The directors and Management of KNM Group Berhad (“KNM” or “the Company”) strives to uphold its commitment to prohibit bribery and corruption in the business conduct within the KNM and its subsidiaries (collectively known as “KNM Group” or the “Group”).

In line with good corporate governance practices, the directors of KNM encourage its employees and associates to commit to the highest possible standards of ethical, moral, and legal conduct. Consistent with this commitment, KNM Anti-Bribery & Anti-Corruption Policy Statement (“Policy Statement”) aims to support good management practices and sound corporate governance practices within the Company.

The Policy Statement aims to set guided principles for its employees, directors and associates (“associated person”) in relation to dealing with improper solicitation, bribery and other corrupt activities and issues that may arise in the course of business. It is also intended to apply to every director of KNM except as otherwise stated in this Policy Statement.

This Policy Statement is not intended to provide definitive answers to all questions regarding bribery and corruption.

For the purpose of this policy, the wrongful activities or wrongdoings refers to any potential violations or concerns relating to any laws, rules, regulations, acts, ethics, integrity and business conduct, including any violations or concerns relating to malpractice, illegal, immoral, embezzlement and fraudulent activities which will affect the business and image of KNM. The directors of KNM has a stewardship responsibility to communicate the requirements of this policy and to guide the organisation in dealing with concerns arising from wrongful activities or wrongdoings.

The key principles of the Policy Statement are as follows:

1. To ensure Top-Level Commitment against bribery and corruption is established

Establish, maintain, and periodically review an anti-corruption compliance programme which includes clear policies and objectives that adequately address corruption risks. Encourage the use of any reporting in relation to any suspected and/or real corruption incidents or inadequacies in the anti- corruption compliance programme.

2. To ensure Risk Assessments are carried out

A corruption risk assessment is done on an annual basis, with intermittent assessments conducted when necessary covering the following:

1. Opportunities for corruption and fraud activities resulting from weaknesses in the organisation’s governance framework and internal systems/procedures;
2. Financial transactions that may disguise corrupt payments;
3. Business activities in countries or sectors that pose a higher corruption risk; and
4. Non-compliance of external parties acting on behalf of the organisation regarding legal and regulatory requirements related to anti-corruption

3. To undertake control measures

a. Due Diligence

Establish key considerations or criteria for conducting due diligence on any relevant  parties or personnel (such as Board members, employees, agents, vendors, contractors,  suppliers, consultants and senior public officials) prior to entering into any formalised relationships.

Methods may include background checks on the person or entity, a document verification process, or conducting interviews with the person to be appointed to a key role where corruption risk has been identified.

b. Purchase of Gift and Corporate Hospitality

Purchase requisition pertaining gift and corporate hospitality shall be a reasonable amount, subject to the approval of the Group Chief Executive Officer in line with the Financial Limit of Authority. Such gifts and hospitality shall fulfil ALL the following conditions prior to approval:

1. They are intended to maintain good rapport with the vendors/ customers of the Company and government officials;
2. They are limited, customary and lawful under the circumstances;
3. They do not have or perceived to be affecting action(s) or decision(s) of the receiving party;
4. There shall be no expectation of any specific favour, benefit or advantages from the intended recipients;
5. There shall not be any corrupt/ criminal intent; and
6. The giving out of gift or corporate hospitality shall be transparent.

Purchase requisition pertaining to gift and corporate hospitality for government official from the public sector, it shall be restricted to statutory limit of the respective countries. However, gift in the form of cash or cash equivalent shall never be given or offered to any public or government officials.

Purchase requisition on gift or corporate hospitality shall be indicated with purpose of requisition, including client or vendor name or representative details.

c. Gift and Entertainment Acceptance

Under no circumstances that an employee of the Group shall receive or soliciting for personal gift from an external party.

Although the general principle is to immediately refuse or return such gifts, accepting a gift on behalf of KNM Group is allowed only in very limited circumstances, whereby refusing the gift is likely to seriously offend and may sever KNM’s business relationship with the Third Party. However, in no circumstances may an employee, director or his/her family/household members accept gifts in the form of cash or cash equivalent.

Employees of KNM Group shall exercise proper care and judgment prior to accepting entertainment from external party. This is vital to safeguard the KNM’s reputation and to protect its employee from allegation of soliciting bribe or corruption.

Any gift or entertainment received by an employee of the Company from external party(s) requires declaration to the Heads of Departments or Group Chief Executive Officer.

d. Facilitation Payment

Facilitation payment to external party is strictly prohibited as it is seen as a form of bribery and corruption, unless it can be proven that such payment is legitimate and supported by an official receipt. Facilitation payment shall not be in any way or form be disguised or translated in personnel renumeration package.

e. Donation and Sponsorship

The Company shall ensure that all donations and sponsorships are not used as a subterfuge for bribery or used to circumvent or avoid any of the provisions in other available policies of KNM, including in particular, the prohibition on bribery. KNMneeds to be certain that donations to foreign-based charities or beneficiaries are not disguised illegal payments to government officials, and shall ensure that the charity does not act as a conduit to fund illegal activities in violation of international anti-money laundering, anti-terrorism and other applicable laws.

The Policy Statement, in accordance with KNM’s commitment to contribute to the community coupled with its values of integrity and transparency, all sponsorships and donations shall comply with the following:

• ensure such contributions are allowed by applicable laws;
• obtain all the necessary internal and external authorisations;
• be made to well established entities having an adequate organisational structure to guarantee proper administration of the funds;
• be accurately stated in the company’s accounting books and records; and
• not to be used as a means to cover up an undue payment or bribery.

Donation and sponsorship are only permissible with prior approval by the Group Human Resource Head and Chief Operating Officer (Division) or Group Chief Executive Officer. All donations and sponsorship payment shall be supported with an official letter of request from the requesting external party and proof of receipt.

f. Reporting Procedure

Establish an accessible and confidential trusted reporting channel (whistleblowing channel), which may be used anonymously, for internal and external parties to raise concerns in relation to real or suspected corruption incidents or inadequacies of the anticorruption programme.

g. Record Keeping and Documentation

KNM is determined to uphold its commitment to maintain accurate and complete records, reflecting KNM’s highest ethical standards and accountability.KNM ensures any and all information in the Group documents and record keeping processes shall not:

1. Intentionally reflect a false or misleading entry in an official company record, report,
   file or claim;
2. Be represented in a falsified, omitted, misstated, altered, concealed in any manner or form or otherwise misrepresent the facts on the Group records;
3. Engage in any scheme to defraud the Group or any other individual; and
4. Encourage and allow any persons to compromise the accuracy and integrity of records.

4. To ensure systematic review, monitoring & enforcement of ABAC framework

Plan, establish, implement and maintain a monitoring programme, which covers the scope, frequency, and methods for review; Identify the competent person(s) and/or establish a compliance function to perform an internal assessment, in relation to the organisation’s anticorruption measures; Conduct continualevaluations and improvements on the organisation’s policies and procedures in relation to corruption; and conduct disciplinary proceedings against personnel found to be in violation of relevant KNM’s internal policies.

5. To ensure adequate training, awareness & communication

The Group’s anti-corruption policy & guidelines should be made publicly available and should also be appropriately communicated to all personnel and business associates.