Materiality

Assessment

Materiality assessments are vital for our value creation journey as we seek to identify the ESG issues that matter most to our business and stakeholders.

Conducting a materiality assessment also allows us to align our material issues and priorities with current trends, global developments and industry peers.

Process of Sunway Berhad’s Materiality Assessment :

STEP

1

Identification of objectives and scope

STEP

2

Identification and categorisation of material issues

STEP

3

Stakeholder engagement (surveys and focus groups)

STEP

4

Prioritisation of material issues

STEP

5

Validation

STEP

6

Endorsement

ENVIRONMENTAL

  • 1

    Ecology & Biodiversity
  • 2

    Physical Impacts of Climate Change
  • 3

    Resource Management (Energy)
  • 4

    Resource Management (Water)
  • 5

    Pollution (Emission)
  • 6

    Pollution (Waste/Effluents)
  • 7

    Resource Management (Supply Chain & Materials)

SOCIAL

GOVERNANCE

  • 15

    Corporate Governance
  • 16

    Business Ethics
  • 17

    Risk & Crisis Management

Legend:

Prioritised

Considered

A

IDENTIFICATION OF MATERIAL ISSUES

Our first step in deciding material issues is to ensure that we comply with the requirements of local regulators. Since 2015, Bursa Malaysia has, under the Main Market Listing Requirements (MMLR) and Ace Market Listing Requirements, required all public listed companies in Malaysia to publish a sustainability statement. Since 2015, Sunway Berhad has published its Sustainability Reports annually to meet the mandatory regulatory rule. In September 2022, Bursa Malaysia enhanced the sustainability reporting requirements in the MMLR to elevate the sustainability practices and disclosures of listed issuers. The enhancement included a list of 11 common sustainability matters and several sector-specific sustainability matters.
We considered the risks to our Company, which consisted of internal and external risks. ESG risks were identified and incorporated into Sunway Berhad’s internal risk focus areas. The focus areas included external, financial, regulatory and compliance, value chain, people, corporate governance and infrastructure.

We also referred to major sustainability indices and rating and ranking tools such as FTSE Russell, MSCI and S&P CSA, among others, to understand exposure to sector-specific risks that were common to our industry classification.
We observed global megatrends or issues that had yet to be considered and analysed the global risks associated with these issues that could have direct or indirect impact on our Company. From here, we aligned our responses to support the achievement of global agenda such as the 17 UN-SDGs by considering the application of the Doughnut Economics Model Framework to provide a safe and just space for humanity without breaking the ecological ceiling.
Finally, we conducted an online survey with our stakeholders to gauge the material issues that should be prioritised based on the resources available to us.

B

LIST OF MATERIAL ISSUES

In 2022, we conducted a fresh materiality assessment with 14 material issues addressing economic, environmental, social and governance issues to better reflect our management approach.

ECONOMIC

  1. Macroeconomic issues
  2. Company’s financial performance
  3. Responsible and sustainable financing
  4. Capital allocation strategy (Build-Own-Operate (BOO) business model)
  5. Brand and reputation

ENVIRONMENTAL

  1. Climate action
  2. Protection of biodiversity
    and ecology
  3. Pollution management

SOCIAL

  1. Value chain improvement
  2. Employee well-being
  3. Human rights
  4. Community investment

GOVERNANCE

  1. Group standards and operating procedures
  2. Innovation and
    technology

C

STAKEHOLDER ENGAGEMENT

We engaged with our stakeholder groups via an online survey to identify and gauge the material issues that should be prioritised based on the resources available to us. We received more than 1,100 responses from the survey conducted.

Internal

Board of Directors

Employees

Sunway Senior Management / Business Division Heads

External

Customers

Media & NGOs

Suppliers /Vendors

Government Agencies / Regulators / Local Authorities

Investors / Financiers / Analysts

D

ONLINE SURVEY

The survey results showed stakeholders’ perceptions of the relative importance and impact of these issues on Sunway, as well as Sunway’s impact on these issues. Their responses were collated and plotted based on the stakeholders’ influence and impact according to the Board of Directors and Senior Management / business division heads, where the prioritised issues were located in the outermost section.

E

PRIORITISATION OF MATERIAL ISSUES

The results of the materiality assessment revealed six material issues that were most significant to stakeholders based on their impact on Sunway and Sunway’s impact on the issues. As part of our commitment towards Net Zero by 2050, we included Climate Action as the seventh prioritised material issue. These seven material issues reflect how we are shifting away from a solely profit-driven business strategy toward a multi-capital, multi-value perspective. This is supported by our knowledge that ESG can and has already affected financial performance.

Our Build-Own-Operate business model gives us a distinctive competitive edge. It enables us to harness the diverse commercial and operational synergies across our business divisions, and we are constantly conducting research and development to improve the model through Innovation and Technology, a material issue that is pertinent to our sustainable growth in a dynamic operating landscape. We have accelerated the adoption of technology and digitalisation in our aim to become a data-driven organisation. By leveraging innovation and technology, we seek to create integrated, digitalised and transit-oriented cities that are smart and sustainable. We will continue to invest in the training and development of our people in technical and soft skills to further improve our talent management. In this context, job satisfaction is vital for talent retention and employee well-being. We aim to achieve the full potential of our talent management in terms of hiring, retaining and developing our employees.

Overall, our materiality assessment’s findings have informed the management’s resource allocation, which guides our ability to create long-term value for our business and our stakeholders. Every prioritised material matter is intrinsically linked with our decision-making and risk management as it influences the inputs and outputs for each capital, as illustrated in our value creation model.

F

ENDORSEMENT

The results of the materiality assessment were approved and endorsed by the Board of Directors.