Fraser & Neave Holdings Bhd Sustainability Report 2019

Operations’ Exposure to Climate Change Risk F&NHB’s operations and supply chain face risks due to climate change impacts. This includes impacts from rising sea levels, extreme temperatures, farming shortages and water availability. Climate change risks are monitored and managed as part of our Enterprise Risk Management process, which is under the responsibility of the Sustainability and Risk Management Board Committee. Identified climate change related risks include flooding and mineral water sourcing and contamination. To manage these risks, we work closely with state authorities and local councils which monitor climate-change risks. We also have robust incident escalation procedures and response plans in place as part of our Business Continuity Management (BCM). Double-decker trucks Route Planning Optimal route planning can help us to reduce costs and be more environmental-friendly. We have therefore streamlined our distribution networks over the past few years. Our Malaysia operations made significant progress in recent years by switching from single-deck trucks to double-decker trucks. We have also increased the product load per truck deck from 22 pallets to 26 pallets. We are now able to move more goods per trip and therefore reduce the number of trips. For FY2019, the cost savings achieved were estimated to be about RM300,000. During the past year, we have implemented the Oracle Transport Management (OTM) system that has an overall efficient control over logistics operations in Malaysia, which comprises overall in-bound, out-bound and export of containers. Through this system, our Distribution team now has full visibility of all the transportation activities throughout the entire supply chain. With this web-based system, we are able to improve our operational efficiency through: • Optimised operational planning – our team can plan and optimise shipments based on cost, service level and asset utilisation; • Improved fleet management – our team can better manage the fleets by transporters, from driver and equipment assignment, dispatch, asset tracking, event management and supplier payment. With the GPS integration into OTM, our planners can track the trucks at any time to ensure safety and timely arrival at destinations. F&NHB has made more than RM800 million of capital investments since 2014 on new lines and warehouses across our production facilities in various locations. This decentralisation strategy also means that our manufacturing and warehouse operations are closer together, resulting in shorter routes to market and lower carbon emissions from logistics. We have also invested RM78 million in a sophisticated Automated Storage Retrieval System (ASRS) at our new integrated warehouse at Shah Alam plant, which will reduce the need for forklifts thus further reducing carbon footprint of our warehouse operations. Read more about the ASRS in page 040. WWW . F N . C O M . M Y F R A S E R & N E A V E H O L D I N G S B H D 080 ECO-EFFICIENCY