SCGC_SD_Report_EN_Final.pdf

Innovative Green Solutions for Sustainable Future Mobility Packaging Energy Infrastructure Sustainability Report2021 SCG Chemicals Company Limited Chemicals Business for Sustainability Our Ambitions SCG Chemicals or SCGC strives to serve as a regional leader, contributing to ASEAN's sustainable growth while delivering value to its customers, employees, business partners, communities, and stakeholders. All of which are handled under a world-class standard of excellence in accordance with corporate governance and international safety requirements. It also seeks to improve people's quality of life by creating high-quality products and services through superior production processes, technological advancements, and innovations. Sustainable Development Goals Be a role model for corporate governance, sustainable development, and the circular economy. Adhere to the rule of law and good governance, along with human dignity, rights, and freedom, as well as equal and just treatment. Increase competitiveness and management potential throughout the supply chain by purchasing and developing high-quality and environmentally friendly products. Reach the target of Carbon Neutrality by 2050. Use resources efficiently and reduce emissions by applying the principles of circular economy and innovation to improve health and well-being. Enhance health and well-being to attain a zero-injury and zero-illness organization. Contents Our Ambitions................................................................01 Sustainability Issues – Economics, Message from President and Chairman of the Environmental and Social Sustainable Development Committee...................... 03 Corporate Governance............................................ 39 Structure of Sustainability Operations..................... 04 Business Code of Conduct..................................... 39 Advocating for Sustainability at the Committee Sustainable Value Towards Supplier....................... 40 Meetings in 2021..................................................... 05 Customer Experience Creation................................ 41 Role of Sustainable Development Committee......... 06 Information and Cyber Security............................... 41 Environmental Management..................................... 42 About SCG Chemicals Human Rights.......................................................... 44 Business Operations of SCG Chemicals................. 07 Employee Caring and Development........................ 45 Chemicals Business for Sustainability in ASEAN.... 08 Talent Attraction....................................................... 45 Sustainable Value Chain.......................................... 10 Community and Social Involvement........................ 46 Stakeholder Engagement......................................... 12 2021 Performance Highlights.................................. 14 Sustainability Performance Data About This Report................................................... 48 Feature Story Sustainability Performance Data.............................. 51 Collaborating to Overcome the COVID-19 Pandemic Subsidiaries Included in Sustainability Report Disruptions............................................................... 16 2021..................................................................... 63 SCGC GREEN POLYMERTM Assurance Statements............................................. 65 Plastic Innovation for Better Future......................... 20 i2P Center International Standard Indices The Solution for Our Planet..................................... 24 GRI Content Index................................................... 67 Sustainability Accounting Standards Board Response Enterprise Materiality (SASB)................................................................ 73 Materiality and Sustainability Issues........................ 28 Task Force on Climate-related Financial Disclosures Climate Resilience................................................... 30 (TCFD)...................................................................... 75 Circular Economy.................................................... 32 Health and Safety.................................................... 34 Awards and Key Collaboration in 2021................... 76 Product Stewardship............................................... 36 This book is printed on Green Offset Paper 100% EcoFiber (made from 100% recycled pulp) with environmentally friendly mineral oil free ink. 02 SCG Chemicals Sustainability Report 2021 Message from President and Chairman of the Sustainable Development Committee 2021 was another year in which the world and Thailand continued include One Manager One Community (OMOC), which to struggle with the adversity of the COVID-19 pandemic, which empowers all managers to play a role in caring for the has wreaked havoc on people's lives and businesses. Both communities surrounding the plants; Waste-free community, the public and private sectors have learned and adapted to which implements integrated waste management using the the changes. SCG Chemicals or SCGC adapted to preserve home, temple, school, and waste bank model to increase resilience, agility, and speed while adhering to well-established recycling volume; online platforms that assist community business continuity management (BCM) practices and collaborating enterprises in generating revenue through merchandizing; with stakeholders from all groups and sectors of society. and promotion of sustainable development operations for There were also new challenges posed by global climate communities, government agencies, and businesses. change. SCGC was committed to conducting business in accordance with its mission of sustainable development, defining SCGC operated in accordance with corporate governance strategies and operational processes as an exemplary organization standard, providing value for the economy, society, and for corporate governance and sustainable development, prioritizing environment and contributing to the country's economic health, safety, circular economy, energy and climate change, development. Additionally, the Company collaborated with and water conservation throughout the value chain through numerous organizations both domestically and internationally innovation development and experience creation with customers to achieve sustainable development goals and to prepare to understand their needs. Additionally, the Company offered for global changes while delivering sustainable value to all one-stop solutions through the i2P Center for developing products, stakeholders. such as SCGC GREEN POLYMERTM to improve manufacturing processes, achieve a low-carbon and environmentally friendly society by 2030, and achieve carbon neutrality by 2050. All of this we believe will be accomplished through cutting-edge manufacturing technology and machinery, and digital systems to control manufacturing processes and a resource and energy- efficient approach to reduce greenhouse gas emissions and Tanawong Areeratchakul increase the use of clean and renewable energy sources. President, SCG Chemicals Regarding post-consumer plastic management, SCGC teamed up with the leading recycler Sirplaste in Portugal to use technology to collect and transform post-consumer plastics into high-quality recycled plastic resins. Additionally, it collaborated with technology startups to develop innovative recycling technologies capable of converting waste plastic to recycled feedstock. It partnered with Braskem to assess the feasibility and approach of using agricultural by-products as bioplastics for sustainability. SCGC has implemented a manufacturing process safety management system to manage and monitor occupational health, safety and integrity to achieve zero work-related accidents or illnesses while establishing personnel practices and training guidelines that emphasize ethics, respect for basic human rights, and the elimination of discrimination on the basis of physical and mental differences, race, nationality, religion, language, age, skin color, education, social status, or any other legal matter. SCGC prioritized caring for the communities surrounding the plants and stakeholders to foster a harmonious living environment in which all challenges were shared and solved appropriately through social development initiatives. Examples 03 Structure of Sustainability Operations SCG Chemicals or SCGC appointed the Sustainable Development Committee to be responsible for supervising the implementation of the Company's sustainable development goals through the Economic and Corporate Governance Excellence Committee and the Environment and Society Excellence Committee. Each committee has a subcommittee responsible for each sustainability issue and monitors the plan that aligns with each company's representative. The subcommittees meet on a regular basis, approximately every 1-2 months. These subcommittees report to the Dimension Committees, which manage and monitor business and ESG-related risks by following the WBCSD's guidelines to ensure effective, efficient, and timely management and report on the implementation status at the business level to the Risk Management Committee on a quarterly basis. The Board of Directors SCG Chemicals The Remuneration Committee The Audit and Risk Committee The ESG Committee President & CEO Management Development Risk Management Committee Committee SCGC Sustainable Development Committee Economic & Governance Environmental & Social Dimension Committee Dimension Committee Innovation and Circular Economy Corporate Governance Corporate Environment Corporate Safety Product Stewardship Compliance & Corporate Energy & Climate Corporate Health Code of Conduct Change Customer Experience Stakeholder Engagement Sustainable Supplier Development Information and Cyber Security 04 SCG Chemicals Sustainability Report 2021 Advocating for Sustainability at the Committee Meetings in 2021 Committee Number of Meetings Meetings’ Topics (times/year) 1. SCGC Sustainable 6 (every two months) Management of environmental, social, and governance (ESG) challenges Development Committee throughout the sustainable supply chain. Policy announcement aimed at achieving net-zero greenhouse gas emissions. Preparation of short-term and long-term plans to address critical concerns of sustainable development in accordance with the goals. 2. Economic & Governance 6 (every two months) Supervision of economic and governance processes to be in compliance Dimension Committee with the business's ESG and sustainable development directions. Compliance & Code of 12 (every month) Supervision and development of a business plan to be in line with applicable laws Conduct and business ethics and to prevent of non-compliance. Communication and oversight of legal concerns pertaining to the Chemicals Business. Corporate Governance 12 (every month) Supervision of businesses to ensure adherence to corporate governance requirements. Innovation and Circular 6 (every two months) Establishment of circular economy-based policies, strategies, indicators, and goals. Economy Development of circular economy-based products and services, establishing a network at the local and national levels and promoting the use of innovation and technology. Product Stewardship 6 (every two months) Supervision of responsibilities in products and services across the supply chain. Customer Experience 6 (every two months) Customer relationship management across the supply chain, attentive customer service, and the identification of opportunities to increase corporate value. Supplier Development 12 (every month) Establishment of business partnership and sustainable supply chain management. Cyber Security 12 (every month) Supervision of operational information security indexes, including leading and lagging indicators, and development of operational strategies to achieve the goals. 3. Environmental 6 (every two months) Supervision of Environmental & Social processes to be in compliance with & Social Dimension the business's ESG and sustainable development. Committee Climate Change and Energy 12 (every month) Supervision of issues related to climate change and energy Management of input risk. Environment 12 (every month) Eco-Efficiency Assessment. Utilization of resources, water and wastewater management, waste management, and air quality. Environmental Management System. Safety 6 (every two months) Operational safety management encompasses safe work procedures, processes and facility risk management, transportation safety, and safety culture. Health 12 (every month) Worker care includes the prevention of illness or illness at work and health promotion to lower the risk of off-duty factors. Stakeholder Engagement 6 (every two months) Management of stakeholders, employee care, business partners, community and social development, government agencies, media, and human rights activities. 05 Role of Sustainable Development Committee Mongkol Sakchai Hengrojanasophon Patiparnpreechavud Environmental Economic & Governance & Social Dimension Dimension Committee Committee Leader Leader “Sustainable development efforts and business operations must be “Our mission is to ensure that our business performs efficiently integrated and be in the same direction. Customers today place and that our products and services contribute to improving a high priority on the environment. Our manufacturing processes stakeholders' quality of life and a healthier environment; that is and products must be environmentally and socially responsible, to be economically, socially, and environmentally sustainable. contributing to environmental and social challenges. For example, The Dimension committee’s supervision is divided into seven major to address waste issues, we design our products to be recyclable areas: corporate governance, compliance, sustainable supplier, so that they can be used as recycled feedstock, reducing waste customer experiences, product stewardship, innovation and circular and resource consumption as well as greenhouse gas emissions, economy, and information and cyber security, all of which are prepared while also promoting the waste bank approach, in which the in short, medium, and long-term plans. community can collect and sort waste for recycling in the new manufacturing process. Recognizing that climate change is a major concern, SCGC aims to achieve Carbon Neutrality by 2050. SCGC Green PolymerTM was The Committee is responsible for formulating policies and plans developed to emit fewer greenhouse gases than other products, with to achieve corporate goals, particularly Carbon Neutrality by 2050 an initial goal of selling 200,000 tons by 2026, representing 20% of in short-, medium-, and long-term plans, as well as annual action total sales, in which we consider a challenge. We seek to achieve plans. This is a global issue that has a direct impact on business. the goals of developing products that minimize resource consumption Our primary strategies are to transition to clean and renewable while retaining crucial properties, such as durability and recyclability, energy sources and to adopt the circular economy principle based which rely on appropriate processing technology, and the development on a make-use-return approach that results in closed-loop circulation. of bioplastics from agricultural products to reduce the use of fossil More technologies, such as carbon capture, hydrogen consumption, fuels. Furthermore, we have worked with customers, business partners, and efforts, such as natural resource conservation, and ecosystem and stakeholders to reduce greenhouse gas emissions until the restoration, will be required in the future. The Committee must therefore targets are met. exercise rigorous oversight to ensure that the business operates in accordance with its policies and accomplishes its goals. SCG Chemicals' research and development capabilities are its greatest asset. We are Southeast Asia's sole company with Aside from addressing social concerns, such as human rights technology for producing catalysts, which are precursors to polymer and poverty, which involve stakeholders ranging from employees production. We also have the i2P center that fosters customer to communities to customers, we also focus on working with all engagement and demands, resulting in innovation that meets their sectors to collaboratively undertake development initiatives that needs. We are also an organization that is always adapting, keen stakeholders are interested in and agree on. Several examples include to make quick decisions, and learn from hands-on practices in community enterprise programs that strengthen and sustain which businesses are confronted with the world of VUCA (Volatility, communities. In this regard, an independent external body analyzed Uncertainty, Complexity, and Ambiguity)), which we must anticipate and assessed the company’s stakeholder engagement to provide and manage these dynamics at all times through networks of feedback for improvement. internal and external experts. However, forecasting is challenging. SCGC has been recognized as level 4 in Rayong's Eco Industrial Learning and adaptation are critical components of long-term Town, with the highest ranking, level 5. Additionally, we believe corporate operations. that to achieve meaningful changes, it is vital to collaborate with SCGC has committed to be a sustainable chemicals business role all sectors, including government, communities, and society, model nationally and worldwide and to cooperate with all sectors all of which must have strong and consistent goals and policies, to enhance sustainable development.” particularly on global warming and climate change, which are global issues affecting everyone.” 06 SCG Chemicals Sustainability Report 2021 Business Operations of SCG Chemicals SCG Chemicals: Challenges and Goals In 2021, the COVID-19 pandemic continued to have impacts on economies across the world, especially in Asian countries. In addition, concerns about global warming and plastic waste have prompted several countries to establish policies aimed at reducing greenhouse gas emissions and launching clearer plastic waste management measures. To emphasize its leadership position in the petrochemical industry, SCGC expedited its business strategies to respond to market changes promptly and sustainably. It introduced both short-term plans to offset the impacts of the COVID-19 and long-term plans to create High Value-Added product innovations and solutions that conform to the new normal and sustainable business practices. Accelerate and Adapt for Sustainability Hybrid Workplace: Accelerate Circularity: Accelerate Innovation: Accelerate Digital Changed the way Accelerated the Accelerated business Technology: About SCG Chemicals of working to offer transition to the circular growth through the Accelerated the adoption greater work flexibility economy through the development of High of digital technologies Feature to ensure employees' brand SCGC GREEN Value Added innovative across the supply chain Story good health and safety. POLYMER™ to maximize products and services to boost the speed and This approach enabled resource use, mitigate (HVA), which focuses on efficiency of business Enterprise Materiality employees to choose global warming, and four industrial segments: capacities by establishing to work in a safe and meet the demands of infrastructure, mobility, the Single Data Platform Sustainability appropriate location environmentally concerned healthcare and energy. to provide real-time access Issues with physical distance customers, brand owners, The product development to the same dataset to while still being able and consumers. Towards efforts were propelled all relevant stakeholders. Sustainability The platform provides Performance to work efficiently, the circular economy, by in-house research Data a series of access points conveniently, and our action plans spanned and development as to efficient and quickly. It also the entire value chain from well as open innovation appropriate raw material introduced proactive upstream, Intermediate, to with a number of research sourcing based on market COVID-19 prevention downstream. Examples and development networks conditions, optimization measures such as include an innovation of from educational institutions and consistency of the Bubble and Seal, high-quality plastic resins and research institutes production process work zoning, work to reduce usage of plastic throughout the world, (Reliability), machine grouping, and the resin while retaining the including Thailand, Asia, malfunction detection remote monitoring same properties; 100% and Europe. Additionally, in advance of damage, system. All of which recyclable plastic SCGC operates ASEAN's and the development aimed to limit the products; the conversion first and only i2P Center of a Digital Commerce plants’ workforce of post-consumer plastics for innovation and product Platform (DCP) to connect while allowing into high-quality recycled development, which customer order data to employees to work plastic resin and recycled was created to accelerate supply chain management from home. feedstock for the petro customer idea generation. data, allowing customers chemical industry; and to track purchase orders the development of anytime, anywhere, and bioplastics. saving up to 70% of the time. About SCG Chemicals 07 Chemicals Business for Sustainability Total Assets in ASEAN in ASEAN Myanmar 300 Vietnam 149,338 Cambodia 606 Indonesia 13% 38,315 Other Countries 8,944 About SCG Chemicals 52% 26% Total 197,503 Feature 9% Million Baht Story (52% of Total Assets) Enterprise Materiality Revenue from Sales Sustainability Issues Domestic Company that does business in Sustainability Performance ASEAN (excluding Thailand) Data Export all over the world and other operations Export in ASEAN Products and Services Production Volume (Per Year)* Number of Factories Olefins 3,400,000 tons 2 Polyolefins and Derivatives 2,130,000 tons 9 HDPE, MDPE, LLDPE, LDPE, PP, High Density Polyethylene Compound for Pipe Polyvinyl Chloride (PVC) and Derivatives 1,333,000 tons 14 PVC Resin, PVC Finished Products, PVC Compound Jetty & Tank Terminal (loading fee/quantity compared to ships) 210,000 Tons 4 Product development and solutions release to the market 15-20 items - *Only the main product of SCG Chemicals subsidiary 08 SCG Chemicals Sustainability Report 2021 High Value Added Products ALL THAILAND and Services SCGC joined as part of the ALL THAILAND project with the Federation of Thai Industries, the PPP Plastics network, High Value Added High Value Added and AEPW to manage used plastics in Products Services a sustainable manner. The project is divided Food & Beverage Industry Industrial Solutions into three sub-projects. Flexible packaging Integrating solutions Retort pouch and digital solutions Lightweight bottle cap that increase Building Construction and productivity while being Infrastructure Industry environmentally friendly, as well as safety management in the Insulation for electrical wire, manufacturing process telephone cables, and cables Energy conservation Water tank furnace coating for Eco Digiclean Klongtoei Project Vinyl doors and petrochemical, which leverages digital technologies windows steel, and ceramic to manage plastic waste from the Large HDPE pipe industries upstream area. Other Industries Furnace Coil Inspection Robot, Tank Inspection Medical equipment Robot, and Sky Visualizer Robot Agricultural equipment Patents of HDPE production process Automotive interior and Functional Material CIERRA™ and exterior parts Solar Energy System Solutions and batteries Thailand's first integrated floating Refrigerator and solar farms washing machine Rayong Less-Waste parts Project which intends to extend the community-based and local waste management model based on circular economy principles across the entire Progress in 2021 province of Rayong. Bio-ethylene: A feasibility study on a joint venture to build a plant to manufacture bio-ethylene with Braskem to generate bio-based polyethylene. The purpose is to promote the use of environmentally-friendly plastics on a larger scale. rHDPE: A collaboration with Unilever to develop and transform current HDPE packaging bottles (gallon bottles, laundry detergent bottles, softener bottles, shampoo bottles, and conditioner bottles) to recycled HDPE (rHDPE). This partnership marked the first time in Thailand that used plastic from household waste is recycled into new packaging. Advanced Recycling Technology: A technology that turns used plastic into Paving Green Roads recycled feedstock for petrochemical plants. The process has been certified Project which explores how to effectively ISCC PLUS granted by the International Sustainability and Carbon Certification convert post-use plastics as ingredients (ISCC). SCGC is Thailand's first company to be certified in the Advanced for paving asphalt roads while Recycling category. minimizing environmental impact. About SCG Chemicals 09 Sustainable Resource and Raw Material Management Value Chain 1. Energy: Reduce the usage of fossil fuels and raise the proportion of renewable energy usage, such as solar energy, through research and development. SCG Chemicals or SCGC integrates 2. Raw Materials: Reduce the usage of raw materials, raise the proportion circular economy principles across of recycled raw material use, and maximize waste reintroduction the value chain and product life approach for processing through research and development. cycle to maximize resource use, boost recycling, minimize 3. Water: Reduce water usage, utilize water more efficiently, and raise the greenhouse gas emissions, and proportion of recycle wastewater usage. meet the needs of customers and environmentally conscious consumers. Produ ct L i fe Cy cle About SCG Chemicals Feature Story Resource and Enterprise Materiality Raw Material Management Development Sustainability of Products, Issues Services, and Solutions Sustainability Performance Data Stakeholder Caring for Sustainable Development Product Usage and Efficient Recycling Production Processes Management to Reduce Pollution and Waste Ci rc la r u Ec on om y 10 SCG Chemicals Sustainability Report 2021 Development of Products, Services, and Solutions The Value 4. Technology-driven Innovation: Research and development efforts We Create are made to create innovations and incorporate technology into the development of products, services, and solutions, encompassing end-to-end eco-friendly processes from design to sourcing, manufacturing, sales, transportation, usage, and recycling where energy and resource consumption are maximized, and waste is kept to a minimum. Promote sustained, inclusive and 5. Collaboration with Customers: Identify real customer needs and develop products that meet sustainable economic the required and desired standards while also adding value to customers, reducing energy growth, full and and resource consumption, lowering greenhouse gas emissions, reducing waste to be productive disposed of, and extending the product's lifespan. employment and decent work for all. Efficient Production Processes Management to Reduce Pollution and Waste 6. Production Efficiency Enhancement: Optimize equipment and processes to minimize pollution and waste from the manufacturing process, including greenhouse gas emissions, air pollution, and Build resilient waste. infrastructure, promote 7. Waste Recycling from the Production Process: Study properties inclusive and of wastes and develop technology for waste recycling, reprocess sustainable into raw materials for use in plants, or transfer to other plants industrialization and as raw materials. foster innovation. 8. Quality Control Before Released into the Environment: Use technology to continuously control, monitor, and inspect the waste quality to meet or exceed legal standards. Product Usage and Recycling Ensure sustainable 9. Product Durability: Develop products that are more durable and consumption and consume fewer resources while retaining the properties that production patterns. enable lower energy consumption and recycling. 10. Waste Collection for Reintroduction into Manufacturing Processes: Develop technology to manage waste collection from expired products for efficient reintroduction into manufacturing processes. 11. Collaboration with All Sectors to Drive the Circular Economy: Take urgent action Coordinate with the government, private sector, academic institutions, to combat climate and civil society to form a comprehensive waste management change and its collaboration network, create economic value through waste impacts. recycling by generating income for the community, or provide public benefits including decrease of waste amount to be disposed and greenhouse gas emissions. About SCG Chemicals 11 Stakeholder Engagement SCG Chemicals or SCGC places high importance on all stakeholders, recognizing that stakeholder feedback is crucial to the development of more efficient and sustainable operations. SCGC revised its activities and channels of stakeholder engagement on a yearly basis to ensure that the Company provides opportunities for all stakeholders to engage and provide transparent feedback on concerns. Stakeholder Objective of Engagement Approach Needs and Expectations Detail Pages Group Engagement Disclose material and Hold activities for SCG's executives to Disclosure of performance to give Sustainability Report 2021 necessary information communicate its business strategies investors an overview of development about SCGC's performance and directions. directions continuously. Shareholder/ Listen to opinions/ Communicate the Company's performance Plans and strategies towards short-term Investor suggestions and use them through the Annual Report, the Sustainability and long-term goals. for further developments Report, and SCG's website. and executions. Understand employee Quarterly meetings with CEO (TA Talk). Reskilling and upskilling to Collaborating to Overcome needs. Quarterly meetings with Executives. accommodate business changes. the COVID-19 Pandemic Recognize employee Employee engagement survey conducted by Corporate directions and adjustments. Disruptions 16 needs and provide an external consultant every two years. Employee caring. Health and Safety 34 facilities to ensure Develop an annual engagement plan in each Business Code of employees can work unit to foster employee engagement. Conduct 39 happily and effectively. Activities that foster employee engagement Human Rights 44 Employee Disclose and communicate (Most activities were conducted vi online Employee Caring and business activities of platforms). Development 45 SCGC with employees. Communicate updates to employees Talent Attraction 45 Promote a culture of through internal communication channels, Community and Social collaboration to work such as email (WeLink), LINE group, Involvement 46 with other stakeholders. Employee Connect Application. Promote and support Regularly visit suppliers and contractors to Provide knowledge and serve as a Health and Safety 34 workplace safety in exchange ideas and listen to suggestions mentor for contractors to enhance their Business Code of suppliers' businesses for improvement. transportation safety for mutual growth Conduct 39 with regard to production Foster safety awareness and promote alongside SCGC. Sustainable Value Towards and transportation. behavioral change to create a culture of Provide knowledge on the environmental, Supplier 40 Support and advance workplace safety. social, and governance (ESG) the operation of suppliers Share knowledge and new trends that may management to enhance the operation and enrich knowledge affect the operation of suppliers and of suppliers and contractors and Supplier and to maximize operational contractors. reduce operational and reputational Contractor efficiency. Elevate transportation contractors by carrying risks. Develop collaborative out annual assessment and development projects for business initiatives under the Sustainability Program growth and expansion. every year. Promote and support Develop operational standards for suppliers suppliers and contractors and contractors and implement digital to comply with regulations technology to improve safety amid the and laws relevant to COVID-19 pandemic. environment and safety. Understand customer Receive complaints, suggestions, and other Integrate services and solutions to SCGC GREEN POLYMERTM needs to deliver products feedback through various channels around meet a comprehensive range of Plastic Innovation for and services that meet the clock. customer need. Better Future 20 their needs. Co-develop products with business customers. Provide online channels for customers i2P Center Co-develop products with Develop collaborations with customers in during the COVID-19 pandemic. The Solution for Our Planet 24 business customers and projects that promote social sustainability. Energy and Climate Change 30 foster collaboration among Develop products, services, and solutions Circular Economy 32 them to develop products under consideration of environmental, Product and Service Customer and services that contribute health, and safety impacts. Stewardship 36 to sustainability. Customer Experience Create channels for Creation 41 customers to offer suggestions on products, seek advice and troubleshooting, and submit complaints. 12 SCG Chemicals Sustainability Report 2021 Stakeholder Objective of Engagement Approach Needs and Expectations Detail Pages Group Engagement SCGC is the community's Management team and employees joining Prevent impact of business operations Collaborating to Overcome top-of-mind organization the monthly dialogue with the local on communities and the environment. the COVID-19 Pandemic when it comes to activities community to listen to suggestions, Leverage the Company's competency to Disruptions 16 in improving the equality feedback, and their need. elevate the quality of life in communities. Circular Economy 32 of life of the communities, Annual community satisfaction survey. Build career and income stability to Environmental encouraging sustainable Serve as partner and consultant and leverage promote self-reliance. Management 42 self-reliance, and being the Company's capability to help develop Take care of communities during the Social and Community part of the environmental various aspects of communities. COVID-19 pandemic. Involvement 46 Community stewardship in areas Integrate the collaboration between where it operates in communities, experts, the government, and Thailand and ASEAN. related sectors to create social impacts. Listen to the opinion of communities. Develop collaborative projects to enhance community competence for the benefit of society. Conduct business Listen to opinions and suggestions from Serve as a role model in management Social and Community activities in strict the government sector. transparency and excellence for other Involvement 46 compliance with applicable Offer opinions and suggestions towards organizations. law and regulations. the rules, regulations, and guidelines issued Cooperate with government agencies Collaborate with by the government. and propose good practices for Government government agencies Foster engagement and share good practices sustainable development. Agency in academic efforts and with the government sector to expand their Participate in collaborative projects that provide support to adoption, e.g., promoting the use of handrails seek to achieve sustainable development activities. when using stairs, health management. goals (SDGs). Serve on a panel or a working group of the government sector to propose rules and regulations. Communicate corporate Regularly disclose business information in Serve as a role model of conglomerates Sustainability Report 2021 news by conducting various aspects, such as quarterly operating that places emphasis on and actively in-depth interviews and result announcements and press conferences. implements sustainable development online surveys (media Occasional site visits and CSR activities. (economic, social, and environmental) empathy) to prepare Support press activities beneficial to society in its business operations and successfully information that meets and consistent with SCGC's guidelines. achieves tangible results. the needs of the media. Listen to the media's opinions, suggestions, Establish online channels and room for improvement once or twice Media for communicating news every month. and updates, such as SCG News Channel, to ensure information is disclosed fully, accurately, and timely. Foster engagement and good relations with the media. Disclose information Listen to opinions and suggestions from Serve as a role model and a mentor on Sustainability Report 2021 completely and civil societies, scholars, and opinion leaders sustainable development for medium transparently. to improve the Company's operations and small organizations. Listen to opinions and Participate in projects that promote social Join forces with large organizations suggestions from the sustainability to create significant changes in terms civil society sector. Foster engagement and share good practices of sustainability. Seek opportunities to with the government sector to expand their Cooperate with government agencies Civil Society create the partnership adoption, e.g., transportation safety, health and propose good practices for Sector, Academia, and drive issues related management. sustainable development. and Opinion to sustainability. Leaders, NGO Foster public awareness and understanding of key sustainable development issues. Leverage the expertise of specialists to support collaborative projects. About SCG Chemicals 13 2021 Performance Highlights E Environmental S Social G Economics and Governance Water Lost Time Injury Sharing Good Withdrawal Frequency Rate Opportunities, Governance Reduction Drawing GHG Emissions 0.010 the Future 0 Reduction Environmental 4.01 case per 200,000 Program Non Compliance Expense and million cubic hours worked 801,000 Investment meters 19 projects Case tons carbon dioxide (compared with 993 (compared with BAU at Employee Contractor 2.3 million baht 0 BAU at the base million baht the base year 0 case 2 cases 1.76 SROI Corruption Case year of 2007) 0.4 of 2014) 14 percent of revenue 12 percent Cyber Security percent from sales 0 Number of Cyber Green Threat Cases Energy Procurement Occupational Consumption Reduction Purchased Illness Frequency Number of Check Dam 0 8.31 gigajoules 1,650 Rate 6,500 units Number of Complaints (compared with million baht 0.06 case per Regarding Data BAU at the base 14 Recycled 200,000 1.24 SROI Insecurity percent of total Water hours worked year of 2007) 10 purchasing 5.5 percent Employee Contractor Social High Value Added Contribution Product and Service percent 0.02 0.08 “SCG Green Choice” Wastewater 61.93 36 percent million baht Alternative Energy Products and 0.60 Fatality from sales 3,428 Services m3/ton Employee Contractor MWh accumulation of 49 product 0 cases 3 cases percent of revenue alternative from sales energy Community 8,527 Suppliers Being OHIFR Employee 0 Satisfaction Investment in Research and MWh Conducted 88 percent Innovation Environment Social and Distribution Rate/10,000 1,726 Carbon Label Governance million baht Certified Hazardous/ Shipment (ESG) Risk Non-Hazardous 0.03 Community 0.7 percent 10 products Assessments Waste to Forest Area from sales 99 Landfill (2017-2021) Recycled percent of 0/0 Motor Vehicle Accident (MVA rate)/ 146,600 Materials suppliers with trees procurement 1,000,000 Km 0.6 percent spending over 0.08 218 rai million baht 14 SCG Chemicals Sustainability Report 2021 Feature Story Enterprise Materiality About SCG Chemicals Feature Story Enterprise Materiality Sustainability Issues Sustainability Performance Data Feature Story 15 In late 2019, Control Room Operator (Boardman) Nakorn monitoring meetings in Bangkok regularly. At the management Piyanuch and Field Operator Nattapon Setthisakko went level, SCG Chemicals or SCGC established a Business Continuity about their routine duties at a Thai Polyethylene Company Management (BCM) plan to avoid production line interruptions. Limited plant in Rayong's Map Ta Phut Industrial Estate. Several measures were taken to ensure that employees were Nakorn, Nuttapon, and other employees boarded a company safe, and that the business could continue producing and shuttle bus and ate lunch at the canteen. The two recalled the delivering products and services as usual despite the pandemic. news of the COVID-19 outbreak. Even still, it looked to them The plant where Nakorn has worked would receive propylene to be implausible. as a raw material to make polypropylene, or PP, which is However, Jirasak Traipin, Plant Production Manager, was essential in various industries, such as the manufacture of car concerned about the situation and had to attend situation- consoles for automobile manufacturers. If the production line is disrupted due to an COVID-19 infection, the damage cost to the company might reach ten million baht each hour because every ton of plastic resins is part of the production of a high-value product and impact to supply chain. The calculated damage did not include the loss of life and health of employees, which was incalculably valuable. This was an example of various operations at SCGC. About SCG Chemicals Collaborating to Overcome the COVID-19 Feature Story Pandemic Disruptions Enterprise Materiality Sustainability Issues Sustainability Performance Data 16 SCG Chemicals Sustainability Report 2021 “Egg White-Egg Yolk” Measure: Employee enabled all employees to submit their health Care in the Face of the COVID-19 Pandemic status on a regular basis via the Health Pass system and COVID-19. Other tasks can Jirasak recalled brainstorming sessions be undertaken held at the plant where employees from home collaborated to establish a range of Other support tasks preventative measures, including “Bubble & Seal”, which accommodated working areas to maintain social distancing and Production infectious case management. support tasks “We were attempting to keep infections to a minimum in our plants. There were four shifts, each with seven employees. Production We planned that if an infection case occurs control tasks during that work shift, the entire team must be isolated for 14 days regardless of “Egg Yolk” : Maximum protection the test result. We did not take risks, even where employees resided in company- if the chance was slim.” provided accommodation. Prior to implementing measures or policies Door-to-door risk prevention measure designed to keep risks associated with travel at bay. requiring employees to comply, the plant had to communicate with them until a Bubble & Seal by arranging operating zones common understanding was reached. under infection prevention measures. “Because we wanted it to be collaborative, not coercive, which might result in refusal Screening with a Health Pass (Self Declaration + Vaccination + ATK) to cooperate. It was better to reach complete prior to entering the company area. agreement and communication.” Employees were obliged to submit daily Business Partners In the Event of Infection health condition reports using the application Screening for entry into the operating area The waiting center was established to care using the Health Pass system and the for high-risk or infected employees promptly, no later than 2.00 p.m. Employees would Bubble & Seal measure. a strategy that contributes to transmission be asked whether they had contacted prevention and alleviates the burden on high-risk individuals or traveled to high- Rayong's public health system. risk areas or provinces. The administrative center's staff would monitor employees who failed to report, particularly employees “Egg White – Egg Yolk” Measure: Maintaining like Nakorn and his colleagues, who were Employee Safety and Business Operations classified as “egg yolk” due to their position At the plant, employees on the production line work in shifts, as boardman. The plant required that all whereas office employees have regular working hours. When employees submit 100% complete health the COVID-19 pandemic gripped Thailand in early 2020, SCGC reports daily. established priority measures to keep production lines running while limiting infection risks and protecting employee health. Risk management measures classified employees into two categories: “egg white” employees who can work from home The web application without visiting the site or office, and “egg yolk” employees “Employee Connect” who are critical to manufacturing operations, such as boardman enable all employees to submit their health status like Nakorn, whose responsibilities included ensuring that on a regular basis via the machinery and automation systems operate continuously Daily Check-in system or in the central control room. Daily Self Declaration. SCGC's initial response entailed communicating with employees to avoid high-risk areas and advising on infection prevention practices both within and outside the operation sites. Additionally, the web application “Employee Connect” was developed to effectively track employee’s health status. This application Feature Story 17 However, if the situation worsened, egg yolk employees such describe SCGC' guidelines and measures to obtain approval as Nakorn would have to be relocated to the hotel to avoid from Rayong's Disease Control authorities. Officials applauded contact with others. The shuttle bus service would be specially the approach, and it was chosen as a model for COVID-19 arranged to assist transportation between the plant and the preventive management for comparable projects. Meanwhile, hotel. the MOCD project continued to run normally throughout the “I had to spend a month in a hotel at the time. There were COVID-19 crisis. no tourists; only employees like me were there. I used a video call to stay connected with my family. However, if an emergency Responding to the Worsening Pandemic occurs, such as my family being ill, I am required to notify the in 2020 company.” In 2021, a series of new COVID-19 pandemic waves resulted This also had brought Jirasak some distress as a in a significant rise in infection cases and deaths compared to supervisor. 2020. Rayong was regarded to be one of the provinces with “These employees made significant sacrifices. a growing number of infected individuals, necessitating the Some of them had to leave their wives and children implementation of increasingly stringent measures, such as at home. I assured them that if they had an issue, proactive screening with a daily antigen test kit (ATK) testing even late at night, they should contact us to assist to screen employees and business partners prior to their entry them. We regarded their commitment to comply into the operation site; self-quarantine for employees and with the company's policy, although it impacted business partners who traveled from provinces within the their family, to be an added bonus in operational controlled areas and were required to be tested for infection About SCG Chemicals performance. I underlined to everyone that their once the quarantine period ended. They could then return to safety and that of their families was critical for the work on the site if the result was negative. Feature operation to continue.” Nattapon recalled an experience in which he unknowingly Story visited a high-risk area that was later reported to have had By 2020, all SCGC plants had safely navigated the pandemic and implemented pandemic infected cases. As a result, he “had to implicitly conduct Enterprise 14-day self-isolation.” Until the result was negative, he was Materiality management guidelines and preventative and control procedures at all stages of operation, cleared to return to work. Sustainability including pre-entry screening and operational Since the beginning of 2021, SCGC has prepared a vaccination Issues area separation. This approach was broadened to plan to ensure that all employees, their families, and the Company's include other projects engaging employees and vendors were vaccinated. This is because if one person is Sustainability partners. Particularly for the MOC Debottleneck infected, it could spread to others. Until mid-2021, when the Performance (MOCD) project, which involved tens of thousands government accelerated the vaccination effort, SCG's Head Data of workers, a report had to be prepared to Office in Bang Sue partnered with the government to establish Measures in Response An outbreak observed Cases of infection New waves of infections that to the COVID-19 overseas. detected in Thailand. last several months. Pandemic Cases of infection A severe pandemic in Rayong. detected in Rayong. December 2019 2020 2021 Closely monitored the Defined measures for Implemented existing measures situation and devised employee grouping, in a consistent manner. plans to care for social distancing, mask Conducted ATK test once every employees both based use, and area disinfection. 14 days. in Thailand and aboard, Bubble & Seal measures. and assisted with return Developed the Health Pass trips. Developed a risk screening system. assessment screening Encouraged employees to get mechanism for employees vaccinated. prior to entering the area. Established vaccination centers and waiting centers to alleviate societal burdens. 18 SCG Chemicals Sustainability Report 2021 a vaccination center to facilitate immunization for the general public. COVID-19 Preventive In Rayong province, SCGC partnered with governmental organization- Social Security Office to set up a vaccination center for insured Innovations persons at the RIL Industrial Estate Office. SCGC collaborated with all sectors to overcome the When the number of infection cases in Rayong began to rise, the crisis. It accelerated creativity within the organization public health system's capacity became overwhelmed with insufficient to develop COVID-19 preventive innovations in a timely beds to accommodate, field hospitals and community isolation manner to fulfill the needs of medical agencies. facilities were established. SCGC assisted by providing equipment The examples are as follows: for setting up field hospitals, paper field hospital beds, and patient supply bags, in addition to previous assistance to the province and communities in the form of PPEs, alcohol, N95 masks, rubber Negative/Positive Pressure gloves, disinfectants, and supply bags. Isolation Chamber Patient Isolation Capsule Furthermore, to alleviate the burden on government-supported field Small Patient Isolation hospitals, SCGC offered hotel stay as company isolation facility with 32 beds for infected employees, where they were treated until healed Capsule for CT scan and free from infection. Small Patient Isolation Capsule for Air Transport By the end of 2021, all employees at SCGC had received two doses Negative Pressure Isolation of vaccines. Additionally, the Company established a Health Pass Room system that employees could utilize to gain access to operational areas. Employees were required to disclose their health condition in Aerosol Box the Daily Self Declaration system to demonstrate proof of two doses Dent Guard of vaccines and antigen test kit (ATK) results before entering the Sharp Disposal Bin for area. Employees were also required to remain within their bubble Vaccination Center and zone, avoiding contact with other bubble zones, a basic control Hospital mechanism in the operational area after the peak of the pandemic VAROGARD, a high- crisis in 2021. performance antiviral mask for general use. Lessons Learned from the COVID-19 Pandemic: Coated with COVID-19 anti-infection substance, Since the start of the COVID-19 pandemic, SCGC distributed the quality of which was “Guard-up Boxes” to all employees, which contain protective equipment, including face masks, alcohol gel, vitamin C, and ATK kits. tested by the Faculty of Medicine Siriraj Hospital, If one becomes infected, while waiting for treatment or being isolated Mahidol University. at home, they would receive a “Care Box” containing essential supplies such as paracetamol, Fah Talai Jone (Andrographis paniculata), pulse oximeter, fever thermometer, and so on. Additionally, in partnership with Ramathibodi Hospital's Virology Laboratory, the Company provided COVID-19 screening using RT-PCR test for employees and business partners. Jirasak and his coworkers learned and engaged in how to deal with the pandemic. “It's all about learning. We had no idea what Egg Yolk, Egg White was before this, but it has become our primary management system. The main issue we had was being apart from our family, and we were trying to treat everyone as though we were members of a large family and that we needed to work together as much as possible.” As a result of its commitment to all lives, SCGC weathered the crisis and was able to deliver products and services to customers and consumers comprehensively and safely, besides providing a number of innovations and products to benefit society as a whole. Feature Story 19 Global warming, natural disasters, and trash overload are all Plastics have become an integral part of people's lives due to negative consequences caused by human activities that are their excellent durability, elasticity, stiffness, and ease of forming. currently reversing the threats toward human quality of life. As a result, they are incorporated into various products and It is projected that the severity of disasters will increase if we packaging. On the other hand, plastic is a difficult material to do not cease squandering resources and energy and generate biodegrade. If not properly disposed of, post-consumer plastic vast amounts of waste that pollute the environment. One of the becomes waste, polluting the environment for hundreds of waste materials being targeted is plastics. years. Globally, there is a growing effort to address climate change and waste management. The government, businesses, and civil society all acknowledge the significance of environmentally friendly production and consumption. About SCG SCGC GREEN POLYMER TM Plastic Innovation for Chemicals Feature Story Enterprise Materiality Better Future Sustainability Issues Sustainability Performance Data SCG Chemicals or SCGC consistently conducts business in accordance with sustainable development and is a leader in the development of plastic resin powered by technology and innovation. It has embraced circular economy principles, which emphasize resource circulation as a means of reducing resource use, energy consumption, and waste generation, by developing innovative plastic resins for the planet's better future under the brand “SCGC GREEN POLYMERTM.” 20 SCG Chemicals Sustainability Report 2021 Plastic 4Rs Principles Before it becomes a plastic cup, a plastic bottle, a plastic high strength and stiffness, allowing for a reduction bucket, or any other plastic goods in customers' hands, plastic in plastic usage throughout the molding process while has to undergo a multi-step process. maintaining the product's desired strength properties. It begins with extracting crude oil or natural gas from the As a result, the product is lighter, resulting in energy earth, which is then transported to refineries and converted savings during transportation and lower shipment costs. into naphtha for use as feedstock for petrochemical plants, Plastic products created with SMXTM technology can lower divided into three segments: upstream, intermediate, and greenhouse gas emissions by 10-20% compared to those downstream. The final product is synthesized in the form of made with standard plastic resins. resin or plastic resin. The plastic products that benefit from this technology are The plastic processing plant then employs plastic resin as a divided into those that require lightweight and stiffness raw material in the injection blow molding process to produce properties, such as bottle caps that require ultra-lightweight plastic products and packaging, which are eventually distributed properties; ultra-thin bottle caps for carbonated beverages to consumers as finished products. that are sturdy and retain gas better, lowering the amount Throughout the product's life cycle, SCGC has raised questions of plastic used by up to 20%. exploring sustainable approaches to plastic management Products with a high degree of durability, such as industrial- based on circular economy principles and the 4Rs principles. grade plastic packaging bags that can help reduce plastic Reduce – how can we reduce our reliance on natural resources? consumption by 30%. Recyclable – how can we make difficult-to-recycle plastic products Products requiring a high degree of robustness, such as and packaging more recyclable? Intermediate Bulk Containers (IBCs), which can lower the weight and plastic content by up to 6%. Recycle – how can plastics be recycled? and The plastic resins produced by SMXTM technology are of Renewable – how can we use renewable plastic as raw material high grade. When recycled, it can also help to reduce the and make it biodegradable? amount of virgin plastic used in each recycling mixture and These questions will lead to a comprehensive decrease in the increase the number of recycling times. Meanwhile, once amount of plastic in the ecosystem, which is a means to solve recycled, conventional plastic's quality degrades faster. plastic waste issues while also helping to reduce the impact of intensifying global warming. Reduce: Boost Product Performance with SMXTM Technology Is it possible to decrease the amount of plastic used by making the plastic product thinner while maintaining the same robustness or thickness with increased performance? With a commitment to seeking a solution, SCGC developed SMXTM technology to produce HDPE that retains a balance of Feature Story 21 Recyclable: Mono-Material Plastic Packaging Recycle: Transform Household Waste into Is it possible to make food packaging bags, snack bags, or High-Quality PCR cleaning liquid bags that are hard to recycle, recyclable? Is it possible to recycle household waste into PCR that contains The reason for this is that this difficult-to-recycle packaging standard properties? Significan

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