Supply Chain Management

Management Approach and Value Creation

Supply Chain Management Approach

The Company integrates sustainable development principles into its supply chain management by incorporating Environmental, Social, and Governance (ESG) considerations, including respect for human rights. This approach enhances the efficiency and quality of sourcing goods and services while supporting long-term sustainable outcomes. Procurement is a key strategic function of the Company. Therefore, the Company has established a Procurement Policy that emphasizes transparency, fairness, and accountability to ensure cost efficiency, sustainable resource utilization, and effective supplier risk management. The Company also promotes anti-corruption practices, business ethics, and responsible business conduct among suppliers, while supporting the development of supplier capabilities to align with sustainability standards throughout the supply chain.

In 2025, the Company strengthened its approach by developing and issuing the “Sustainable Supply Chain Management Manual.” Approved by the Executive Committee, the manual is implemented across all business units, including subsidiaries and affiliated companies, to ensure consistent practices aligned with the Company's sustainability standards. The supply chain management framework consists of the following key processes:

Selection of New Suppliers

Prioritization and Classification of Supplier Groups

Criteria for Classifying Key Suppliers

The Company categorizes, analyzes and prioritizes suppliers based on established criteria, considering 3 main factors: impact on core projects, availability of alternatives and price and quality risks. Suppliers are divided into 4 main groups: Critical Tier 1 Supplier, Tier 1 Supplier, Critical Non-Tier 1 Supplier and Affiliated Company, according to the following criteria:

Supplier Risk Assessment

The Company places strong emphasis on supply chain risk management to mitigate potential impacts on operational costs, business continuity, and corporate reputation arising from factors such as raw material price volatility or non-compliance with applicable laws and standards. To manage these risks effectively, the Company conducts supplier risk assessments at least once every three years, covering 100% of Critical Tier 1 Suppliers. The assessment is carried out using appropriate methodologies, including ESG Self-Assessment Questionnaires, on-site visits or audits, and monitoring information from credible external sources. The assessment results are used to strengthen risk control measures and support continuous supplier development.

Supplier Risk Identification

Sustainability-related risks associated with suppliers are assessed across economic, social, and environmental dimensions for both new and existing suppliers. The assessment covers various supplier categories, including product vendors, contractors and subcontractors, service providers, logistics and transportation providers, as well as EPC contractors and operation and maintenance (O&M) contractors involved in energy and construction projects. The assessment considers the following key risk factors:

Supplier Risk Assessment Criteria

The Company evaluates risks across 2 dimensions: Likelihood and Impact, covering operations, labor, reputation, finance, legal compliance, and environmental compliance. Data from self-assessments, past performance, news, and industry risk trends are mapped onto a Risk Matrix to calculate the risk score (Likelihood x Impact). Risks are categorized into 4 levels: Low, Moderate, High, and Very High. High and Very High-risk suppliers are subject to stringent control measures, while Low and Moderate-risk suppliers are continuously monitored to prevent risk escalation.

Risk Score (Likelihood x Impact)	Risk Level	Action When Identified
Score 1-2	Low Risk	Continuous monitoring to maintain or reduce risk levels.
Score 3-4	Moderate Risk	Continuous monitoring to maintain or reduce risk levels.
Score 5-8	High Risk	Establishment of control measuresto mitigate risks.
Score 9-16	Very High Risk	Establishment of control measures to mitigate risks

In 2025, Critical Tier 1 Suppliers, (both new and existing)

92

suppliers

The assessment results indicated that 41 suppliers were at Low Risk, 6 at Moderate Risk, and 3 at High Risk.

50 suppliers were assessed for risks, representing

54.35%

of all Critical Tier 1 Suppliers

For the suppliers identified as High Risk, the Company collaborated with them to establish control and monitoring measures to appropriately improve and mitigate their risk levels. These actions include implementing a Corrective Action Plan (CAP), closely tracking progress, and conducting follow-up audits within specified timeframes to ensure their operations comply with the Company's requirements and standards.

Supplier Performance Evaluation

The Company requires Critical Tier 1 Suppliers to report environmental, social, and governance (ESG) information as part of the supplier performance evaluation process. The assessment covers material sustainability issues that may affect business operations, including corporate social responsibility, human rights and labor practices, occupational health and safety, environmental management measures, and the provision of environmentally friendly products or services. The information collected is used to monitor supplier performance and provide recommendations to support continuous improvement. All registered suppliers are subject to an annual performance evaluation using established assessment tools, including Evaluation Forms (Vendor and Contractor Evaluation) and the Supplier Sustainability Self-Assessment questionnaire. The evaluation process may also include performance monitoring during project execution and on-site audits, in accordance with the Company's established criteria.

Supplier Performance Evaluation Criteria

The Company requires suppliers to achieve a minimum performance score of 60% (Grade C) under the supplier performance evaluation framework. Suppliers scoring 50–59% (Grade D) are classified as high-risk suppliers and are subject to additional risk assessment, which may include further evaluation and on-site audits of their operational facilities. If a supplier receives a Grade D rating for two consecutive evaluation cycles, the Company may consider removing the supplier from the Approved Vendor List (AVL).

Existing suppliers assessed on ESG performance

43.25%

327 Suppliers

The supplier performance evaluation process is conducted in parallel with monitoring compliance with the Supplier Code of Conduct. Evaluation results are communicated to suppliers to support operational improvements and to jointly develop supplier capacity-building or improvement plans, thereby promoting responsible and sustainable business practices throughout the supply chain. In 2025, the Company conducted ESG-based supplier performance evaluations for 43.25% of suppliers within the assessment scope, with the majority of suppliers achieving "Good" or "Excellent" performance ratings.

Supplier On-site Audit and Visit

Criteria for On-site Audits and Visits

The Company conducts supplier on-site audits at least once per year for Critical Tier 1 Suppliers that are newly engaged, classified as high or very high risk, or have received a "Needs Improvement" performance rating (Grade D) in the supplier performance evaluation. Audits are conducted by an audit team comprising representatives from the procurement function and specialists in safety, labor regulations, and sustainability. The audits may be carried out either through physical site visits or via online audit platforms, depending on the circumstances. The assessment covers economic, social, and environmental issues that are material to the supplier's business operations. Following the audit, suppliers are required to develop a Corrective Action Plan (CAP) within a specified timeframe, and the Company monitors the implementation progress accordingly. If suppliers fail to implement the required corrective actions, the Company may temporarily suspend procurement or business engagement with the supplier.

Based on the 2025 supplier risk assessment, three suppliers were identified as high-risk

3

suppliers

The Company conducted on-site audits for these suppliers and closely monitored their improvement progress through continuous communication and follow-up information requests.

Critical Tier 1 Suppliers Assessed On-site

In addition, the Company maintains ongoing supplier monitoring through media and information reviews, document assessments, and random inspections when potential risk signals or non-compliance indicators are identified. During the reporting year, no significant cases of non-compliance with social or environmental requirements were identified among the suppliers assessed.