Environmental Responsibility

Climate Change

Why It Matters

QL’s operations are exposed to climate-related physical and transition risks. Changes in weather patterns may affect farm productivity, livestock health, fish availability and production efficiency, while rising energy costs and regulatory developments may influence operating margins. These factors can have direct implications for operational stability and cost management across business pillars. Proactive management of climate-related risks is therefore important in maintaining resilience in an increasingly uncertain operating environment.

Our Approach

Climate change presents a significant challenge across our value chain, from raw material sourcing and production to logistics and product delivery. We recognize our contribution to greenhouse gas emissions as well as the need to adapt to climate impacts. As such, we operationalise our Climate Change Policy by decarbonisations, expanding the use of renewable energy, offering solar energy solutions to more clients, optimising energy efficiency as well as support climate adaptation initiatives i.e. mangrove reforestation and rehabilitation that may co-benefit climate mitigation, climate adaptation as well as disaster risk reduction (DRR).

In support of Paris Agreement’s agenda to limiting global warming to 1.5° Celsius, as well as the Net Zero commitments from countries (Malaysia, Indonesia and Viet Nam) that we operate in, QL has committed to Net Zero as early as 2050.

The Group aspires to reduce 90% of absolute Scope 1 and Scope 2 GHG emissions from our non-FLAG activities, and 72% of absolute Scope 1 and Scope 2 GHG emissions from our FLAG activities; as we make reference to the emission reduction pathway of Science based Targets initiative (SBTi).

The Group has commenced preparation for the IFRS S1 and S2 Standards disclosures. We initiated climate risk assessment on physical as well as transition risks and opportunities, referencing TCFD recommendations, and IFRS S2 Standard.

Governance

Climate-related matters at QL are overseen by the Board of Directors (“the Board”), which provides oversight and strategic guidance on the Group’s sustainability and climate agenda as reflected in the Board’s Charter, supported by EXCO, Sustainability Steering Committee (SSC) and Sustainability Reporting Working Group (SRW).

Strategy

QL took an important step forward by commencing preparation for the IFRS S1 and S2 Standards disclosure. We initiated climate risk assessment on physical as well as transition risks and opportunities, referencing TCFD recommendations, and IFRS S2 Standard.

In alignment with the scope of reporting of this Sustainability Statement:

All business units are exposed to climate-related transition risks
All business units are vulnerable to climate-related physical risks
All business units identified climate-related opportunities

With a clearer understanding of the potential impacts of climate change on its operations and value chain, QL has developed and implemented a range of risk response measures to address the potential impacts of climate-related physical risks across its operations and value chain. These measures are tailored to specific hazards, including flooding, storm-induced flooding, storm winds, landslides, rising temperatures, extreme heat impacts on biological assets, drought, and sea level rise, preparing for transition towards a low-carbon and climate-resilient future.

Collectively, these measures form QL’s operational response to climate-related physical risks and are implemented to reduce potential disruption to operations and maintain continuity across affected sites.

As opportunities arise, QL considers potential in:

Resource Efficiency: The adoption of circular economy principles i.e. composting chicken manure to fertiliser for agricultural use, converting fisheries waste to fishmeal as aquaculture feed
Energy Source: Both Energy Efficiency and Renewable Energy system or appliances where feasible i.e. Solar PV, Solar Battery Energy Storage System (BESS) etc. within prevailing regulatory provisions.
Products & Services and Market: Observing the demand of sustainable products, where relevant sustainability
certifications or green label may enhance market access.

Risk Management

QL continuously reviews the relevance of its transition and physical climate risks by tracking developments in climate science, regulatory changes, and shifts in business strategy. This ongoing process enables QL to proactively manage emerging climate-related risks to reduce potential impacts, while also identifying and capitalising on opportunities in a timely manner.

QL applies an integrated Enterprise Risk Management (ERM)-aligned process to identify, assess, prioritise, and monitor climate-related risks and opportunities. The process of climate scenario analysis combines exposure and vulnerability analysis, geospatial assessment of high-risk assets, as well as policies and market outlook to assess the physical and transition risks under different climate scenarios.

Risks and opportunities are prioritised using a structured risk matrix based on confidence and severity and subsequently quantified through a 1–5 Impact and Likelihood scoring system. Prioritised climate risks are integrated into the ERM framework to ensure comparability with other enterprise risks. Prioritisation also considers QL’s risk appetite, regulatory sensitivity, and strategic relevance, ensuring alignment with overall corporate risk governance.

Risks are monitored on an ongoing basis, with entities responsible for day-to-day management. The risk management reporting structure is as illustrated below. QL continuously monitors emerging climate science, regulatory developments, and business strategy shifts to ensure the relevance of risk assessments.

Commitment to Climate Change

To showcase our dedication to addressing climate change concerns, we introduced a Climate Change Policy in FY2024. The policy outlines QL’s strategy for tackling climate-related matters and integrating climate considerations into our decision-making procedures.

Our Target

Achieve 20% GHG emissions reduction by FY2026 from FY2020 baseline.

FY2026 Performance

Reduce 6.1% GHG emissions intensity from the base year FY2020

FY2026 Highlights

901,862.84 GJ

renewable energy consumed

30,029.04 tCO₂e

of GHG emissions avoided

6.1%

GHG Intensity Reduction

Note: Performance since FY2020

Our Performance

Energy Consumption

Indicator	Unit of Measurement	FY2024	FY2025	FY2026
Total Non-Renewable Energy Consumption	Per Thousand Gigajoule, 000 GJ	1,184.20	1,277.67	1,296.68
Scope 1 (Diesel, Petrol, Natural Gas & Liquified Petroleum Gas)	000 GJ	503.13	547.63	538.66
Scope 2 (Purchased Electricity)	000 GJ	681.07	730.04	758.02
Renewable Source by Type
Solar, Biogas & Biomass	000 GJ	977.51	891.80	901.86
Energy Intensity
Total Energy Consumption	000 GJ	2,161.71	2,169.47	2,198.54
Energy Intensity	GJ/ RM Mil Revenue	484.88	442.39	449.01

GHG Emissions

Indicator	Unit of Measurement	FY2024	FY2025	FY2026
Total GHG Emissions	Per Thousand Tonnes, 000 tCO₂e	153.64	164.85	170.61
Direct GHG Emissions (Scope 1)	000 tCO₂e	36.10	38.63	39.59
Indirect GHG Emissions (Scope 2)	000 tCO₂e	117.54	126.22	131.02
GHG Emissions Intensity	tCO₂e/ RM Mil Revenue	34.46	33.62	34.84
Indirect GHG Emissions (Scope 3)	000 tCO₂e	-	22.30	8.51
GHG Emissions Avoidance
Total GHG Emissions Avoided	000 tCO₂e	25.79	24.03	30.03