Fraser and Neave : Introduction to Social Pillar

Introduction to Social Pillar

WELL-BEING OF OUR PEOPLE, COMMUNITIES AND SOCIETIES

Thriving

F&N's successes over the last 140 years have been made possible through the unwavering commitment of our people, the support of our consumers, and the steadfast backing of the communities in which we operate. Maintaining a collaborative relationship with our stakeholders is imperative for our sustained success and growth. These relationships foster trust, innovation, and resilience, demanding continuous effort and adaptability to changing needs, ultimately driving our shared success.

We do so by offering a robust portfolio of high quality and nutritious products for consumers, providing vulnerable groups with the support they need, empowering our employees by providing tools for long-term growth and rewarding work environments, and respecting the human rights of all stakeholders.

Creating Value for Society

• Nutrition
• Community Development and Inclusive Growth
• Human Rights

Empowering Our People

• Human Capital Development
• Employee Safety, Health and Well-being

Contributing to SDGs

2025 SUSTAINABILITY TARGETS AND FOCUS AREAS

NUTRITION

72% of beverage and dairy products (based on formulation), excluding canned milk and cordials, comply with the Nutritional Guidelines by 2025

COMMUNITY DEVELOPMENT AND

INCLUSIVE GROWTH

10% increase in the number of annual community programmes F&N provides (from a 2020 baseline) by 2025

HUMAN CAPITAL DEVELOPMENT

Provide an average of at least 18 hours of training to Executives and 11 hours of training to Non-executives by 2025

EMPLOYEE SAFETY, HEALTH AND WELL-BEING

Reduce the LTIFR to 0

F&N believes that as a corporate citizen, valued should be created for our consumers, and the communities in our operational markets. As an industry leader in the F&B sector, F&N is committed to enhancing societal well-being by introducing healthier product options for its customers, extending support to local communities, and advocating for human rights.

Our efforts are further elaborated in the following sections:

• Nutrition
• Community Development and Inclusive Growth
• Human Rights

NUTRITIONSDGs

GRI Index:

GRI 416-1, GRI 416-2

Our philosophy of 'Pure Enjoyment. Pure Goodness' embodies our promise to consumers, ensuring we provide delicious, good-quality products that are rich in nutritional benefits. Together with promoting an active lifestyle, F&N aims to offer products that satisfy our consumers and enhance their health and well-being.

Our commitment to creating healthier products is driven by a keen awareness of the evolving microenvironment. By deeply understanding the needs and preferences of the societies in the countries where we operate, we strategically steer our new product development efforts towards offering healthier choices that resonate with our consumers. This approach not only reflects our responsiveness to changing market dynamics but also reinforces our dedication to promoting well-being through our product offerings.

Approach

Consumer F&B trends across the world are shifting. "Quality" is redefined by consumers to focus on affordable nutritious products. Yet many see cost as a barrier to improving their diet and health. This drives F&N to constantly reinvent, reformulate, and release new and improved products annually by focusing on reducing the sugar level of our beverages and fortifying the key nutrients in our products, to expand the availability of affordable nutritional beverages.

The F&N Nutrition Charter outlines our commitment to developing products that are healthy for consumers and guides us through our product development:

To develop products based on proven scientific evidence and research, and consumer insights and tastes relevant to evolving Asian lifestyles

Quality

To provide safe, high-quality and affordable products to all our consumers

Governance

To actively self-regulate and

ensure accountability via strong

corporate governance

Innovation

To innovate and constantly refine our

products to meet the changing needs of all our consumers and ensure consistent delivery of good taste and the right nutritional values

Our increasing health and nutrition ambition focuses on:

• Reducing sugar levels
• Catering to the diverse dietary needs of consumers
• Fortifying our products with micronutrients

F&N's product development team continues to expand the health and nutrition profile of our portfolio. It is important for F&N to provide products with healthier option that do not compromise on our consumers' enjoyment. A list of the new products launched in FY2023 can be found in the 'Innovation' chapter of this Report.

Performance

GRI 416-1 (2016)

Percentage of significant product and service categories for which health and safety impacts are assessed for improvement.

GRI 416-2 (2016)

Incidents of non-compliance concerning the health and safety impacts of products and services

93% of significant product categories for which health and safety impacts were assessed for improvement.

In FY2023, we maintained our health and safety standards with no significant incidents of non- compliance with regulations resulting in fine, penalty or warning.

Initiatives

Reducing Sugar Levels

Around 73% of our RTD products are certified HCS/HCL. Since 2004, F&N has taken deliberate steps in reducing the sugar content of our RTD products, and has since achieved a reduction of 61% in the sugar index (grams of sugar content per 100ml) across our range of RTD beverage products in Singapore and Malaysia.

Sugar Index: Total Beverages (SG & MY) with Water

• 61% reduction from FY03/04 to FY21/22, compared to 59% reduction from last reporting (FY03/04 to FY20/21)
• Decrease in FY 21/21 due to: Sugar tax implementation (MY), Nutrigrade regulations (SG) and product portfolio mix

F&N recognises that the scale of our operations in the region goes beyond impacting our consumers. Community is an essential component of our stakeholder network and significantly influences our business operations and achievements We connect and support local communities by maintaining positive relationships and strengthening them between different cultures to promote social inclusion.

Approach and Initiatives

In each market F&N operates in, we undertake several short and long-term programmes that serve to create greater social equity. We identified five areas to focus our community endeavours:

Strengthening Vulnerable Groups

The ongoing high inflation and subsequent tightening in global financing conditions would no doubt have devastating effects on the vulnerable and marginalised groups. This would further deepen inequality causing a greater global challenge. Our consumers and employees come from all segments of society and the widening inequality of wealth and opportunities undermine the development potential of our communities and also our business. As such, strengthening vulnerable groups is a key concern for us.

1. Malaysia: Upgrading of School's Resource Centre

F&NHB supported Sekolah Kebangsaan Tobobon, Kota Kinabalu in upgrading the facilities of school's resource to enhance the reading environment of students. The funds were utilised to purchase reading materials, two sets of air conditioning units, as well as rubber mats and curtains to improve the resource centre's ambiance.

2. Singapore: Assisi Fun Day 2023

Over 20 volunteers consisting of F&N staff from Singapore, family members and friends spent 11th June morning with 20 seniors from Lions Befrienders at the Assisi Fun Carnival to raise funds for Assisi Hospice.

The volunteers accompanied the seniors from Lions Befrienders' branch at Blk 318 AMK Lions Befrienders'. Each senior received vouchers worth $25 to buy food, drinks, apparels, handicrafts, shoes, books and many other interesting items from stalls at the Carnival.

Promoting Environmental Consciousness

Companies have a critical role to play in minimising our environmental footprint and leading sustainable development in societies. As we continue to move towards a circular economy model in our business, we exchange knowledge with communities and learn from them to better implement our ideas. Establishing partnerships with communities to promote environmental consciousness is our key priority.

1. Malaysia and Thailand: F&NHB School Recycling Program

F&NHB kickstarted the 2023 iteration of the School Recycling Programme as part of the Group's continuous efforts to raise awareness about the importance of recycling among school children. The campaign is held in partnership with SWCorp Malaysia, an agency under the Ministry of Local Government Development. This five month campaign targets about 1,300 primary and secondary schools throughout Malaysia.

The Waste Bank and Recycling Project was set up in two local schools, Wattanodtia School and Watkokmayom School, in the Ayutthaya Province of Thailand to improve their waste management infrastructure by setting up recycling stations and renovating waste storage areas. Through these projects, students were inculcated with good recycling habits and received tangible monetary benefits by selling the recyclables collected.

2. Singapore: Recycle N Save

Recycle N Save is a joint initiative by F&N and the National Environment Agency ("NEA") of Singapore. To date,

the initiative saw the collection of more than 16 million aluminium cans and PET bottles for recycling. More details can be found in the 'Packaging' section of this Report on pages 93 to 94.

Spreading Festive Cheer

Our community development programme regards our F&N brand promise - "Pure Enjoyment. Pure Goodness" by encouraging communities to connect with each other by spreading festive cheers and strengthening relationships between different cultures.

1. Malaysia: F&NHB Celebrates Hari Raya with Underprivileged

F&NHB continued its tradition of spreading joy to the less fortunate this Ramadan by hosting a buka puasa with the residents and staff of the Pertubuhan Rumah Anak Yatim Dan Asnaf Kampung Sijangkang in Selangor at the Kota Permai Golf & Country Club. During the buka puasa, our Chairman Y.A.M. Tengku Syed Badarudin Jamalullail presented duit raya and a full set of baju raya to each of the 51 children from the orphanage along with products from the F&N portfolio.

2. Malaysia: F&NHB Celebrates Chinese New Year with Underprivileged

This year, F&NHB continued its tradition to spread smiles this Chinese New Year, visiting 460 orphans, disabled children, and senior citizens across Malaysia. Close to 100 F&N volunteers visited 12 homes in total, located in Butterworth, Ipoh, Kuala Lumpur, Melaka, Johor, Mentakab, Kota Bahru, Kuala Terengganu, Kuching, Kota Kinabalu, and even Brunei. The volunteers distributed personal care products, Mandarin oranges, F&N food items, and ang pows worth around RM 5,000 to the residents.

Promoting Active Lifestyles

F&N's products contribute to the health and well-being of our communities. We have a long and proud tradition of promoting active lifestyles in the community, from grassroots developments to elite levels. We believe sports has an important role in all societies and is a powerful tool to support nation-building.

Lowering the barrier of access to sports and encouraging participation among youth is vital because it teaches core values like cooperation and respect, while instilling discipline and confidence within the individual. It is for this reason that 100PLUS is passionate in supporting schools and grassroots sports programmes, especially in football and badminton, to nurture future generations of champions.

2025 Target

1. Long-term Partnerships with Sporting Associations (Grassroots programmes)

F&NHB has been a long-term partner of the Football Association Malaysia, Badminton Association of Malaysia, Malaysian Hockey Confederation and the National Sports Council through our 100PLUS brand. 100PLUS is also the official beverage partner of the Johor Darul Takzim and Selangor Football Club. In addition, 100PLUS works closely with the Sportswriters Association of Malaysia (SAM) and is the primary sponsor for the annual SAM 100PLUS Awards.

F&NHB's allocation of investment in sports development is as follows:

2. Advocating for Healthy and Active Lifestyle

F&N continues our commitment to encourage our consumers to lead an active lifestyle by supporting major runs, marathons and sports activities, such as SGX Cares Bull Charge Charity Run 2023, Great Eastern Women's Run Singapore 2023, Standard Chartered Singapore Marathon 2023, Tour de France Prudential Singapore Criterium 2023, Standard Chartered Kuala Lumpur Marathon, Bursa Bull Charge 2023, Minggu Amanah Saham Walk 2023, and KL Car Free Morning.

The initiatives are synonymous with our brand essence to advocate an active lifestyle amongst our consumers.

Performance

GRI 413-1 (2016)

Operations with local community engagement, impact assessments and development programmes

100% of our operations have implemented local community engagement, impact assessments and development programmes.

At F&N, our business activities are carried out with a strong sense of responsibility, firmly guided by our commitment to uphold principles of good governance. Our corporate governance framework empowers us to uphold the highest

standards of human rights throughout our operations. We continuously work to improve our stakeholders' health and well-being and treat them with dignity, respect, and fairness.

Identify human rights issues for F&N Group's own operations, value chain and new business relations by considering the impact to the business and on potential rights holders. We benchmarked peer companies in the beverage and dairy sectors and acknowledged global human rights trends to improve our understanding on the impact of human rights issues.

Rank risks of the identified human rights issues that do not have controls and/or measures in place.

Rank risks of identified human rights issues that exist even with the company's controls and/or measures.

4 Risk Prioritisation

Prioritise salient human rights issues, and issues with high residual risk.

Results of HRRA

Likelihood

9 SALIENT

HUMAN RIGHTS

ISSUES WERE

IDENTIFIED FOR THE F&N GROUP.

• Human Rights Issues (F&N)
  1 Employee Health and Safety
  2 Community Health and Safety
  3 Working Condition
  4 Community Standard of Living
  5 Community Access to Water & Sanitation
  6 Consumer Health and Safety
  7 Consumer Discrimination
  8 Customer/Consumer Data Privacy
  9 Employee Discrimination

Policy Commitment

F&N has policies on human rights which are applicable to its employees, suppliers and business partners. The policy describes our commitments, particularly in the following areas:

• Prohibition of child labour, forced labour, human trafficking, and discrimination and harassment.
• Respecting and promoting fairness, diversity, the right to freedom of association and collective bargaining, fair remuneration and fair working conditions.
• Respect and promote health and safety, data privacy and the environment of our stakeholders.

F&N Human Rights Policy was developed in accordance with related human rights principles under international standards - the UN Universal Declaration of Human Rights, the UN Guiding Principles on Business and Human Rights, UN Global Compact, the International Bill of Human Rights and the International Labour Organization's Declaration on Fundamental Principles and Rights at Work. The Human Rights Policy upholds under domestic and international laws, rules, and regulations. The Human Rights Policy extends to all companies under the F&N Group.

Employee Health & Safety

Actual Issues

• Marketing & Sales: Client-focused departments have an increased risk of contracting the COVID-19 virus during work hours since they meet people in high frequencies
• Production + Human Capital: Minor work injuries and accidents
• Logistics: Road accidents during transportation, minor vehicle malfunction (e.g. flat tires)

Mitigation Measures

• Compliance with Public Health Regulations on COVID-19 measures, e.g. face masks, hand sanitizers, temperature checks
• Approved paid leaves for vaccinations and launched a vaccination program for employees
• Track employees' vaccination progress
• Offer doctor consultations and in-house panel clinics in large-scale production plants
• Increased safety training and safety briefing to identify potential risks at the start of the workday

Actual Issues

• Human Capital: An employee felt uncomfortable to report a case of verbal harassment until after resigning from the company

Mitigation Measures

• Inform employees the various channels and measures available to raise discrimination and harassment issues anonymously, e.g. welfare committee, reporting channel, mental health hotline
• Implement additional trainings for supervisors on preventing discrimination and harassment of employees

Potential Issue

• Discrimination by prioritising against certain groups of customers/consumers

Mitigation Measures

• Ensure F&N's products are targeted to all consumers
• Marketing strategies are suitable for a multi-racial society and ensure no content are inappropriate or discriminatory against one's gender, race, culture, etc.