We manage sustainability risks by enhancing due diligence documentation and strengthening our frameworks. This includes implementing the CCPT DDQ to assess climaterelated risks (including biodiversity and ecosystem considerations) and adopting the VBI Assessment Framework (VBIAF) to align our financing decisions with sustainability principles. Moving Forward As we continue to refine our strategies and operational practices, we remain committed to integrating sustainabilityrelated considerations into all facets of our operations. At the same time, we aim to achieve better alignment with recognised international frameworks and standards, such as the TCFD Recommendations, GRI Standards, International Sustainability Standards Board (ISSB) standards, and the UNSDGs. MANAGING OUR CLIMATE RISKS AND OPPORTUNITIES The Group recognise the pressing challenges of climate change and are steadfast in our commitment to identifying and managing climate-related risks and opportunities facing our business including the broader societal and economic implications. To enhance our climate risk management framework, we have undertaken a thorough gap analysis, identified and mapped our physical and transition risks, and initiated a climate risk stress testing exercise. These proactive steps align with industry best practices and regulatory expectations, reinforcing our role as a responsible and future-ready financial institution. Our climate-related disclosures move towards alignment with the internationally recognised standards, including the International Financial Reporting Standards (IFRS) S2 Climaterelated Disclosures and the TCFD recommendations. Furthermore, we have partially adopted the "Stretch" recommendations outlined in the TCFD Application Guide for Malaysian Financial Institutions, published by BNM’s JC3, of which we are a founding member. OUR SUSTAINABILITY ENDEAVOURS Moving forward on our sustainability journey, we are dedicated to addressing current and emerging risks through the ongoing development of effective due diligence measures, supported by the continual enhancement of our policies and practices to meet evolving sustainability standards. Our Environmental Endeavours We recognise the significant impact of our operations and those of our clients on the environment, particularly in areas such as climate change, water scarcity and pollutions, biodiversity loss, marine degradation and deforestation. As part of our commitment to environmental stewardship, we are dedicated to developing and enhancing monitoring frameworks that not only assess these risks but also guide us in mitigating the adverse effects associated with our clients’ activities. By integrating comprehensive due diligence processes, we aim to identify and address potential environmental impacts proactively, ensuring that our business practices contribute positively to preserving natural habitats, reducing deforestation and driving decarbonisation. Our Social Commitments Our social initiatives are guided by the principles of fairness and legality, particularly concerning labour practices and working conditions. We recognise that labour violations and other human rights risks, including those impacting local communities, represent a pervasive risk across all sectors in which we operate. In response, we are committed to developing robust systems to ensure adherence to international labour standards and Malaysian regulations. Additionally, we are enhancing our engagement processes to more effectively address worker and community concerns, ensuring that our operations support ethical and sustainable practices universally. Our Governance Practices In governance, we focus on strengthening our policies and oversight mechanisms to foster greater accountability and transparency. This includes improving our capabilities in reporting sustainability impacts and refining our approaches to preventing bribery and corruption. Bank Islam Malaysia Berhad ◆ Integrated Annual Report 2024 126 Sustainability Statement
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