KENANGA INVESTMENT BANK BERHAD SUSTAINABILITY REPORT 2024 BASIS OF THIS REPORT OUR APPROACH TO SUSTAINABILITY KENANGA AT A GLANCE GOOD GOVERNANCE LEADERSHIP STATEMENTS SUSTAINABLE ECONOMIC GROWTH ENVIRONMENTAL STEWARDSHIP EMPOWERING PEOPLE AND COMMUNITIES APPENDIX 21 20 For more information on how we manage Responsible Investing, please refer to pages 42 to 47 of this Report. For more information on how we manage Digitalisation, please refer to pages 48 to 52 of this Report. For more information on how we manage Cyber Security, please refer to pages 53 to 54 of this Report. For more information on how we manage Client Experience, please refer to pages 55 to 56 of this Report. For more information on how we manage Good Business Conduct, please refer to pages 28 to 31 of this Report. For more information on how we address Risk Management, please refer to pages 32 to 34 of this Report. For more information on how we manage Regulatory Compliance, please refer to pages 35 to 40 of this Report. MATERIAL TOPICS, KEY RISKS AND OPPORTUNITIES OUR APPROACH TO SUSTAINABILITY OUR APPROACH TO SUSTAINABILITY Key Risks: Greenwashing risk stems from exaggerated or misleading sustainability claims, while market and performance risks arise from evolving ESG trends and regulations, leading to short-term investment fluctuations. Transition and reputational risks are linked to financing high-emission sectors, which can trigger divestment pressure and impact revenue negatively. Key Opportunities: Responsible investing drives long-term value by enhancing resilience and growth. It improves risk management, mitigates ESG-related risks, and strengthens investor confidence while attracting sustainable capital. Key Risks: Regulatory non-compliance can incur fines, reputational damage, and loss of trust from regulators, investors, and clients. Additionally, a lack of understanding of good governance practices may result in poor decision-making and accountability gaps. Weak financial crime policies further increase legal risks and undermine stakeholder confidence. Key Opportunities: Building regulatory trust through strong compliance reinforces credibilitywith regulators and investors. Promoting governance awareness fosters ethical practices and accountability among stakeholders. Implementing robust financial crime measures further protect the organisation, ensuring security and strengthening trust. 3 Regulatory Compliance Ensuring adherence to local and international laws, regulations and standards by maintaining compliance in all operations, from financial reporting to governance practices, reduces the risk of legal or regulatory breaches. Key Risks: Non-compliance with evolving regulations can result in legal penalties, fines, and reputational damage. Weak governance structures risk financial instability and diminish stakeholder trust. Unethical practices undermine relationships and operational efficiency. Key Opportunities: Strong regulatory compliance safeguards reputation, mitigates risks and attracts investors. Effective governance, supported by clear accountability, fosters trust and supports growth. Ethical business practices enhance stakeholder confidence and organisational resilience. Good Business Conduct Upholding the highest standards of integrity in business practices by ensuring ethical conduct, implementing anti-corruption measures and fostering a transparent corporate culture. 1 Good Governance Responsible Investing Incorporating ESG factors into investment decision-making, to generate sustainable, long-term returns while promoting positive societal impact. 1 Sustainable Economic Growth Key Risks: As digitalisation accelerates, the risks of data breaches and oversight gaps grow. Rapid technological advances may outpace governance frameworks, while outdated systems increase costs and require frequent upgrades. Key Opportunities: Digitalisation enhances efficiency, redirect resource use, and expands financial inclusion through digital platforms. Strategic fintech collaborations drive innovation, ensuring sustainable growth and resilience. Digitalisation Leveraging technology to enhance business operations and customer experiences, encompassing the adoption of advanced digital tools to improve efficiency, offer innovative financial products and remain competitive in a tech-driven market. 2 Key Risks: Cyberattacks can lead to systemdowntime, disrupting operations and damaging client trust. Data breaches may expose sensitive information, compromising service continuity and customer confidence. Furthermore, non-compliance with data protection regulations can result in heavy fines and legal repercussions. Key Opportunities: Implementing strong cybersecurity frameworks enhances resilience, builds stakeholder trust, and positions the organisation as a key player in providing secure digital services, driving competitive advantage. Cyber Security Implementing measures and protocols to safeguard sensitive data and ensure secure operations in a rapidly evolving digital environment. 3 Key Risks: Client trust is foundational to our brand, and it can be compromised by data breaches, biased practices, or a lack of access to accurate information. Misleading communication or failure to adhere to marketing standards can damage our reputation, leading to client dissatisfaction and increased attrition risk. Key Opportunities: Transparency, ethical practices, and accurate information build trust and loyalty in our brand. Aligning financial solutions with societal needs and ensuring compliance strengthens our reputation. Inclusive digital platforms enhance accessibility for a seamless client experience. Client Experience Delivering superior client experience to retain customer loyalty and trust, through initiatives such as providing seamless, efficient and customer-centric financial services that meet evolving client needs. 4 Key Risks: Ineffective risk governance—including weak internal controls, non-compliance, or failure to uphold ethical standards—can lead to legal penalties, reputational damage, and financial loss. The failure to integrate ESG risk considerations can lead to increased regulatory scrutiny, asset devaluation, and a loss of investor and public confidence. Key Opportunities: Leveraging technological solutions for stronger compliance and cybersecurity enhances risk detection. By incorporating ESG risk factors into their risk management strategies, organisations are better equipped to mitigate potential disruptions and enhance stakeholder confidence. Additionally, embracing digital innovation, diversifying financial products, and implementing effective crisis management strategies foster resilience and drive sustainable growth. Risk Management Identifying, assessing and managing potential risks such as strategic, operational, financial and ESG-related risks, which could impact Kenanga’s business operations, financial stability, or reputation, ensuring resilience and long-term sustainability. 2
RkJQdWJsaXNoZXIy MTc1ODMy