DIVIDEND
As a result of our ongoing transformation, we have incurred substantial impairment losses. However, this is a small price to pay in return for the expected long-term benefits. In 2020, these impairment costs resulted in Kulim recording a loss of RM398.95 million. Because the loss does not reflect any weakening of our fundamentals, I am pleased to share that the Board has approved a total dividend payment of RM52 million for the year 2020. This is in line with our commitment to creating sustainable shareholder value.
SOCIAL & ENVIRONMENTAL PERFORMANCE
As a state-owned entity, playing a socio-economic development role comes naturally to Kulim. While being profit-driven, we see our businesses as vehicles for the betterment of local communities. In addition to contributing in a significant manner to food security, we also pride ourselves on providing fair and equitable employment.
No less than 73% of our total workforce are foreign but we treat them the same as local hires, offering the same rights and benefits including housing and health coverage. As of January 2020, we have created greater inclusiveness by providing our foreign employees with the same SOCSO protection as local employees. Committed to keeping our workers safe during the pandemic, we have not just adhered to all SOPs as required by the Ministry of Health and the Malaysian Palm Oil Association (“MPOA”) but also made available additional medical staff at our operating units, and established an online counselling platform to help manage any mental stress.
Environmentally, we have always operated in a manner that respects and protects our natural surroundings. Kulim was among the first plantation companies in the world to obtain the RSPO certification, and we continue to strengthen our commitment to sustainability while incentivising our smallholders to do the same.
In light of the urgency to mitigate climate change, we are placing greater emphasis on reducing carbon emissions in our operations. Over the years, we have invested in biogas plants to capture methane, one of the most potent Greenhouse Gases (“GHGs”), from our effluent, and convert it into energy. Today, we are increasing our methane-capturing efficiency and capacity and looking at feeding the gas onto the national grid while also supplying a highly compressed form to third parties. This would serve the dual purpose of lowering our carbon footprint while creating a new and viable source of revenue.
STRENGTHENED GOVERNANCE
In last year’s Integrated Annual Report, we indicated plans to attain the MS ISO 37001:2016 Anti-Bribery Management System (“ABMS”) certification. Towards this end, our newly established Integrity Unit has developed an Anti-Bribery Plan, reviewed three existing policies related to integrity: our Conflict of Interest, Gift and Entertainment, and Whistle-Blowing policies; while developing three new policies: an Anti-Bribery and Corruption Policy, a Due Diligence Policy and a Referral Letter Policy. These came into effect as of 10 September 2020.
Our Integrity Unit also carried out various initiatives to create awareness of Section 17A of the Malaysian Anti-Corruption Commission (Amendment) Act 2018 within Kulim as well as among our contractors, suppliers and business associates. The objective is to ensure integrity in all our dealings and those of our partners.
We had hoped to be ABMS certified by the end of 2020, but SIRIM’s audit exercise was delayed due to the pandemic, and we now expect to obtain the certification in the second quarter of 2021.