Risks

• Dissatisfied customers can negatively impact revenue and reputation.
• In-house engineering capabilities are required for the innovation process.

Opportunities

• Gain business advantage by understanding evolving customer needs and expectations and strengthen product/service quality and speed of delivery.
• Innovative developments and ownership of intellectual property (IP) and proprietary technologies.

Mid-term Approach

• Enhance competitiveness and future-proof business by using customer insights to develop innovative products and solutions.
• Develop in-house capabilities by nurturing innovation and high performance culture.

Value Created

• Launched Yaris, Vios and RAV4 with new and innovative safety features.

Risks

• Disengaged employees may lead to suboptimal work performance and productivity level.

Opportunities

• Employees speak positively about the organisation to their colleagues, potential employers and co-workers.
• Employees demonstrate extra effort and engage in behaviours that contribute to business success.

Mid-term Approach

• Enhance employee engagement initiatives through structured and tailored programmes.
• Provided platform to drive higher engagement with employees (i.e., Teams, Webex, e-Learning platforms).

Value Created

• Employees have intense desire to be part of and stay in the organisation.
• 500 employees were recognised for their long service with only 4% of turnover rate for employees with high talent in 2020.
• Improved employee engagement score for 2019 and 2020 (84% and 78%, respectively) compared to previous years (below 60%).

Risks

• Lack of relevant training reduces the capability of employees to meet evolving business and market needs.
• Inadequate professional development programmes decrease employee performance and productivity.

Opportunities

• Good development and upskilling opportunities increase talent attraction and retention.
• Well-trained employees build the Group’s resilience against future challenges and market changes.

Mid-term Approach

• Develop a dynamic and agile workforce trained with adequate and future-relevant skills to drive the Group’s growth.
• Regularise skills as well as training needs assessment across divisions and business functions.
• Identify and design internal training and education programmes to improve productivity.
• Identify training to meet current and future skills.

Value Created

• Employees received 50,122 hours of training.
• Upskilling of employees and growing capabilities to achieve maximum productivity.

Risks

• Without responsible management of natural resources, the business may face resource availability issues and regulatory penalties.

Opportunities

• Systematic management of energy and resources can help improve operating expenses and reduce direct environmental impact from the Group’s operations and business activities.

Mid-term Approach

• Regularly implement energy and waste management initiatives to mitigate risks.
• Comply with applicable laws and regulations, as well as conduct community engagement on environmental stewardship.

Value Created

• Produced 22% more solar energy compared with previous year.
• GHG emissions decreased by 28.61% compared with 2019.

Risks

• A lack of diversity may impede the Group’s ability to facilitate an exchange of ideas, perspectives, culture, creativity, etc.

Opportunities

• Improve workplace dynamics with the help of various skill sets, different ethnic and cultural viewpoints, gender diversity, etc.
• Create a culture of learning and growth, tolerance, patience and perseverance across all levels of the organisation.

Mid-term Approach

• Design and launch programmes to improve diversity across all critical dimensions.

Value Created

• Achieved 40% women’s representation on the Board.

Risks

• Inconsistent labour engagement creates communication gaps, affects morale and impact employee performance.

Opportunities

• Tap into the power of labour networks to improve the quality of the workforce, work environment and productivity.

Mid-term Approach

• Strengthen labour management guidelines and governance to ensure effective and efficient resolution of all labour concerns and matters.

Value Created

• 62.63% of employees are unionised.
• All feedback received through the grievance mechanism has been resolved or is in the process of resolution.
• Maintained Industrial harmony with union during the pandemic.

Risks

• Weak or ineffective anti-corruption governance can lead to regulatory pressures, increased costs of non-compliance and unfavourable reputation.

Opportunities

• Principles of good governance can future-proof the organisation by strengthening resilience against extraneous factors.

Mid-term Approach

• Strengthen the governance of the enterprise risk management framework and various policies and processes for efficient implementation of EES programmes and initiatives.

Value Created

• Maintained zero number of cases of corruption/policy breaches reported through our whistle blowing channel.

Risks

• Irresponsible processes and practices along the supply chain can cause reputational damage and incur additional operational costs.

Opportunities

• Strengthen supply chain management by instilling sustainability practices among vendors and suppliers to ensure sustainable business growth.

Mid-term Approach

• Set standards for sustainable practices in the supply chain to raise the collective capacity of the industry and support local suppliers.

Value Created

• 43.19% suppliers were local, representing 33.56% of the Group’s procurement budget.
• Implemented 86 cost optimisation initiatives and achieved RM134 million cost savings.

Risks

• Poor OHS standards and practices lead to health threats, workforce inefficiencies and financial losses.

Opportunities

• Improve health and well being of employees, which in turn can improve productivity and performance.

Mid-term Approach

• Create a culture of ‘health and safety’ across the organisation through education and awareness.

Value Created

• Maintained zero cases of fatalities.
• 27 UMW operational sites, including branches, in Malaysia achieved the ISO 45001:2018 certification.

Risks

• Negative social and economic impact from our operations on local communities can potentially give rise to reputational repercussions.

Opportunities

• Enhancing stakeholder value for communities strengthens UMW’s market reputation as an engineer of sustainable business.

Mid-term Approach

• Implement community development initiatives that nurture future generations and equip youths with industry-ready skills, such as the PROTÉGÉ programme.

Value Created

• UMW Community Champions dedicated 2,372.5 volunteer hours.
• Contributed approximately RM1.5 million in cash and in kind to communities in need to mitigate the impact of COVID-19.