shunting between third-party warehouses and our factories; and minimises use of forklifts, thus cutting our fuel usage and greenhouse gas emission. DELIVERING VALUE TO DRIVE SOCIAL PROGRESS The sheer size and reach of our operations lend us the potential to create positive social and economic value. Leveraging on our position, we strive to empower various segments of the community. For example, we partner with the Halal Industry Development Corporation (HDC) to help small and medium enterprises (SMEs) qualify as halal vendors. Our contributions to the halal ecosystem in Malaysia were recognised this year through the Halal Food and Beverage Excellence Award during the World Halal Conference 2020. F&N Dairies (Thailand) Limited, meanwhile, was named Thailand Best Halal Company of the Year 2020 by the Central Islamic Council of Thailand (CICOT) in Bangkok. In Thailand, building on a long-established relationship with dairy cooperatives, we established a three-year Farming Excellence programme in 2019 which is helping 2,200 dairy farms enhance the quantity and quality of their milk while also reducing energy consumption and waste. This will translate into higher productivity and income for the farmers. Meanwhile, maintaining our support for the marginalised, we directed our efforts this year towards helping them overcome the difficulties brought about by the pandemic. Special focus was given to frontliners, whom we kept energised as they helped keep the nation safe. Since the viral outbreak in Malaysia, F&NHB has distributed more than one million products in both Peninsular and East Malaysia. More details about how we deliver inclusive growth while managing our impact can be found in the Sustainability Statement in this report. STRATEGIC REPORT: Chief Executive Officer's Statement (Cont’d.)