Governance and Ethics

Sustainability at F&NHB is governed by our Board, which is kept updated on our performance by our Sustainability Management Committee (SMC) that oversees a Sustainability Development Working Team. Our governance framework ensures both that: 1) sustainability policies approved by the Board are implemented on the ground; and that 2) performance on the ground is reported to the Board. At the Board, sustainability is overseen by the Sustainability & Risk management Committee as our sustainability strategies support F&NHB’s risk management.


At F&NHB, we focus on three key areas in overall risk management framework:

1 Business Operational Risks

2 Integrating material sustainability issues

3 Emerging risks which may impact us in mid or even long-term basis

We have integrated the material sustainability issues into our overall risk management framework by identifying specific risks, opportunities, and key priorities for the financial year to drive our strategic decisions. Specific sustainability risks are managed as part of the Enterprise Risk Management. This helps us to develop better products and create more meaningful value for our stakeholders.

Risk appetite and risk tolerance statements are reviewed by the SRMC and approved by the Board annually. At the end of the financial year, the Board receives assurance from the CEO and Chief Financial Officer that the risk management and internal control system in place for the Group is adequate and effective to address risks which the Group considers relevant and material to its operations through the ERM Validation Report and Comfort Matrix.

Risk Matrix
Emerging Risks Climate Change Risk Risk from disruptive digital technology and disruption
  • Environmental
  • Technological
Description The Malaysian government’s emphasis on the energy transition aligns with global efforts to combat climate change and underscores Malaysia’s commitment to a sustainable and prosperous future. For instance, Malaysia had revised the Nationally Determined Contribution (NDC) to reduce the intensity of greenhouse gas (GHG) emissions by 45 per cent by 2030 compared with 2005 levels.

The globalisation of the world’s economy is vulnerable and prone to the impacts of climate change such as fires, floods, heat waves, windstorms, cold fronts etc which may result in loss of human life, damage to ecosystems, destruction of property and/or financial loss at a global scale. The volatility of global weather disruption may influence the economic activities. As such, any significant increase in prices of commodities and materials could materially affect the cost and profitability of our products.

It is therefore a new risk that may occur in the future and affect F&N’s business operations.

Like many industries, food and beverage industry is prone to be affected by the development and employment of technologies and innovations to increase production efficiency, decrease the dependence on human labour, save costs for the business in the long run, and respond to the ever-changing demand of consumers.  Hence, there is a risk which the company could not adapt itself to keep pace with technological advancement in terms of products, business model, and route-to-market resulting in significant impact on the Company in the long run.
  • Potential impact on revenues and financial performance ie reduced profit margins, increase in production and operating costs from the tax levy through the enforcement of laws and regulations for climate change mitigation
  • High insurance premium and disaster restoration costs
  • Loss of competitive advantage
  • Potential impact on revenue and financial performance ie. Inability to achieve targeted revenue and business growth plans
  • Loss of competitiveness and market share
  • The threat of new and smaller entrants, including existing competitors which leads to more intense business competition
Mitigating Actions
  • Established structural flood mitigation measures to protect the facilities and mitigate the damage in the event of flood
  • Identify and analyse possible risks to the organisation from climate change
  • Keep sufficient inventory on hand to supply business and customers in the event of natural disaster damage
  • Sufficient insurance coverage to insure high risk components
  • Commodities and materials price risk is managed through forward purchase of key commodities, active monitoring of commodities price trends, and vigilant sales forecasting and production planning
  • Define and continuously refine the digital vision and strategy to align the organisation with the needed change
  • Stay up-to-date with latest innovations and technology trends thru following tech news, attending online training/ webinars and follow industry social media accounts
  • Continually assess and invest in new technologies to leverage the strength of our product portfolio, enhance the capabilities of our people, improve the efficiency of our manufacturing and distribution, and innovate in our route-to-market

We have in place various policies and guidelines that ensure a high level of integrity across the organisation such as our Anti-Bribery and Anti-Corruption (ABAC) Policy, Code of Business Conduct and Human Rights Policy. These are aligned with the UN Guiding Principles on Business and Human Rights, International Labour Organisation (ILO) guidelines, Thailand’s Labour Protection Act and Malaysia Employment Act 1955.


publicly reported breaches of the Code of Conduct in the past 5 years

(including customer privacy data, conflicts of interest, and money laundering & insider trading)

(FY2018 – FY2022)


publicly reported case of corruption and bribery in the past 5 fiscal years

(FY2018 – FY2022)


publicly reported case of discrimination and harassment in the past 5 fiscal years

(FY2018 – FY2022)

Read Our Codes and Policies