44 ABOUT THIS REPORT WE ARE KENANGA LEADERSHIP STATEMENTS SUSTAINABILITY AT KENANGA KENANGA INVESTMENT BANK BERHAD SUSTAINABILITY REPORT 2023 SUSTAINABLE ECONOMIC GROWTH Our Investment Strategy Kenanga Investors Group (“Kenanga Investors” or “KIG”), which comprises Kenanga Investors Berhad (“KIB”), Kenanga Islamic Investors Berhad (“KIIB”), and Eq8 Capital Sdn Bhd (Formerly known as i-VCAP Management Sdn Bhd), is the asset and wealth management arm of the Group. As part of our commitment to responsible investing, Kenanga Investors works closely with investee companies, regulators and a broad range of market players in the integration of ESG considerations into our investment process. Kenanga Investors has been a signatory to the Malaysian Code for Institutional Investors (“Code”) since 2017, and we have established procedures to support the Code’s principles throughout our investment value chain. Additionally, our membership in the Institutional Investors Council (“IIC”) and active participation in JC3 reflect our dedication to advancing the ESG agenda while accelerating a swift response to the climate risks in our sector. Kenanga Investors and KIIB have been affirmed investment manager ratings (“IMR”) of IMR-2 by the Malaysian Rating Corporation Berhad for the 7th consecutive year since first rated in 2017 in its recent November OUR APPROACH RESPONSIBLE INVESTING WHY IT MATTERS By investing in companies that are committed to sustainable practices, we can help create positive impact on the environment and society, while building long-term value and attracting investors who consider overall business sustainability in their investment decision-making process. GRI 3-3 2023 rating announcement. The rating considers KIG’s well-established investment processes and sound risk management practices. KIG enhanced its Sustainability Blueprint in 2022 to incorporate fixed-income asset class by developing an in-house ESG assessment to perform positive screening for bonds and sukuk-based on independent and accredited external data sources. Following the enhancement, in 2023, KIG completed comprehensive screenings for its fixed-income securities and sector-specific assessments for equities, with a heightened focus on sectors bearing elevated ESG risks. As of December 2023, KIB’s total asset under management (“AUM”) with ESG coverage amounted to approximately RM10 billion, accounting for approximately 48% of our reported AUM. To effectively manage and monitor risks, various factors and indicators specific to respective industries such as palm oil, oil and gas, banking and finance, power, as well as mining were integrated into this process for a more holistic perspective. Following this, KIG has developed strategies tailored to include ESG screening procedures, participation in active stewardship via engagement with stakeholders, and the exercise of voting rights in investee companies.
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