Message From CEO
The natural rubber market in 2024 has seen significant volatility, with supply constraints due to climate change, fluctuating demand and supply shaping the natural rubber landscape. As CEO, I'm steering our company through these challenges while maintaining our commitment to robust sustainable practices. We're taking important measures in regards to reducing our carbon footprint, fostering inclusion, and maintaining transparency in our supply chains.
The 2022 acquisition of Halcyon Agri Group, Teck Bee Hang's (TBH) parent company, by Hainan Rubber Group signifies a pivotal shift in our company's environmental, social, and governance (ESG) practices. This strategic move, which occurred two years ago, has positioned us to better navigate the challenges facing the rubber industry in 2024. The current year has proven particularly difficult for the sector, with volatile natural rubber commodity prices and widespread supply chain disruptions impacting numerous market participants.
As a 70-year pioneer in the rubber industry and a subsidiary of Halcyon Agri Corp., the largest rubber group company, we prioritize integrating ESG sustainability principles throughout our entire value chain. This approach is fundamental to creating positive impacts for our business and stakeholders alike.
LEE KENG SENG
Chief Executive Officer
Regarding environmental matters, TBH plans to join the Science Based Target Initiative (SBTi) in 2025, advancing our ongoing commitment to certified greenhouse gas reduction targets. We have already completed solar rooftop installations at two factories and aim to extend this project across all our facilities. Additionally, we're installing a biomass furnace in one of our factories, transitioning from LPG to the more sustainable Palm Kernel Shells as a fuel source. These initiatives collectively support our transition to a low-carbon economy.
On the social front, by the end of 2024, we aim to have all our factories certified by the Thai Ministry of Labor under the Good Labor Practice Standard. While we are progressing toward this goal, we continue to implement 5S, Kaizen, and Quality Control Cycle initiatives to enhance our staff's skills and know-how. This year, we were honored with the 'Gold Medal' in the Kaizen National Award by the Technology Promotion Association (Thai-Japanese). Furthermore, the Department of Industrial Works has accredited all our factories with CSR-DIW, recognizing our commitment to exemplary social responsibility practices.
On the governance front, we've highlighted our commitment to transparency, legal compliance, and best practices in managing TBH by earning the Good Governance Standard certification from the Thailand Ministry of Commerce. This certification demonstrates our dedication to high governance standards. We're also working with Rubberway, a tool that helps map risks in the natural rubber supply chain. This partnership allows us to identify sustainability issues early and develop effective solutions to address any potential problems
Most importantly, we're preparing for the EU Deforestation Regulation (EUDR) set to take effect in 2025. This regulation will significantly impact our industry, requiring due diligence to ensure our natural rubber products comes from deforestation-free sources. We're proactively adapting our supply chains and traceability systems to comply with EUDR requirements, seeing this as an opportunity to lead in sustainable practices and meet evolving consumer and regulatory demands.
Our proactive approach in identifying ESG opportunities, including EUDR readiness, positions us for positive stakeholder impact despite market uncertainties.
Our commitment to responsible business practices has earned us a Gold Medal in EcoVadis' ESG rating, highlighting our dedication to environmental, social, and governance excellence. We're constantly pushing to enhance our sustainability impact, leveraging feedback from rigorous third-party audits like EcoVadis and Forest Stewardship Council (FSC) . This approach helps us benchmark against global standards, identify growth areas, and implement cutting-edge practices. By staying proactive and adaptable, we're ensuring our sustainability efforts continually evolve and lead the way in the natural rubber industry.
