29 How We Are Governed Financial Statements Shareholders’ Information Additional Information OUR CLIMATE CHANGE RISK MANAGEMENT FRAMEWORK The CCRMF plays an integral role in supporting the Group as it embarks upon a phased approach towards addressing climate change-related risks and opportunities. Aligned with our CCRMF, we have also introduced a Climate Change Risk Assessment Checklist (“Climate Change RAC”). The Climate Change RAC is developed based on the guiding principles outlined in BNM’s CCPT as well as other criteria as per industry best practices to support the classification assessment. MANAGING OUR SUPPLY CHAIN RISK Our Group Code of Conduct for Vendors and Group Procurement Policy provide employees and vendors with a guiding framework to achieve and maintain high standards of professionalism, transparency and accountability in our procurement decisions. Our robust Know Your Vendor Assessment requires vendors to undergo an extensive due diligence process that reviews risk indicators which culminates in a score that serves as a guide for Kenanga to manage its front-end risk. In line with our digitalisation efforts across our business operations, we have fully digitalised our procurement process. Moving forward, we are enhancing our vendor assessment framework to integrate environmental and social risks for potential and existing suppliers. In 2021, we purchased products and services worth RM67.18 million from local suppliers, accounting for 79% of our total procurement expenditure. As part of our community investment initiatives, we also endorse procurements from social enterprises that we support. For more information on our CCRMF, TCFD disclosures and how we manage our key emerging risks, please refer to pages 14 to 20 of our Sustainability Report 2021. For more information on our supplier evaluation criteria, please refer pages 20 and 21 of our Sustainability Report 2021. The Framework aims to: Provide an overview of how climate change impacts our business, clients and the broader economy Inculcate awareness amongst our stakeholders on the pertinence of understanding climate risks as well as ensuring they stay abreast of Kenanga’s climate ambitions Facilitate the integration of climate change considerations into our existing risk management practices and business activities Develop appropriate reporting standards for our climate risk management disclosure for internal and external stakeholders Identify and formulate appropriate climaterelated strategies, feasible risk appetites and targets to improve our readiness towards climate risk management Introduce a structured classification methodology to assess and classify our financing and investment activities to ensure they are aligned with the transition to a low-carbon economy Establish the necessary guiding principles to support our financing and investment activities, ensuring climate risks are considered In addition to the framework which focuses on the climate risks, the business divisions are also encouraged to place emphasis on Social and Governance risk aspects in lending or financing and investment activities. Following the approval of the CCRMF in 2021, we will also be integrating ESG risks more holistically into our enterprise risk management framework in 2022. In 2021, a total of 182 employees attended courses covering topics on ESG and climate-related risks, clocking a total of 627.8 training hours. We look forward to increase these numbers in the coming years as we expedite our ESG journey.
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