CONNECTING COMMUNITIES DELIVERING VALUE

SUSTAINABILITY REPORT 2017 Our Vision Our Stakeholders Our Mission

To be the PRIDE of Our Shareholders, Staff, P Producing Quality, On Spec & On Time Sarawak & Beyond Customers & Community R Respect & Integrity

I Improving, Innovating & Investing in People

D Delivering Sustainable Growth

E Environmentally Conscious, Safe & Conducive Workplace

TABLE OF CONTENTS

1 About this Report

2 Our Business

4 Corporate Information

5 Corporate Structure

6 Performance at a Glance

7 Financial Highlights

7 2017 Share Price Performance

8 Board of Directors

10 Senior Management Team

12 Message from Our Group Managing Director

16 Our Four Stakeholder Group Model

18 Materiality Mapping

19 Economic

24 Environment

36 Social: Labour Practices and Decent Work

53 Social: Society

66 Social: Product Responsibility

70 Ensuring a Sustainable Future SUSTAINABILITY REPORT 2017 1 About This Report This About Head Office Departments Cement Division Construction Materials & Trading Division Construction & Road Maintenance Division Property Development Division Samalaju Development Division Sustainability Reporting Awards (MaSRA) Guidelines for Malaysian Companies International Organisation for Standardisation (ISO) 26000:2010 Guidance on Social Responsibility CMS’ Departments and Divisions: ------Global Reporting Initiative (GRI) G4 Sustainability Reporting Guidelines Bursa Malaysia’s Sustainability Reporting Guide Association of Chartered Certified Accountants (ACCA) Malaysia 1 January to 31 December 2017 (Financial Year or FY 2017) unless specified Annually The activities of the Group’s associate companies are not covered in this Report due to the fact that at the associate level, CMS’ influence is at Board level only. At each associate company, the respective management teams are responsible for implementing their own sustainability agendas. The scope of this Sustainability Report aligns with that of the Annual Report to ensure consistency in the line of reporting and financial statements. Note that the scope of this Report only covers the abovementioned Departments and Divisions that CMS has full management control over and which we are able to apply our Sustainability Agenda to. REPORTING CYCLE REPORTING SCOPE REFERENCES AND GUIDELINES AND REFERENCES REPORTING PERIOD REPORTING

• • • • • • • • • • • This Report serves as a tool to demonstrate to our stakeholders and other interested a tool to demonstrate to our stakeholders This Report serves as sustainable and responsible a in operations our undertake to continued we how parties manner throughout 2017. financial aspects of Report 2017, which highlights the Together with our Annual transparent and comprehensive clear, a provide reports two these business, our and Social performance in managing the Economic, Environmental representation of our is detailed information on the scope and (EES) aspects of our operations. Outlined below have been no changes to the boundaries criteria used when preparing this Report. There Report 2016. of this Report from the previous Sustainability This is Cahya Mata Sarawak Berhad’s (CMS or the Group) the or (CMS Berhad’s Sarawak Mata Cahya is This our sustainability which discloses Report, third Sustainability manner in line a transparent and objective achievements in Reporting Initiative or GRI Guidelines. with the Global As a leading proponent of the Sarawak’s growth story, CMS continues to identify opportunities to help build and strengthen linkages between markets, businesses and communities, as well as create tangible value for our key stakeholders. These include the host of infrastructure projects and related services required across the State and the energy-intensive opportunities under the Sarawak Corridor of Renewable Energy (SCORE) initiative. By continuously reinvesting into our core competencies and expanding into related infrastructure facilitation activities, we continue to create a long-term, sustainable growth pathway for both CMS and Sarawak, as well as good value for our stakeholders. As we maximise our participation in the Sarawak growth story, CMS undoubtedly remain one of the best proxy-listed investments for Sarawak’s dynamic growth. The cover of Cahya Mata Sarawak Berhad’s The cover of Cahya Mata Sarawak Berhad’s 2017 Sustainability Report portrays the Darul Hana Bridge, Kuching’s iconic new landmark which connects the northern and southern parts of the city, and which CMS had a hand in constructing. Our cover also carries the theme ‘Connecting Communities. Delivering the Value’ which not only reflects the role that bridge is playing in integrating communities as and delivering tangible value, it also serves an expression of how CMS is doing its bit to connect communities and deliver real value. Connecting Communities Delivering Value Our Business

Cahya Mata Sarawak Berhad (CMS) is Sarawak’s leading infrastructure facilitator and Kuala a prime mover in Sarawak’s Lumpur growth story. Sabah

Originally established as a cement manufacturer some 43 years ago, CMS has steadfastly grown from strength to strength amidst the challenges of the marketplace and successfully diversified into the manufacturing and trading of Cement and Construction Materials; Construction; Road Maintenance; Township, Property and Infrastructure Development; Education; Financial Services; and Alloys Smelting. In 2015, CMS bolstered its role as an infrastructure

(21076-T) facilitator by venturing into the telecommunications infrastructure arena.

CMS’ solid progress over the years is very much a reflection of Sarawak’s own Sarawak dynamic progress. As the State moves into a new era of growth with the Sarawak

Cahya Mata Sarawak Berhad Corridor of Renewable Energy (SCORE), CMS’ expansion path too is moving into a new trajectory to take advantage of the business investment opportunities in energy-intensive industries and their infrastructure and related needs. Given the vast business potential within SCORE and throughout the State of Sarawak, CMS continues to leverage on its healthy balance sheet, local knowledge, an experienced management team, proven strategies and a synergised portfolio of Sarawak-based businesses, to maximise its participation in the Sarawak’s growth story. CMS’ Stable of Businesses:

Ferrosilicon & Manganese Today, CMS is listed on the Main Market Cement & Clinker Alloys Smelting of Bursa Malaysia Securities Berhad (Bursa Malaysia), the Malaysian stock exchange. As of 31 December 2017, CMS’ Construction Financial Services market capitalisation stood at RM4.19 billion. Construction Materials Hotel & Workers’ Trading & Agencies Accommodation

Industrialised Building System Education (IBS) Products & Solutions

2 Our Business

KUCHING SIBU Batu Niah Tanjung Manis Samalaju Saratok Lawas Kota Samarahan Mukah MIRI Sarikei Limbang

Marudi Lundu SUSTAINABILITYREPORT 2017 BINTULU Bau Tapah

Mambong Betong Kapit Sg. Asap Sri Aman Simunjan

Serian

Township & Property Precast Concrete Products Steel Fabrication & Engineering Development

Steel Pipe Manufacturing Premix Wire Mesh & Laying

Project Management Stone Aggregates

Road Maintenance Telecommunications Infrastructure

3 Cahya Mata Sarawak Berhad Corporate Information Mdm UmangNangkuJabu Mr ChinMuiKhiong Y BhgDatuHubertThianChongHui Y BhgDatukSeriYamKongChoy Y DHDato’RichardAlexanderJohnCurtis Y BhgDatukSyedAhmadAlweeAlsree Y BhgDatoSriMahmudAbuBekirTaib Anwar Jamalullail Y AMTanSriDato’SeriSyed 21076-T Cahya MataSarawakBerhad DIRECTORS COMPANY NUMBER COMPANY NAME 4 f t Selangor DarulEhsan 47301 PetalingJaya Jalan PJU1A/46 Pusat DaganganDana1 Level 6,SymphonyHouse Symphony ShareRegistrarsSdnBhd w www.cmsb.com.my f t Sarawak 93100 Kuching Jalan SungaiSarawak Level 6,WismaMahmud Denise KooSweePheng SHARE REGISTRAR REGISTERED OFFICE GROUP COMPANY SECRETARY +60 378418151/8152 +60 378490777 +60 82333828 +60 82238888 Stock Number:2852 Stock Code:CMSB Sector: IndustrialProducts Bursa MalaysiaSecuritiesBerhad Main Market RHB BankBerhad Maybank IslamicBerhad Kenanga InvestmentBankBerhad Hong LeongBankBerhad CIMB IslamicBankBerhad Bank MuamalatMalaysiaBerhad Ernst &Young STOCK EXCHANGE LISTING PRINCIPAL BANKERS AUDITORS SUSTAINABILITY REPORT 2017 5 4.16% As at 12 March 2018 12 March As at CMS I-Systems (India) Pte Ltd HELP IBRACO CMS Sdn Bhd HELP IBRACO CMS Sdn COPE Private Equity Sdn Bhd Kenanga Investment Bank Berhad* KKB Engineering Bhd* SACOFA Sdn Bhd OM Materials (Sarawak) Sdn Bhd Malaysian Phosphate Additives (Sarawak) Sdn Bhd OM Materials (Samalaju) Sdn Bhd CMS I-Systems Bhd CMS Capital Sdn Bhd Cahya Mata Sarawak Management Services Sdn Bhd CMS Education Sdn Bhd INACTIVE COMPANIES SERVICES / DORMANT / 30% 51% 100% STRATEGIC INVESTMENTS 21.22% 20% 50% 25% 25% 95% Corporate Structure Corporate 100% 100% 100% 44.25% * 20% 40% PPESW BPSB JV Sdn Bhd 40% CMS Premix Sdn Bhd CMS Penkuari Sdn Bhd CMS Roads Sdn Bhd CMS Pavement Tech Sdn Bhd PPES Works (Sarawak) Sdn Bhd PPES Concrete Product Sdn Bhd CMS Quarries Sdn Bhd Betong Premix Sdn Bhd CMS Premix (Miri) Sdn Bhd 70% CMS Infra Trading Sdn Bhd CMS Works Sdn Bhd CMS Wires Sdn Bhd CMS Resources Sdn Bhd 80% 60% 60% 51% 60% 100% 100% 100% 100% 69% 51% 51% 100% CONSTRUCTION & ROAD MAINTENANCE DIVISION INFORMATION & COMMUNICATION INFORMATION & COMMUNICATION TECHNOLOGY DIVISION CONSTRUCTION MATERIALS & TRADING DIVISION CORE BUSINESS DIVISIONS CMS Cement Industries CMS Cement Industries Sdn Bhd Samalaju Hotel Management Sdn Bhd Samalaju Management Services Sdn Bhd CMS Land Sdn Bhd CMS Property Management Sdn Bhd CMS Hotels Sdn Bhd CMS Concrete Products Sdn Bhd Samalaju Industries Sdn Bhd Samalaju Properties Sdn Bhd CMS Property Development Sdn Bhd CMS Cement Sdn Bhd Projek Bandar Samariang Sdn Bhd 51% 51% 100% 100% 100% 100% 100% Listed on Main Market of Bursa Malaysia The dotted line above represents the Management reporting lines 51% 100% 100% 100% 100% SAMALAJU DEVELOPMENT DIVISION PROPERTY DEVELOPMENT DIVISION CEMENT DIVISION * Cahya Mata Sarawak Berhad Performance at aGlance 6 PROFIT ATTRIBUTABLE TO OWNERS OF THE COMPANY 1,416,841 175,072 2013 2013 1,673,898 221,335 2014 2014 REVENUE (RM’000) (RM’000) 1,788,008 248,149 2015 2015 1,551,319 169,177 2016 2016 1,606,444 213,210 2017 2017 1,654,117 294,894 2013 2013 TOTAL SHAREHOLDERS’ FUNDS 1,811,731 341,452 PROFIT BEFORE TAXATION 2014 2014 (RM’000) (RM’000) 2,017,501 388,596 2015 2015 2,212,836 302,139 2016 2016 2,349,846 330,774 2017 2017 SUSTAINABILITY REPORT 2017 7 8.0 2.95 0.27 2.13 2.19 9.35 5.22 3.30 4.70 3.90 2017 2017 19.85 689,628 636,364 330,774 213,210 2,033,084 2,349,846 4,087,202 1,074,376 1,606,444 6.3 1.99 0.11 2.00 2.06 8.00 4.90 3.17 5.23 4.00 2016 2016 15.75 687,867 247,956 169,177 302,139 1,371,984 2,212,836 3,451,337 1,074,376 1,551,319 Financial Highlights Financial 4.5 2.14 0.08 1.82 1.88 7.68 3.80 6.00 5.13 2015 2015 12.96 23.31 611,112 163,678 248,149 388,596 1,307,756 2,017,501 3,231,079 1,064,741 1,788,008 8.5 2.51 0.06 1.68 1.74 7.90 3.30 4.72 3.96 2014 12.77 21.42 639,462 104,796 221,335 341,452 1,602,401 1,811,731 2,800,131 1,033,352 1,673,898 bonus issue After split and 2017 Share Price Performance (RM) 2017 Share Price Performance 2014 17 2.99 0.06 4.70 4.88 7.22 6.55 2013 11.17 11.46 10.50 17.52 * 451,313 100,102 175,072 294,894 999,276 * 1,349,054 1,654,117 2,423,892 1,416,841 bonus issue Before split and 2.99 6.99 6.89 2013 Adjusted for the share split and bonus issue

Current ratio (times) Current assets (RM’000) Current liabilities (RM’000) Gearings (times) Gross dividends per share (sen) Gross dividends per share (RM’000) Total shareholders’ funds Total assets (RM’000) Net tangible assets per share (RM) Net assets per share (RM) Return on average shareholders’ equity (%) Return on total assets (after tax) (%) Total borrowings (RM’000) Basic earnings per share (sen) Basic earnings per share Profit attributable to owners of the Company (RM’000) Profit attributable to of shares (‘000) Weighted average number Revenue (RM’000) (RM’000) Profit before taxation Low High Closing * Cahya Mata Sarawak Berhad Board of Directors 8 Group ExecutiveDirector Independent, Non-ExecutiveDirector Group Chairman AHMAD ALWEE ALSREE Y BHG DATUK SYED SYED ANWAR JAMALULLAIL Y A M TAN SRI DATO’ SERI

Non-Independent, Non-Executive Director Non-Independent, Non-ExecutiveDirector Deputy GroupChairman ALEXANDER JOHN CURTIS Y D H DATO’ RICHARD ABU BEKIR TAIB Y BHG DATO SRI MAHMUD

SUSTAINABILITY REPORT 2017 9

Board of Directors of Board THIAN CHONG HUI CHONG THIAN JABU NANGKU UMANG Y BHG DATU HUBERT HUBERT DATU BHG Y Non-Independent, Non-Executive Director Independent, Non-Executive Director

CHIN MUI KHIONG MUI CHIN Y BHG DATUK SERI SERI DATUK BHG Y YAM KONG CHOY KONG YAM Independent, Non-Executive Director Independent, Non-Executive Director Cahya Mata Sarawak Berhad Group Finance General Manager, Group Procurement Senior GeneralManager, Group GeneralCounsel Chief InformationOfficer Technology Division Head, Information&Communication Group ChiefFinancialOfficer Group ChiefExecutiveOfficer-Operations Group ChiefExecutiveOfficer-Corporate Group ExecutiveDirector Senior Management Team TAN MEI FUNG DANNY SIM WEI MIN DAVID LING KOAH WI MOHAMED ZAID ZAINI SYED HIZAM ALSAGOFF GOH CHII BING Y BHG DATO ISAAC LUGUN AHMAD ALWEE ALSREE Y BHG DATUK SYED 10 5 4 3 2 1 8 7 6

3 1 7 5 8 6 4 2 SUSTAINABILITY REPORT 2017

11 9 15 16 10 11 12 13 14 Special Projects LIM JIT YAW JIT LIM Cement Division Trading Division GOH CHII YEW CHII GOH Head, Construction & CHONG SWEE SIN SWEE CHONG Group Internal Auditor Chief Executive Officer, Senior General Manager, Senior General Manager, Senior General Manager, Group Human Resources SUHADI SULAIMAN SUHADI Road Maintenance Division Samalaju Properties Sdn Bhd Acting Chief Executive Officer, WENDY YONG SAN SAN SAN YONG WENDY Head, Construction Materials & FRANCIS LOU CHEE NGEE CHEE LOU FRANCIS Head, Property Development Division VINCENT KUEH HOI CHUANG HOI KUEH VINCENT Senior Management Team Management Senior ABDUL NASSER BIN MOHD SANUSI MOHD BIN NASSER ABDUL 14 16 12 10 9 15 13 11 Cahya Mata Sarawak Berhad ethical company. and entrenchourselvesas aprogressiveand tangible corporatesocial responsibilitypractices we continuetogaingoodgroundasimplement for thesecondconsecutiveyearatteststofact that CMS’ inclusionintheFTSE4GoodBursaMalaysia index Message from OurGroup ManagingDirector 12 Dato’ RichardCurtis Group ManagingDirector SUSTAINABILITY REPORT 2017

13 in forging the Miri- Marudi Road Rehabilitation Project which is helping reduce the gap between rural and urban areas. CMS continues to maintain its status as a constituent of the F4GBM Index for the second year running. CMS has had a hand

Message from Our Group Managing Director Managing Group Our from Message anniversary of Bandar Samariang, th

OUR ROLE IN CONNECTING COMMUNITIES AND AND COMMUNITIES CONNECTING IN ROLE OUR VALUE DELIVERING This year, the cover of our Sustainability Report portrays This year, the cover of our Sustainability Report had a hand the newly-built Darul Hana Bridge which CMS Head of State, in constructing. Launched by Sarawak’s Mahmud, on His Excellency Tun Pehin Sri Haji Abdul Taib Kuching 11 November 2017, this iconic bridge connects cover also City North with Kuching City South. Our Delivering carries the theme ‘Connecting Communities. role that the Value’ which is not only a reflection of the communities, bridge is playing in linking and integrating is doing its it also serves as an expression of how CMS tangible value. bit to connect communities and deliver growth story, As a leading proponent of the Sarawak’s will help build CMS continues to identify strategies that businesses and strengthen linkages between markets, for diverse and communities, as well as create real value stakeholders. Aside from the Darul Hana Bridge, another one of the linkages that CMS has had a hand in forging is the Miri- subsidiary, Group Project by Road Rehabilitation Marudi CMS Roads Sdn Bhd. Connecting towns and people, the project is not only on track but progressing well ahead of its original 30-month schedule. The project also directly addresses one of Sarawak’s biggest challenges which is to reduce the development gap between the rural and urban areas, not only in terms of infrastructure, but also by way of improving access to markets and lifting the level of income in the State’s rural communities. Other examples of our building linkages and delivering value include the construction of the Datuk Temenggong Abang Kipali bin Abang Akip Interchange, via a shallow underpass, to ease traffic congestion and connect of fiberisation and construction the communities; telecommunication towers, as well as the rollout of broadband infrastructure throughout Sarawak to link and elevate the livelihood of rural communities; and the celebration of the 20 the township and community which we have built and developed, as well as created tangible value for.

I am delighted to present the third standalone I am delighted to present the third Berhad Sustainability Report of Cahya Mata Sarawak CMS’ inclusion in the index for the second consecutive Dear Stakeholders, 2017, FY in place took developments positive Several in remaining a one of which was the Group’s success (F4GBM) constituent of the FTSE4Good Bursa Malaysia January 2018, Index. I am pleased to report that that on 13 our status as CMS received news that we had maintained second year a constituent of the F4GBM Index for the index running. The F4GBM Index is a globally recognised by the London launched by the FTSE Group and owned Stock Exchange. It measures and recognises companies across the world who are demonstrating strong Environmental, Social and Governance (ESG) practices. In Malaysia, F4GBM index constituents are selected from the Top 200 Malaysian stocks on Bursa Malaysia and screened in accordance with transparent ESG criteria. that will help build and strengthen linkages linkages build and strengthen that will help communities, businesses and between markets, stakeholders. real value for diverse as well as create CMS’ (CMS or the Group) which encapsulates ended year financial for the journey sustainability in review, 31 December 2017 (FY 2017). For the year its pursuit of CMS once again made good progress in turning responsible business and sustainable growth, Economic, in commendable performances on the Environmental and Social (EES) fronts. year attests to the fact that we continue to gain good ground as we implement tangible corporate social responsibility practices and entrench ourselves as a progressive and ethical company. With this international recognition, we now show up on the radar of financial institutions who have set down strict ESG criteria This achievement is also doing for their investments. much to reduce our perceived non-financial risk profile by positioning us as a company that is upholding a sustainability-based (and thus safer) business model which will ultimately draw more investors in. This repeat performance is a result of the worthy efforts put in by the entire Group including our Board of Directors (Board), Senior Management team and employees and I sincerely thank them for their fine work. CMS continues to identify strategies to identify strategies CMS continues Cahya Mata Sarawak Berhad Message from OurGroup ManagingDirector 14 especially amidstthedifficulttimes. strong tieswithinourfamilycontinues toholdusingoodstead ever-increasing valuetoourstakeholders. Oursuccessinfostering work togetherwiththemtofindnewandinnovativewaysdeliver retain them,nurturethemwithinacreativeenvironment,aswell as disaster. HereatCMS,weendeavourtolookforthebesttalent, as meetingotherwiseunaffordablemedicalexpensesorafamily in tohelpemployeesfacingchallengesbeyondtheirresources such proud ofourCompassionateFundwhich,uponapplication,steps company. Over and above contractual employee benefits, we are coupled withtheprofessionalismofawell-runmeritocratic listed them thewarmthandcamaraderieofafamilyenvironment, committed tonurturingthewell-beingofourfamilybyaccording – theyarepartandparceloftheCMSfamily.Wedeeply Our employeesaremorethanjustcomponentsofourworkforce Environmental sectionofthisReport. The resultsofCMS’preservationeffortsarespeltoutinthe Bintulu plantisscheduledtofollowsuitin2018. and Pendinggrindingplantsin20162017respectively,the Following the implementation process at our Mambong clinker us to set objectives and measure results in a more effective manner. ISO 5000:2011energy management framework which is enabling In FY2017, we continuedto make goodprogress by way of our for ourownplansandCMS’sustainabilityagenda. utilise atleast70%IBScomponents and solutions,thisaugurs well agenda throughbymakingitmandatoryforgovernmentprojectsto With thegovernmentshowingitscommitmenttopushingIBS manual foreignlabour,plusreducestheoverallcostofconstruction. risks, alleviatestheissueofdependencyonskilledworkersand quality andproductivity,reducesoccupationalsafetyhealth construction as it is a methodology that lends to better construction the CementDivision.IBSconstructionunderpinssustainable the Group’s Industrialised Building System (IBS) business through Our environmentalpreservationeffortsalsoextendtorejuvenating basic compliancestandards. waste andwaterenvironmentalstrategiesthatgobeyondmeeting practices bydevelopingmorerobustandintegratedair,materials, footprint. Oureffortsthusfarcentreonhoningourenvironmental strategies and technologies to minimise our environmental end, wehavebeenapplyingbestpractices,innovativeoperating CMS isdeeplycommittedtopreservingtheenvironmentandthis of thisReport. and ourotherachievementsarespeltoutintheEconomicsection tangible valueforavarietyofstakeholders.Thefinerdetailsthese between markets,businessesandcommunities,aswelltocreate these initiativesthatarecertainlydoingmuchtostrengthenlinkages We arehumbledyethonouredtohavehadahandinundertaking OUR FOCUS ON NURTURING THE CMS FAMILY OUR EFFORTS TO PRESERVE THE ENVIRONMENT

unwavering trustandconfidence inus. as wellourjointventurepartners andassociatecompanies,fortheir business partners, the Federal and State Governments and agencies, to expressmyheartfeltgratitudeCMS’valuedcustomers, suppliers, growth and we want to acknowledge their worthy contributions. I wish Many partieshavesupportedourpursuitofsustainablelong-term stakeholders. meaningful long-term,sustainablegrowthwhilecreatingvalue for allour programmes androllingoutnewonessothatwewilltruly achieve competitive edge.CMSremainscommittedtostrengtheningour existing and innovationthroughoutouroperationstobolsterefficiency within everylevelofourorganisation,wecontinuetoprioritiseexcellence mitigation activities. As we focus our efforts on embedding sustainability of top-line growth opportunities, bottom-line improvements and risk create long-termsharedvalueforourstakeholdersbymakingthemost the EESfrontstosecurefutureofGroup.Wearedetermined upholding responsible management and sustainable development on As wemoveforward,wanttoreiteratetheGroup’scommitment suppliers, staffandcommunity. ties withourfourkeystakeholders,namelyshareholders,customers/ best todelivertrueandsustainablevalue,aswellestablishenduring committed toadvancingtheGroup’ssustainabilityagendabygivingtheir have cometounderstandtheimportanceofsustainablegrowthandare and ourworkculturecontinuestogaingoodground.Ouremployees Our effortstoembedsustainabilitywithinthemindsetsofourworkforce pleased withthepositiveresultsthatwederivedindifferentareas. FY 2017wasagoodyearforusonthesustainabilityfrontandIam for waystoenrichcommunitiesandstrengthentieswiththem. and helpedentrenchCMSasafriendtothem.Wewillcontinuelook in elevating the livelihood of the many communities that we operate in elderly andchildren’shomes.Oureffortshavecertainlygonealongway based charitable organisations, mosques, churches, a home for the (2016: RM117,121)infundsthatweredistributedamongvariouslocally- much more.Atthesametime,ouremployeesraisedatotalofRM103,560 charity sales,rebuildingcommunities,jog-a-thons,communityworkand (2016: 45,534 man-hours) for CSR activities including fund-raising In 2017, CMS employees clocked a total of 48,420 man-hours the ‘CMSDoingGood’initiative. Saving LivesandCommunityClean-up(Gotong-Royong)componentsof Sustaining CharitableOrganisations,Environmental&HealthAwareness, the communitiesinSarawakthroughRebuildingCommunities, 10 yearsonandouremployeevolunteerscontinuetolendsupport increased Corporate Social Responsibility (CSR) efforts and initiatives. CMS’ contributiontosocietyandourimageinthecommunitythrough Back in2007,welaunchedthe‘CMSDoingGood’campaigntoimprove ACKNOWLEDGEMENTS AND FAREWELL OUR COMMITMENT TO DELIVERING SUSTAINABLE GROWTH OUR ENDEAVOURS TO ENRICH COMMUNITIES

SUSTAINABILITY REPORT 2017 15

of Sarawak and Beyond’. I bid you of Sarawak and Beyond’. I bid you PRIDE Message from Our Group Managing Director Managing Group Our from Message These two gentlemen bring with them an intimate understanding understanding intimate an them gentlemen bring with two These and a shared belief in the Group’s of CMS’ businesses their proven track-record and profound direction. Collectively, that into an absolute continuity business acumen translates of leverage on as we usher in a new era all stakeholders can with Both gentlemen will work together leadership for CMS. Chief Financial Officer, Tuan Syed Hizam our current Group the on our targets while I will remain on Alsagoff, to deliver Non-Executive Director. These three Board as Non-Independent in instils CMS of workings with the familiarity gentlemen’s CMS’ succession planning is sound, a confidence that the Board I am confident that solid and geared for even greater success. sustainability practices under their leadership, CMS will take its to the next level. areas of opportunity, As the Group ventures forth to explore new remain leadership new the and Board your that assured rest responsible manner by committed to conducting business in a upon all four groups of upholding good EES performance. I call the new leadership team our key stakeholders to continue lending to secure the future of their steadfast support as they venture forth for our stakeholders. the Group and create long-term shared value all these years. May our Thank you all for your very kind support CMS truly become the ‘ all adieu. all adieu. Yours sincerely, Dato’ Richard Curtis Group Managing Director

As I take my leave, I leave you in the good hands of my accomplished successors both of whom are Sarawakians from within CMS, who will lead CMS to the next level of success. Dato Isaac Lugun and Mr Goh and Corporate, – Officer Group Chief Executive Bing will serve as Chii of part as respectively, Operations, – Officer Executive Chief Group the Board’s dual leadership strategy. They have a combined 46 years of work experience in CMS and are a fine testament of the Group’s prudent succession planning efforts. It is with a tinge of sadness that I pen my final note on sustainability It is with a tinge of sadness that I pen my Group Managing Director on to you. As you may know, I retired as strategic direction that will The Group’s businesses now all have clear are now solidly sustainable, carry them to greater heights. Our profits trend reflecting Sarawak’s upward clear on a and diversified future expect now can we this, of top On growth. economic own investments our energy-intensive growth once profit transformational have in place engaged, accelerate into profitability. Today, we at all levels which gives us competent and high performing employees and to grow. Above all, the the bandwidth to manage our businesses sustainable growth of CMS’ building blocks are in place to ensure the business for the long-term. a big thank you for your unrelenting trust in us. Having you as one of our unrelenting trust in us. Having you as one a big thank you for your continues to be both encouraging and beneficial four stakeholder groups support as we work together and CMS look forwards to your continuing of our State. to see the development and the progression the Group for over 11 years. 31 December 2017 after having served hard to lay some solid In that time, my team and I have worked growth. groundwork for the next phase of CMS’ transformational To the communities that we operate in and which in turn support us, that we operate in and which in turn support To the communities My deep appreciation is extended to our Board for their astute insights astute their for Board our to extended is appreciation deep My my the CMS family of employees, I wish to convey and wise counsel. To the their dedication, diligence and resilience amidst utmost gratitude for among CMS has become deeply entrenched challenges of our business. worthy we operate in simply because of their the communities that by way of employee volunteerism. support and efforts, particularly Cahya Mata Sarawak Berhad so astoprovidethebestandmostfeasibleplatformsforcommunication withourstakeholders. the communitiesthatsurroundus.Assuch,wecontinuetoexploredifferentwaysbywhichcanimproveourengagement methods andpractices In ordertoensurethatwemaintainourreputationasanaccountableandconscientiouscorporatecitizen,itisimperativethathearthevoicesof many individualsandorganisationsthatareeitherdirectlyorindirectly impacted byouractivities. We alsoacknowledgethatthereareotherstakeholdersextendbeyondourfourstakeholdergroupmodelandthese s consistofthe Above all,wearecontinuouslyimprovingourengagementinitiativestoensureremainarespectedandintegralpartofthe fabricofsociety. We continuallystrivetoimproveourengagementmethodsandpracticesensurethatthequalityoftheseengagementsis constantlydeveloped. stakeholder engagementactivitiesarealsoimportantastheymayinfluence ourManagement’sdecision-makingprocess. Our systematicandregularengagementwithourvariousstakeholdershelpsustounderstandtheirneedspointsofview.Theresultsthese employer orabusinessthatgeneratesrevenueandhelpstoboostlocal economies. individuals andorganisationsthatareimpactedinsomewaybyouractivities.Theymaybeaffectedroleasaprivatesectorcorporation,an Having afour-stakeholdergroupmodeldoesnotmeanwedoconsiderotherstakeholders.Werecognisethatstakeholdersconsistofmany Stakeholder Engagement (community). level, thereisastrongemphasisonmaintainingsustainable,ethicalandhonourableoperationalperformancetoupholdourobligationstherakyat volunteers areinvolvedincommunityprojectsastheyfeelastrongsenseofobligationtofulfiltheirresponsibilitiesstakeholders.AttheDivisional to upholdingtheirwell-beingandthroughimplementingmeaningfulCorporateSocialResponsibilityorCSRactivitiesatseverallevels.Employee to ensuringweinnovatesothatdonotlagbehindothers.Inaddition,forouremployees,thisisfurthermanifestedinternallyviacommitment treating allstakeholderswithrespectandintegrity(whichincludesforexample,payingoursuppliers,consultantscontractorsonatimelybasis), as wellensureweremainresponsibleandaccountableineveryaspectofourbusiness.Thisrangesfromdeliveringqualityonspectime,to Internally withinCMS,ouremployeesclearlyunderstandthatgivenroleinSarawak’seconomy,weareobligedtoadoptalong-termperspective, the communitiesinwhichweoperateandourshareholders. CMS isrunforfourstakeholders–ourstaff,customers/suppliers, A definingfeatureofCMSasaresponsiblecorporatecitizenisthat Our Four Stakeholder Group Model 16 Shareholders Department of Environment Employees Stakeholder EngagementatCMS Government Agencies Customers/ Suppliers Community Media SUSTAINABILITY REPORT 2017

17 Ad hoc Ad hoc Ad hoc Ad hoc Ad hoc • Regularly • Regularly • Regularly • Regularly • Regularly • Regularly • Regularly • Regularly • Regularly • • Regularly • Regularly • • Regularly • • Regularly • Regularly • Quarterly FREQUENCY • Annually • Quarterly • Regularly • Regularly • Regularly • 24/7 • Biennially • Annually • Annually • Biennially • Regularly • Tri-annually • Daily • Regularly • Annually • Biennially • Annually • Regularly • Annually • • Annually • • Regularly Our Four Stakeholder Group Model Group Stakeholder Four Our Project progress updates CMS Friendly Games Sponsorships and donations Employee volunteerism CMS Friendly Games Corporate Social Responsibility activities Dialogue sessions Customer surveys Customer training (within the respective Divisions) Code of Ethics and Business Conduct Dialogues with customers/dealers Press releases Meet & Greet the Media Media get-togethers Progress updates Compliance reports AGM presentation (by the Group Managing Director) AGM presentation (by Quarterly result briefings Media statements Investor presentations calls with (potential) investors Meetings/telephone relations portal Comprehensive investor Koffee Talk sessions Town Hall sessions Management/Senior Management retreats Employee Satisfaction Surveys Departmental meetings OurCMS Magazine CMS intranet Annual dinners CMS Friendly Games Safety Month OurCMS Blog Family Day Bowling games/birthdays Festive open houses Employee engagement initiatives Incentive trips • Meetings • • • • • • • • • • • • • • • Meetings • • METHOD(S) OF ENGAGEMENT • • • • • • • • • • • • • • E-blasts • • • • • • • • • Media Employees Community Shareholders STAKEHOLDER Customers/Suppliers Government Agencies Department of Environment The various processes and methods adopted by CMS to engage with stakeholders are covered in the Group’s OurCMS digital magazine that is available The various processes and methods adopted by CMS to engage with stakeholders are is released on a for viewing on our corporate website. OurCMS magazine reports all events, corporate news and feature stories about CMS and source of information for our stakeholders. accessible and comprehensive tri-annual basis. The objective of the magazine is to serve as an easily y of these y of these and the frequenc undertook in 2017 that the Group engagement practices the diverse stakeholder section highlights The following activities. Cahya Mata Sarawak Berhad the mostimportanttoCMS.The issuesinthetoprightquadrantarematerialtobothstakeholders andtoCMShavebeenprioritisedinthisreport. As perthediagram,topicsthat aremostrelevant to ourstakeholders areplottedtowardsthetopofmatrix;withthose therightbeing • • Employees • Shareholders following groupswassought: of ourstakeholdergroups,feedbackfromtherepresentatives the surveywiththeirresponsesrepresentingviewsofCMS.Interms at theendof2015.MembersourSeniorManagement team completed We commissioned an external consultant to conduct a materiality survey The Methodology findings inthenextreportingcycle. to rolloutasecondmaterialityanalysisintheyear2018andreport changed significantlyoverthecourseoftwoyears.Wewillendeavour 2015’s analysisaswebelievethatthetopicsofrelevancewouldnothave continued toalignoursustainabilityinitiativeswiththefindingsof For the year 2017, we did not conduct a new materiality analysis but its stakeholdersandthecommunity. preserve orerodeEconomic,EnvironmentalandSocietalvaluesforCMS, as thosewhichhadadirectorindirectimpactonourabilitytocreate, sustainability forinclusioninthisreport.Materialtopicsweredefined stakeholders. Ouraimthenwastoprioritisethemostimportantareasof a betterunderstandingoftopicsthatareimportanttobothCMSandits Back in2015,weundertookamaterialityanalysisofourbusinesstogain Materiality Mapping 18 Customers

Medium Importance to Stakeholders Highest Medium •

Environmental expenditure •

Suppliers’ labourpractices • Media • Community • Suppliers andcontractors •

Human rightsof suppliers •

• Human rights

• investment &training Human rights

• •

senior managerssenior locals/employing local Equal for salary

of security Human rights Societal grievancesSocietal • • • • Importance toCMS Importance

•

Equal

• Public policy opportunity Diversity & equal Environmental grievances men &women remuneration for

Customer privacy •

on society Suppliers impact rights breaches Reporting human •

• on environment ofImpact transportation

The materialitymatrixispresentedinthefollowingdiagram. from mediumtohighestwasadopted. between 3.25 and 5. As all issues were important to some degree, a scale Our stakeholder scores ranged from 3.81 to 4.64 and CMS’ scores were Scores over 3 were considered medium; scores of 4 or more important. Results deemed completeandusedforthisresearch. and completedby249respondents.Atotalof155surveyresponseswere agreement with(3)beingneutral.Thesurveywasmadeavailableonline Symmetric Scalewaschosensorespondentscouldspecifytheirlevelof a scale of ‘very unimportant’ (1) to ‘very important’ (5). A 5-point Likert Respondents wereaskedtoindicatehowimportanteachcriterionwason Developing economy local • Non-discrimination •

• Biodiversity Local suppliers • Energy •

•

mechanisms Workplace grievance • • •

practices Fair employment • Product Employee/ • products &services Compliance of

• satisfaction customer information/

employer relations

Effluents & waste Indigenous rights Training &education • • Corruption • Emissions Water • • •

• • Responsible marketing Customer health&safety Community engagement • Environmental • •

Materials & waste ofimpact products Forced/compulsory labour societal lawssocietal Compliance with • Child labour

• • Competition Economic performance •

Safety &health Environmental laws Highest SUSTAINABILITY REPORT 2017 19

Economic Economic Job Opportunities In implementing its road In implementing its road contract, maintenance concession CMS Roads Sdn Bhd has created additional jobs for some 800 Sarawakians and hundreds of local sub-contractors. These include, amongst others, our ability to continually drive shareholder value, to ensure the well-being of our employees, to ensure a continued focus on improving our product quality and to ‘Do Good’ while expanding our Corporate Social Responsibility activities. These and other economic activities are essential to our make-up as absolute our underpin and entity corporate responsible a commitment to and focus on delivering long-term sustainable economic growth. The Economic The Economic dimension of sustainability refers to the capacity of the Group to generate steady, improving growth in relation to our economic indicators. We view this as an important dimension as a strong, stable and sustainable financial and economic system supports, not just the company, but various other critical activities.

The Construction Materials & Trading Division has been exploring the use of waste slag from smelters Recycling Waste Materials Recycling Waste as road base with good effect.

into Divisional management plans and budgets, our core businesses all met with some early success in 2017. Following the incorporation of an Following the incorporation Edging Strategy Our Edging Strategy Cahya Mata Sarawak Berhad Darul HanaBridge.Thissymbolicmid-riverconstruct,the of theiconicnewlandmarkacrossSarawakRiver, Sarawak’s capitalcityofKuchingwastheofficialopening Last year, one ofthe most talked about eventsin Creating LinkagesandDeliveringValue strengthening theState’ssustainableprogress. several initiativesthatunderscoreourcommitmentto regional economic powerhouse. In 2017, we rolled out growth mandateandhelpingtransformitintoamajor committed to meeting the needs of the State’s sustainable Being Sarawak’sleadinginfrastructurefacilitator,CMSis In SupportofSarawak’sSustainableProgress more out-of-the-boxthinkingintotheirdailyactivities. businesses aremakinggoodprogressastheyincorporate to makeworkmoreefficient.Allinall,theGroup’s our systemsandlookingtoadoptmoreICTapplications quality developer.OntheHRfront,weareautomating property developmentarmisrepositioningitselfasa now offerslight-emittingdiode(LED)lightingwhileour Our tradingarmtoohasextendeditsproductlineand securing additionalworksfromexistingcontracts. They are also looking at new construction revenue by well asinvestinginasecondlineattheSibanyisquarry. of innovativenewtechnologiesforthepremixplants,as business. TheDivisionhasalsobeenexploringtheuse incorporating thismethodoffabricationinitsday-to-day approval from therelevantauthoritiesin order to start successful andtheDivisionisnowaggressivelyseeking smelters asroadbasewithgoodeffect.Thetrialswere instance, hasbeenexploringtheuseofwasteslagfrom The ConstructionMaterials&TradingDivisionfor businesses allmetwithsomeearlysuccessin2017. Divisional managementplansandbudgets,ourcore Following the incorporation of an Ocean Strategyoragreenfieldexpansion. opportunities forsuccesswithlowerrisksthanaBlue on the‘edge’ofacompany’srangefocusoftencarry companies, businessesinthe‘nearfieldofvision’or to createsignificantgrowth.Oftenoverlookedby opportunities onthe‘edges’ofourcurrentbusinesses Group movedtofocusmore closely onmaximising introduction oftheEdging Strategy backin2016,the growth opportunitiesnearertohome.Followingthe constraints, wecontinuetoexplorethefeasibilityof of largescalegreenfieldopportunitiesandoperating In abidtocountersluggishmarketconditions,thelack Economic OUR 20 EDGING STRATEGY

Edging Strategyinto diverse stakeholders. and communities, as well as create tangible value for our and strengthenlinkagesbetweenmarkets,businesses CMS continues to identify opportunities to help build Being aleadingproponentoftheSarawak’sgrowthstory, connect communitiesanddelivertangiblevalue. serves asanexpressionofhowCMSisdoingitsbitto is playinginlinkingandintegratingcommunities,italso theme notonlyaimstoreflect the rolethatbridge ‘Connecting Communities.DeliveringValue.’Thisyear’s from forthisyear’sSustainabilityReporttheme, this magnificentstructurewhichwealsodrewinspiration CMS isproudtohaveplayedapartintheconstructionof (Sarawak) SdnBhdandNaimLand. contract wasawardedtotheconsortiumofPPESWorks for theStateGovernmentofSarawakandturnkey by the Sarawak Economic Development Corporation both areas.ThisRM35.00millionbridgewasimplemented South, providinganalternativeroutetotheresidentsof engineering, linksKuchingCityNorthwith first ofitskindinSoutheastAsiatermsdesignand quarry. at theSibanyis a secondline as investingin plants, aswell for thepremix technologies innovative new the useof been exploring Division has & Trading Materials Construction The SUSTAINABILITY REPORT 2017 21 Economic Economic The Miri- Marudi Road Rehabilitation Project by CMS’ Construction & Road Maintenance Division is a clear example of the linkages we are building and the value we are creating in the marketplace. not only in terms of infrastructure, but also by way of not only in terms of infrastructure, but the level of improving access to markets and raising income in our rural communities. under CMS’ PPES Works (Sarawak) Sdn Bhd is a subsidiary PPES Works Division. Maintenance & Road Construction (Sarawak)’s construction of the Datuk Temenggong Abang Kipali bin Abang Akip Interchange via a shallow underpass to ease traffic congestion is another project much welcomed by the communities it connects as it provides an innovative, cost effective solution to a long a at to resolve bottlenecks on how best running debate road roundabout. There are many other instances in which CMS continues Take value. tangible creating while linkages build to the case of our telecommunications infrastructure and services provider associate, SACOFA Sdn Bhd, which is doing its bit to link communities through its rollout of the State’s telecommunication towers and their rolled 2017, SACOFA In FY fiberisation. subsequent out more than 100 towers bringing the total number of throughout operates now it towers telecommunication Sarawak to more than 1,300 with more than 11,000km of fibre optic cables in place. SACOFA continues to implement many initiatives, among which is the rollout of its SACOFA4U community outreach programme that is doing much to bridge the digital divide by strengthening telecommunication penetration in rural areas. We are pleased to report that notwithstanding the many challenges ranging from the road’s remote location in crop weather, inclement in, materials getting of terms compensation issues and the need to keep the road open to users as much as possible whilst works are underway, we are ahead of schedule. Since the project’s commencement, the focus remains on expediently providing long-lasting upgrades to the road so that it is safe and fit-for-purpose for those who travel between one addresses directly project This Marudi. and Miri of Sarawak’s biggest challenges which is to reduce the development gap between the rural and urban areas, The Miri-Marudi Road Rehabilitation Project by CMS’ The Miri-Marudi Road Rehabilitation Project is a clear Construction & Road Maintenance Division and the value example of the linkages we are building towns we are creating in the marketplace. Connecting 15 September and people, the project which began on ahead of its 2016 is on track and progressing well Scheduled for completion original 30-month schedule. by 31 March 2019, the RM77.40 million contract entails trimming slopes, elevating flood-prone sections, laying a stone-gravel base and sealing with a tar surface. In view of extensive public interest due to the road’s previous long-standing unsatisfactory condition and growing importance, the Division volunteered to provide quarterly updates to the media for further dissemination on the project’s progress. These updates have gone down well with our target audiences. Cahya Mata Sarawak Berhad to enhancetheapproach toSarawak’smanagement andmaintenanceof collaborative platformtoshare, discussanddeterminefirmstrategies management andmaintenance ofStateroads.Servingasanopenand towards achievingthehighest performancestandardsrelatingtothe an importantmilestoneasit set thestageforallpartiestomove Road AssetsusingaPerformance-based Contract’.Thiseventmarked day seminar and workshopentitled ‘Management & Maintenance of of Sarawak(JabatanKerjaRayaorJKRSarawak)co-organised atwo- In April2017,CMSRoadstogetherwiththePublicWorksDepartment Strengthening theState’sAssets Sarawak. unwavering commitmenttosafeguardingsustainedeconomicgrowth for Company’s soundbusinesspracticesandanillustrationofthe Group’s Cement to ensure a reliable supply of quality cement is indicative of the Baleh DamandthePanBorneoHighway.Thisforwardplanning byCMS cement inSarawak,includingtheprocurementforprojectssuchas 1.7 millionMT,enablingtheGrouptomeetgrowingdemandfor million metrictonnes(MT),wellabovecurrentlocaldemandofaround rated cement production capacity has increasedbyalmost60%to2.75 Today, withitsthirdplantinMambong,CMSCement’stotalannual prices ofitsproductsatthispoint,despiterisinginputcosts. support growthanddevelopmentinSarawakbymaintainingtheselling facility inMambongonline,CMSCementcaneffectivelycontinueto raw materials,andbringingitsnewlyintegratedcementgrinding efficiency, pre-emptively negotiating more favourable revised rates for By working tirelessly to increase its clinker production facility’s its customers. environment withoutpassingtheincreasedcostofdoingbusinessonto rebut thisrumourinthemediaandtomanagechallengingoperating foresight, forwardplanningandmanagement,itwasreadytoimmediately had absolutelynoplanstoincreaseprices.AsaresultofCMSCement’s of anationwidecementpricehike,theCompanyputonrecordthatit refuting market rumours of a cement price hike. Responding to rumours in thepropertydevelopmentandinfrastructuremarketStateby On 27February2017,CMSCementSdnBhdmovedtoinstilconfidence A ResponsibleAllytotheState that willendureforthelong-term. quality, sustainable township and creating strong community linkages part, wearehumbledyetelatedtohavehadahandindevelopingthis term opportunitiesanddevelopmentfortheStateitspeople.Onour Sarawak’s greater plan tocontinue on agrowthpath that willdeliver long- development oftheBandarSamariangtownshipisconsistentwith 20 yearsofgrowthanddevelopment.CMS’involvementinthe On 26August2017,ProjekBandarSamariangSdnBhdcelebrated together. the State’snetworkofroadsandhighwaysbringingcommunitiescloser Furthermore, everyroadincrementallyhelpstheflowofcommerceon jobs forsome800Sarawakiansandhundredsoflocalsub-contractors. of StateroadsthroughoutSarawak.Thecontracthascreatedadditional concession contractforcurrently241kmofFederalroadsand5,847km has beenundertakingthesepastmanyyearsviaitsroadmaintenance delivering valueisthroughthegoodworkthatCMSRoadsSdnBhd Another exampleofhowwearehelpingconnectcommunitiesand Economic 22

favourable torelatedpartiesthan thosegenerallyavailabletothepublic. must bestruckwithstandard commercialtermsthatarenotmore length andconductedwithahigh levelofprofessionalism. Transactions At CMS,ourprocurementprocedures aretransparent,heldatarm’s Sustainable Procurement ahead ofotherexistinginternationalschoolsintheState. education. ThispartnershipisdestinedtopositionTunkuPutra School development trainingwillensurestudentsreceiveasolid,well-rounded These holisticlearningexperiencescoupledwithcareerandleadership artistic andcreativedimensionsaimedatdevelopingtheirfull potential. of intellectual,emotional,physical,social,moralandspiritual, as well Under thispartnership,studentsoftheSchoolwillbeexposedto anarray its newpurpose-builtcampus,whichwillhavea1,500-student capacity. HELP InternationalSchoolwillbeginitsfirstintakeinJanuary2020at Tunku Putra-HELP International School in Kuching. The new Tunku Putra- and theHELPEducationGroupannouncedapartnershiptoestablish Consequently, inMarch2018,CMSEducationSdnBhd,IbracoBerhad are absolutelytransferabletotheSchool. and passion in leading the education charter, are all strong attributes that talent managementandteacherdevelopment,aswellitsphilosophy proven academicsuccessinitsKualaLumpurcampus,strength Services (HELP)totakeTunkuPutraSchoolupthenextlevel.HELP’s In late2017,CMSEducationformedapartnershipwithHELP ways andmeanstodelivertopnotcheducation. to academic excellence, this international school continues to explore Tunku PutraSchool(theSchool).Alreadyrenownedforitscommitment through subsidiary,CMSEducationSdnBhd,theownerandoperatorof The Groupisinvolvedinthedevelopmentofournation’sfutureleaders Raising theBaronAcademicExcellence standards toensureSarawakenjoysbetterroadsgoingforward. is collaboratingwithJKRSarawaktoincorporaterevisedandimproved CMS Roadsacknowledgesthereisalwaysroomforimprovementand stakeholders arenotonlymet,butsurpassed.Notwithstandingallthis, Management System - CREAM - to ensure the expectations of all our maintenance management system, the CMS Road Engineering Asset specialised equipment,suchasroadscanners,andaninnovative to deliveringrealvalue to itsstakeholders. To date, it has introduced Contractual AssessmentRating,underscorestheCompany’scommitment level, everyyear,asreflectedintheRoadMaintenanceIndexand CMS Road’ssuccessinexceedingitscontractualperformanceatevery yet optedfortheprivatisationofmaintenanceactivities. concession renewalsorevenforgovernmentalagencieswhohavenot now attractinginterestasitseenamodelforotherMalaysianroad road maintenancecontractinMalaysia.Theformatofthisis To date,CMSRoadsholdstheonlyperformance-basedlong-term local context. to roadassetsmanagementandmaintenanceintothespotlightina International RoadsFederation,bringingthelatestglobalapproaches of thefast-developingState.Theeventalsosawparticipation road assets,theeventprovedtimelygivenrapidlychangingneeds SUSTAINABILITY REPORT 2017 23 Economic Economic

SCORE PLAY SCORE GROWING OF OF GROWING PRIVATE SECTOR PRIVATE DRIVEN PROFITABILITY DRIVEN EXPORTABLE EXPERTISE EXPORTABLE

Our tendering processes have specific processes, checks and balances and checks processes, specific have processes tendering Our experience averting on many years of These are based built into them. have occurring. Periodically, these measures the above issues from being recalled and suppliers and their managers resulted in tenders being banned as vendors. Our 9-Point Scorecard and to strengthen our foundations for economic In line with our efforts which principles of a set have implemented growth, we transformational growth and help fuel a robust performance. will help to drive sustainable to ensure will help us , this set of principles Known as the 9-Point Scorecard financial and sustainable profits; uphold prudent that we sustain solid an experienced balance sheet; and develop policies to ensure a strong CMS forward. and professional management team to steer corporate governance We are also tasked with undertaking strong among the communities measures; enhancing ties and building respect from our shareholders that we serve; as well as gaining strong support on private sector-driven and bankers. Finally, we have set our sights play; and developing the profitability; leveraging on a strong SCORE in the future. expertise that can help us expand globally becoming towards guide CMS principles will these that We believe accelerating economic the best proxy-listed investment for Sarawak’s economic growth for our growth and will ensure long-term sustainable four stakeholder groups. for growth can be found in The finer details of CMS’ proven strategies section of CMS’ 2017 Annual the Management Discussion and Analysis Report. GROWING GROWING CORPORATE SUPPORTIVE GOVERNANCE COMMUNITY RESPECT COMMUNITY OUR 9-POINT SCORECARD SHAREHOLDERS & BANKERS & SHAREHOLDERS the tendering process with other parties more than one tender through other parties: SOLID & & SOLID EXPERIENCED With common shareholders, directors, management With common shareholders, directors, management and/or operating premises; or family With shareholders or directors as their close members. Submitting • • in any anti-competitive conduct including Engaging in any anti-competitive conduct including arrangement tender rigging and entering into any the genuine with other parties that will compromise competition of those tendering Manipulating or entities MANAGEMENT TEAM MANAGEMENT SUSTAINABLE PROFITS SUSTAINABLE FINANCIALLY PRUDENT FINANCIALLY STRONG BALANCE SHEET & & SHEET BALANCE STRONG Fair Competition all for ethically fairly and honestly, to compete suppliers We expect our We expect their statements and representations business opportunities. are in all respects. Suppliers and consultants to be true and accurate forbidden from: We are committed to leading with integrity and conducting business with integrity and conducting to leading We are committed that directors, standards. We insist with high ethical relationships vendors (contractors, suppliers or consultants) owners, employees and Code) our Code of Ethics and Business Conduct (the abide by the terms of to with the Code is also mandatory for vendors at all times. Compliance maintain their registration. Cahya Mata Sarawak Berhad Environment 24 conventional lighting. for thehotelascomparedto Energy Management cost savings estimated 50% has translatedintoan at SamalajuResortHotel The usageofLEDlighting

In 2017,therewasa water usedinthepreviousyear. as comparedtotheamountof at theCementDivision Water Management consumption decrease inwater significant 14.5%

performance environmental The of futuregenerations. is preservedforthe enjoyment to ensurethattheenvironment policies andvariousinitiatives we haveintroducedKPIs, environment. Tothisend, footprint whileconservingthe which mitigatesourcarbon in asustainablemanner and arefocusedonoperating we havebeenentrustedwith steward oftheresources committed tobeingagood water. HereatCMS,weare systems suchasland,airand on livingandnon-livingnatural the impactofitsoperations of acompanyrelatesto In 2017, are soldtoalocalsteelmanufacturer. waste ironoxideandscrap At CMSWiresSdnBhd, iron wererecycled. of ironoxideandscrap a totalof23.80tonnes Solid WasteManagement

SUSTAINABILITY REPORT 2017 25 Environment Place winner was the QA Department of CMS Cement Sdn Bhd Place winner was the QA Department of Place winner was CMS’ Group Procurement Department which Group Procurement Department which Place winner was CMS’ st nd COMPETITION #1: #1: COMPETITION OFFICE GREENEST CMS #2: COMPETITION PRODUCT RECYCLE CREATIVE MOST CMS AWARD DO-GOODER’ won RM1,000 for their project which involved the use of plastic bottles bottles project which involved the use of plastic won RM1,000 for their outside plant vegetables in the vegetable garden and paper egg trays to their office patio at Level 2, Wisma Mahmud. The 2 (Pending grinding plant) which won RM500 for their project entitled (Pending grinding plant) which won RM500 around planting more ‘Office Beautification’. This initiative revolved trees, flowers and having a herb garden. The ‘CMS Top Do-Gooder’ title went to Daugal Miting from CMS from Miting Daugal to went title Do-Gooder’ Top ‘CMS The the CSR man-hours over Trading Sdn Bhd who accumulated 148 Infra 2016/2017 period. He received prize money amounting to RM500. The ‘CMS Goes Green’ competition was rolled out to all employees all to out rolled was competition Green’ Goes ‘CMS The awareness on of raising with the objective CMS Group within the life. Prizes in daily friendly being environmentally and to sustainability as period March 2016 – June 2017 were awarded for the competition follows: The 1 The top winners were Daugal Miting and Dalia Aseng, a husband and The top winners were Daugal Miting and Bhd and Tunku Putra School wife team from CMS Infra Trading Sdn making involved which project for their RM1,000 who won respectively, recycled paper. 61 pieces of a ‘Go Green Scribbling Pad’ from TOP ‘CMS SWITCH TO WATTAGE OR IN YOUR WORK LED LIGHT BULBS WHEN NOT IN USE ECO-FRIENDLY LOW UNPLUG CHARGERS, BE MORE PRODUCTIVE, APPLIANCES & DEVICES GENERATE VALUE DAILY 1-2 FLOORS ESPECIALLY FOR FROM YOUR DESK MINIMISE PRINTING BY WORKING ONLINE TURN OFF COMPUTER & LIGHTS WHEN AWAY TAKE STAIRS NOT LIFTS MORE GREENERY & ENVELOPES RECYCLE PAPER USE NATURAL LIGHT IONISE OFFICES WITH CMS Goes Green Go Green gets the thumbs up was launched on 4 March The ‘CMS Goes Green’ Awareness Campaign green. ‘CMS Goes 2016 with managers dressed in an invigorating of Divisions and 10 trees Green’ posters were presented to the Head our carbon to reduce us calls for project The planted. ceremonially were execution of the following footprint and our utility bills through the guidelines: Sustainability at Our Workplace Sustainability at Our ENERGY MANAGEMENT sustainability an organisation’s part of an integral management is Energy costs long-term savings by minimising efforts as it encourages on the negative impact of electricity generation while lessening the and we are constantly exploring new avenues environment. At CMS, measures which we can incorporate energy-saving devising new ways in all our achieve optimum energy utilisation across that will help us to implement to continued we review, in year the For Divisions. Business few new established initiatives while adding a many of our previously undertakings. measures to our environmentally-based Cahya Mata Sarawak Berhad power in2017. 0.12 kWh/tof saved clinker plant The Mambong power in2017. 1.4 kWh/tof saved grinding plant The Mambong power in2017. 0.5 kWh/tof saved grinding plant The Pending Environment 26 and meetingsareconductedonaquarterlybasis.The The committeehasattendedtherequiredtraining to workon.Therelevantdocumentshavebeenissued. energy usagecircuitandthedatabaseforcommittee monitoring ofelectricalenergyusage,thesignificant plant hasestablishedtherequiredframeworkfor The ISO 50001 committee for Pending grinding the Division. order toensurethesuccessofthisnewstrategywithin energy managersandotherpositionsofinfluencein management representatives.Italsoincludesengineers, Manager ofProductionandrespectiveplantmanagersas Chief ExecutiveOfficer(actingasadvisor),theGeneral The committeememberscompriseoftheDivision’s its successwithintheDivision’srespectivecompanies. monitor theimplementationofISO50001andtoensure Cement Division has set up a committee to specifically As partofitseffortstoadaptthenewinitiative,our Specifically, ISO50001providesaframeworkto: follow suitwithourBintulugrindingplantin2018. process inourPendinggrindingplant2017andwill commenced theISO50001:2011implementation certification atourClinkerplantinMambong.Wealso In May 2016, we achieved full ISO 50001:2011 Implementing ISO50001atourCementDivision management Continually improveenergy Review howwellthepolicyworks Measure theresults decisions aboutenergyuse Use data to better understand and make policy Set targetsandobjectivestomeetthe of energy Develop apolicyformoreefficientuse consumption rate. and performancefactorsinordertoreduceitspower to furtherimprovekilnlineavailability,reliability The CementDivisioncontinuestoexploreallavenues kWh/t. down from 97.75 kWh/t in 2016, a reduction of 0.12 specific power consumption in 2017 was 97.63 kWh/t, At theCMSCementIndustries’kiln(clinkerplant) down from45.21kWh/tin2016,asavingof1.4kWh/t. specific power consumption in 2017 was 43.81 kWh/t, CMS ClinkerSdnBhd) or the Mambong grinding plant, the At CMSCementIndustriesSdnBhd(formerlyknownas a reductionof0.5kWh/t. was 34.51kWh/t-downfrom35.01in2016, The Pendinggrindingplant’spowerconsumptionin2017 of 2.49kWh/t. per tonne(kWh/t)to40.89kWh/tin2017,areduction specific powerconsumptionfrom43.38kilowatthours cement salesvolume,theplantwasabletoreduceits owing totherecentthroughput optimisations andhigher in thepreparatorystageforISO50001certification, consumption. ThoughtheBintulugrindingplantisstill Cement Divisionhasbeenabletocurtailitsrateofpower Through variousinitiativesintroduced,theGroup’s Improving EnergyEfficiencyattheCementDivision (Suruhanjaya TenagaMalaysia). Audit CompanyregisteredwiththeEnergyCommission grant whichwillenableittobeappointedasanEnergy Division isplanningtoapplyforanenergymanagement contributed directsavingsofalmost30kWperhour.The (DC) motor to an Alternating Current (AC) motor which of acooler second grate drive fromaDirect Current that wassuccessfullyimplementedtheconversion awareness plans in the pipeline. One of the projects has todateseveralprojectswithbasicenergyreduction Although theinitiativeisstillfairlynew,committee relevant datahasbeencollatedfrom2014onwards. electrical energyusageandmilloutputoptimisation,the In preparingthedatarelatingtosystemsuchas 50001 certificationwillcommenceinBintulu2018. the requiredinformation.TheimplementationofISO of Malaysia(SIRIM)energyauditorstovetthroughall will calluponStandardandIndustrialResearchInstitute database forthesystemhasbeenestablishedandwe

SUSTAINABILITY REPORT 2017

27 2017 215,368 761,480 1,788,606 5,136,685 135,956,719 128,054,580 Environment 2016 697,800 209, 533 1,226,612 5, 582, 464 133,144,504 133, 765, 112 2015 171,074 660,837 1,915,639 3,912,248 129,166,315 139,304,786 Electricity Consumption (kWh) Total Samalaju Properties Sdn Bhd Property Development Construction & Road Maintenance Cement Construction Materials & Trading Division/Company onsumption in comparison to 2016 was due to higher consumption The higher consumption of electricity by the Construction & Road Maintenance Division Borneo Highway project (WP06) undertaken by PPESW BPSB from the Sarawak Museum Campus project and due to the construction of the Pan JV Sdn Bhd. The increase in electricity consumption for the Samalaju Development Division in 2017 was due to higher occupancy by tenants at the Lodges. The increase in electricity consumption for the Samalaju Development Division in Our efforts in implementing energy-efficient lighting extend beyond the changing of light bulbs, as is evident at our Samalaju Resort Hotel which was Our efforts in implementing energy-efficient design of the building employs substantial amounts of tempered glass panels to allow indirect built with a green concept in mind. The architectural site was also deliberately designed to face the South China Sea to allow the wind off the sea to naturally natural lighting into the premises. The hotel To facilitate long-term savings, energy-efficient lighting fixtures have been planned for the hotel from cool the premises and to reduce the solar heat. conventional lighting. into an estimated 50% cost savings to light up the hotel as compared to the onset. The usage of LED lighting has translated CMS’ Property Development Division is using LED lighting in the common areas of many of its new properties such as the ongoing niche Rivervale LED lighting in the common areas of many of its new properties such as the ongoing CMS’ Property Development Division is using line with the product pontoon. We expect 30-40% less energy consumption for these LED lights in Residences project and The Isthmus river reduce energy) at its uses LED bulbs in its general landscaping lighting and sodium lamps (which manufacturer’s literature. The Division also construction sites. escent tubes to 18-watt from 40-watt fluorescent tubes to 18-watt for its main buildings having switched & Trading Division is using LED lighting The Construction Materials bulbs. saving lights to 9 and 12-watt LED LED tubes and from 18-watt CMS’ Electricity Consumption Group is required to submit its total energy consumption for the last three years. Reporting, the for Sustainability In line with the GRI requirements have a long life and are free of toxic chemicals. have a long life and are controls the starting of the 6kV motor, plant in Pending. The plant also strictly has implemented LED lighting at its grinding The Cement Division the plant’s conversion of motors from the previous tripping or stoppage, following the motor after a 30-minute lapse from choosing to kick-start DC to AC power. of two units of solar introduced at the Samalaju Eco Park Apartments. Furthermore, since the installation In 2017, 34 80-watt LED street lights were awing RM35 per unit Office in 2014 by Samalaju Properties Sdn Bhd, the 40W LED lanterns have been dr lighting at the Eco Park Sales Gallery/Site per annum electricity bills. This data is presented in the following table: Energy Efficient Lighting Energy Efficient of our operational costs, many while minimising our in the environment of toxic chemicals the negative effect our efforts to decrease As part of option as they are energy-efficient, LED bulbs have proved to be the most feasible converting to energy-efficient lighting. companies have been Cahya Mata Sarawak Berhad towers andheatexchangersinthebearingscoolingsystemsincluding: incidents ofinletpipeblockageorinefficiencyatthewatercooling previous year. A number of coordinated actions were taken to reduce at theCementDivisioncomparedtoamountofwaterusedin The year2017sawasignificant14.5%decreaseinwaterconsumption of thewatercirculatingsystem. an alternativesource,aswellthemaintenanceandregularinspection reduction intheusageoftreatedwaterfromboardbyusing Some ofthewater-savinginitiativeswehaveimplementedinclude water resourcesoptimally. through theplanning,developing,distributingandmanagingofour stability. AtCMS,wehavemadeitourgoaltoreducewaterwastage valuable resourcethatisessentialtobotheconomicandenvironmental is imperativeinordertomaintainthelong-termsufficiencyofthis As waterisanecessaryandpreciouscommodity,goodstewardship • • • • • Samalaju Central.PropertiesSdnBhdhassincetaken thefollowingstepsinitsefforttoconservewater: to thegrowingnumberoftenantsatSamalajuLodges,inclusion oftheEcoParkApartments,andsupplywatertoconstructionsiteat The SamalajuPropertiesSdnBhdsawan increase inwaterconsumptioncomparedtotheamount of water usedinthe previous year. Thiswasdue Sdn Bhd. the SarawakMuseumCampusprojectandduetoconstructionofPanBorneoHighway(PackageWP06)undertaken byPPESWBPSBJV The higherconsumptionofwaterbytheConstruction&RoadMaintenanceDivisionincomparisonto2016wasdue consumptionfrom Water consumptionbyourBusinessDivisionsforthelastthreeyears is presentedbelow. In linewiththeGRIrequirementsforSustainabilityReporting,Groupisrequiredtosubmititstotalwaterconsumption thelastthreeyears. CMS’ WaterConsumption Environment WATER MANAGEMENT 28 Division/Company Cement Construction Materials&Trading Construction &RoadMaintenance Property Development Samalaju PropertiesSdnBhd Total Water Consumption(m Uses rainwater/reusedwaterfromnaturalpondstothe plants Undertakes routinecheckstomitigatewastageofwater,especially atwashrooms Installed sub-meterstotrackconsumption Undertakes periodiccheckingonwatermains,tanks,pumps todetectpotentialleakage Organised acentralisedlaundrysystemtooptimiseandreduce waterusage 3 ) collected forgeneraluseattheplant. the project,werelaunchedprogrammein2016.Rainwaterisnow Harvesting Programmeatourclinkerplant.Followingasuspensionof intention ofreusingiton-site.In2010,webeganourRainwater Rainwater harvesting is the process of collecting rainwater with the Rainwater HarvestingProgramme water respectively. two waterpondsforthispurposethatcanstore2.43m CMS QuarriesSdnBhd recycles water to coolits machinery. Wehave Using RecycledWatertoCoolMachinery • • • • • Rain waterharvestinginitiativesfortoiletflushingandplantwatering water systemarewellmaintainedinordertoavoidleakages Ensuring allwaterpiping,pumpsandtanksintherecyclingcooling The usageofundergroundwater The settingupofintervalmaintenanceforthewatercoolingtowers system heatexchangers The introductionoforganicfoulingdissolvingsolventforthecooling 361,159 192,220 30,730 57,763 4,615 2015 510 485, 544 146,710 175,067 60,096 3,470 2016 971 3 and3.3m 453,148 125,430 262,950 59,971 4,135 2017 662 3 of of SUSTAINABILITY REPORT 2017

29 Environment The plant is also looking to substitute its use of limestone by up to 3% its use of limestone also looking to substitute The plant is with this line In ash. bricks and kiln old sludge, with this replacing by the Division’s environmental team contacted initiative, our Cement Samajaya the Samalaju Industrial Park (SIP) and waste generators from then on the year, R&D in the laboratory, and Industrial areas. During and waste generated within SIP was conducted an industrial scale, on by the were submitted to and approved subsequently, the applications Wastes (DOE) in Putrajaya. Scheduled Department of the Environment especially on the sea route are being negotiated Transportation licences with the DOE. is Alternative Fuel and Raw Materials Committee The Cement Division’s the teams to actualise and the plant DOE in Putrajaya working with the raw materials’ usage will 3% substitution target. In 2018, the alternative of waste usage from the increase significantly with the future approval Free Industrial Zone. waste generators at the SIP and at the Samajaya Tyre-derived Fuel through the recycling of In an effort to create sustainable energy Bhd (formerly known Sdn Cement Industries materials, CMS waste as CMS Clinker Sdn Bhd), under its clinker operation, began to process tyre-derived-fuel (TDF) in 2015 by burning small quantities of shredded tyre-derived-fuel (TDF) in 2015 by burning clinker. to manufacture tyres purchased from a local-based supplier all kinds and it produces the TDF is a fuel derived from scrap tyres of 25% more energy than sub- same energy as petrol and approximately bituminous coal. negative effects at the As the trials did not produce any significant the relevant approvals from clinker plant, the Company is seeking Department of Environment, the governmental authorities like the Resources and Environment Sarawak (DOE Sarawak) and the Natural usage of TDF. The DOE had Board, Sarawak (NREB) for the commercial asked for the installation of a CEMS-Gas Analyser as a prerequisite for the trial burn which was successfully carried out in December 2017. and 2018 March or February TDF in of tonnes burn 300 will a trial, we As once licensed, will co-process another 300 tonnes under a strict watch. The Company has also established a long-term TDF supply contract with ZHA Sdn Bhd, a Sarawakian-based company. Manganese Slag Premix Aggregates Replacement for Road-based Materials CMS Pavement Tech Sdn Bhd from our Construction & Road Maintenance Division has been researching the possibility of using by-products of smelting plants in SIP as material in its road base. The initiative aims to recycle the waste material which would otherwise go into landfills, while at the same time exploring a potentially cheaper source of input material. Silica fume is a by-product of producing ferrosilicon alloys in smelting plants and is commonly used to strengthen Portland Cement concrete due to its extreme fineness and high silica content. Following extensive research into using Phosphogypsum (PG) as a conclusion the to come has plant clinker our limestone, for replacement that the waste material is viable as a material replacement. We have plans to purchase the waste material from an identified source. The plant has also considered replacing its Light Fuel Oil (LFO) with Residual Fuel Oil (RFO). We are in discussion with PETRONAS and have sourced several recycled oil suppliers in the Kuching area. Reusing Waste in the Production of Clinker For the first time in 2017, a total of 259.54 tonnes of Calcium Hydroxide Ca(OH)² sludge was incorporated in the raw mix preparation. Future volumes are subject to the availability of the sludge from various waste generators. We are also continually looking into additional sourcing of sludge from within the industry. Cement Division’s Alternative Fuel and Raw Materials Committee Cement Division’s Alternative Fuel and Raw Alternative Fuel and During the year in review, the Cement Division’s Raw Materials Committee held six meetings in which they focused primarily on the suitability of the conversion of waste into a cement raw material. In line with their discussions, all waste from Samalaju and Samajaya Industries have been tested and research and development (R&D) processes have taken place. IBS is the way forward for future construction projects. The Government IBS is the way forward for future construction the agenda on IBS through has shown its commitment in pushing to utilise at least 70% making it mandatory for government projects facilitate the industry and to IBS components. One of the measures to we will start, is to enhance advocate IBS construction, which is where in construction. fraternity the professional of knowledge among level the IBS construction was introduced somewhere in the 1960s by foreign in the 1960s by foreign IBS construction was introduced somewhere and multi storey buildings. contractors for housing projects. i.e. landed issues and leakage at However, several problems especially jointing Over the players. jointing caused poor uptake by the local industry the some of these problems years, with the advancement of technology the level of acceptance of have been solved. Despite this advancement, IBS by local industry is still low. Revitalising the Industrialised Building System (IBS) Business Building System (IBS) Business Revitalising the Industrialised Building to revitalise the Industrialised The Group is endeavouring through the Cement Division. IBS construction System (IBS) business several construction because it is able to address underpins sustainable quality such as poor of the industry issues in some parts prevalent relatively long construction of construction work, low productivity, a labour. period and too much dependency on foreign MATERIALS MANAGEMENT MATERIALS the management of when it comes to not believe in wastage CMS does in our of reducing the use of natural resources materials. With the aim so as we continue to research and innovate operations where possible, recycled which we can replace raw materials with to find more ways in resources. Cahya Mata Sarawak Berhad Environment metric tonnes. to 184,300 amounted conducted Tech SdnBhd Pavement place thatCMS of recycling-in- total amount In 2017,the and ironoxide. of scrapiron 23.80 tonnes Bhd recycled CMS WiresSdn In 2017, 30 Tech specialisesinusingcement stabilisationtechnology slow andenvironmentally-unfriendly, CMSPavement pavement rehabilitationtends tobecostly,inefficient, and maintenance.Astheconventional methodof pavement workscoveringconstruction, rehabilitation CMS PavementTechSdnBhdisaspecialistproviderof Cold inPlaceRecycling(CIPR) continue theeconomicdevelopmentofState. environmentally-friendly societyandatthesametime, recycle, thebetterwecanhelpcreateamodernand granite-type stoneisinlimitedsupply.Themorewecan stone availableinnorthernSarawak.Eventhesouth, road base,ifpossiblebecausethereisnotmuchhard would bemuchbettertousethiswastematerialas Although thewastewillnotbeentirelyfreetous,it respective DivisionsandcompanieswithintheGroup. Concrete, Premix,etc.,arebeingundertakenbythe Other usesfortheslagwastesuchasinReady-Mix will becarriedout. the pavement after which post construction monitoring Pavement Techisalsocurrentlyrunningafieldtrialon DOE in Sarawak which is now awaiting approval. CMS convincing andaresubmittedinanapplicationtothe material forsubbase,roadbaseandCIPRwere results todetermineitssuitabilityassupplementary Bhd andPertamaFerroalloysSdnBhd.Laboratorytest furnace slagroadbasefromOMSarawak(Malaysia)Sdn at MambongIntegratedplantonsiliconmanganese completed apreliminarytrialburnandstabilisationtest In thelateststageofproject,Companyrecently as todisposeofit. environmentally-friendly waysto re-utilisewaste,aswell player, CMSiscommittedto findinginnovativeand waste hasontheenvironment. As aresponsibleindustry systems, however,canavoidthe negativeimpactthat impact theenvironment.Positivewastemanagement community’s healthandsimilarlyitcanalsonegatively management can potentially have a negative effect on the produced in our plants very seriously. Improper waste practice ofcollectinganddisposingwasteeffluent waste managementpractices. Here atCMS,wetakethe practices encompassesallouroperationsincluding The Group’scommitmenttosustainableandethical WASTE MANAGEMENT during theyearwas6km. tonnes. Thetotallengthofoff-sitemillingconducted the Companyconductedamountedto184,300metric In 2017,thetotalamountofrecycling-in-placethat improved pavementperformanceanddesignlife. of costsavings,quickerconstructiontimes,aswell Company’s technology,clientscantakeadvantage locally-sourced, alternativematerials.Bytappingthe sustainable engineeringandconstructionusing friendly company,CMSPavementTechpromotes bitumen andsoilstabilisers.Asanenvironmentally- works usingotheragentssuchaslime,emulsion, This subsidiaryisalsocapableofperformingstabilisation and enhancedwithahigherstrength,newboundedbase. existing pavementsarerecycled,stabilisedwithcement the WirtgenWR2500Smachine.Inthisnewmethod, to reconstructwhilerehabilitatingpavementsusing

SUSTAINABILITY REPORT 2017 31 Environment donated to a nearby bricks manufacturing company and some of the waste components, including company and some of the waste components, including donated to a nearby bricks manufacturing Used bag filters, paper bags, torn jumbo and spent oil, are incinerated during clinker production. Cement Industries Sdn Bhd are sold as scrap. pre-sling bags, old metal plates, etc. at CMS metallic parts and old belt conveyors which can be sold At CMS Wires Sdn Bhd waste such as old and scrap iron is sold to a local steel manufacturer. to a third-party are weighed. Waste iron oxide of scrap iron and iron oxide. Basic bricks are sold to In 2017, CMS Wires recycled 23.80 tonnes a recycling company. under SW421 A total of 3,698 litres of waste oil, spent lubricant and hydraulic oil, classified rags and was generated and subsequently collected by a licensed contractor in 2017. Cotton of Sarawak’s contaminated gloves were sent to Trienekens (Sarawak) Sdn Bhd, the operator integrated waste management system, for proper disposal. also re-uses PPES Works (Sarawak) Sdn Bhd re-sells its leftover construction materials. It slabs. demolition waste or broken and formwork, as well as waste such as timber construction clearing is Waste paper is recycled for internal photocopying and printing and waste from land utilised as the base for an access road in a swampy area. Recycling Capabilities for New Premix Plants capabilities When the Group specifies and commissions new premix plants in the future, recycling will be built into the design. Scheduled Waste no longer Scheduled waste is any discarded solid, liquid or contained gas or material that can and without special technologies safely of dispose to difficult and is hazardous it is As used. be with facilities, we make it a point to ensure that all scheduled waste is discarded in compliance of waste operational regulations. In 2017, some 9,000 litres (2016: 7,000 litres, 2015: 5,800 litres) by the oil, spent lubricant and hydraulic oil, classified under SW421 was generated and collected gloves Cement Division. All materials that had come in contact with the oil, such as contaminated and used cotton rags were also properly disposed of as well. Recycling where we can, general waste is Recycling where we can, general waste is usually separated and sold to a third-party vendor for reutilisation. Wood waste is Those industrial wastes which contain calorific Those industrial wastes which contain calorific value are co-processed at the calciner. as such materials raw mixed or Contaminated gypsum and limestone with cement or clinker, also regarded as waste, are put back into the bricks alumina and basic Old mix. operations are crushed at the limestone crusher and used later as alternative raw material. Our Cement Division does not record the the record not does Division Cement Our weight of our solid waste as our focus is primarily on minimising or eradicating waste. Solid Waste industrial solid of disposal the in taken is Care waste produced by our Cement Division through its annual production cycle. Wooden bag pallets, zinc and acrylic cladding sheets, old PPEs filters, contaminated gloves and rags, used used (safety helmets, safety shoes, dust masks), filter industrial pollution control systems like etc., spent greases, lubrication, bags, hoses hydraulic oil, broken off belt conveyor rollers, used and worn out conveyor belts, worn out ducting, old kiln bricks, and hacked off castables, are discarded in various ways that are deemed environmentally-friendly. Cahya Mata Sarawak Berhad goals listedasfollows: the short,mediumandlong-termcanbeseenintheiremissioncontrol environmental impact. Their environmental objectives and targets for CMS CementDivisioniscontinuouslyfocusedoncontrollingtheir standards andtopreventindustrialpollution. environment monitoring to keep our practices within the regulatory business processes, the Group continues to focus on conducting regular In thenameofgoodenvironmentalpracticesandconscientious is generatedandsubsequentlydisposedofaresummarisedinthetable below. CMS CementIndustriesSdnBhdunderitsclinkeroperation,producesrelativelysmallvolumesofscheduledwaste.Thetypesscheduledwastethat Environment The Groupdoesnotproduceortransportanywastedeemedhazardous underthetermsofBaselConventionAnnexI,II,III,andVIII. Monitoring Programme.TheCompanydoesnotproducehighquantitiesofscheduledwaste. PPES Works(Sarawak)adoptsstringentscheduledwastepracticeswhicharealsopartofitsEnvironmentalImpactAssessment andEnvironmental 5. 4. 3. 2. 1. The procedureforhandlingthescheduledwasteissummarisedbelow: AIR EMISSIONS, NOISE, DUST AND VIBRATIONS 32 • Contaminated spillkits Contaminated rags Spent oillubricantandgrease Contaminated rags,plastics,paperandfilters Types ofScheduledWastes Waste electricalsandelectronics Waste leadbatteriesinwholeorcrushedform Obsolete laboratorychemicals • Containers contaminatedwithlaboratorychemicals Drums contaminatedwithoil,lubricantandgrease Long-Term Medium-Term Short-Term The WMTcallsfordisposalofwaste180daysfromthedatewasgeneratedorwhenquantityreaches20MT,whichev er comesfirst. The WasteManagementTeam(WMT)leadersubmitstherecordstoDOEonamonthlybasis. Once thedrumisfull,ittransferredtoscheduledwastestore.Thetotalquantityofrecordedinarecordbook. Contaminated partsarecleanedwithdieselbeforebeingdisposedofatthescrapstoragearea. The operatorensuresallgeneratedscheduledwastesareproperlystoredinrelevantcontainers. clinker plantsbelow50µg/m guidelines of Clean Air Regulation 2014 (i.e. the stipulatedrequirementsunder To reduceemissionfrommainstacksbelow plants below150µg/m 100 µg/m To reduce the stacks’ emission lower than the clinkerunloading/dischargingactivities To improve the highly visible emissions from 200 µg/m 3 forcementplantstacks 3 forclinkerplantsandbelow 3 . 3 andcement

and reportingsubmittedbyourconsultantstoNREB. Sarawak (NREB) guidelines. These are covered in the quarterly monitoring are incompliancewithNaturalResourcesandEnvironment Board, Project sitesunderdevelopmentbyourPropertyDevelopment Division Quality Guidelinesof260µg/m which waswithintheMalaysianRecommendedEnvironmentalAir Suspended ParticlesfortheCementDivisionin2017was95.42µg/m Miri BulkTerminalandMambongIntegratedPlant,theaverageTotal Based onambientairmonitoringatPending,Bintulu,SibuBulkTerminal, Average CMS ConcreteProducts Mambong IntegratedPlant Miri BulkTerminal Sibu BulkTerminal Bintulu GrindingPlant Pending GrindingPlant Location Air QualityResultsforCementDivision(µg/m 3 . 144.20 113.77 197.07 222.5 76.51 138.6 116.7 2015 110.99 3 ) 52.03 140.9 129.3 2016 69.3 76.4 198 Waste Code SW410 SW410 SW421 SW410 SW409 SW110 SW102 SW430 95.42 125.0 163.8 112.8 2017 36.9 68.0 66.0 3

SUSTAINABILITY REPORT 2017

33 Environment It does not require water to operate water and dust the than rather asphalt the into back recycled is Dust sludge being discharged to the sediment pond It achieves zero emissions Dust Emissions Good housekeeping are Materials & Trading Division, dust emissions At our Construction using compounds and plants roads, of sweeping regular by minimised of by water sprinklers, reducing spillage sweepers and dampening tyres. and the installation of washing bays for lorry product/raw materials system Upgrading of coal mill coal mill system at CMS Cement Industries The upgrades of the of a ball mill type that was able to grind a maximum Sdn Bhd in 2013 from per a new coal mill that has a capacity of 22 tonnes 15 tonnes per hour to consumption and lower dust hour has resulted in lower specific power emissions. Baghouse Dust Collector which was changed from CMS Premix Sdn Bhd’s pollution control system in 2015 has resulted in a Venturi Scrubber to a Baghouse Dust Collector the following advantages: • • • Trading & Materials Construction our from readings emissions Dust shown on table on the left. Division were similar to its Air Emissions, Bhd’s effort to reduce dust In addition, PPES Works (Sarawak) Sdn dewatering of project sites. emissions includes washing, cleaning and Vibrations In the quarries business, ground vibrations are one of the risk factors to the surrounding landscape and infrastructure as uncontrolled vibrations may cause severe damage to nearby utilities and pipelines. When blasting, CMS Quarries monitors its seismic vibrations in three directions at right is kept control Strict vertical. and transverse radial, – other each to angles of explosive charges, depth and numbers of holes per blast. The loose blasting areas require additional measures. CMS Quarries recorded average vibration was 6.6 mm/s surpassing the permissible level of 5 mm/s in 2017. This was because the vibrometer was installed closer than required. In any case, the number of blast holes has now been reduced in order to further reduce vibration levels. At the limestone quarry, which comes under the Group’s Cement Division, the recorded average vibration was below 2 mm/s. Across all our quarries, all air blasts recorded were within the Malaysian Recommended Air Quality Guidelines’ maximum of 12 d(B)A. BIODIVERSITY the natural world also known as the enriching or restoring Biodiversity, to committed are We efforts. environmental our of part integral an is not only protecting our environment but also to cultivating it and see it flourish.

- - - 50.3 50.1 time Night- (d(B)A) Half Half st nd Quarter Quarter 1 2 rd th 3 4 during 2017 Half 2017 Readings taken nd - - 2 58.6 49.7 57.6 time Day- (d(B)A) ) - - - 3 50.1 55.7 time Night- (d(B)A) 100 24.8 74.6 15.1 (µg/m Half 2017 Average Total st 1 - - - 49.5 58.7 time Day- Suspended Particulate Suspended Particulate (d(B)A) For transfer chutes: put liners with defector plate and an enlarged For transfer chutes: put liners with defector chute size so as to minimise noise levels help in absorbing which Around the plant’s boundary: plant more trees sound and thus reducing noise levels For high pressure blowers: install inlet silencers For compressor room: install heavy-duty doors Noise Monitoring Results Air Quality Results Location Quarry at Mile 7 Quarry at Mile 9½ Quarry at Mile 21 Sibanyis Quarry Darul Hana Bridge Quarry at Mile 21 Sibanyis Quarry Location Quarry at Mile 7 • • • CMS Quarries Sdn Bhd’s sites A summary of the noise results at three of level for day time is 65 d(B)A is presented below. The noise permissible • The noise levels for CMS Quarries are an improvement over the previous year. The noise level during the night is mostly generated by public vehicles along the main road. Noise Monitoring Sibu Bulk Terminal, Miri Based on noise monitoring at Pending, Bintulu, Plant, the average noise level Bulk Terminal and the Mambong Integrated is within the recommended for the Cement Division was 70 d(B)A which achieved this by the following national guidelines. The Cement Division actions: air d(B)A. Wherever effective to reduce noise, and for night time, 55 from blasting Noise quieter versions. be replaced with will compressors is covered in our vibrations section. The table below encapsulates the Air Quality results of our various results the Air Quality below encapsulates The table Recommended within the Malaysian sites. These are operational Guidelines. Environmental Air Quality Cahya Mata Sarawak Berhad recognised bestpracticesinenvironmental designandperformance. Samalaju Propertiesisalsointhe processofpursuingtheBCAGreenMarkCertificationwhichis abenchmarkingschemeincorporatinginternationally site clearingworks. in 2017asoursiteclearingworkshadalreadybeencompleted inearly2015.However,itwillstillbeSamalajuProperties’contractforanyfuture To aidinthesiteclearingwork,CompanyemployedanEnviro Mulchertoshredtheoilpalmtreesasspecifiedinourcontract.Itwasnotimplemented Samalaju Propertiesisonthevergeofre-planningbluespaces. The detailedplanforBlock2and4originallyincorporatedblue spacesintheformofalakeandcanal.However,projectisnolongerongoing Ptrerocarpum, PlumeriaObtusa(Cempaka),PolysciasSp(Polyscias White), PseuderanthemumJessica(jessicaplant ), AxalyphaSiamensis(smalltealeaf). planted areasfollows:ParkAlstoniaAugustiloba(Pulai), During 2017,atotalof44treeswereplantedat16unitsshophouse and209treesatSamalajuEcoparkApartments.Thetypesofthatwere of sourcingandplantingweretakenintoaccount.Thetreeplan at theSamalajuEcoParkisencapsulatedintablebelow. significance, localsignificancetotheBintuluarea,endemicityandcurrentconservationstatuswerealsoconsidered.Eachspecies’naturalhabitat,ease selected forplantinginthetownship.Specieswerebasedontheirornamentalpotential,usefulnessandculturalsignificance.Theirhistorical Samalaju PropertiesSdnBhdhasalsoplannedtolandscapethetownshipwithtreesthatareindigenousSarawak.30nativetreespecieswere and providelivingspacesforthecommunity. to preservethenaturallandscapeandgentlewaterfeatures.Greenbluespacesinformofparkscommunitygardenswilldottownship lifestyle tothethousandsworkingatSIP.Theplanfortownshipincorporatesnaturalsemi-undulatingterrainoftheareaandisdesigned Designed and developed with the futureinmind, the visionforSamalajuEcoParkwasconceptualisedtoprovide a balanced,healthyandsustainable Samalaju DevelopmentDivisionsincetheprojectwaslaunchedin2015. The SamalajuEcoParkTownship,a2,000-acreeco-themedtownshipadjoiningtheIndustrial(SIP)hasbeencrownjewelofour Samalaju EcoPark offices participatedinanEarthHourNightRide. We also observed EarthHour with allour offices switching off theirlightsbetween 8:00 p.m. to 9:30p.m. and severalcycling enthusiasts from our Division in2017. Our ConstructionMaterials&TradingDivisionexceededtheirplantingtargetof500treesbyestablishing800throughoutthe 80 treesaplingswereplantedin2017.TreesalsoPendingandBintulugrindingplantstobeautifytheenvironment. Our CementDivision’scontributiontowardsbiodiversityincludedtreeplantingattheMambongIntegratedplantonaquarterlybasis.Atotalof was chosenforitscolourfulfoliageandtheHibiscusflowerbeingnationalofMalaysia. In 2017,ourPropertyDevelopmentDivisionplantedsome200treesacrossitsvariousdevelopments.Forlandscaping,thefloweringshrubEugenia Environment 34 Description Samalaju HotelResort 160 UnitsApartments 96 UnitsApartments 96 UnitsApartments Lake &CanalInfrastructure Service Centre-34Units Tree PlantingatSamalajuEcoPark Land Size 24.27 23.1 6.01 2.76 2.97 (Ac) 5 Green Area Ficus Lyrata(FiddleFig-Leaf),EucalyptusDeglupta(Eucalyptus),white Bucida, Pheltophorum 18.1 2.45 0.99 1.33 8.87 0.45 (Ac) Green Area % of 78% 41% 36% 45% 37% 9% No. of Trees 1100 123 532 50 67 9 (Green Area) Trees/Acre 61 50 50 50 60 20 2016 &2017 (re-planning) (continuing) (deferred) Planting Year of (done) (done) (done) 2015 2016 2017 2018 2017

SUSTAINABILITY REPORT 2017 35 Environment CMS Roads Sdn Bhd CMS Premix Sdn Bhd ISO 14001 certified since 2013 ISO 14001 certified since 2004 ISO 14001 certified since 2005 PPES Works (Sarawak) Sdn Bhd CMS Cement Industries Sdn Bhd ISO 14001 certified since April 2001 CMS Cement Sdn Bhd (Bintulu Plant) CMS Cement Sdn Bhd (Pending Plant) ISO 14001 certified since February 2008 ISO 14001 certified since September 2012 Wall and IBS in some schools in Sarawak in 2018. However, sales Wall and IBS in some schools in Sarawak ECO CMS ECO WALL PANEL CMS ECO building Bhd’s answer to sustainable Products Sdn As CMS Concrete a total Panel continued to see brisk sales with materials, the ECO Wall (2016: in 2017 sold m²) being 1,650 (about tonnes 227 metric of to the alternative eco-friendly is an Panel ECO Wall The 3,000 tonnes). and method which consumes more energy conventional brickmaking and it The amount of labour required is reduced causes more pollution. The such as quarry dust that are in less demand. utilises quarry products hollow core design. in weight due to its advanced ECO Wall is 30% lighter strength of 90 pieces of brick and its compressive It is also equivalent to wall. bearing load a as suitable it make millimetre square per Newtons 25 Department’s specifications The Government’s policy and Public Works the ECO Wall and other IBS were the main push factors for the use of in the private sector are products in 2017. Awareness and acceptance is keen to continue to use still low. We note that the Federal Government Federal funding. will very much depend on the magnitude of ENVIRONMENTAL COMPLIANCE for an environmental The ISO 14001 standard sets out the criteria framework that a company management system. It maps out a an effective environmental or organisation can follow to set up companies who have management system. The list of our subsidiary below. attained ISO 14001 certification is listed ISO 14001 Certification Energy Efficiency Improves energy consumption by optimising building orientation, minimising solar heat gain through the building envelope, harvesting natural lighting and various other related measures Indoor Environmental Quality Achieves good quality performance in indoor air quality, acoustics, visual and thermal comfort Sustainable Site Planning & Management Successfully selects appropriate sites with planned access to public transportation, community services, open spaces and landscaping Materials & Resources Promotes the use of environment-friendly materials sourced from sustainable sources and recycling Water Efficiency Incorporates rainwater harvesting, water recycling and water-saving fittings Incorporates innovative design and initiatives that meet the objectives of the GBI 1. 2. 3. 4. 5. 6. Innovation As part of its biodiversity efforts, the development started a tree nursery consisting of 100 white Bucida trees. Buildings are awarded with the GBI rating based on six key criteria: Buildings are awarded with the GBI rating GBI is Malaysia’s green rating for buildings and towns, created to GBI is Malaysia’s green rating for buildings awareness raise and environment built the in sustainability promote architects, engineers, of environmental issues amongst developers, the public. planners, designers, contractors, as well as CMS Properties Sdn Bhd also competed the development of two of the development also competed Sdn Bhd Properties CMS which Towers Gateway The called buildings GBI-certified signature Berhad and the Sarawak will serve as headquarters for Pelita Holdings at The Isthmus, in 2017. Economic Development Corporation, both Green Buildings at The Isthmus Green Buildings Division is our Property Development project that Another innovative in is the 246-acre development called The Isthmus currently developing (CBD), the City’s Central Business District Kuching. Poised to become Index has adopted the Green Building the award-winning development, The at possible where projects new for standard accreditation (GBI) building, the Menara Sarawak Energy Isthmus. One such development, in 2013. It is was completed Berhad, Energy the head office for Sarawak the in East Malaysia and the first to be awarded the first green building the UCSI Also, in 2016, it was announced that final GBI Silver Rating. will have is being undertaken by the UCSI Group Campus and Hotel that the GBI rating. Cahya Mata Sarawak Berhad employees. work andeffortsof our owe oursuccessto thehard CMS recognisesthat we Social: LabourPractices andDecent Work 36 culture andlifestyle, each withitsowndistinctlanguage, Diversity inSarawak of diversity,butembracesit. Sarawak isnotonlytolerant groups, 40 sub-ethnic at least With avarietyofethnicgroupsand

recruited from Sarawak. employees were 96% approximately In 2017, Local Hiring

of newly years. rate (asperthefollowingtable) in thelastthree is evidentintheGroup’srelatively lowturnover progress intheareaofemployeedevelopment performance, pay and participation. Our while achievingequilibriumbetween provide fairtreatmenttoallouremployees initiatives havebeenfoundedonourgoalto and professionalism.Ouremployee-based camaraderie, trust,excellence,initiative a holisticworkingenvironmentthatinspires As such,theGroupiscommittedtocreating including teambuildingsessions. training sessions, employees attended of 2,664 2,571 out In 2017,atotalof and careerdevelopmentopportunities. We provideeachemployeewithtraining Training &Education

SUSTAINABILITY REPORT 2017 37 160 128 2017 32 Total 139 113 2016 Male Turnover 23 (No. of Employees) Social: Labour Practices and Decent Work Decent and Practices Labour Social: 130 Female Notice period for operational change change, is another The changing of an employees’ roles, or operational the appropriate notice. The matter in which we take care to provide on the type of operational amount of time given in the notice depends operational change which change being made. In the case of a significant location, the employee is involves a transfer or secondment to another given reasonable notice before he or she is required to move. In other instances, a period of one week is considered adequate. A total of 218 inter-company transfers took place throughout the year in review with the majority of cases being a transfer of company nominally whilst maintaining the same physical home base. All cases were handled according to Company policy and procedures. Local hiring As we are committed to the development of the local infrastructure and economy of Sarawak in all aspects, employing Sarawakians continues to be a priority in the Group’s employment drive. This endeavour is most evident in our Construction Materials & Trading Division and Samalaju Development Division as all members of senior management have been hired from the local community. If we are unable to recruit locally, other Malaysians are considered before we look further afield. 103 2015 27 80 40 160 120 6.01 2017 5.50 2016 Total 5.50 2015 Turnover (%) 2 4 8 6 Our employees are encouraged to report unacceptable behaviour that is either repeated on numerous occasions or is of such a significant nature that it is offensive and detrimental to a reasonable person. No case of sexual harassment was reported in 2017. Sexual harassment operations. our in forbidden strictly are harassment sexual of forms All These include making sexual gestures or requesting sexual favours which or detrimental preferential of either promises implied or overt contain to any employee any other not subject must Employees treatment. with or nature sexual a of material visual or language, spoken or written sexual connotations. Grievances are defined as complaints by an employee that are not or settled once brought to their immediate superior’s satisfactorily supervisor’s attention. We have a formalised procedure to handle grievances transparently and fairly. Grievances In order to handle all grievances transparently and fairly, we have organised a formalised structure that provides employees with a secure solution to their problems. During the year, two cases of grievances were reported and dealt with according to standard procedure. Employment Practices through providing our We aim to be an employer of choice in Sarawak working environment that employees with a value and goal-driven an both on potential full their realise to employees our encourages individual and corporate level. We have clear policies and processes in place to ensure that candidates are recruited and assessed on merit and rewarded based on their individual recruited and assessed on merit candidates are that to ensure processes in place policies and We have clear Key Performance Indicator (KPI) performance. EMPLOYEE TURNOVER RATES EMPLOYEE Cahya Mata Sarawak Berhad to theGroup’ssuccess. values theuniqueperspectivesandcontributionsofeveryemployee, thusensuringthatweattractandretainatalentedworkforcecontributes we hopetoembodythesamespiritandperspectivewhenitcomes tosupportingadiversifiedworkforce.Wecontinuedriveworkculturethat own distinctlanguage,cultureandlifestyle,Sarawakisnotonly tolerantofdiversity,butembracesit.Beingahome-growncompanytheState, Sarawak isrenownedforitsmulti-culturalandclose-knitsociety.Withavarietyofethnicgroupsatleast40sub-ethnic groups,eachwithits Diversity intheWorkforce Social: LabourPractices andDecent Work 38 TOTAL Property Development&SamalajuProperties Finance Services(COPE) Services (CMSInfraTrading&TunkuPutraSchool) Head Office Construction Materials Construction &RoadMaintenance Cement Division/Company New EmployeesRecruitedin2017 1.5% (4) 2016 Breakdown ofNewEmployeesRecruitedin2016and2017 1.5% (4) Sarawakians 97.0% (258) Overall 302 130 22 60 57 8 5 0 Malaysians New Employeesin2017(individuals) 2.0% (6) Sarawak 289 129 16 19 60 57 8 0 Expatriates 2017 West Malaysia 2.3% (7) 6 0 0 5 1 0 0 0 95.7% (289) Expatriates 7 6 0 0 0 0 1 0 SUSTAINABILITY REPORT 2017 39 547 1,228 2017 2017 2,117 1,436 Social: Labour Practices and Decent Work Decent and Practices Labour Social: 457 Female 1,133 Non-Permanent Employees 2016 2016 Male 2,023 1,377 Workforce by Gender Workforce by Employment Type Permanent Employees 453 1,008 2015 2015 1,911 1,356 The following charts highlight the diversified workforce at CMS: The following charts highlight the diversified Cahya Mata Sarawak Berhad about 12.32%in2017compared to2016.Formanagerialpositionsandabove,maleemployees accountfor76.43%withfemalesat23.57%. regardless ofgender.Currently, 79.47%oftheGroup’semployeesaremalewhile20.53% female.Theshareofwomenemployeeshasgrown In respectofworkforcediversity,theGroupiscommittedto provideequalemploymentopportunitiesandpractisesmerit-basedpromotion Equal employmentopportunitiesregardlessofgender Social: LabourPractices andDecent Work 40 1000 1250 1500 250 500 750 500 550 600 650 700 750 500 716 617 397 2015 2015 683 11 <30 Malay 1,198 564 Workforce byAgeGroup 30 to40 Workforce byEthnicity Chinese 883 520 679 414 2016 2016 695 12 Indian 40 to50 1,201 616 775 577 Others >50 714 427 2017 2017 718 13 1,149 655 SUSTAINABILITY REPORT 2017

41 Social: Labour Practices and Decent Work Decent and Practices Labour Social: Koffee Talk Initiative Koffee Talk non- our for platform provides a Initiative Talk Koffee Group’s The the within workers category of the largest employees, executive directly work-related issues and general concerns Group, to voice their biennial and Group Human Resources. The to senior management interact our non-executive employees to programme also encourages and the senior management in a comfortable among themselves issues constraints of corporate hierarchy. All setting, devoid of the Talk sessions are summarised and highlighted raised during the Koffee Town Hall sessions where senior management during the following our issue is being addressed, thus retaining will explain how each process. employees’ faith in the session to finalise the prior In 2016, we organised a Koffee Talk Key members of senior year’s meeting minutes and actionable points. session included the Group management who were involved in the Resources’ Senior General Managing Director and the Group’s Human biennially, the next Koffee Manager. With Koffee Talks being scheduled Talk session will be organised in 2018. Board of Directors and Senior Management Strategic Retreat Board of Directors and Senior Management Strategic Retreat Our Board of Directors came together to discuss our current operating status and to strategise for the future, during our annual Board of Directors and Management Strategic Retreat on 11 September 2017 at Casa Del Rio Melaka Hotel, Malacca. Five members of the Board were involved, which represented 71.42% attendance. During the offsite retreat, presentations from each Head of Division and key Head Office Departments covering their current operations, future plans and challenges were reviewed. Our Group Executive Director and Group Managing Director also made presentations that focused on big picture issues and CMS’ overall strategic direction, challenges and opportunities. annual Senior Management fashion, we conducted our In a similar Strategic Retreat which saw 21 senior managers gather on Malacca. Hotel, Melaka Rio Del Casa at 2017 September 11-13 32 members of senior management were involved, which equates to 94% attendance. The retreats serve to improve synergy, increase collaboration and instil a sense of common purpose among the Group’s leaders. The implementation of a Work-Life Balance Policy which endorses flexible working hours, part-time employment and the payment of an additional RM300 to employees to cover their health and lifestyle costs which include topping up their Out-Patient Entitlement Aerobic and Zumba sessions Safety awareness campaigns, briefings and the Safety awareness campaigns, briefings and adoption of best practices Employee engagement activities such as teambuilding and mentoring Improved employee retention and satisfaction through job rotation, right fit, enhancement, empowerment and employee inclusion Special programmes that help employees for understand common goals, share a passion success and take pride in their work Awareness of major diseases, recognising health symptoms, joining support groups, understanding healthy eating habits and the importance of exercising Managing workloads and deadlines to avoid burn-out by adopting flexi-hours, managing leave utilisation and taking time to recuperate or indulge in meaningful hobbies Celebrating staff birthdays in office EMPLOYEE ENGAGEMENT EMPLOYEE Work-Life Balance employees to live in a responsible our We continue to encourage that various annual work-life balance initiatives manner through our to the needs of our employees. Our initiatives have been tailored well- of the employees’ health and general emphasise the importance in purpose-filled and motivated remain they that ensuring while being balance initiatives and their vocational journey. Among the work-life programmes implemented to date are: Employee engagement continues to be a focal point of our work-based to be a focal point engagement continues Employee work towards encouraging a working environment initiatives even as we realise and commitment. We strive to that fosters unity, positivity our with a fuller life for all employees through corporate growth together and various other forms of engagement. work-life balance programmes Cahya Mata Sarawak Berhad in CMS. Sarawakian talentsandhaveacombined46yearsofworkexperience respectively. Heemphasisedthatbothgentlemanarehome-grown Executive Officer-Operations,DatoIsaacLugunandMrGohChii Bing, appointed GroupChiefExecutiveOfficer-Corporateand Chief Ahmad AlweeAlsree,tooktheopportunitytointroduce newly At theTownHallthisyear,ourGroupExecutiveDirector,Datuk Syed the workforce. employees todiscussimportantissuesthataffecttheorganisation and Hall alsoservedasaplatformfortopmanagementtoengage withall the annual performance of the Group and its future direction. The Town Executive DirectorandGroupManagingprovideanupdateon Town Hallsessions,whichwerefirstintroducedin2007,sawourGroup 6 December2017inBintuluwith501employeesattending.TheCMS held on4December2017with1,056employeesinattendanceand For theyear2017,weorganisedtwoTownHallsessions.Theywere Town Hall performance andareasofconcern. of theGroup.Surveysandtrainingspecifictomanagers’needswerealsoconductedhelpmanagersidentifycurrentissuesrelatingwork 2017. Theretreatwasconductedinaforumstylewhichparticipantsreceivedupdatesfromtopmanagementontheperformanceanddirection We heldtheannualmanagementretreatforourmanagersandseniorexecutivesatSamalajuResortHotelinfrom23-25October Management Retreat Social: LabourPractices andDecent Work 42 Miri. Carnival &AnnualDinnerwas organised on24-25November2017in at theBCCK,andConstruction &RoadMaintenanceDivisionSports the CementDivisionFamilyDay wasorganisedon25November2017 7 December2017 at the Borneo Convention Centre Kuching (BCCK), Head OfficeandcertainDivisions organisedtheirannualdinnerson month ofDecember,weorganisedthreeDivisionalAnnualDinners. The respective Divisionalannualdinnersareheldonalternateyears. Inthe all ouremployeesattheendofeachyear.Groupannualdinners and and servicestotheGroup,wecontinueholdanannualdinner for As agestureofgratitudeforallouremployees’contributions, efforts Annual Dinner biennial attendanceismadepossible. work operations,arotationprogrammeisintroducedtoensurethat For theTownHallsessions,ifemployeesareunabletoattenddue employees givingData’RichardCurtisastandingovation. Curtis, whoalsomadehisfarewellspeech.Thesessionconcludedby 11 yearsunderthehelmofGroupManagingDirector,Dato’Richard spoke atlengthonthesuccessesGrouphadenjoyedforlast This year’s Town Hall was also an emotional event as Datuk Syed Ahmad

SUSTAINABILITY REPORT 2017

43 5.84 2016 Dissatisfied Employee-Supervisor Relationship Employee-Supervisor Satisfaction Career Growth & Job 94.16 • • 6.34 2014 Satisfied Social: Labour Practices and Decent Work Decent and Practices Labour Social: Employee Satisfaction Survey (%) 93.66 50 100 Internal & Public Perception Internal & Public Perception Environment Employee Welfare & Work Top Management The methodology for the last ESS which was conducted in 2016 and the results were results were in 2016 and the which was conducted for the last ESS The methodology as follows: ESS Methodology for 2016 July 2016 to 1,000 CMS employees Group- The anonymous ESS was distributed on 12 category consisted of 40% of the total CMS employees. Each wide, approximately survey comprised the on a ‘six-point’ rating scale. The 2016 ES five questions based following five categories: • • • more satisfied with their jobs The 2016 ESS revealed that employees were generally to 2014. The results of the surveys are as across the Group in 2016 in comparison follows: We held our annual Long Service awards event to show our appreciation and accord We held our annual Long Service awards event to show our appreciation and accord special recognition to our employees for their loyalty to the Group. Since the first awards ceremony in 2007, each employee has been rewarded with a cash award, and a certificate and long service leave after their first 10 years in their Company subsequently every five years. In 2017, a total of 334 employees received the Long 128 RM1,555,500 (2016: of monetary value had a combined which Award Service employees, RM554,500). Going forward, the Group will incorporate Employee Engagement Initiatives under the Going forward, the Group will incorporate Business Process of the KPI. be As the Employee Satisfaction Survey is conducted biennially, the next survey will conducted in 2018. Long Service Awards

Baleh Kapit Raft Safari Baleh Kapit their career growth, welfare, work environment, as well as environment, work welfare, growth, career their as the internal and public perception of the Group. The survey results are tabled at Board meetings and action plans are devised to address areas that need improvement. The survey is available in both English and Bahasa Malaysia. Employee Satisfaction Survey We distribute an employee satisfaction survey (ESS) usually once every two years. This survey examines employee-supervisor relationships and gauges employees’ satisfaction. It also gauges employees’ perception of CMS Inter-Regional Games & CMS Friendly Games Every other year, CMS organises its Group-wide sporting event, the ‘CMS Inter-Regional Games’ and ‘CMS Friendly Games’ as part of our efforts to foster stronger In 2017, approximately unity. and Group-wide ties friendly in engage to together came employees 178 clan warfare in the form of sports such as badminton, bowling, football, as well as track and field events. The participants were divided into four houses that were captained by the senior management of our various Divisions. The Baleh Kapit Raft Safari has been an integral event integral event The Baleh Kapit Raft Safari has been an for CMS and we will continue with this tradition in 2018. The Baleh Kapit Raft Safari is a two-day rafting The Baleh Kapit Raft Safari is a two-day River. CMS competition which is held along the Rejang as part of our participates in this competition biennially efforts and in 2017, the Group employee engagement three and team of 28 participants by a was represented One of the coordinators led by Dato’ Richard Curtis. is for key purposes of participating in this competition bond with the Dato’ Richard Curtis to engage with and to are mostly trainees and executive-level employees who fun but from the millennial generation. The competition’s opportunity an provides also environment challenging on the for Dato’ Richard Curtis to share his thoughts generation Group and its future direction with the next of potential leaders. Cahya Mata Sarawak Berhad components: At CMS,ourKeyPerformance Indicator (KPI) systemcomprises five main payments orbonuseswhenoneoftheGroup’sgoalsisachieved. the systemfeaturesarewardthatawardsperformancecontract directly impacttheGroup’sperformance.Asincentivesforouremployees, work targets with CMS’goals,directionandbusiness objectives thatwill employs aperformancemanagementsystemwhichalignsouremployees To ensureoptimumperformanceacrossallourDivisions,theGroup office lunches,dinnersandcompanyoutings. memorandum, notices,intranetupdates,circulars,workers’gatherings, Office DepartmentsandBusinessDivisionsoperationalmeetings, the year.In2016,engagementactivitiesincludedregularHead Other formsofemployeeengagementoccurregularlythroughout Other FormsofEngagement employees alloverSarawak. as aneasilyaccessibleandcomprehensivesourceofinformationforour news andfeaturestoriesaboutCMS.Theobjectiveoftheblogistoserve OurCMS BlogistheGroup’sin-houseblogcoveringallevents,corporate OurCMS Blog Social: LabourPractices andDecent Work CMS’ KPI PERFORMANCE MANAGEMENT 44 (Years) Service Length of Long ServiceAwards 35 years 30 years 25 years 20 years 15 years 10 years Demerits Development Personal Priorities Critical Process Business Financial System Cash ValueofAward(RM) 5,500 5,000 4,500 4,000 3,500 3,000 2015 or failuretohighlightrisks permanent disablementofacolleague Covering matterssuchasthedeath or Responsibilities hours or received)andCorporateSocial programmes (conductedand/ Covering thenumberoftraining contributions ofthatemployee Covering thekeypersonalperformance issues Covering theindividual’skeyprocess Division, BusinessUnitorHeadOffice and locationoftheGroup,Business relevant mix according to grade, role Covering financialperformanceinthe 10,000 8,000 6,000 4,000 3,500 3,000 2016 (Working Days) Long Service Leave 7 6 5 4 3 2 Director, Dato’RichardCurtisas partoftheannualKPIsettingprocess. were decidedbetweentheHeadofDivisionsandGroupManaging management, air emissions control andbiodiversity. All SKPIs for 2017 management, energywater waste environmental targetsfor2017.Thesecouldrelateto materials Business Divisionwasrequiredtoselectandundertake relevant performance andeventuallyimprovingourbusinessoperations. Each Indicator (SKPI)withtheaimofmanagingourlong-termenvironmental In 2015,CMSintroduced its ownSustainability Key Performance Sustainability KPI salary increasesorbonusesarenotconsideredforthatparticularyear. employee failstoachieveaminimumMPAratingof‘MeetsExpectations’, It determinesthesalaryincrementofemployees.Ineventan work initiatives. assessment alsoconsidersemployees’additionalresponsibilitiesand behavioural competencyindeliveringtheirworkperformance.The The MPAcomplementstheKPIsandisanevaluationofemployees’ Management PerformanceAssessment(MPA) performance results. the followingyear.Rewardspaymentsaredirectlylinkedtothesetotal The KPIresultsforthefinancialyeararefinalisedinfirstquarterof covering: and theGroupHumanResourcesDepartmenttakeaholisticapproach All SustainabilityKeyPerformanceIndicatorsundertakenbyDivisions executive levelandbelow. component comprisesatleast45%ofthetotalKPIforemployees comprises 60%oftheirtotalKPI;meanwhilethecriticalpriorities employees atthemanageriallevelandabove,financialcomponent management tabledtotheNomination&RemunerationCommittee.For The KPIsystemisemphasisedGroup-wide,withallKPIsforsenior Threshold On-Target Stretched Score KPI SystemScoringMethodology performance) Economic (financial Meets Expectation Exceeds Expectation Outstanding Achievement (tree planting/ Environment air quality/ recycling) 90% oftheKPIitem 100% oftheKPIitem 110% oftheKPIitem Weightage (Corporate Social Responsibility) Social SUSTAINABILITY REPORT 2017 45 Others Mileage TRAVEL Executive OVERTIME Non-Executive Accommodation Subsistence allowance Unpaid Pilgrimage Examination & Study Compassionate/Calamity OTHER TYPES OF LEAVE OF TYPES OTHER Marriage, Paternity & Maternity Social: Labour Practices and Decent Work Decent and Practices Labour Social: Relief Others Leave of absence to represent State/Country Sick Leave SALARY & SALARY Site/Hardship ALLOWANCES Prolonged illness MEDICAL LEAVE MEDICAL Acting responsibility Find new customers Exploit underused capabilities/synergies/resources efficiencies Improve processes and and resources Reduce wastage of time • • • • Delivery Warding Executive Executive TRAININGS Non-Executive Non-Executive ANNUAL LEAVE ANNUAL HOSPITALISATION to attend an average of for Executives and above An average of 24 hours of Non-Executives are required 18 hours of training per year compulsory training per year

which seeks to drive growth by by growth drive to seeks Strategy which Edging EPF SOCSO SALARY DEDUCTIONS MEDICAL CARE- MEDICAL BENEFITS with dependent children Married/Single employees Married/Single employees without dependent children OUTPATIENT TREATMENT OUTPATIENT SUMMARY OF OF SUMMARY Leverage on the on Leverage looking for opportunities at the edges or periphery of our existing at the edges or periphery of our existing looking for opportunities businesses Offer additional products/services better to sell more Understand our customers COMPETITIVE BENEFITS Our pay rates and all our remuneration and benefits are above the enforceable statutory minimum. The Group makes it a priority to ensure that they are in line with the job market. We believe in fair pay and benefits for all workers and monitor all benefits are reviewed regularly to ensure that issues regarding income inequality closely. • • • In 2017, we introduced several new items for our SKPI including the following: new items for our SKPI introduced several In 2017, we Cahya Mata Sarawak Berhad a totalof416employeesunderwentHealthScreening. year whileemployeesabove40yearsoldarescreenedannually. In2017, Employees aged40andbelowaresubjecttohealthscreening twicea or harmfulillnessesthatmayaffectouremployees. understanding healthrelatedissuescanhelpmitigatetherisks ofmajor health advantagetotheGroupanditsemployees.Monitoring and workforce. Ourongoinghealthscreeningbenefitprovides a holistic We areresponsibleforprotectingthehealthandwell-being ofour Health Screening during theyearinreview. successfully appliedforeducationalassistanceworthatotalofRM37,912 course. ItissubjecttotheapprovalofourManagement.Threeemployees Employees mayapplyforareimbursementoffeesaftercompletingthe • • • • employees must: the course of their employment. In order to qualify for this benefit, Qualified employeesareeligibleforeducationalassistancetwicein Educational Assistance needs. work fromhome on afull-timebasis in 2017duetojustified personal A flexibleworkingarrangementwasapprovedforselectedemployeesto • • • • environment duetoanyofthefollowingconditions: is eligibletorequestachangeintheirassignedworkroleor employees whocannotcommittonormalworkinghours.Anemployee We have provisions for flexible working times (flexi-time) for fulltime Flexible Working Social: LabourPractices andDecent Work EMPLOYEE HEALTH 46 Accreditation Board(LembagaAkreditasiNegaraorLAN) (Jabatan PerkhidmatanAwamorJPA)accreditedbytheNational Pursue acourseapprovedbythePublicServiceDepartment their jobperformanceandcontributiontoCMS Pursue acoursedirectlyrelatedtotheirpositionorthatwillimprove Have beenincontinuousserviceforatleastoneyear Be afull-timeandcertifiedstaffmember Other reasonsapprovedbytheManagement medical care Attending toorsupportinganimmediatefamilymember’s affects hisorherworkfocus/qualityonashortlong-termbasis An extenuatingcrisisthatimpactstheemployee’swell-beingand A severehealthconditioncertifiedbyamedicalpractitioner

• • • • As farasispractical,weshall: job-related injuriesandillnesses. are committedtocontinuouslysafeguarding,managingandpreventing well-being of employees and others associated with its businesses. We The Grouprecognisestheimportanceofprotectingsafety,healthand benefit in2017. employee. A total of 46 employees were recipients of the retirement plaque and certificate of appreciation are presented to theretiring of uptotwoandhalfmonth’ssalaryisgiven.Aretirementgiftvoucher, and acleandisciplinaryrecordforthelasttwoyears.Retirementbenefit by employeeswithaminimumof10yearscontinuousemployment ex-gratia basedontheirlastdrawnbasicsalary.Thisbenefitisreceived Employees on mandatory retirement may receive a retirement Retirement Benefits of funds. Compassionate Fund has never had to turn a valid claim away due to lack Fund. AtotalofRM123,898.45wasdisbursedin2017andtodatethe all proceedsfromin-housetrainingarechannelledtotheCompassionate medical assistanceforemployeesandtheirfamilymembers.Eachyear, of situationscovered.Thefundalsocoversthedeathemployeesor of homeduetofire,floods,landslidesorotheractsGodareexamples are notcoveredbytheiremploymentbenefitsandentitlement.Aloss A compassionatefundwas established tohelpemployeesinwaysthat Compassionate Fund OCCUPATIONAL HEALTH AND SAFETY and workproceduressoastoensuretheirownsafety Ensure ouremployeesandotherscomplywithapplicableregulations accidents andoccupationalhazardsintheworkplace Identify andensuremeasuresaretakentopreventormitigate perform theirtasksinasafeandhealthyworkenvironment supervision toenableemployeesandothersintheworkplace Provide thenecessaryinformation,instruction,trainingand other relevantapplicablestandardsandstatutoryprovisions Comply withtheOccupationalSafety&HealthAct1994(OSHA)and

SUSTAINABILITY REPORT 2017

47

Social: Labour Practices and Decent Work Decent and Practices Labour Social: Strengthening of the Emergency Response Team at the Wisma Strengthening of the Emergency Response which measures emergency preparedness building for Mahmud fire drills and the purchase included implementing in-house training, of emergency response equipment first aid course, work-life Internal training which included a fire drill, balance and awareness of OSH legal compliance initiatives such Safety Month which also incorporated sustainability as tree planting and a recycling campaign that included Site visits to identified work sites and plants/factories various employees from other subsidiaries to enhance understanding and instill a sense of belonging among employees Reshuffling of Safety employees within the Group to strengthen the implementation of Safety, Health & Environment (SHE) measures HSE and Security Audit for the whole Group carried out by Group the personnel within all safety Audit plus meeting with Internal Group to standardise policies and compliance Occupational Safety and Health (OSH) Structure and Occupational Safety and Health (OSH) Structure and Non-Executives. These personnel are deployed in every Division and respective CEOs the functionally to reporting subsidiary and administratively to the Head Office (General Manager and Assistant Manager of Group Human Resources). An OSH Committee is established in every Division and subsidiary to enforce OSH Implementation and compliance to related statutory requirements. The percentage of the workforce represented by these committees is roughly 95%. The remaining 5% represent the subsidiaries of trading, investments and development office. In 2017, the Taskforce organised four meetings in which they organised organised they which in meetings four organised Taskforce the 2017, In initiatives: and subsequently implemented the following • • • • • • Roles & Responsibilities The management team of OSH in the Group is driven by 35 OSH personnel that comprise of General Manager – Operations, Group Human Resources, Assistant Manager, 13 Executives and 20 Setting safety policies and procedures for Group-wide Setting safety policies and procedures implementation Directing the implementation of safety programmes best and procedures rules, safety of awareness Raising practices taken to measures of current effectiveness Reviewing the ensure the safety of employees and others in the workplace Ordering investigations on work-related incidents, accidents reports and reviewing in the workplace, safety threats to and and recommendations Supporting the Business Units’ safety committees in the implementation of safety standards and campaigns • • • • • The key roles of the Taskforce include: • Group Safety Taskforce and introduced the We formed a Group Safety Taskforce (Taskforce) underline our commitment Group Safety & Health Policy in 2009 to part of a also became Workplace’ Healthy ‘Safe & safety. to personal Group is headed by our The Taskforce our Group’s Mission statement. Managing Director, Dato’ Richard Curtis. Cahya Mata Sarawak Berhad year. will besubmittedtoDOSHPutrajaya before31Januaryofthefollowing The JKKP8form,thatsummarises allrecordsandstatisticofaccidents, OSH Casesin2017. OSH committee.Therewasatotalof30contractorswithno record of for internalusageonly.Accidentinvestigationswillbeconducted bythe JKKP6 –JKKP10.However,theOSHcommitteehasproducedother forms Regulations 2004intheOSHA1994.Thefiveformsapplication are of accidentsstrictlyadherestotherequirementNADOOPOD The Groupiscommittedtoensuringthattherecordingand reporting counselling totheaffectedpersonnel. In theeventofanincident,adoctorfromourpanelclinicwill provide workforce inaccordancewithstatutoryrequirement. Assessments attheworkplaceandmedicalsurveillancefor Other prevention measures include the execution of Hazard Risk specific trainingsessionsthatareconductedbyin-housetrainers. practices throughoutouroperations.Wealsoproviderelevantand as wellthroughtheenforcementofstricthygieneandhealthcare the circulation of newsletters, flyers and notices throughout the Group, We choosetoeducatethemondiseasepreventionandtreatmentvia serious diseases. their familymembersandsurroundingcommunitieswithregardto We also implement the following assistance to assist our workforce, • • • following protection: ergonomic andpsychosocialrisks.Theseworkersareaccordedthe Safety &Healthrisksparticularlymechanical,electrical,dust,noise, & RoadMaintenanceDivisionsareexposedtohigherOccupational Approximately 1,000workersintheCement,aswellConstruction incidence orhighriskofspecificdiseases. These areworkersinvolvedinoccupationalactivitieswithhigh High RiskOccupationalActivities Social: LabourPractices andDecent Work 48 Provision ofproperPersonalProtectiveEquipment(PPE) Training) Administrative control(SafetyProcedures,Work-shift,Toolboxand Advanced Technology) Engineering control(Isolation,Substitution,Guardingand emphasise ourfocusonahealthier lifestyle. ‘Heart Run’wasorganisedto closetheSafetyMonthcampaignto on othercompanies’OSHpractices andstandards.Anearlymorning subsidiary companieswithinthe Grouptoobserveandprovideinput whereby selectedemployees hadtheopportunitytovisitother A compulsorysitewalkaboutwasalsoincludedintheprogramme Equipment (PPE)suppliersandinvitedspeakersfromlocalcompanies. Sarawak GovernmentHospital,privateclinics,PersonalProtective Department ofMalaysia(BOMBA),theHealthDepartment, andthe the Social Security Organisation (PERKESO),the Fire and Rescue talks andtrainingfromtheDepartmentofSafetyHealth (DOSH), Among theactivitiesorganisedduringSafetyMonthwere safety Group-wide. has sinceendeavouredtoensureexcellenceinOSHmanagement, performance criteriaintoitsstaffKPIsfrom2009andtheCompany CMS hasincorporatedOccupationalSafetyandHealth(OSH) ‘A Betteryou,Today!’andcarriedtheslogan‘YourLifeMatters!’ and iscentraltoallofouractivities.Thisyear’scampaignwasthemed our actionsandactivitiesallday;putsimply,safetyisawayoflifeatCMS Safety isanattitude,aframeofmind,awarenessourenvironment, as environmentalandsustainabilityvalues. employees andstakeholdersonOccupationalSafety& Health, aswell year sinceitsinceptionin2013aimstocreateawarenessamong Campaign. Thecampaign,whichkicksoffeveryOctoberofthe 2017 markedthefifthanniversaryofCMS’Group-wideSafetyMonth CMS SafetyMonth and 2.5%,ifthereisnocaseofpermanentdisablement. Priorities fortheirKPIwiththeweightageof2.5%ifthereisnofatality relevant divisionswillalsohavethesafetyelementaspartoftheirCritical Additionally, Divisionheads,safetypersonnel and employeesofthe those inthedefaultingbusinessunit. demerit KPIsforallemployeesalthoughhigherpenaltiesareimposedon A deathorpermanentdisablementanywhereintheGroupresults affected byourbusiness. may harmouremployees,contractors,visitors,customersandothers compromise onouremployees’health.Weaimtoeliminaterisksthat We haveanunwaveringcommitmenttosafetycomplianceandwillnot Safety andHealthProgrammes

SUSTAINABILITY REPORT 2017 49 Social: Labour Practices and Decent Work Decent and Practices Labour Social: CMS Safety Month Campaign in 2017 included: Month Campaign in CMS Safety th Activities of safety banners by the Group handover Month Campaign and the ceremonial Launch of the 2017 Safety CEOs/Head of Divisions Managing Director to spoke on mental health and doctors from DOSH and PERKESO. Two external Training by external speakers heart diseases respectively Campus project Visit to the Sarawak Museum at the subsidiary level Various activities initiated at the subsidiary level Various activities initiated 3M and KPJ Sibu Specialist Hospital PERKESO, Ethan Tan of Training/talks by external speakers from DOSH, (Occupational Health) Health screening KPJ Sibu Specialist Hospital Dr. Anna Wong of Eye At Work, and Jyi Lin, a lung specialist, Training/talks by external speakers - Dr. Wong Ethan Tan of 3M Hospital Health screening by Borneo Medical Centre and Ms Patricia of Bintulu Hospital PERKESO, Ethan Tan of 3M Training/talks by external speakersby DOSH, (Nutrition/healthy lifestyles) and Bintulu Hospital Health Screening by Bintulu Medical Centre level Various activities initiated at the subsidiary and Dr. Seena M. Kalluvalappil of PERKESO, Ethan Tan of 3M Training by external speakers from DOSH, health screening) and the importance of Columbia Asia Miri Hospital (Healthy lifestyles Asia Hospital Miri Health Screening at a booth set up by Columbia Cement Industries Site Walkabout by CMS employees at CMS level Various activities initiated at the subsidiary Various activities initiated at the subsidiary level Endu from Jabatan Kesihatan Training/talks by external speakers including PERKESO and Mr Jambai Sri Aman (Healthy lifestyles and body weight management) A clinic and health screening at a booth set up by Public Medicare Group (Nutrition & Training/talks by external speakers from Jabatan Kesihatan Negeri Sarawak Stress Management) and Tags, a spine and joint specialist (Ergonomics) of drill/training and handling Emergency response refresher courses on fire/chemical incidents, fire fire extinguishers (organised simultaneously across all Divisions) Health Awareness), the Mental Training/talks by internal and external speakers - Neuchlos Jub (First Aid Association of Sarawak and Dr. Hafiz of Klinik Tang Satok (Diabetes) Health screening by Klinik Tang Satok Visit to CMS Concrete Products Various activities initiated at the subsidiary level Communications Blood donation drive (organised by the Group Safety Committee and Group Corporate Department) Various activities initiated at the subsidiary level and SEB (Electrical Safety) Training/talks by external speakers from BOMBA Tabuan Jaya (Fire Safety), Mr Kelvin Siaw of Advanced Pathology (Communicable Diseases) Various activities initiated at the subsidiary level Site walkabout by the respective Safety & Health Committees Various activities initiated at the subsidiary level Closing ceremony for the Safety Month incorporating a 3.7km Heart Run 2 Oct 3 Oct 5 Oct 6 Oct 9 Oct 9 Oct 4 Nov Dates 10 Oct 10 Oct 11 Oct 11 Oct 12 Oct 13 Oct 16 Oct 16 Oct 17 Oct 18 Oct 18 Oct 19 Oct 20 Oct 21 Oct 23 Oct 24 Oct 25 Oct 26 Oct 27 Oct Weeks Week 1 Week 2 Week 3 Week 4 Safety Events held during Safety Month 2017 held during Safety Safety Events 5 held during the health and safety events The various Cahya Mata Sarawak Berhad undertaken byouremployeesin2017. The following table covers the various types of training programmes Other TrainingProgrammes participants. There were9InternalTrainers,and1ExternalTrainer422 levels). organised fornon-Executives(bothsupervisoryandnon-supervisory Resources, LegalandSafety.Outofthe19sessions,6werespecially on functional areas and regulatory requirements including IT, Human A totalof19sessionswereheldin2017coveringtopicsandsubjects and monitorsemployeedevelopment. evaluating thetraining.TheGroupHRalsoidentifiesbesttrainers HR) Department,whichisresponsibleforselecting,coordinatingand The ITC programme is managed by Group Human Resources (Group procedures orprocesses. role asapolicymakerandadvisor,alsoremovesuncertaintiesin Head Office’s key functions. This role adds value to the corporate office’s Our ITCprogrammecoverscriticalprocessesandproceduresofthe In-House TrainingCapability(ITC) 13 sessionsheldin2016. in-house training sessions wereheldin2017comparison to only switching focustowardsin-housetrainingsessions.Atotalof19 In 2017,ourtrainingbudgetwasreducedconsiderablydueto Social: LabourPractices andDecent Work employees attendedtrainingsessions,includingteambuildingsessions. an averageof18hourstrainingperyear.In2017,atotal2,571 of 24hourstrainingperyearwhilenon-executivesmustundertake CMS toretain.Executives,managersandabovemustattendanaverage opportunities. Thisapproachproducesahighly-skilledworkforcefor We provide each employee with training and career development Training andEducation 50 List ofTechnicalandSoftSkilltrainingundertakenduring2017: year peremployee hours oftrainingper Average numberof budget peremployee Average training Training CMS TrainingBudgetandHours 4. 3. 2. 1. Resuscitation (CPR) Basic OccupationalFirstAidsand Cardiopulmonary Shovel LoaderOperatorsTraining Safe HandlingofForkliftTruck Forklift OperatorTraining Technical Skills Hours Unit RM 1,533 2015 17 1,364.74 2016 15 792.82 2017 16

13. 12. 11. 10. 9. 8. 7. 6. 5. 23. 22. 21. 20. 19. 18. 17. 16. 15. 14. 13. 12. 11. 10. 9. 8. 7. 6. 5. 4. 3. 2. 1. Road MaintenanceManagementSystemTraining CREAM Training 3-Day TechnicalWorkshop Management System(EMS) Life CyclePerspectiveandItsApplicationonEnvironment Safety Health(NIOSH) Working atHeightbyNationalInstituteofOccupational Ergonomics andManualHandlingintheWorkplace Refresher Authorised EntrantandStandbyPersonforConfinedSpace Seminar onConcreteMixDesign(Intermediate) Refresher Course2017 Authorised EntrantandStandbyPersonforConfinedSpace Technical Skills Group InternalAuditWorkshop onBusinessEthics Negligence Law forNon-Lawyers-Administration ofEstateand Project ManagementProfessionalPractice1 Types ofPersonality Industry Payment&AdjudicationAct2012(CIPAA)and4 Strategic Procurement,Incoterm2010,Construction ISO 9001:2015,14001:2015&OHSAS18001:2007 (Process RiskandPerformanceBasedApproach) Integrated ManagementSystem(IMS)InternalAuditing Audit DalamanAmalanPersekitaranBerkualiti(5S) Kursus AmalanPersekitaranBerkualiti(5S) Management ISO 9001&14001:2015AwarenessforTop ISO AwarenessTraining 5S AwarenessTraining Safety ManagementatWorkplace Committee Empowering YourOccupationalSafetyandHealth 5S BestPractices Cloud ComputingandEmailSecurity Effective SafetyCommitteeTraining MS OfficeWordsIntermediateLevel MS OfficeExcelIntermediateandAdvanceLevel Motivational Workshop HR fornon-HRPersonnel Report WritingSkills Communication Skills People ManagementSkills Soft Skills SUSTAINABILITY REPORT 2017 51 Dato Isaac brings with him a wealth of experience in Dato Isaac brings with him a wealth of while Mr the corporate and strategic investment areas, business core in expertise accumulated his brings Goh, Isaac will manage the group’s corporate operations. Dato companies strategic investments that include associate in smelting, financial services and telecommunications the Group’s infrastructure, while Mr Goh will oversee construction Core Business divisions, including cement, materials & trading, property development, construction & road maintenance. As both these distinct areas of our business needed very focused attention to realise their due decided after Board the potential, considerable consideration that two separate but complementary CEOs would best serve our specific needs. These two talented ‘CMS-grown’ leaders bring with them an intimate understanding of CMS’ businesses built up over the last 20 years or so and a shared belief in the Group’s direction. Both gentlemen will work together with our current Group Chief Financial Officer, Tuan Syed Hizam Alsagoff, to deliver on our targets. These three with the workings of CMS instils gentlemen’s familiarity in the Board a confidence that our succession planning is sound, solid and geared for even greater success. CMS’ Tier 2 and Tier 3 Succession Planning Over the course of 2017, in line with our Succession Planning initiatives, Tier 2 Succession Planning candidates had 16 individual sessions with Group Managing Director, Dato’ Richard Curtis; while all six Tier 3 Succession Planning Candidates plus another three new candidates, had individual sessions with the Senior General Manager of the Group Human Resources Department. Social: Labour Practices and Decent Work Decent and Practices Labour Social: Alternative options to support the succession plans Setting a timeframe for potential successors to fill Setting a timeframe for potential successors critical positions Annual mentoring through a one-to-one interview one-to-one a through mentoring Annual with the Group Managing Director on the availability of potential successors Monitoring the performance of potential successors Devising a customised development and mentoring and development customised a Devising programme for potential successors Creating a talent pool for critical positions CMS Announces its New Era of Leadership are credited planning strategies sound succession CMS’ with preparing able successors to the Group Managing Director, Dato’ Richard Curtis who retired at the end of 2017. Dato Isaac Lugun and Mr Goh Chii Bing have been promoted from within CMS to serve as Group Chief - Corporate and Group Chief Executive Executive Officer Officer - Operations respectively, as part of the Board’s dual leadership strategy. • • • • • SUCCESSION PLANNING business Succession planning is essential to ensure is seen long-term growth. This approach sustainability and sustainable as necessary to help CMS meet its long-term growth objective. annually and Management conducts succession planning focuses on: • CMS’ sound succession planning strategies are credited with preparing able successors to the Group Managing Director, Dato’ Richard Curtis who retired at the end of 2017. Cahya Mata Sarawak Berhad The nextMTDPprogrammewill beheldinthe2019/2020period. Some oftheprominentpositionsinGroupthatMTDPgraduates are takingupcurrentlyasfollows: from Batch2,werecruited10employees;and3, 17employees. Since theinceptionofMTDP,employeeshavebeensubsequentlyrecruitedfromeveryyearlybatch.FromBatch1,we 12employees; technical competenciesbeforeconsideringthemforemployment. performance. Theirrespectivementorsalsoconsiderbehaviouraland Upon completionoftheMTDP,traineesareassessedontheiroverall retirement. from businessgrowthandnaturalattritionsuchasresignations organisation. Theprogrammealsoaddressesmanpowergapsresulting high-quality technicalandnon-technicalskillsetsthatarecriticaltothe The MTDPsupportsCMS’long-termstrategytobuildandmaintain at variousBusinessDivisions. structured trainingincorecorporatefunctionsandspecialised Group’s successionplans.Weprovidetraineeswith12monthsof The MTDPattractsanddevelopsexecutive-leveltalentaspartofthe Management TraineeDevelopmentProgramme(MTDP) employees intheirrespectivecompanies. skills indealingwithdifficultemployeesorgroomingpotential which wassetforadurationofsixmonths,focusedondeveloping people managementskillsamongstotherattributes.Theassignment, syllabus wastoguidemanagersdevelopemployeeengagementand Satisfaction Survey and series of Koffee Talks, the key focus of the Programme. ArisingfromtheoutcomeofCMSEmployee This year,sixcandidateswerechosenforapilotDevelopment Social: LabourPractices andDecent Work 52 Production EngineerforCMSPremixSdnBhd,Sibu Senior HRExecutiveforCahyaMataSarawakManagementServices Sdn Bhd,Kuching Risk ExecutiveforCahyaMataSarawakManagementServicesSdn Bhd, Kuching Senior AuditExecutiveforCahyaMataSarawakManagementServices SdnBhd,Kuching Mechanical EngineerforCMSCementIndustriesSdnBhd,Kuching Senior ProductionandMaintenanceEngineerforCMSQuarriesSdnBhd, Kuching Acting PlantManagerforCMSCementSdnBhd,Kuching The selectioncriteriafortheMTDPisasfollows: Have highfamilyvalues Team player Good communicator ICT savvy Inquisitive nature Problem solver Love challenges Graduates withuptotwoyearsworkingexperience Fresh GraduateswhohavebeenconferredaDegreeor SUSTAINABILITY REPORT 2017 3 53 % 18 8.4 38.3 32.3 2017 4 % 35 26 24 10 2016

Charitable Sustainaining Organisations 9 5 Social: Society Social: % & Health 37 23 27 Awareness Programmes

2015 Environmental Environmental & Health Environmental 250 employees from the Construction Materials & Trading Division 800 trees along the roadside leading up to the entrance of the Sibanyis quarry. planted a total of Good Rebuilding Communities CMS Doing Lives Saving Clean-ups Community our employees In 2017, RM103,560 which were distributed among various locally-based charitable organisations, mosques, churches, a home for the elderly and children’s homes to assist them in their day-to-day expenses. CMS ‘Doing Good’ raised a total of Breakdown of ‘Doing Good’ Initiatives by Type Sustaining Charitable Organisations Environmental & Health Awareness Programmes Saving Lives Community Clean-ups (Gotong-Royong) Rebuilding Communities based charitable organisations, mosques, churches, a home for the elderly and children’s homes to based charitable organisations, mosques, churches, assist them in their day-to-day expenses. sections. discussed under the following Our various ‘Doing Good’ programmes are

CMS employees CMS employees man-hours In 2017, 48,420 Employee Volunteerism dedicated a total of dedicated a total for CSR activities including fund-raising charity sales, rebuilding communities, jog-a-thons, community work and many more. CMS ‘DOING GOOD’ ‘DOING CMS EMPLOYEE VOLUNTEERISM VOLUNTEERISM EMPLOYEE Our ‘Doing Good’ activities continue to drive our community-based CSR efforts which have seen our employees step up to the plate time and again to help those in need. In 2017, our employees raised a total of RM103,560. The locally- among various were distributed funds In 2017, CMS employees dedicated a total of 48,420 man-hours (2016: 45,434 man-hours; 2015: 43,526 man-hours) for CSR activities rebuilding sales, charity fund-raising including work jog-a-thons, community communities, and many more. CMS initiated a ‘Doing Good’ culture in the mid- CMS initiated a ‘Doing Good’ culture in the 1990s and its Corporate Social Responsibility and to expand continued has CSR role or primarily focused has CMS 2007, Since evolve. CSR on direct employee participation in a activities and we continue to inculcate sense of concern and a caring attitude among Direct of policy. matter a employee as our of the form takes participation employee multiple year-round employee volunteerism. These projects are often led by CMS employees and have certainly helped build up respect for CMS within the local community. As part of our annual KPI, employees at the executive level and above are required to in activities CSR of hours 24 least at undertake undertake must non-executives a year; whereas at least 8 hours of CSR activities. Cahya Mata Sarawak Berhad for theflowof watertotheriver,development ofotherprojects, combination offactorsincluding lowlyingland,lackofproperdrainage Investigation revealedthatthe floodingintheareawasduetoa Issues onfloodingattheMambong areawereraisedafewtimes. permissible regulatorylevel. representatives. Our emissions from the plant are always well below the monitoring surveyaresharedwiththecommunityheadsand kampung compliance withregulatoryrequirement.Theresultsofeach dust We conduct regular dust monitoring at Kampung Mambong to ensure activities andtoassurethemthatwewillnotencroachupontheir land. the affectedlocalcommunitytoensuretheyarewellinformed ofour Whenever wedosurveysofquarrylands,willopendialogues with various communityhalls. and motivationaltalkstotheschoolssponsorshipofchairs forthe of prizesforstudentswhoperformedwellacademically,bookdonations and activitiesthatbenefitthecommunitiesasawholesuchsponsorship initiatives withvillagesinandaroundMambongarrangingprogrammes CMS CementIndustriesSdnBhdcarriedoutcommunityengagement improved roadaccessandbetteramenities. especially intheruralareas.Severalschoolshavebenefittedfrom programmes arenotonlycarriedoutinKuchingbutthroughoutSarawak schools, villages,mosques,churchesandmanyothers.Our‘DoingGood’ Good’ activitiessuchasrebuildingworksandcommunityclean-upsat During theyear2017,CMSemployeescontinuedtocarryout‘Doing Social: Society REBUILDING COMMUNITIES 54 Rebuilding Communities Sustaining CharitableOrganisations Environmental &HealthAwarenessProgrammes Saving Lives Community Clean-ups(gotong-royong) Sarawak. to respondwheneverthereis a landslide,roadcollapseorfloodingin During therainyseason,ourroad maintenancecrewisalwaysquick finale sawthegrandprizeofamotorcycle beinggivenaway. drive, children’scolouringcontest, andfreemusicconcert.Theevent celebrations includedafreemedicalcheck-upbooth,blood donation were presentedtoprimaryandsecondaryschools.Theanniversary of thefoundingSamariangtownshipwherebookdonations Projek Bandar Samariang Sdn Bhd held the 20 744 startedoperationsinMarch2017. Borneo 744,Malaysia’sfirstBlueOceanEntrepreneursTownship. Borneo Sarawak EconomicDevelopmentCorporationforthedevelopment of CMS Landhassigneda15-yearrent-freetenancywithdivision ofthe Construction commencedon18December2017. Association fortheWelfareofIntellectuallyDisabledChildren. Gateway Towers,issponsoringworkers’quartersfortheSarawak CMS LandSdnBhd,togetherwithanotherlocalcontractorforThe which CMSwillhelptocoordinate. the Padawan Municipal Council (Majlis Perbandaraan Padawan or MPP) Kerja RayaorJKR),theDepartmentofIrrigationandDrainage(DID) of governmentagenciessuchasthePublicWorksDepartment(Jabtan Mambong cementmillsotheseissueswillrequirethecollectiveinputs widened theroadandimproveddrainageduringconstructionof blockage ofdrainagechannels,andsiltationintheriver.CMShadalready CSR man-hourscommittedbyCMSemployees 16,088 11,776 9,868 3,690 2,104 2015 16,134 11,992 11,090 4,644 1,674 2016 th anniversary celebration 18,524 15,655 8,715 4,080 1,446 2017 SUSTAINABILITY REPORT 2017

55 Social: Society Social: activities which were carried out on 6 May 2017 gotong-royong activities which were carried out on 6 May 2017 Rumah Bihai Gets Tar-Sealed Road Gotong-Royong at Masjid Kampung Selangkin Employees Hike Uphill to Help Church Hike Uphill to Help Employees 31 CMS employees answered the call for help from Rumah Bihai, Mukah 31 CMS employees answered the call for help from Rumah Bihai, Mukah on 6 May 2017 to tar-seal the road entrance leading to their longhouse. resurface the premix to laying before the base prepared volunteers The area while the rest of the volunteers, together with the longhouse folks, cleaned the surrounding areas of the longhouse. 18 March 2017. Masjid Kampung Selangkin, Simunjan now has a carpark with an open space to hold religious functions, thanks to our employee volunteers. The involved cutting down bushes and clearing the surrounding area of debris before gravel and premix were laid to the front yard of the mosque. CMS employees volunteered to carry wooden planks, bags of sand and CMS employees volunteered to carry wooden all the way up to the Catholic gravel from the foothill of Mount Singai, Bau 228 meters above Memorial Pilgrimage Centre, which is approximately a new stairway with platforms sea level. The materials were used to build construct a new building on leading up to the Centre, as well as to Longhouse Gets New Facility Solid Foundation for Carmelite Monastery New Walkway for SK Kampung Nyalau for SK Kampung New Walkway CMS employee volunteers based in Bintulu and Miri helped with the CMS employee volunteers based in Bintulu and Miri helped with the preliminary works for the construction of an outdoor toilet for the longhouse folks of Rumah Jangi, Ulu Sebauh in Bintulu. On 26 February 2017, our volunteers cleared the site of debris before mixing cement and laying the bricks to build the toilet wall. The much-needed facility will be used by the longhouse folks and visitors during communal and festive activities. Over 100 CMS employees volunteered to rebuild the Carmelite Monastery in Kuching on 5 February 2017. The building was infested with termites which caused it to rot. CMS also donated 5,000 tonnes of quarry waste worth RM55,000 used to fill the monastery’s foundation and compound area. CMS sponsored materials to build the 66-meter covered walkway which to build the 66-meter covered walkway CMS sponsored materials from the the students and teachers when walking will provide shade for classrooms. school entrance to the 24 CMS employees came together on 19 January 2017 to help build a together on 19 January 2017 to help 24 CMS employees came for SK Kampung Nyalau in Bintulu. Our volunteers new covered walkway Association and villagers laid Parents-Teachers together with the the and planted flowers and trees around concrete for the walkway school compound. Cahya Mata Sarawak Berhad school compoundandlayingpremixtotheparkingarea. cleaning andpaintingoftheroadkerb,liningroad, the Musa inKotaSamarahanon11November2017.Activities included 48 CMSemployeesresurfacedtheschoolcarparkofSKDatoMohamad donated householditemstotheinstitution. IT room,resourcemusicroomandschoolcompound. CMS also the compound,sweptanddusteddininghall,school library, welfare institutionforchildren,locatedinKuching.Thegroupcleaned to cleanthevicinityofRumahKanak-KanakTohPuanHajahNorkiah,a On 16September2017,atotalof38employeesfromCMSgottogether and laidgravelattheparkingarea. grass, cleanedthecompound,paintedbuildinginlightshadesofblue KEMAS, apre-school,atKampungSungaiDuuh,Serian.Theycutthe 41 CMSemployeescameforwardon15July2017andhelpedTabika ground withpremixinfrontofthechurch. machinery tocleanthesitebeforelayingstonesandlevelling 47 CMSemployeesarrivedon20May2017withtheirshovelsand Chapel inSiburansoughthelptotar-sealtheirchurch’sparkingarea. Our caring CMS employees were ready to help when The Epiphany to celebratetheGawaiHarvestFestival. Government. Theparkinglotwascompletedintimeforthecommunity the way for anew tar-sealed road which will be constructedby the stones infrontofthelonghouseandremovedsolarpaneltopave Rapa TiputatUluLayar,Betong.Theylevelledtheparkinglotandlaid on 10May2017totravel40kmhelpthecommunityatRumahKedit, 38 CMSemployeestooktheopportunityofWesakpublicholiday Social: Society 56 Rebuilding WorksatSKDatoMohamadMusa Children’s HomeGetsAClean-Up Tabika KEMASGetsAFace-Lift Tar-Sealed ParkingLotforChurch ‘Doing Good’onWesakDayforRumahKedit 2-storey woodenstructureofthe131-yearoldschool. hall thatwasengulfedbyafireon29October2016destroyedthe 8 January2017toraisefundsfortherebuildingofSt.Teresa’sSchool 38 CMSemployeestookpartinthe‘SaveSt.TeresaRun’,organisedon Puan JenapBtMaharitohelpeasethefamily’sfinancialburden. a chequeofRM56,064waspresentedtoMohamadJamil’s spouse, after sufferingfromdiabetes.FromCMS’GroupTermLifeInsurance, 12 August2016fromHypoxic-IschemicEncephalopathypost CPR the familyoflateMohamadJamilBinKepotwhopassed awayon On 26January2017,CMS’CementDivisionhelpedoneofits own– SUSTAINING CHARITABLE ORGANISATIONS Helping OneofOurOwn A RacetoRebuildSt.Teresa’sSchool

SUSTAINABILITY REPORT 2017 57 Social: Society Social: Run for Autism Awareness Fun Time with Milo ‘Doing Good in the World’ ‘Doing Good 90 CMS employees took part in the Kuching Run for Autism 2017 90 CMS employees took part in the Kuching Run for Autism 2017 organised by The Kuching Autistic Association (KAA) on 2 April 2017. KAA aims to create awareness and reach out to the public especially for funds raising while society our in children autistic accept to parents their educational and training programme. CMS contributed RM5,000 to KAA. 52 CMS employees joined 6,000 other participants on 2 April 2017 in 52 CMS employees joined 6,000 other participants on 2 April 2017 in the annual 3km Milo Breakfast Run. On 26 February 2017, 41 CMS employees took part in a run organised On 26 February 2017, 41 CMS employees Club’s the for funds raise to Central Kuching of Club Rotary the by programmes. CMS also community projects and youth development contributed RM5,000 to the run.

Making A Difference The COLOUR POWDER is back! The COLOUR 23 March 2017, in aid of four-year old Edison George who suffers from brain damage and became epileptic last year, and who requires two cans of milk a week. With the contribution of 14.7kg of the special blend of milk, little Edison will have at least fourteen weeks of milk supply. Through our ‘Make a Difference’ initiative, a group of CMS employees Through our ‘Make a Difference’ donated 10 cans of S26 Milk Gold to the HOPE Place Kuching on Covered in multi-coloured powder, 38 CMS employees ran the 5km Covered in multi-coloured powder, 38 CMS 3,400 other participants, on Colour Rush 5.0 together with more than and awareness in support 18 February 2017. The run aims to raise funds cancer in Sarawak. CMS also of families and children battling childhood sponsored RM5,000. Cahya Mata Sarawak Berhad privileged families. 2017. Themoneyraisedfromthedonationwillbeusedtoassistless to theMalaysian Red CrescentSarawak (Stampin Chapter) on 17May PPES Works(Sarawak)SdnBhdandCMSRoadsdonatedclothes RM3,000. for the Society for Critically Sick Children whereby CMS sponsored Race heldattheJubileeGround,Kuching.TheeventraisedRM15,000 15 CMS‘Superhero’employeesparticipatedinthe5kmSuperhero Rat RM15,054.90 whichwillbeusedtofundthespecialschool’sactivities. Children (PERKATA)OpenDaySaleon30April2017.Theyraised food at the Sarawak Association for the Welfare of Intellectually Disabled Seven CMS subsidiary companiessetup 10 stallstosell a varietyof Social: Society 58 Intergalactic RaceforMankind ‘Doing Good’fortheMalaysianRedCrescentSarawak ‘Doing Good’forPERKATA

raised RM3,482fortheSarawakCheshireHome. Sdn BhdsetupstallsattheSarawakCheshireHomeOpenDaySalesand Information Systems,CMSCementSdnBhdandIndustries On 2July2017,manyCMSemployeesfromGroupManagement ages toparticipate. Fun Run and a 1km Kids Dash - a run perfect for runners of all levelsand Marathon &Veteran,10kmRun5kmCorporateRace, 9 July2017whichhadsevencategoriestochoosefrom–21kmHalf- 17 employeesjoinedtheannualSpringLiveActiveRunheldon The SarawakChildren’sCancer Society (SCCS)helditsGoBald a totalofRM26,499forthecause. and TunkuPutraSchoolstudents bravelyshavedtheirheads.CMSraised support for children with cancer on 9 July 2017 and 11 CMS employees Fundraising forSarawakCheshireHome Go Bald Beating theClock 9 forChildren’sCancer 9 eventin

SUSTAINABILITY REPORT 2017

59 Social: Society Social: edition run raised RM2.20 million which was channelled to 30 edition run raised RM2.20 million which th Cement Division Gives Donates Back to the Community Cement Division Gives Donates Back to Bursa Bull Charge Run 2017 Bursa Bull beneficiaries representing a range various segments including the representing a range various segments beneficiaries Managing Group mothers. single and underprivileged youth, disabled, CEO Run in 11.37 mins. Director, Dato’ Richard Curtis ran the 1.5km Malaysia’s aspiration to be a This year’s theme was in line with Bursa free providing event, neutral carbon a being by champion sustainability to a food bank. bus rides and donating surplus food and water Our Lady of Lourdes Church, Kampung Sikog, James Rajak Anak Agok Our Lady of Lourdes Church, Kampung Sikog, James Rajak Anak Agok on 14 September 2017. The Division continued its ‘Doing Good’ quest by sponsoring four sets of High Bay Lightings for Kampung Sitang’s Community Centre and on the following day, handed over electrical items to Pastor Jenyi Simet as prizes for the Tadik Terang Sports Day on 31 October 2017. A final good deed for the year was done on 22 November 20017 with a donation of RM1,500 to the principal of SK St. Augustine, Stanley Sagir, for the school’s high academic achievers. Between September and November, CMS’ Cement Division played an Between September and November, CMS’ Cement Division played an affair, yearly a As community. the to back contributing in role active 200 units of plastic chairs were handed over to the Chairman of The annual Bursa Bull Charge 2017 held in Kuala Lumpur gathered The annual Bursa Bull Charge 2017 held on 14 September 2017. 1,818 participants from 150 organisations The 4

CMS Tribal Run 3.0 Raises RM133,000 for 10 Local Charities CMS Tribal Run 3.0 Raises RM133,000 for Projek Bandar Samariang Donates to Fire Victims Projek Bandar Samariang Kuching Run for Peace Kuching Run 26 July 2017. Three families from Bandar Samariang received donations totalling totalling Bandar Samariang received donations Three families from 2017. Bandar Samariang Sdn Bhd on 12 August RM12,000 from Projek Manager, over by Senior Sales & Marketing The donations were handed bin Deni and Rami Kapol Gary Kho to Jemat bin Mos, Encik Kusaini on morning fateful that on fire by razed were houses terrace whose 32 CMS employees showed their support for the ‘Run for Peace’ Peace’ showed their support for the ‘Run for 32 CMS employees aims Malaysia. The run, held on 23 July 2017, organised by Soka Gakkai for to be aware of the importance of taking action to inspire the people culture of peace in the community. peace and to create a CMS held its annual Tribal Run for the third time on 27 August CMS held its annual Tribal Run for the third time on 27 August 2017 which gathered an impressive 3,100 participants (2016: 3,000 participants). 100% of the entry fees totalling RM133,000 (2016: RM120,000) were donated to 10 local charitable organisations namely Dyslexia Association of Sarawak, Kuching Autistic Association, Home of Peace, Purple Lily Foundation, Sarawak Cheshire Home, Sarawak Society for Parents of Handicapped Children (PIBAKAT), Sarawak Society for The Deaf, Salvation Army, Society for Critically Sick Children (SOS Kids) and Society for The Urban Poor. Each organisation received RM13,300 (2016: RM12,000). Cahya Mata Sarawak Berhad colouring books,toysandstationeries. Intellectually DisabledChildren(Perkata)whoreceivedschool bags, Kuching AutisticAssociationandtheofWelfare of a totalof111giftsweredistributedtothespecialchildren from the gifts fortheneedyandlessprivilegedchildren.Throughprogramme, in-a-Box’ programmewiththeaimofspreadingloveandjoythrough On 16December2017,CMSemployeescontributedgiftstothe‘Love- to virtualrunnersorwhocouldnotparticipateontheeventday. on 8October2017hadanaddedboostbyopeningacategorycatering of Cruelty to Animals (SSPCA)’s Animazing Race. This year, the run held CMS employeesparticipatedintheSarawakSocietyforThePrevention RM370,000 intotal. Sarawak HeartFoundationfortheRunwhichcollectivelyraised cannot affordthehighmedicalbills.CMScontributedRM5,000to Heart Centretoprovidethebestcardiaccareespeciallyneedywho hospitals inKualaLumpur.ThefoundationcollaborateswiththeSarawak diseases whichenablesthemtoundergomedicaltreatmentatcardiac assistance programmeprovidedtochildrensufferingfromcriticalheart Sarawak Heart Foundation’s Heart to Heart Programme, a financial to runattheHeartRun.Themoneyraisedwillbeusedmanage On 24 September 2017, CMS employees joined the 3,000-strong crowd RM10,000 fortherun. by theIEMEngineer’sRunon30September2017.CMSsponsored 67 CMSemployeesparticipatedintheElectrifyingNightRunorganised Social: Society 60 The ElectrifyingNightRun CMS SpreadsLove The AnimazingRace Run forYourHeart waste inandaroundtheRivervale Residencespremises. 50 Mother Earthbyplanting100Eugineatrees,50Agaveplantsand Development SdnBhdcametogethertomakeadifferenceand support On 17June2017,atotalof49employeesfromCMS Property to theNationalCancerCouncilMalaysia. before endingattheStart/Finishpoint.ARM1perentryfeewasdonated 25km fromJalanAstana,crossingtheSungaiSarawak,KampungSurabaya 1Malaysia’ atWismaKastam,Kuchingon21January2017.Theyrode 14 CahyaCycliststookpartinthecharityfunride‘KayuhanAmalKastam ENVIRONMENTAL & HEALTH AWARENESS PROGRAMMES 1Malaysia 2017 Cahya CyclistssupportFunRideKayuhanAmalKastam Property EmployeesSupportMotherEarth Hibiscus floweringplants.Theyalsohelped toclearconstruction

SUSTAINABILITY REPORT 2017

61 Social: Society Social: site. The four criteria include: the site is a particularly good Tree Planting by Construction Materials & Trading Division Materials & Trading by Construction Tree Planting RAMSAR The RAMSAR site is situated 15km from Kuching and approximately 5km from Damai Beach. The Kuching Wetlands National Park covers an area of 6,610 hectares in between the Sibu Laut and Salak rivers. The park extensive an includes that system mangrove saline a of mainly comprises network of marine waterways and tidal creeks interconnecting the two major rivers that form the boundaries of the park. Initiated in 1971 at Ramsar, Iran, the Ramsar Convention had been adopted by many countries including Malaysia in 1995. The Kuching Wetlands National Park fulfilled four out of nine criteria suitable as a representative example of a natural coastal mangrove system, the site supports the Proboscis Monkey (Nasalis larvatus), the site is of special porosus) (Crocodylus Crocodile value as a nursery area for the Estuarine and the site is an important spawning and nursery ground for fish and prawn species. 30 September and 14 October 2017. This CSR event forms one of the CSR event forms one of the 30 September and 14 October 2017. This key performance Divisions’ business processes and is a sustainability the quality of the living indicator. The Division strives to uplift proper maintenance of trees. environment through active planting and Sin came together to plant a 250 employees headed by Mr Chong Swee up to the entrance of the total of 800 trees along the roadside leading quarry site. CMS’ Construction Materials & Trading Division organised a tree Division organised a tree CMS’ Construction Materials & Trading over two weekends on planting event at Sibanyis Quarry, Kuching CMS Plants 500 Mangrove Saplings An Environmentally Friendly Ride around Kuching Friendly Ride An Environmentally Aside from manpower, CMS also contributed supplies worth RM2,300 comprising rubber boots, gloves, a ladder, hoes and garbage bins for the programme’s future use. On 20 November 2017, the volunteers braved the rain and mud and to managed systematically, and collaboratively together working by plant all 500 saplings in just one hour. Part of the group were assigned to do nursery work where they managed to prepare 500 saplings from the mangrove propagules as part of the propagation process. This is to meet the condition set by the Forest Department whereby the number of saplings planted must be replaced with the same number of saplings prepared in their efforts to guarantee sustainability. 75 CMS employees volunteered to plant 500 mangrove saplings (Bakau Kurap species or Rhizophora Mucronata sp.) at the RAMSAR site, Kuching participated in has time CMS second the This is Park. National Wetlands collaboration in organised was which planting programme mangrove the with the Forest Department Sarawak, the government agency that promotes the rehabilitation of the ecosystem in Kuching Wetlands. Our cyclists rode a distance of 30km around Kuching on 21 October 2017. Our cyclists rode a distance of 30km around Energy Berhad (SEB) and The Enviro Ride, jointly organised by Sarawak was held at SEB’s premises, at the Department of Environment Sarawak, Bersama’, the event The Isthmus. Themed ‘Alam Sekitar Tanggungjawab at aims and transportation of mode alternative an as cycling promotes of the environment. foster a commitment towards the conservation Cahya Mata Sarawak Berhad went tocharity. and plasticbottles.Atotalcollection of6,336kg(worthRM1,759.30) comprising of newspapers, aluminiumcans,cardboards, mixed papers, arrived all excited to offload, with stacks and parcels of recyclable items, 2017, CMS received an overwhelming response from the employees who clean theirofficesandhomes,tousherintheNewYear.On13 January started earlythisyearwhichgaveeveryoneanopportunity to spring The recyclingcampaignorganisedbyGroupInternalAuditDepartment Welfare Fund. activity totallingRM10.80(21.5kg)wenttoCMSCementIndustries’ our volunteerstoclearrubbishalongthebeach.Proceedsfrom Santubong. Makingtheclean-upafamilyaffair,membersjoined Industries SdnBhdorganisedaclean-upatthePasirPandakBeach, On 24September2017,atotalof40volunteersfromCMSCement government orprivatehospitalstodonate. donors, especiallythosewhoworkshiftsfinditdifficulttogetthelocal employees todonatebloodmoreconveniently,asmanyofourregular Sdn Bhd’sPendingandMambongplants.Thisistoencourageour Blood donationdrivesareorganisedregularlyatCMSCementIndustries 23 September2017with58and61successfuldonors,respectively. CMS organised two blooddonationdriveson4March2017and Social: Society SUSTAINABLE PROJECTS COMMUNITY CLEAN-UPS SAVING LIVES 62 This Year,ResolvetobeBetterbyReducing,Reusing&Recycling CMS CementIndustriesCleansPasirPandakBeach A LifeSavingCommitment

in thecommunity. significant either to the receiving charity or to strengthen CMS’ image and sportseventswithinSarawak,targetedatactivitieswhich were donations. Alldonationsandsponsorships were madetocharitable In 2017,wespentclosetoRM1,040,592onphilanthropiccauses and activities, health,educationandculture. to report. However, we prioritise community development, sporting local communities.Afulllistoftheseinitiativeswouldbetoovoluminous by lendingfinancialsupporttoinitiativesthathaveapositiveimpacton At CMS,weaimtodoourbestforsocietyvia‘DoingGood’platform Sarawak SocietyforParentsofChildrenwithSpecialNeeds(PIBAKAT). RM1,000 forcharity.Proceedsofthisrecyclingcampaignwenttothe On 14July2017,CMSorganiseditssecondrecyclingdayandraised their WelfareFund. papers, cardboardboxesandaluminiumcansraisedRM1,315.55for they recycled3,875kgofwastesuchasnewspapers,plasticbottles, Trading Divisionhasinculcatedrecyclingasaculture.On17April2017, In anefforttoreducewasteandpollution,CMS’ConstructionMaterials& Recycle forCharity Recycle TodayforaBetterTomorrow Corporate Philanthropy SUSTAINABILITY REPORT 2017 63 Social: Society Social: Anniversary. CMS aims to bring th (formerly known as CMS Opus Private Equity (formerly known as CMS Opus Private Equity CMS Sponsors 2,000 Subscriptions of The Star ePaper for Schools CMS Sponsors 2,000 Subscriptions of The COPE Private Equity Donates over RM100,000 to Local Charities over RM100,000 to Local Equity Donates COPE Private opportunities to students who are mainly in secondary schools to have in English learn to medium a as it utilise and ePaper Star The to access a more fun way. CMS cares about education and the importance of the younger generation mastering the English language. On 16 August 2017, CMS sponsored 2,000 subscriptions through the Star Newspaper-in-Education for 341 subscriptions given out during the Projek Bandar Samariang Sdn Bhd’s 20 COPE Private Equity Sdn Bhd Sdn Equity Private COPE community by giving Sdn Bhd) on their own initiative reached out to the cheque A in Sarawak. charities local five to RM128,000 of sum total a Mahmud on 31 July 2017. presentation ceremony was held at Wisma very good job in carrying out The selected local charities have done a dams, micro-hydro building from organisations their of objectives the care and support for kidney providing education for disabled kids to giving support our of need dire in are organisations These patients. cancer and as well as manpower. in getting funds to run their daily operations, CMS Borneo rd Borneo Junior Open rd CMS Sponsors 3 CMS Donates RM140,000 to Mosques in Sarawak RM140,000 to Mosques CMS Donates Junior Open Squash Championship at the Sarawak Squash Centre in Petra Jaya, Kuching from 7 to 11 July 2017. The programme provides an avenue for young players to engage in healthy competitive play and help raise the standard of the game besides gaining invaluable experience. In line with CMS’ ongoing commitment to community development In line with CMS’ ongoing commitment to the Muslim communities and investment, CMS donated RM140,000 as part of its ‘Adopt- of Sarawak during the holy month of Ramadhan suraus located in Kuching, a-Mosque’ programme. 70 mosques and Sibu, Miri and Bintulu each Kota Samarahan, Betong, Sarikei, Bintangor, upkeep and activities Ramadhan their funding towards RM2,000 received plays a part in enabling of the mosques and suraus. This programme their respective communities. these suraus to play more effective roles in to Surau Darus Sakinah. In addition, a donation of RM18,000 was made CMS has been a proud sponsor of the Sarawak Squash Racquet Association development programme which has had grants totaling RM253,328 over the past seven years. CMS sponsored RM10,000 for the 3 Cahya Mata Sarawak Berhad 10 November2017. anticipated annualeventsinKuchingwasheldfor10daysbeginning 22 September2017.Theevent,whichisregardedasoneof the most CMS sponsoredRM30,000fortheSarawakRegatta2017on Social: Society ones. joy to the students as a majority of them could not afford to buy new from poorfamiliesinthenearbyvillages. The schoolbagsbroughtmuch Serian. Theseschoolscompriseofunderprivilegedstudentswhocome primary schools-SKSebuyauEnsengei,SimunjanandParunSuan, On 11 September 2017, a total of 200 school bags were donated to two 64 Proud SponsorofSarawakRegatta2017 CMS DonatesSchoolBagstoUnderprivilegedStudents

10 training anddevelopmentprogrammefortheyear. CMS alsocontributedRM3,000tofundtheOKU/PARAathletes’ has donatedRM79,500totheCampsince2012. Communication Camp held between 22 and 24 September 2017. CMS and 78facilitators participated inthethree-dayToastmastersYouth International, 160studentsfrom23schoolsaccompaniedby10teachers Organised by the Kuching Toastmasters Club and Toastmasters Two CMS bowlers won 4 Pehin SriHajiAdenanbinSatem,thefifthChiefMinisterofSarawak. PARA athletes bowled forcharity. The eventwas a tribute to the late government agencies,andprivatecompaniesalongwiththeOKU/ Bowling FriendlyCompetitionasmembersandindividualsfromSABATI, On 11March2017,therewasagreatturnoutattheTenpinPara Palliative Care,FireandFloods,theLionsNursingHome. Environment, HungerRelief,PaediatricCancer,Vision,Autism,Disability, in supportoftheireffortstohelp10causesnamely,Diabetes, On 25October2017,CMScontributedRM20,000totheLionsClub CMS ContributedRM20,000totheLionsClub Toastmasters YouthCommunicationCamp2017 by PersatuanTenpinBolingParaNegeriSarawak Charity TributeinMemoryof‘TokNan’,aFund-RaisingEvent th placeintheOverallIndividualCategory. th place in the Overall Team Category and

SUSTAINABILITY REPORT 2017 65 Social: Society Social: PUBLIC POLICY AND LOBBYING LOBBYING AND POLICY PUBLIC CMS is a member of the Sarawak Chamber of Commerce & Industry Chamber of Commerce member of the Sarawak CMS is a provides SCCI The Sarawak. in chamber trade pioneer a is which (SCCI) helps and the supporting environment that the network, opportunities working their competencies in a unique businesses in maximising with Sarawak. The SCCI runs across Sarawak, environment such as in Kuching, Sibu, Bintulu and Miri. regional committees active and CMS Cement Industries Sdn Bhd are CMS Cement Sdn Bhd (C&CA). & Concrete Association of Malaysia members of The Cement for the Government in the formulation of policies The C&CA works with of cement industry. It also serves as a channel the development of the relevant organisations. communication with the Government and Sarawak Quarries Association CMS Quarries Sdn Bhd is a member of the for members to discuss (SQA). This Association serves as a platform as dialogues organises activities such matters. The SQA industry related on market trends and training with regulatory departments, discussions from time to time. Steel Iron and Malaysian member of the a is Bhd Sdn Wires CMS of MISIF is to assist Industry Federation (MISIF). A primary function business efficiently and their out carrying its members in support and through various activities successfully. MISIF supports its members Government on issues of including making representations to the on the steel industry. concern, primarily those relating to policies a member of the Sarawak Our Property Development Division is (SHEDA). The aims Housing and Real Estate Developers’ Association a forum for the advancement and objectives of SHEDA are to provide development with a view of interest of companies engaged in property promote goodwill amongst to raise the standard of the industry and members. Our Group Human Resources Department (Group HR) has been a member of the Malaysian Employers Federation (MEF) since 2009. The MEF assists in providing training and Human Resources relevant market updates (such as regulatory and statutory updates) to its members. In by held meetings attend to representative a sent HR Group our 2016, the MEF which were held on quarterly-basis. CMS is the first corporate rotary member of the Rotary Club of Kuching the being one main the projects, community supports which Central Preventive Blindness project which carries out eye-screening services and performs cataract and pterygium operations, in partnership with the Sarawak Medical Services. This project has benefited the low- income people especially in the rural community. The club also supports poor single mothers and their families. World Islamic Economic Forum 2017 (RM336,404.25) th Sarawak Business & Investment Summit 2017 (RM26,500) Sarawak Business & Investment Summit 2017 th Baleh Kapit Raft Safari (RM20,000) Rainforest Music Festival (RM20,000) What About Kuching (RM15,000) PurpleLily (RM10,000) Kolej Laila Taib (RM100,000) Other Donations Projek Bandar Samariang Donates to Fire Victims Samariang Donates Projek Bandar 1. 13 Other substantial donations during the course of the year were made to: of the year were made Other substantial donations during the course On Saturday, 12 August 2017, a total of three families from Bandar 2017, a total of three families from On Saturday, 12 August Bandar totalling RM12,000 from Projek Samariang received donations launched was township Samariang Bandar The (PBS). Bhd Sdn Samariang had developing rapidly ever since. A family which in 1997 and it has been to a fire. for the past 14 years had lost everything resided at the township went a long way in easing their burden. Donations from PBS certainly 5. 6. 7. 4. 2. 3. 4 Cahya Mata Sarawak Berhad importance tous. is oftheutmost products andservices The qualityofour Social: Product Responsibility 66 Product Responsibility and well-beingofourcustomers. to usasittranslatesintothesafety importance utmost and servicesisofthe the qualityofourproducts Here atCMS, respectively. Customer Engagementand At theCementDivisionfor2017, Customer Satisfaction and 85% average 95% were ratedon Satisfaction surveyresults

breakage. the cement.Itshouldalsobestrongenoughtoreduce humidity andmoisturewhichcouldleadtolumpinessof be abletoprotectthecementwithin,fromexternal the QCsection.Thematerialstoproducebagsshould Incoming packaging materials are sampled and tested by accordance toourspecifications. sourced fromreputablesuppliersandproducedin All packagingmaterialsi.e.50kgandjumbobagsare mitigate therootcauseandtopreventrecurrence. conformances, actionsshallbetakenimmediatelyto Quality Control(QC)Section.Foranyincidentsofnon- samples arecollectedandtestedonregularbasisbythe regime (aspertheQualityControlPlan)whereby Cement Divisionhasimplementedastricttesting specifications andcustomerrequirements,theGroup’s To ensurerawmaterialsandtheproductconformto excellence andsustainability. systems that we have implemented while emphasising on that theycomplywiththestringentqualitymanagement priority toconstantlymonitorouroperationsensure their generalsatisfaction.Assuch,wehavemadeitour the safetyandwell-beingofourcustomers,aswell is oftheutmostimportancetousasittranslatesinto Here atCMS,thequalityofourproductsandservices SOCIAL: PRODUCT RESPONSIBILITY We haveimplementedthe or violations. credible informationonillegalpractices volunteers tocomeforwardwith to encourageouremployeesand blowing Policy Whistle- Ethical BusinessConduct SUSTAINABILITY REPORT 2017

67 Social: Product Responsibility Product Social: ISO 9001 - since 2000 IMS Certification (ISO 9001:2015, ISO 14001:2015 and ISO 18001) ISO 9001:2015 ISO 9001:2008 IMS Certification (ISO 9001, ISO 14001 and ISO 18001) IMS Certification (ISO 9001, ISO 14001 and ISO 18001) ISO 18001:2007 ISO 9001:2008 ISO 9001:2008 CMS Pavement Tech Sdn Bhd CMS Quarries Sdn Bhd & CMS Premix Sdn Bhd CMS Quarries Sdn Bhd & CMS Premix (Kuching only) CMS Premix Sdn Bhd (Sibu only) & CMS Premix (Miri) Sdn Bhd (Bintulu only) CMS Wires Sdn Bhd CMS Roads Sdn Bhd PPES Works (Sarawak) Sdn Bhd CMS Premix Sdn Bhd & CMS Premix (Miri) Sdn Bhd CMS Premix Sdn Bhd & CMS Premix CMS Wires Sdn Bhd • • • • • • • • • IMS Certification (ISO 9001, ISO 14001 and ISO 18001) IISO 9001 - since Nov 2000 5S Certification - since 2008 OHSAS 18001 - since Sept 2014 ISO 9001 - since 2003 ISO/IEC 17025 - since 2010 ISO 14001 - since 2008 5S Certification - since 2007 OHSAS 18001 - since Aug 2011 ISO 9001 - since 1998 ISO/IEC 17025 - since 1996 ISO 14001 since 2001 5S Certification - since 2004 OHSAS 18001 - since Nov 2002 ISO 9001 since 2009 ISO/IEC 17025 since 2011 ISO 14001 - since 2012 5S Certification - since Nov 2009 ISO 50001 - since May 2016 OHSAS 18001 - since Nov 2013 CMS Quarries Sdn Bhd CMS Concrete Products Sdn Bhd CMS Cement Sdn Bhd (Bintulu grinding plant) CMS Cement Sdn Bhd (Kuching grinding plant) CMS Cement Sdn Bhd (Kuching grinding CMS Cement Industries Sdn Bhd ISO 9001:2008 Quality Management Systems ISO 9001:2008 Quality Management Systems ISO 14001:2004 Environmental Series Management Systems Occupational Health and Safety Assessment OHSAS 18001:2007 • • • • • • • • • • • • • • • • • • • • OUR COMMITMENT TO QUALITY QUALITY TO COMMITMENT OUR Quality Certifications of Companies within the Group Quality Certifications of Companies within The complete list of the Group’s quality certifications is illustrated in the following list: is illustrated in The complete list of the Group’s quality certifications teams to ensure the end Quality Control teams to ensure the end with the contractor’s Quality Assurance and and site personnel are working closely Sdn Bhd’s project team architectural specifications and industry standards. product satisfies the • • In addition, Samalaju Properties began its application for Qlassic certification. CMS Property Development Sdn Bhd During the year in review, • uction-based the first construction-based Sdn Bhd became 2004, PPES Works (Sarawak) systems. In improving our management to continually We are committed (IMS) which incorporates: System to be accredited with an Integrated Management company in Sarawak Cahya Mata Sarawak Berhad Social: Product Responsibility renewing itscertification. fabric forthereinforcementofconcreteandisnowinprocess Industry DevelopmentBoard(CIDB)Certificationforitsweldedsteel On 22September2016,CMSWiresSdnBhdobtainedConstruction the relevantinformation. with support from the Company’s departments that assist in providing relevant membership,togetherwiththeComplianceDepartmentand Company’s BusinessDevelopmentManageroverseesandmonitorsall As eachcertificatecarriesavalidityperiodoftwotothreeyears,the engineering, mechanicalandelectrical construction-related activities. of anyvaluemainlyrelatingtotheconstructionbuildings,civil These certificationsallowPPESWorks(Sarawak)toundertakeworks • • • construction-related bodies: PPES Works(Sarawak)SdnBhdisregisteredwiththevarious Certificates ofRegistrationwithRelevantAuthorities 68 Registration Unit(UPKJ)withClassA The SarawakStateFinancialSecretary’sContractorandConsultant Development Division The MinistryofWorks(Malaysia)ContractorandEntrepreneur The ConstructionIndustryDevelopmentBoardwithGradeG7 The certifiedshort-firerinstructs satisfied thatallshotshavebeen to ensureitiscarriedoutsafely Once thecertifiedshort-fireris the explosivetobedetonated is deliveredbeforeblasting fired, fiveminutesisgiven to allowfumesclear A safetybriefing 6 1 7 another authorisedpersoninforms authorised personalcheckthatall personnel areatleast100metres The quarrysupervisorandother One continuouslongsiren all employeesofthedate indicates thecompletion The quarrysupervisoror and timeoftheblasting from thequarryface of theblasting 8 5 2 following illustration: Mining SupervisorandDrillers. Our blastingmethod is explained via the Production &MaintenanceEngineer,QuarrySupervisor,ChiefBlaster, Blasting operationsrequireatleastsixworkers,theyincludethe injuries werereportedandonlypropertydamagewasinvolved. There wasanincidentrelatedtoblastingin2017atSebuyauQuarry.No monitor theblastingcondition. procedures. In2018,wewillusearemotecameramountedondroneto all blasting methods are performed in compliance with the correct operations, nolessinCMSQuarriesSdnBhdwherewemakesurethat Our stringent safety standards are emphasised throughout our manufacturing operations. Investment DevelopmentAuthority(MIDA)andtheCIDBforourcement Malaysia forourcementandclinkeroperations,fromtheMalaysian manufacture andsellfromtherelevantauthoritiessuchasStandard For theCementDivision,wehaveobtainedrequiredlicensesto SAFE BLASTING at thequarrypittowarnofblasting with explosives,theblastersounds Once theholeshavebeencharged ‘all clear’signalhasbeensounded Blasting noticesandredflagsare posted attheguardhouse approach thequarryuntil No workmenareallowedto before blastingcommences entrance ofthequarryand the sirensixtimes 9 4 3 SUSTAINABILITY REPORT 2017 69 Social: Product Responsibility Product Social: Bribes, kickbacks or payments of money Bribes, kickbacks or payments other the use of services, entertainment or any Gifts, loans, property, nominal value benefits more than a or to government employee or representative Making payments to any any other third party Investigating the circumstances of the suspected fraud and producing a written report Securing records and assets including restrictions, as well as barring access to offices and systems Determining whether the case should be reported to the police Deciding if the suspected employee should be suspended from work Corruption with corruption and procedures to deal policies and We have formalised strictly Code of Ethics and Business Conduct improper conduct. Our forbids: • • • of systems the adequacy reviews Audit Department Internal Our Group as well areas, audit We prioritise risks. corruption manage controls to and Group. All business units are as assess risks and their significance to the analysed for risks related to corruption. in response to corruption There were no identified incidents or reports in 2016. Anti-Fraud Management for fraud and the practice of Here at CMS, we maintain zero-tolerance of one person that causes loss any other form of deception for the benefit is employee each policy, anti-fraud our with compliance In another. to understanding on an possess they that states that form a sign to required occurrences any report to agree that they and fraud as constituted is what and suspected incidences of fraud. Fraud Response Committee comprises which Committee Response Fraud a founded also have We Office Departments. Their appointed representatives from various Head responsibilities include: • • • • Whistle-blowing Even as we are committed to high standards of conduct, we expect our employees to reflect the same ideologies when it comes to ethics, morals and legal business conduct. As such, we have provided the relevant platform for any employee or external party to ‘blow the whistle’, that Designated member of to a disclosure confidential a formal make is, to Authority (DA). In the event of a policy violation, DA members refer suspected misconduct to the Board of Directors or Group Audit Committee. Misconduct consists of fraud, misappropriation, abuse of authority, corrupt practices or any other form of contravention or non-compliance with Company policies and procedures. Employees are encouraged to raise serious concerns should they suspect any illegal or unethical behaviour. To regulatory authorities, government departments or agencies government departments or agencies To regulatory authorities, of the law pursuant to the requirements with CMS To organisations associated third-party advisers and partners, professional To CMS’ strategic to time service providers which it engages from time order Required or authorised by law or by court ETHICAL BUSINESS CONDUCT CONDUCT BUSINESS ETHICAL CUSTOMER SATISFACTION CUSTOMER CUSTOMER PRIVACY PRIVACY CUSTOMER We are committed to conducting our business across the board in an ethical manner that is founded upon integrity. In support of this to Policy Whistle-blowing the implemented have we commitment, encourage our employees and volunteers to come forward with credible kickbacks bribery or Fraud, or violations. practices on illegal information are not tolerated within our operations and dealings. At CMS’ Construction & Road Maintenance Division, the Client’s Satisfaction Survey Summary for 2017 Performance using evaluation criteria such as work done conforms to specifications, timeliness, compliance with Safety & Health control requirements, yielded aggregated results consistently over 75% at worksites in Betong, Kuching, Kapit, Mukan, Samarhan, Sri Aman and Serian. For CMS Quarries Sdn Bhd, 85% of customers surveyed rated that For CMS Quarries Sdn Bhd, 85% of customers products and services rendered was good. At CMS Premix Sdn Bhd, 98.05% of customers surveyed rated that products and services rendered was good. While at CMS Wires Sdn Bhd, 85% of customers surveyed rated that products and services rendered was good. Customer satisfaction continues to play an integral role in our operations an integral role Customer satisfaction continues to play subsidiary companies while as it helps us to gauge the performance of our Each of our subsidiaries providing us with insight to consumer trends. which all responses received, carries out their own customer survey from and analysed. both positive and negative, are fully review Engagement and Customer At Cement Division for 2017, the Customer on average 95% and 85% Satisfaction survey results were rated to maintain is able Division Cement the that indicates This respectively. with customers and the intended levels of rapport and engagement dealers and is meeting their expectations. • • • • We do not disclose personal data unless it is: We do not disclose personal When it comes to privacy, we observe strict regulations and procedures strict regulations to privacy, we observe When it comes end, this To protected. duly is data personal customer’s our guarantee to (PDPA), the Personal Data Protection Act 2010 the Group complies with data and proper management of personal which regulates the processing in commercial transactions. Cahya Mata Sarawak Berhad focus on identifying and taking advantage of opportunities whilst made byallourcoreBusinessDivisions.Thiswillcomeviaa steadfast On theEconomicfront,wewillcontinuetoensuregoodprogress is stakeholders. internally amongst CMS’ employees as acommitment to our four key Economic, EnvironmentalandSocietalperformance.Thisismanifested conducting ourbusinessinaresponsiblemannerbyupholding good As weexplorenewareasofopportunity,remaincommittedto continue toidentifywasteproductsthatwecanreuseorrecycle. be alicensedpremiseforanindustrialwastesco-processingplant.We We areconferringwithDOEforCMSCementIndustriesSdnBhdto an oldkilnbasicbricksbuyerfortheiruseasalternativerawmaterial. carbon blackresinsasalternativefuel.Enquiresarebeingmadewith companies tobuyouroldbeltconveyorswithsteelcordsandburn smart partnershiponscheduledwastesmanagementandwithPyrolysis operator ofSarawak’sintegratedwastemanagementsystem,abouta Division is in discussion with Trienekens (Sarawak) Sdn Bhd, the In additiontotheinitiativesmentionedabove,Group’sCement activities togreaterheights. stakeholders, we remain committed to advancing our sustainability and sustainablevalue,aswellestablishenduringtieswithour meaningful manner.Whilewehaveendeavouredtodelivertrue that itwillbecomeembeddedwithinourworkingcultureinamore Sustainability isevolvingtobeawayoflifeatCMSanditouraim Ensuring aSustainable Future 70 Sarawak andBeyond’. term, sustainablegrowthandourambitionofbecomingthe‘ PRIDE of new ones,weareconfidentthatwillachievemeaningful long- As westeadfastlyimplementourexisting programmes androll out their responsibilitiestoourcommunity. various community projectsfeela strong sense of obligation to fulfil or CSR activities. Our employee volunteers who are involved in the will continuetoimplementmeaningfulCorporateSocialResponsibility renewed commitmenttowardsoursustainabilityagenda.Andlastly,we on Group-wideteambuildinginitiativestobuildcamaraderieanda improve operationalefficienciesandproductivity,aswellleverage We willalsocontinuetorolloutcontinuousemployeetraining conserve andmaintaintheecosystemsforfuturegenerationstoenjoy. continue toexpandandimproveourKPIspolicieshelp any impactofourbusinessactivitiesontheenvironmentandwill sustainable performance. We understand the importance of mitigating Environmental andSocialconsiderationstoensurewedelivera balancing outourstrongeconomicperformancewithresponsible As aconscientiouscorporatecitizen,wearegenuinelycommittedto pathway forusinthelongrun. that our core businesseswill continue to create a sustainable growth business efficiencyandbolsterourcompetitiveedge.Weareconfident excellence anddriveinnovationthroughoutouroperationstoenhance optimising coststructures.Wewillalsocontinuetoupholdaspiritof This page has been intentionally left blank This page has been intentionally left blank

CAHYA MATA SARAWAK BERHAD (21076-T) Wisma Mahmud, Jalan Sungai Sarawak 93100 Kuching, Sarawak t +60 82 238 888 f +60 82 333 828 w www.cmsb.com.my