Golden Agri Resources : INTERACTIVE SR2023

SUSTAINABILITY REPORT 2023

GOLDEN AGRI-RESOURCES LTD

Performance Update

Environmental Management

Climate Change

Supply Chain

Customer

Community

Our People

TABLE OF

CONTENTS

3 About this Report

4 Chairman's Statement

7 Performance Update

11 About GAR

15 Our Approach to Sustainability

22 Materiality

26 Stakeholder Engagement

27

42

50

61

66

76

84

88

93

94

Environmental Management

Climate Change

Transforming Our Supply Chain

Our Customers

GAR in The Community

Our People

GAR and The UN SDGs

Assurance Statement

Glossary

Feedback and Contact

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ABOUT

THIS REPORT

The Sustainability Report 2023 provides an account of our progress and challenges in managing our most critical sustainability topics in FY2023.

Customer

Community

Our People

The reporting scope is global. We have prepared this report in accordance with Global Reporting Initiative (GRI) Standards and the relevant sector standards for Agriculture, Aquaculture and Fishing. GAR has used the GRI reporting framework since we began reporting on our ESG performance in 2011 and continue to use it as it is the most widely-used reporting framework globally. The full GRI content index can be found on the GAR website.

The report also contains disclosures recommended in the Agricultural Products Sustainability Accounting Standard (Industry Standard, Version 2018-10) that was developed by the Sustainability Accounting Standards Board (SASB). The SASB disclosure index can be found on our website.

We are reporting on climate-related disclosures based on Task Force for Climate-related Financial Dislcoures (TCFD) recommendations.

We are proud to present photos taken by our employees throughout this report. These range from shots of estates, operations, local communities and the diverse flora and fauna found in our areas.

ASSURANCE

We have engaged PricewaterhouseCoopers LLP to undertake a Limited Assurance on selected sustainability information. Other information related to our material topics including High Carbon Stock (HCS), High Conservation Value (HCV) and Free, Prior and Informed Consent (FPIC) is reviewed by certification bodies such as the Roundtable on Sustainable Palm Oil (RSPO). Our NDPE IRF data is also undergoing verification by Control Union. The data for this report has also been reviewed internally.

Performance Update

Environmental Management

Climate Change

Supply Chain

Customer

Community

Our People

CHAIRMAN'S

STATEMENT

Dear stakeholders, employees and partners,

Following a remarkable year in 2022, we demonstrated our resilience and delivered solid results in FY2023. This performance is a testament to our ability to navigate the complexities of our industry, including challenges such as crude palm oil (CPO) price fluctuations, unpredictable weather conditions, a dynamic geopolitical environment, and the backdrop of a slowing global economy. Our strategic focus on margin optimisation across the value chain has been instrumental in our success, fortifying our cash flow resilience and maintaining a robust balance sheet.

Normalised palm oil prices and reduced output impacted the plantation business performance. Despite these challenges, the business secured a healthy EBITDA margin of 24 percent or US$478 million in FY2023. Our plantations produced 2.94 million tonnes

"We recognise that action on climate change is not just a necessity but critical to our business and industry's future. GAR is committed to achieving net zero by 2050 and has pledged to pursue a pathway limiting global warming to 1.5 degrees Celsius."

of palm product output, a slight decline attributable to the reduced mature area from our replanting activities and the high rainfall experienced in the early part of the year. Nevertheless, palm product yield reached 5.3 tonnes per hectare, which is amongst the industry's highest. To sustain plantation production growth, we will continue rejuvenating our plantations by replanting with newer generation, high-yielding planting materials.

Leveraging scale and technological advancements in Precision Agriculture remain integral to GAR's long-term strategy.

Downstream operations sustained robust performance, contributing significantly to consolidated EBITDA. Benefitting from integrated processing facilities, global distribution capabilities, a broad diversified product portfolio, and a large customer base, the business expanded sales volume, reaching over 100 countries. Achieving a solid EBITDA margin of 5.3 percent or US$507 million, GAR's downstream segment underscores its resilience and adaptability to evolving market conditions.

FRANKY OESMAN WIDJAJA

Chairman and Chief Executive Officer

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CONTINUOUS IMPROVEMENT

IN SUSTAINABILITY

Customer

Community

Our People

We are focusing our sustainability efforts on three core areas: addressing climate change risk, supporting a sustainable palm oil sector through traceability and capacity building, and supporting community economic development.

In pursuit of continuous improvement, we have joined the World Business Council for Sustainable Development (WBCSD), a global network of 200 businesses committed to transitioning to a more sustainable world. This will allow us to learn from best practices as well as share our perspective as an Asian-basedagri-business.

GAR will contribute to the Agriculture & Food Pathway, aiming to enhance collaboration across the sector and support the Equitable Livelihoods workstream. GAR aims to support the creation of thriving and resilient agriculture and food systems that promote equitable livelihoods for all workers, placing farmers' prosperity at the heart of food systems.

We recognise that action on climate change is not just a necessity but critical to our business and industry's future. GAR is committed to achieving net zero by 2050 and has pledged to pursue a pathway limiting global warming to

1.5 degrees Celsius. This goal requires significantly reduced

GHG emissions from our operations and Scope 3 emissions in our value chain.

GAR has taken a proactive stance in endorsing the Agriculture Sector Roadmap to 1.5C during COP27. This roadmap is a strategic tool designed to accelerate ongoing efforts within the agricultural commodity sector to combat deforestation. In line with the roadmap, all our palm oil production volumes are on track to meet the criteria of the "Delivering" category of the NDPE Implementation Reporting Framework by 2025.

We are finalising our decarbonisation strategy and roadmap for all entities in which GAR has equity of 50 percent or above. We aim to complete this by mid-2024. As part of our efforts, GAR has also mapped our carbon emissions footprint across Scopes 1, 2 and 3.

I am proud to report that GAR has achieved 99 percent Traceability to the Plantation (TTP) for our palm supply chain in Indonesia and expects to complete 100 percent TTP in 2024. Through rigorous efforts and investment in technology, we have successfully mapped our entire palm supply chain in Indonesia. We have also started the traceability process for our global supply chain for palm and non-palm products. We will use the considerable experience we have gained in supplier support and engagement to ensure that all our suppliers are aligned with our sustainability commitments. This achievement is fundamental to GAR's ability to offer responsibly sourced products to our customers. It also positions GAR to be well-placed to respond to incoming destination market regulations such as the European Union Deforestation Free Regulation or EUDR.

Despite the heightened fire risk during an El Niño year, our proactive measures and stringent fire prevention strategies have limited the impact of fires on GAR's operations. We know that communities around us need support in tackling and preventing fires, and we continue to expand our long-term collaboration with them through the Desa Makmur Peduli Api programme. Currently, 117 villages are enrolled in the programme, which trains local communities to prevent and suppress fires and educate them on the hazards of fire and haze.

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Performance Update

Environmental Management

Climate Change

Supply Chain

Customer

Community

Our People

The Bright Future Initiative, aimed at supporting local communities' economic development, continues to make a positive impact, focusing on livelihood improvement and community enterprise development. We have set up more than 160 projects in over 100 villages across our operations in Indonesia. These include organic vegetable, livestock and cash crop farming. We are also helping to upskill local communities and enabling them to market value-added products derived from the projects to boost their incomes. This also helps build local community resilience by offering them greater economic diversification and opportunities.

These achievements highlight our commitment to sustainability, responsible business practices, and community engagement. The expectations of agribusiness to operate sustainably and responsibly are ever-changing and evolving, moving from voluntary standards to regulatory requirements. GAR's long-standing sustainability commitments and investments have prepared us well for these changes.

Our continuing efforts also support the UN Sustainable Development Goals, particularly goals related to Zero Hunger (SDG2), Responsible Consumption and Production (SDG12), protection of Life on Land (SDG15) and Partnerships for the Goals (SDG17).

LOOKING AHEAD WITH CONFIDENCE

As we move forward, technology and sustainability serve as our cornerstones in our quest for excellence. We recognise the imperative to harness the transformative forces of technology to drive efficiency, foster innovation, and propel us into new realms of growth. Moreover, sustainability is not merely a green choice; it represents a strategic investment in our future, enhancing our market position and ensuring long-term profitability. At GAR, we believe we can do well and do good. Our journey towards a sustainable future is continuous, and we are grateful for the support of our shareholders, employees, and partners in this shared endeavour.

• The expectations of agribusiness to operate sustainably and responsibly are ever- changing and evolving, moving from voluntary standards to regulatory requirements. GAR's longstanding sustainability commitments and investments have prepared us well for these changes. "

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PERFORMANCE

UPDATE 2023

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Performance Update Environmental Management Climate Change Supply Chain Customer Community Our People

Contributing to UN SDGs:		COMPLETED AND	NEEDS WORK	ON TRACK
		MONITORING
NDPE/GSEP commitments	2023 highlights	Future targets		Status
ENVIRONMENTAL MANAGEMENT

No development of and conservation of High Carbon Stock (HCS) forests and High Conservation Value (HCV) areas

HCS/HCV conservation:	• Continue to maintain conservation areas
• 79,900 ha in GAR concessions	• Continue encouraging and supporting suppliers in their
• >100,000 ha by GAR suppliers	conservation efforts
Riparian zone and mangrove swamp:	Explore and expand mangrove swamp conservation in
• ±3100 ha riparian buffer zone maintained	partnership with customers or other stakeholders
• ±290 ha mangrove swamp conserved

Maintained no development and	Continue no development and conservation of peat
conservation of peat

No development and conservation of peatlands

Peatland rehabilitation:	•	Aim to complete current phase of peat rehabilitation in
Revegetated >1,600 ha of degraded peatland		West Kalimantan by 2025
in West Kalimantan and Jambi	•	Aim to complete initial rehabilitation of peat area in Jambi of
		750 ha by 2027

No burning

Zero Burning Policy:

• Limited impact from fires
• 117 villages enrolled in fire prevention programme, Desa Makmur Peduli Api

Continue to implement and strengthen fire prevention efforts

Continuous yield improvement

Yield improvement:

Continue cloning programme

1.75 million clones of super high-yielding Eka 1 & Eka 2 produced

Climate change adaptation & mitigation:	Continue R&D to maintain/improve
Continued research into climate change resilient	yields in face of climate change
seed stock

Report & reduce GHG emissions

Reported Scope 1, Scope 2 and Scope 3 emissions for GAR global operations

• Finalise GHG reduction strategy
• Implement Agriculture Sector Roadmap to 1.5C
• Continue implementing TCFD reporting and prepare for ISSB reporting

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		COMPLETED AND	NEEDS WORK	ON TRACK
		MONITORING
NDPE/GSEP commitments	2023 highlights	Future targets		Status
SOCIAL AND COMMUNIT Y ENGAGEMENT

Respecting the right to Free, Prior and Informed Consent and recognising the need for food security in new developments

Participatory Mapping in 199 villages to date

Continue to implement FPIC

Positive economic, social and community development

Annual economic and community	Continue to implement annual
programmes carried out (see p 69)	programmes

Empowering people through community development programmes

•	103 Bright Future Initiative projects to boost income and	Continue to implement Bright Future
	community resilience	Initiative Projects and MSMEs
•	58 Micro, Small and Medium Enterprises (MSMEs)

WORK ENVIRONMENT & INDUSTRIAL REL ATIONS

Recognising, respecting and strengthening the rights of all our workers

Responsible Employment:	Continue to practise responsible employment
• No incidents of child or forced labour	practices and respect workers' rights

• No incidents of harassment or abuse
• All employees paid wages equal to or above legal minimum wage

Freedom of association:

85,625 employees (87%) represented by 191 labour unions and covered by CBAs

Women, diversity and inclusion:

• No incidents of discrimination or harassment

• Maintained an average female to male salary ratio of 1:1.04

Employee health & safety:	Enhance implementation of OHS and
3 fatalities	continue to aim for zero fatalities

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Performance Update Environmental Management Climate Change Supply Chain Customer Community Our People

Contributing to UN SDGs:		COMPLETED AND	NEEDS WORK	ON TRACK
		MONITORING
NDPE/GSEP commitments	2023 highlights	Future targets		Status
MARKETPL ACE & SUPPLY CHAIN

Traceable and transparent supply chains

•	99% Traceability to the Plantation	• Achieve 100% TTP
	(Indonesian palm supply chain)	•	Maintain 100% TTM
•	100% Traceability to the Mill	•	Map non-palm commodities
	(global palm supply chain)		supply chain

Support to suppliers

• 19 training sessions for nearly 650 participants	• Continue engagement and
• 11 human rights workshops for over 310 participants	training for suppliers
from 408 suppliers in 2023	• Continue Sawit Terampil
• Sawit Terampil programme: >7,000 smallholders in	programme
Aceh and North Sumatera upskilled & 270 smallholders
obtained RSPO certification

Due diligence and grievance procedures

• Closed 8 grievances

Continue to asasess suppliers annually

• Assessed all existing suppliers and new suppliers against GAR NDPE commitments (see p 56)

Compliance with all relevant national laws and international certifications' principles and criteria

Assessed suppliers through NDPE IRF and	Achieve 100% NDPE IRF
annual internal supplier assessment (see p 56)	"Delivering" by 2025

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