Annual Report 2020

Sustainability Statement SUPPLY CHAIN MANAGEMENT As a digital and lifestyle company, we rely on a number of suppliers to ensure smooth operations. Given the important role our suppliers play, we believe in treating them fairly and equitably. At the same time, we expect our suppliers to maintain the same level of integrity as AirAsia. Our supplier selection process involves sending out Requests for Quotation or Requests for Proposal to several suppliers and subsequently assessing them on a level playing field based on their response commercially and contractually. Once engaged, we require our suppliers to adhere to our Supplier Code of Conduct (SCOC) as well as our Environmental Policy Statement and Safety Policy Statement. The SCOC covers the following: • Business Integrity and Conflict of Interest • Labour Practices • Confidentiality and Personal Data Protection • Environmental Health & Safety Management • Social Responsibility • Competitive Pricing & Terms Selected Suppliers are evaluated annually for their performance on the quality, reliability and cost of goods or services provided as well as the application of ESG principles in their operations, in addition to our annual supplier risk assessment. In 2020, we updated the SCOC by including our new Anti-Bribery and Anti-Corruption Policy. We also updated our Group Procurement SOP to include our Supplier Performance Evaluation Policy and Contract Policy. The updated Group Procurement Contract Policy ensures the Group’s legal risks are managed while taking into consideration local policies and regulations. Indicators 2017 2018 2019 2020 No. of local suppliers excluding fuel, aircraft purchase & lessors 2,235 4,999 3,860 1,779 % spend on local suppliers 30.30 34.10 35.10 38.03 Total spend on local suppliers (RM) 572,597,786 663,823,177 622,002,369 572,184,262 110 AIRASIA GROUP BERHAD