Copyright © 2026 PETRONAS Chemicals Group Berhad 199801003704 (459830-K).
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PETRONAS Chemicals Group Berhad
Key Stakeholder Groups
Employees
Suppliers & Vendors
Shareholders & Investment Community
Communities
Customers
Business Partners
Government & Regulators
MediaSAFEGUARDING THE ENVIRONMENT
Climate Change
Description
PCG’s approach to improving energy efficiency, advancing renewable energy, reducing GHG emissions, promoting sustainable transport and green facilities and strengthening preparedness for climate-related disruptions across its global operations.
Impact to PCG
Reducing PCG’s carbon footprint strengthens long-term competitiveness, mitigates climate-related financial risks and supports compliance with regulatory requirements across multiple jurisdictions.
Our Response
- Advanced PCG’s NZCE 2050 Roadmap, supported by energy efficiency, flaring reduction and early renewable integration
- Delivered tangible emissions reductions through operational optimisation and asset decarbonisation efforts, achieving approximately 100 ktCO₂e reduction in 2025 from energy efficiency, flare reduction and low-carbon processes initiatives
- Continued the purchase of bundled RECs, reducing market-based GHG emissions by 212 ktCO₂e
- Enhanced the quality and scope of climate disclosures, maintaining dual Scope 2 reporting and refining Scope 3 emissions coverage to focus on the most material categories
- Embedded climate considerations into decision-making, integrating climate risk assessments, internal carbon pricing and IFRS S1 and IFRS S2 readiness into investment and risk management processes
Alignment to UN SDGs
Nature & Environment
Description
The policies and practices on environmental management aimed at minimising and mitigating the negative impacts of operations on nature and ecosystems. This includes responsible resource use, pollution control and biodiversity conservation.
Impact to PCG
Minimising PCG’s environmental footprint lowers operational risks, mitigates potential financial losses and regulatory penalties, prevents production disruptions and strengthens our longterm business resilience.
Our Response
- Improved water stewardship at priority sites, delivering approximately 88% of targeted freshwater withdrawal reduction at domestic water-stressed locations through optimisation projects and digital monitoring
- Advanced waste circularity across operations, achieving an 88% hazardous waste recycling rate and generating more than RM20 million in value through waste recovery and valorisation initiatives
- Strengthened environmental compliance and performance monitoring, including enhanced air emissions tracking, site-level controls and readiness for evolving regulatory requirements
- Expanded circular resource-efficiency practices, embedding the 5Rs framework across operations to reduce resource intensity, waste generation and environmental impact
Alignment to UN SDGs
SUSTAINABLE VALUE CREATION
Business Strategy & Financial Resilience
Description
PCG's strategic approach to ensuring business continuity, long-term and sustainable value creation, and financial resilience. It encompasses considerations of shifting demographics, changing consumption patterns, market access, socio-economic risks, and responsible investing and financing, all of which influence the organisation’s ability to adapt, remain competitive and deliver enduring stakeholder value.
Impact to PCG
Strengthening operational excellence, diversifying revenue streams and reinforcing financial resilience enable sustainable growth and position PCG to navigate market volatility, regulatory changes and evolving stakeholder expectations.
Our Response
- Improved operational performance across the Commodities portfolio, lifting plant reliability (94.9%) and overall equipment effectiveness (88.5%) through disciplined asset turnaround and logistics management
- Delivered measurable transition outcomes through specialty and low-carbon solutions, including first production of synthetic esters and the launch of Emfinity® Esters, Neptem™ emulsifiers and Viscotech® Upcycled products
- Applied disciplined capital allocation to support resilience and transition, integrating internal carbon pricing (ICP) into investment decisions and directing funding toward priority decarbonisation and growth initiatives
- Achieved zero Scope 1 and 2 emissions at the Echt site, demonstrating the effectiveness of early, site-level decarbonisation actions through renewable electricity adoption and electrification
Alignment to UN SDGs
Innovation & Product Stewardship
Description
PCG's commitment to developing innovative and high-quality products, and services that are safe, transparent and aligned with evolving customer expectations. It includes responsible management of technologies, intellectual property and product lifecycles, while upholding consumer rights, and fostering trust through ethical and sustainable practices.
Impact to PCG
Delivering innovative, customer-centric and compliant products strengthens PCG's competitive advantage, supports customer loyalty, and reinforces long-term business resilience and brand reputation in a rapidly evolving market.
Our Response
- Delivered 30 new specialty chemicals (SC) products in 2025, reinforcing a strong innovation pipeline aligned with regulatory compliance, application performance and sustainability requirements
- Advanced low-emissions solutions through product innovation, including Neptem™ emulsifiers enabling waterborne alkyd coatings with reduced volatile organic compounds (VOCs) emissions, aligning with stricter environmental regulations without compromising performance
- Expanded sustainability-aligned specialty portfolio, including engineered synthetic esters for transformer fluids and low-carbon viscosity modifiers, addressing regulated infrastructure needs and supporting energy transition objectives
- Strengthened responsible product stewardship and sourcing, through lifecycle-based product design, ISCC PLUS-certified Pro-Environment solutions, verified product carbon footprints and enhanced regulatory transparency across key markets
Alignment to UN SDGs
Circular Economy
Description
PCG's approach to support the transition towards a circular economy model, creating opportunities for developing sustainable circular products, plastic waste management and responsible materials management.
Impact to PCG
Strengthening PCG’s leadership in sustainable materials reduces waste-related costs, unlocks new revenue opportunities through circular products and enhanced resilience to tightening regulations and evolving market expectations.
Our Response
- Expanded circular and Pro-Environment product offerings, including Neptem™ emulsifiers, Viscotech® Upcycled and Emfinity® Esters, enabling lower-VOC, recycled-content and bio- based solutions that reduce lifecycle emissions while maintaining performance
- Advanced plastics circularity readiness through structured feedstock testing and technology screening, strengthening pathways for advanced recycling and scalable circular production
- Embedded circular practices across operations, strengthening waste segregation, recovery infrastructure and pellet-loss prevention through renewed Operation Clean Sweep® commitment
- Scaled circular awareness and engagement, reaching over 100,000 students across 102 schools via the PCG Be Green programme and delivering tangible recovery outcomes through community-based Clean-Up and Waste2Value initiatives
Alignment to UN SDGs
Supply Chain Management
Description
Covers the policies and practices for procurement, supplier and contractor management, and materials handling to support a sustainable and resilient supply chain. It includes responsible sourcing, managing environmental impacts such as GHG emissions, addressing human rights and socio-economic risks, and considering geopolitical factors that may affect supply continuity.
Impact to PCG
Embedding sustainability into procurement decisions strengthens value-chain reliability, reduces operational risks and enhances supplier performance and supports business continuity, regulatory compliance and long-term competitiveness across PCG’s operations.
Our Response
- Strengthened supplier risk governance through comprehensive Third Party Risk Management (TPRM) screening across suppliers, vendors and joint ventures, supported by enhanced due diligence, contract-level controls and mitigation actions
- Embedded human rights and ethical sourcing requirements into procurement processes under the PETRONAS Human Rights Policy, PETRONAS Code of Conduct and Business Ethics (CoBE), PETRONAS Anti-Bribery and Corruption Manual (ABC Manual), and PETRONAS Contractors' Code of Conduct on Human Rights (CoCHR), reinforcing labour, safety and integrity standards
- Strengthened contractor engagement and safe operations by delivering 12 FELT Leadership sessions for term and spot service providers, reinforcing safe and sustainable working practices throughout the logistics value chain
- Supported broader supply chain resilience, and small and medium enterprise (SME) development through vendor development programmes and ESG-focused engagement initiatives, enhancing supplier readiness, compliance and long-term competitiveness
Alignment to UN SDGs
Cybersecurity & Digitalisation
Description
The use of digital technologies to unlock new business models, improve operational efficiency and resilience, and protect data from cyber-attacks and breaches, while enabling value creation and strengthening stakeholder trust across global operations.
Impact to PCG
Robust digital infrastructure and cybersecurity standards support business continuity, regulatory compliance and long-term competitiveness while protecting PCG’s reputation, minimising cyber risks and preventing financial losses.
Our Response
- Maintained strong cyber resilience across operations, with zero high or very high severity cyber incidents, zero business-critical system downtime and no substantiated breaches of customer data or privacy during the year
- Strengthened governance and risk oversight through the PETRONAS Enterprise Cyber Security Governance Framework (ECSGF) across IT and operational technology (OT) environments monitored via defined Key Performance Indicators (KPIs) integrated into the Corporate Risk Profile
- Building a cyber-aware workforce, achieving 99% employee pass rates in cybersecurity assessments, 92% completion of mandatory training modules and reducing phishing test failure rates to 1.4%, continuing a downward trend
- Continued to enhance digital security and operational efficiency through initiatives including Secure-by-Design architecture, cybersecurity risk assessments for new systems, cyber insurance coverage and the deployment of advanced digital tools
UN SDGs
Safety & Health
Description
Policies and practices that foster a culture of safety, compliance and continuous improvement to create as well as sustain a safe and healthy environment for employees and the broader public. This includes measures to address occupational risks, transportation safety, emergency preparedness and proactive hazard identification across all global operations.
Impact to PCG
Maintaining a safe and healthy workplace reduces regulatory, legal and reputational risks, improves morale and productivity, operational disruptions and minimises incident-related costs. A strong safety culture supports business continuity and stakeholder trust.
Our Response
- Strengthened Generative Health, Safety and Environment (HSE) Culture and leadership accountability, with 240 FELT Leadership engagements conducted by the MD/CEO and Heads of Plants, reinforcing frontline visibility, early intervention and shared ownership of safety across Operating Units (OPUs)
- Enhanced process safety discipline and incident prevention, through implementation of the 8 Golden Rules of Process Safety, supported by targeted communications, cross-learning sessions and Safety Pauses
- Improved consistency and compliance across operations via the refreshed HSE Framework and standardised assurance processes, including completion of Occupational Safety and Health Administration (OSHA) 2022 gap assessments
- Digitalised safety management and assurance, with continued rollout of ePTW+2.0 across manufacturing sites, delivering faster permit processing, improved documentation accuracy and enhanced oversight of high-risk activities
Alignment to UN SDGs
Talent Management & Well-Being
Description
The policies and practices to create and retain a capable and high performing, diverse and inclusive workforce. This approach supports organisational agility, innovation and business continuity, while ensuring employees feel valued, empowered and equipped to thrive in a rapidly evolving industry.
Impact to PCG
Effective talent management & well-being enhance workforce productivity, strengthen organisational capability, reduce staffing issues and support long-term business success.
Our Response
- Strengthened workforce effectiveness and leadership alignment through completion of the business portfolio review, clarifying roles, decision rights and capability priorities
- Built future-ready talent pipelines via structured internship, graduate and technical programmes, supporting early-career development and workforce sustainability
- Advanced leadership and capability development through PETRONAS leadership programmes, competency-based assessments and targeted sustainability learning to support evolving business and transition needs
- Enhanced employee well-being and engagement through flexible work arrangements, preventive health initiatives, financial support for employees with special needs children, and structured wellness programmes under the Employee Wellness Roadmap
Alignment to UN SDGs
Human Rights
Description
The policies and practices in managing and upholding fundamental human rights within the workplace, supply chain and community, including efforts to assess and address social as well as environmental impacts of projects.
Impact to PCG
Strong human rights practices reinforce PCG's reputation, protect employee morale and productivity, reduce regulatory, legal and operational risks across the value chain. They also support business continuity, build stakeholder trust and contribute to long-term value creation.
Our Response
- Strengthened human rights compliance across operations and supply chains, anchored in the PETRONAS Human Rights Policy and reinforced through mandatory CoCHR self-assessments, Know Your Counterparty (KYC) documentation and ongoing contractor monitoring under Licensing & Registration (L&R) process
- Completed Social Risk Assessments (SRAs) across all Malaysian operating sites, covering labour and working conditions, responsible security, community well-being, and supply chain management, with findings used to prioritise oversight and targeted mitigation
- Maintained accessible grievance mechanisms with timely remediation, ensuring all employee, contractor and community grievances were reviewed, investigated and resolved through structured procedures within defined timeframes
- Advanced human rights awareness and capability, delivering targeted training for employees, grievance handlers and contractors, including Malaysian statutory social security (PERKESO) sessions and dedicated human rights modules
Alignment to UN SDGs
Community Engagement
Description
Stakeholder engagement and programmes conducted to deliver positive social impact to communities in areas we operate or interact with, including efforts that foster community development, support local economies, and encourage philanthropy and volunteering.
Impact to PCG
Community engagement strengthens PCG’s social licence to operate, enhances brand trust and reputation, reduces regulatory, operational and reputational risks, and supports long-term business resilience.
Our Response
- Scaled PCG Be Green, our flagship social impact programme, reaching over 100,000 students across 102 schools nationwide through the PCG Be Green School Competition and PCG Be Green Outreach Programme under Service Learning Malaysia-University for Society (SULAM), strengthening environmental literacy and youth leadership
- Advanced biodiversity conservation and ecosystem restoration outreach, engaging more than 4,000 visitors at the ecocare Environmental Education Centre (EEC) since its 2024 reopening and delivering hands-on learning on biodiversity and conservation with schools and community partners
- Enabled a 25% increase in income at the Kampung Lebai Saman Community Centre, strengthening local economic resilience and community enterprise growth
- Expanded community engagement initiatives, supporting environmental clean-ups, reforestation and education programmes in Thailand, China and India, strengthening local resilience and environmental stewardship near operating sites
Alignment to UN SDGs
STRENGTHENING ETHICS & INTEGRITY
Corporate Governance
Description
Business policies and practices to ensure ethical, transparent and responsible governance, including oversight of corporate conduct, regulatory compliance and accountability in financial and non-financial matters.
Impact to PCG
Embedding strong governance protects stakeholder interests, strengthens market confidence, mitigates risks and drives long-term value creation while enabling the Board to oversee ESG integration, drive innovation and foster a culture of integrity and ethical conduct across the organisation.
Our Response
- Strengthened Board-level oversight of sustainability, risk and integrity, with 100% of operations assessed for corruption-related risks and governance matters embedded within PCG’s Corporate Risk Profile and Risk Appetite
- Maintained a zero-tolerance stance on bribery and corruption, recording zero confirmed incidents of corruption, anti-competitive behaviour or regulatory breaches
- Comprehensive governance and ethics training coverage, with 100% of Board members and employees trained or informed on anti-corruption
- Enhanced whistleblowing and integrity mechanisms, strengthening transparency, escalation effectiveness and oversight visibility through improved workflows and structured reporting
Alignment to UN SDGs
