Economic Growth

Sustainable Supply Chain Management

The Company has purchased products and procured services from suppliers and contractors for the main and supporting activities of industrial estates.

As such, the quality of products and performance of suppliers and contractors can have both positive and negative impacts on the Company. Moreover, management of relationships with suppliers and contractors is also essential to promote and build long-term growth together.

Risks

Suppliers and contractors having substandard performance or high ESG risks are likely to cause non-compliance to laws and regulations or create negative social and environmental impacts such as safety, waste management, labor practices, which in turn puts the Company's image and credibility at risk.

Opportunities

Conducting business with suppliers who operate with fairness and transparency and uphold social and environmental responsibilities will help the Company reduce supply chain risks and negative impacts from business operations in the short and long terms, as well as increase the quality and efficiency of the Company's performance

Management Approach

The Company had appointed AMATA Procurement Working Committee chaired by the Senior Vice President - Accounting & Tax, Finance & Treasury, Investor Relations and Information Technology.

The Working Committee, consisting of the senior executives of the Company and its subsidiary companies, has the duty and responsibility in developing the procurement best practices in compliance with the international and ethical standards in order to set the procurement standards of AMATA Group, as well as, preparing and disseminating the Supplier Code of Conduct to communicate the intent of the Company in doing the business ethically with responsibility by taking economic, social and environmental impacts into consideration.

As well as a ESG risk assessment within the Company's supply chain. That covers all suppliers and contractors in good corporate governance, economy, society, and environment. Setting the management guidelines and strategies suitable for each group of suppliers and contractors and arranging for development and enhancement of suppliers and contractors' potential to reduce the sustainability risk and impact from business operations both in the short and long term.

Hence, the Company had established the guidelines of sustainable supply chain management as follows:

Performance

The Company has announced the Supplier Code of Conduct and Procurement Manual of AMATA Group to its critical suppliers in accordance with sustainable supply chain management policy to promote the importance and to be a guideline for suppliers and contractors in doing business to comply with the Company's practice with an emphasis on social and environmental responsibility as well as honest, fair and transparent business practices covering the following issues:

Business Ethics

Comply with laws and regulations, conduct business based on accuracy and integrity, anti-corruption, transparency, and verifiable information disclosure.

Human Rights

Accurate and legal employment, fair treatment, and no use of child or forced labor of any kind.

Occupational Health and Safety

Comply with occupational health and safety laws, provide safety equipment suitable for operation, record job sickness and accidence statistics, and communicate to understand and follow.

Social Responsibility

Preparing a channel for receiving complaints from stakeholders and considering the impacts arising from the operation.

Environmental Responsibility

Comply with environmental laws and regulations, prepare measures to prevent and reduce environmental impacts from the operation, and promote environmentally friendly technologies and products.

In 2021, 69% of critical suppliers have responded to the Supplier Code of Conduct Acknowledgment. Procurement processes were undertaken according to the Amata Group Procurement Manual as follows:

1. Critical Supplier Identification

In 2021, the Company has identified critical tier-1 suppliers from existing 932 tier-1 suppliers and contractors in its supply chain by using the following criteria:

High-volume suppliers in the top 80% of total procurement value
Suppliers of critical components or services that are important to the Company
Non-substitutable suppliers

In 2021, it was found that there were 71 critical tier-1 suppliers and contractors, accounting for 87% of the total procurement value. Among these, there were 6 suppliers in the real estate and rental business and 65 suppliers in the utility services business, representing the procurement value of 20 and 80 percent, respectively.

2. Risk Assessment in supply chain (Disclosure 308-2, 414-2)

The Company has implemented a supplier ESG risk assessment for critical suppliers and all new suppliers through a self-assessment questionnaire (SAQ) that covers economic, social, and environmental dimensions. Suppliers with medium to high risk (self-assessment score less than 80%), the Company will make a site visit to perform an additional on-site ESG audit. Furthermore, the Company has assigned the Procurement Department and business units using the supplied products or services to conduct an annual supplier quality assessment but with a different frequency depending on the risk level. Critical and high-risk suppliers are required to present preventive and corrective measures, which will be assisted by the Company as a way to build a good relationship with suppliers.

The Company has set a target to assess all critical and new suppliers for ESG risk. In 2021, the Company conducted the ESG risk assessment of 71 critical suppliers and contractors (100%) and eight new suppliers (100%). There were no critical suppliers with high and critical environmental, social, governance, or economic risk.. The Company has determined risk management measures for individual critical suppliers, and also provided them some supplier development activities in order to reduce likelihood and impacts of such risks. However, the Company has not yet terminated business relationships with any suppliers and contractors that were assessed (0%). (Disclosure 308-2, 414-2)

3. Supplier Audit / Evaluation

Every supplier and contractor will be annually evaluated their performance and assessed their relationship by the Company. Critical suppliers that have passed a ESG risk assessment, covering economic, social, and environmental dimension, will receive an on-site ESG audit of which details and frequency depend on the risk level of individual suppliers as required by the Company and ISO14001 Standard. The supplier audit and evaluation can be performed by examination of reference documents, self-assessment questionnaire, and on-site audit by the Amata Group's procurement working team.

In 2021, the Company has set a target to conduct an on-site ESG audit of not less than 80% of the total number of critical suppliers. It was able to audit 56 suppliers, accounting for 80 percent of critical suppliers.

4. New Supplier Registration

The new supplier selection process includes reviewing qualifications and past performance of suppliers and contractors to determine whether they meet the Company's requirements. All new suppliers are required to complete an ESG risk assessment using a self-assessment questionnaire prior to new supplier registration. If a passing score is achieved and no economic, social, and environmental risks are found, the new supplier will sign the Supplier Code of Conduct Acknowledgement and be registered as a new supplier. If a passing score is not achieved or there are risks, the supplier must develop and submit a preventive or corrective plan and implement it until the score is acceptable before it can register as a new supplier.

In 2021, the Company had eight new suppliers, all of which (100%) have successfully completed the selection process.

5. Supplier Development

The Company has emphasized on the development of suppliers and contractors in its supply chain, especially critical suppliers of utility and industrial services, to reduce the social and environmental risks and impacts as well as compliance risks. It also encourages suppliers and contractors to improve their performance in line with the Company's standards. For example, it supports suppliers and contractors of critical products and services to develop business processes and obtain international management system certifications, such as ISO 9001, ISO 14001, ISO 17025, and OSHA 18000.

On 30 March 2021, Amata Water Co., Ltd. held a meeting on the establishment of a water user association under the Water Resources Act B.E. 2561 together with critical suppliers of raw water to discuss the Water Resources Act B.E. 2561 and how to establish a water user association.
Amata Water Co., Ltd. provided information and advice to suppliers to prepare them for the ISO 9001 certification audit.
On 2 October 2021, Amata Facility Services Co., Ltd. organized solid waste spill recovery and clean up training for waste collecting and sorting staff of its contractors to improve their waste separation process and enhance environmental management knowledge and skills to leverage their safety and efficiency.
Between 18-19 October 2021, Amata Facility Services Co., Ltd. organized training on waste separation and infectious waste sorting for waste sorting staff of its contractors to ensure proper and safe waste disposal process.
On 6 November 2021, Amata Facility Services Co., Ltd. organized training on basic firefighting and evacuation for employees of its contractors working in the Company's industrial estates.

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