IJM Corporation Berhad

THE ABILITY TO COMMAND THE CONFIDENCE OF OUR CUSTOMERS, SUPPLIERS, BUSINESS PARTNERS, INVESTORS, BANKERS, GOVERNMENTS AND REGULATORY BODIES ARE OF PARAMOUNT IMPORTANCE TO THE GROUP’S CONTINUED SUCCESS. IJM THEREFORE DEVOTES CONSIDERABLE EFFORT TOWARDS CULTIVATING EXCELLENT BUSINESS ETHICS AND VALUES, GOOD CORPORATE GOVERNANCE AND STAKEHOLDER ENGAGEMENT, EFFICIENT PROCUREMENT SYSTEMS, AND QUALITY AND INNOVATIVE PRODUCTS AND SERVICES.

Business Ethics and Values

The Group recognises that maintaining an ethical business culture within the organisation is a constant work-in-progress. To this end, IJM goes beyond the mere developments and improvements of policies, practices and procedures; it also promotes ethical leadership from the top as an important means of inculcating and preserving an enduring moral foundation throughout the Group. Induction, training and improvement courses organised by the Group’s Human Resource Department are also embedded, whenever possible, with messages to foster an ethical culture amongst staff. In its interactions with business constituents, the Group undertakes to conduct itself in a responsible and ethical manner.

Corporate Governance

Among the Group’s CR Framework is to cultivate a culture of good corporate governance and accountability throughout the Group, as stated in its policy statement “We strive to uphold the highest standards of professionalism and exemplary corporate governance to maximise the benefits for all stakeholders”. The Group has in place various best practices from adequate Board balance among executive, non-executive and independent directors for sound decision-making process to transparent disclosures of the Board’s remuneration.

Along with good governance, the Board is committed to ensure true and fair financial reporting, maintenance of sound internal control systems and appropriate risk management framework, proper safeguard of the Group’s assets and prevention of fraud and other irregularities. The Group’s risk management framework adopts a risk-based approach and its reviews cover the areas of noncompliance with applicable laws, regulations, guidelines, changes to internal controls and management information systems. The outcome of the current year’s risk assessment reviews has been satisfactory and no material misstatements or losses, contingencies or uncertainties have arisen. For more details, please refer to the Corporate Governance Statement (for the Group’s best corporate governance practices) and Statement on Internal Control (for the risk management framework, practices and other internal control measures).

Stakeholder Engagement

The Group endeavours to communicate quality information to investors, regulators, customers, suppliers, employees and the general public, in a timely and transparent manner. For instance, the Group has an established Investor Relations (“IR”) programme to disseminate important information about the Group’s developments, operations and financial performance to the investment community. Various disclosures and announcements are made to Bursa Malaysia Securities Berhad, regular dialogues are held with analysts and fund managers, and press conferences are organised from time to time to effectively disseminate pertinent information to the general public. More details of the Group’s Investor Relations activities are contained in the Corporate Governance Statement.

Avenues for whistle-blowing are available where an employee can report fraud or irregularities confidentially and discreetly to the Group Internal Auditor, Chief Executive Officer and Managing Director or the Company Secretary. Opportunities are also made available for employees to provide feedback and opinions through interactive intranet forums and suggestion boxes. The Group also welcomes visitor to this website to offer feedback and comments for improvements pertaining to the Group’s product offerings, services or any other matters they wish to raise.

Procurement Policy

The Group’s CR initiatives include the decisions on procuring goods and services for the business as it takes on the responsibility to ensure that materials or services that are procured satisfy the client’s requirements and contract specifications. The Group’s procurement policy is to obtain the most reliable source of materials and services in terms of pricing, quality, availability and timely delivery.

The Group adopts neutral and open procurement policies and procedures which have been ISO 9001 certified and aimed at providing choice, quality, efficiency, timeliness and economies of scale in the provision of quality products and services to ensure customer satisfaction. It covers areas such as material requisitions and order process, requests for tenders and quotations, evaluation and selection of subcontractors and suppliers based on established criteria, periodical sub-contractor/supplier assessments and regular updates of approved sub-contractor/supplier lists.

Quality Products and Services

In its effort to deliver superior quality products and services to its customers and comply with applicable regulatory requirements, the Group has in place the highest standards of policies, procedures and best practices with the adoption of ISO quality certification. This is in line with the Group’s policy statement “We strive to ensure the quality of our products and services exceeds our customers’ expectations”. To date, the Group’s ISO-certified companies stand at 15. The Group’s commitment to quality is further demonstrated by the adoption of its ‘Mark of Excellence’ branding and ‘Excellence through Quality’ corporate motto.

As a responsible corporation, the Group carries out regular reviews, process improvements and quality control assessments, to continually enhance the production process and quality of its products and services, to minimise product defects, accidents, health and environmental hazards, whilst at the same time, satisfying customers’ requirements and meeting the needs of its stakeholders and the community at large. In addition, annual satisfaction surveys are carried out to obtain customers’ feedback in order to serve them better.

IJM has developed its own niche building technology and expertise by becoming an established leader in the construction industry for the private and public sectors, as well as the international arena. As a testament of the Group’s commitment to quality, it has received strong recognition from satisfied customers, governmental and regulatory bodies, and public support, through an assortment of awards and endorsements including the Malaysian Construction Industry Excellence (International Achievement) Award in 2007 and MITI Industry Excellence Award for Export Excellence (Services) in 2008.

Innovation, Research and Development

The Group constantly innovates and improves on the quality of its products and services in order to remain relevant to evolving technology and consumer preferences. In this regard, the Group practices regular reengineering and reinvention of its products and processes through ongoing research and development (“R&D”) to produce the highest quality with lower costs and faster time-to-market than its competitors, to maintain its competitive edge.

An innovative construction subsidiary, IJM Building Systems Sdn Bhd was accredited by the Malaysian Book of Records for the production of the first lightweight oil palm fibre reinforced cement composite panels in Malaysia.

The Industry Division’s Central Research and Development Laboratory at its Klang factory has been accredited by the Department of Standards, Malaysia, for calibration scope covering dimension and mass since 2000. In its continuous effort to enhance the pretensioned spun concrete (“PSC”) piles manufacturing processes and cost efficiency, the laboratory has embarked on a study using new environmental-friendly chemicals and cementitious additives to produce more durable and energy efficient piles. The use of new poly-ether based additives combined with green technology cementitious products has given rise to improved pile quality that can accelerate the gain in concrete strength without the steam curing process, thus, resulting in shorter turn around time in the delivery system. Other areas of R&D improvements are the setting up of aggregate testing facilities to obtain better understanding of aggregate properties and durability of concrete under sulphate attack.

Our Plantation Division continuously carries out R&D activities through its Quality, Training and Research Centre (“QTRC”). Such efforts include the implementation of biological controls to reduce the use of chemical pesticides. Other R&D efforts carried out include oil palm yield improvements through methodical breeding and selection, scientific recordings of genetic blocks, selection of mother palms in Sijas Estate, Sabah and progeny testing trials. The breeding programme allows the Division to produce high yielding quality planting materials. Additionally, the SIRIM MS157:2005 and Malaysian Palm Oil Board (“MPOB”) certified hybrid oil palm seeds bearing the ‘IJM DxP’ trademark are produced and used in the Division’s oil palm replantings in Sabah as well as new plantings in Indonesia.

The Group, in its stride to deliver high quality and innovative products and services, will continue to invest and allocate resources in R&D activities for sustainable improvements and to eliminate inefficient processes.