To ensure compliance with laws and regulations, influence policy development, and advocate for industry standards, besides aligning with national goals to drive sustainable growth and stability. Why We Engage • Industry meetings, discussions, and dialogues with relevant agencies. • Involvement in government-led and global initiatives and programmes. • Provision of thought leadership and insights within our industry. Channel and Frequency of Engagement • Adherence to legal and regulatory frameworks to maintain financial stability and uphold ethical business practices. • Mitigation of critical risks, including data breaches and cyber threats, to safeguard consumer trust and confidence. • Proactive risk management to build resilience and uphold the integrity of the financial ecosystem. • Improved governance within CSOs to enhance transparency and ensure accountability in managing social and welfare activities. • Partnerships with industry participants and stakeholders to promote innovation and address systemic challenges effectively. • Commitment to sustainable banking practices, strong governance, and regulatory compliance to drive socio-economic progress. Governments and Regulators Expectations The local authorities in our markets of operation, who play an instrumental role in supporting our vision of holistic wealth creation and advancing the growth of Malaysia’s financial industry. • Enhancing our systems and processes to ensure robust compliance with evolving legal and regulatory frameworks. • Strengthening Sadaqa House’s governance to fulfil our fiduciary duties while creating meaningful societal impacts. • Maintaining a close relationship with changemakers and collaborative partners to drive innovation and resilience, including the: – Malaysian Federal Land Development Authority (FELDA) (through iTEKAD) – State Islamic religious councils (MAINs) – Ministry of Education • Supporting the Malaysian Government-linked Enterprise Activation and Reform Programme (GEAR-UP) through iTEKAD entrepreneurship development and Sakeena Home Ownership Programme. • Embedding ESG principles and delivering financial solutions that support socio-economic growth. Our Response and Business Initiatives • Financial penalties, regulatory enforcement actions, and reputational damage caused by non-compliance or irregularities. • Unfavourable rules, higher compliance costs, and operational burdens resulting from a lack of engagement in regulatory development. • Inefficiencies and legal risks arising from unclear regulatory expectations and priorities. • Disrupted performance and escalating costs due to insufficient preparation for regulatory changes. Risks • RM202 million in taxation and zakat • RM188 million in Group tax expenses • RM11.4 million in zakat paid Value Creation Indicators Quality of Relationship: Governments and Regulators CR Material Matters: SRF CESF GGC DPS Capitals: FC SR UNSDGs: Link to: Opportunities Value Created for Governments and Regulators Value Created for Us • Regulatory alignment and a culture of compliance, alleviating their burdens. • Implementation of industry standards and best practices that contribute to a robust and efficient financial system. • Increased support from the Malaysian government, corporate entities, and State Islamic religious councils (MAINs) to enhance the development of microentrepreneurs. • A healthier, more stable market environment through advocacy for a level playing field, reducing risks and ensuring sustainable business growth. • Enhanced competitiveness, adaptability to industry advancements, and capacity to capture new growth opportunities. Bank Islam Malaysia Berhad ◆ Integrated Annual Report 2024 40 Stakeholder Engagement and Value Creation
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