05/09/2022

To our stakeholders:

I am pleased to confirm that Nutrition Technologies reaffirms its support of the Ten Principles of the United Nations Global Compact in the areas of Human Rights, Labour, Environment and Anti-Corruption.

In this annual Communication on Progress, we describe our actions to continually improve the integration of the Global Compact and its principles into our business strategy, culture and daily operations. We also commit to share this information with our stakeholders using our primary channels of communication.

Sincerely yours,

Thomas Berry
Co-CEO

Nutrition Technologies acknowledges the corporate responsibility to respect human rights. Nutrition Technologies is committed to continuously comply with international and local applicable laws and regulations pertaining to human rights.

We respect internationally recognized human rights as expressed in the International Bill of Human Rights, consisting of the Universal Declaration on Human Rights and UN Global Compact principles for Human Rights.

Our efforts are to ensure the business is supporting and protecting human rights while not engaging or involving with others in unlawful and morally wrong activities. We have taken efforts to draft, review and revise the Employee Handbooks for Malaysia and Singapore, as well as the company recruitment and training procedures which covers the following topics related to human rights:
- Fair employment practises,
- Diversity & equal opportunity
- Grievance handling
- Environment, Safe & healthy workplace
- No forced or child labour
- Harassment free & anti bullying
- Personal & professional development
- Misconduct handling and disciplinary procedures
- Alcohol, substance abuse and sexual harrassment

i.) The employee handbook was briefed and communicated to all levels of employees in the organization.
ii.) The recruitment and training procedures had been registered as part of the Good Manufacturing Practices (GMP) under Feed Safety Management System (FSMS).
iii.) Employee Engagement Survey will be conducted in October to gauge employee satisfaction and gather feedback for continuous improvement.
iv.) Monthly deep dive in Leadership Meeting on employee turnovers and manpower related issues.
v.) Training and briefing on misconduct handling & counseling for HR personnel, managers and supervisors.

Efforts and initiatives will be taken in the next 12 months to maintain and improve the following related to the progress and adherence to human rights principles:
- Gather feedback from employees, staff and stakeholders of the company through meetings, engagement surveys and other active communication channels.
Implement a Whistle Blowing mechanism for all Nutrition Technologies subsidiaries and locations.
- Actively participate, comply and improve on internal & external audits for training and recruitment procedures. (target to achieve nil non-compliance report).
- Draft and implement Sexual Harrassment Policy as per the guidelines set by the Labour Department of Malaysia.
- Actively focus on achieving employee training and personal development targets based on annual training needs analysis and approved annual training plan.
- Draft, implement and widely communicate the HR General Policy with specific coverage in Human Rights and Labour principles.
- Implementation of pre-employment medical check up and annual medical check up as to ensure employee health and prevention of drug, alcohol & illegal substance abuse.

Nutrition Technologies acknowledges the corporate responsibility to meet Labour principles. Nutrition Technologies is committed to continuously comply with international and local applicable laws and regulations pertaining to Labour principles.

Nutrition Technologies also respects the principles and rights set out in the International Labour Organisation Core Conventions and the UN Global Compact Principles related to Labour.

In the pursuit of our commitment to meet the Labour principles. Nutrition Technologies has embarked to encourage and uphold open, transparent and mutually respected communications across the organization, eliminate all forms of forced & child labour as well as uphold a work environment free from discrimination of employment and occupation. The following efforts has been implemented:
- Systematic and effective new hire induction program to familiarize with company policies, core values, organization structure, quality, health, safety & environment, work flows etc.
- Clearly described compensation & benefits in the Employee Handbook.
- Clear performance management policy and employee appraisal process which drives the rewards and development needs.
- Job descriptions (JD) available for all positions and levels in the organization specifying knowledge, skills and abilities of the position. Personnel requirements specified in the JD do not include any discriminative elements.
- Maintain demographic data of employees and strive to ensure there is diversity and balance in aspects of age, gender, nationality and cultural orientation.
- Implemented Business Travel, Entertainment and Expense policy which provides a clear, fair and transparent guidance for all employees traveling on company related business.

Efforts and initiatives will be taken in the next 12 months to improve the following related to the progress and adherence to Labour principles:

- Seek continuous feedback from the Leadership team and other internal & external sources.
- Review the Malaysia Employee Handbook with aspects to amendments to Employment Act 1955.
- Include a specific clause related to the importance of freedom of association and collective bargaining in the Employee Handbook.
- Adhere and implement Act 26 for foreign workers hostels and welfare requirements if employing migrant labor.
- To continuously work on relevant policies and guidelines for the HR department (NT Internship Guidelines, International Mobility Policy, Equal Employment Opportunity etc.).

At Nutrition Technologies, we believe that environmental sustainability management is our core responsibility to conserve our planet's natural resources and to protect our ecosystems in order to ensure a viable sustainable healthy well-being and needs of our future generations. Essentially, our primary focus areas are environmental protection, economic and social development. To achieve these goals, we are committed to the principle of sustainable development through the implementation of our Environmental Management Policy (EMP) coupled with Quality, Health, Safety, and Environment (QHSE) standards, Good Manufacturing Practice (GMP) and Hazard Analysis Critical Control Points (HACCP) systems throughout our operations, subsidiaries and supply chain providers towards minimizing the impacts of our operations at a global scale.

First and foremost, our corporate philosophy is the key fundamental guiding and overarching principle that embraces the following virtues:
(a) Vision - To create a world that sustainably feeds itself through a circular economy.
(b) Mission - To mass produce high-quality, affordable insect products and pioneer new biotechnologies that enable a more sustainable agricultural sector.
(c) Core Values - Quality, Sustainability and safety, Integrity, Teamwork and collaboration, Innovation.

Operating in tandem with our corporate philosophy is our Environmental Management Policy (EMP) which is the governance to fulfill our primary objectives, comprising the followings:
(i) compliance with relevant legislation, regulations and standards for environmental protection as set by local and international authority.
(ii) review the environmental impact of our activities so as to mitigate environmental impact while preventing unnecessary waste by leveraging on advanced technologies.
(iii) equip our staff with effective working knowledge and deep skill sets through relevant training programs to cultivate environmental awareness culture and responsible mindset.
(iv) inculcate sustainable and continuous improvement activities in environmental performance by incorporating appropriate measurement indices and effective monitoring mechanisms to verify and validate actual, realizable and actionable outcomes.
(v) perform and maintain proper documentation including provisional licenses in competencies in schedule risk management and scrubber management.

We have successfully developed and implemented various specific solutions in our operations and processes to address and respond in an effective and targeted manner as follow:

(a) Intelligent air and ventilation system with real time monitoring, IoT data analytics capabilities and emission cleaning, that provides consistently fresh, clean and high quality air reliably throughout our entire production, storage facilities, laboratories, offices and new expansions to ensure and achieve a safe, healthy, comfortable and conducive work environment to maximize and leverage the full potential of our human capital resource’s capabilities, innovation, creativity and productivity. And also, optimizing the effective useful operational life of our production equipment investments while maintaining consistent quality assurance instrumentation performance exceeding all international standards compliances.

(b) Utility consumption monitoring that enables us to execute cost and emission saving initiatives

(c) Ongoing upgrading of the current batch wastewater recycling system to a continuous water recycling treatment system This will help improve our water quality and achieve energy efficient cycle utilization performance.

(d) Real time monitoring of our production system to quantify and qualify the performance of our production outputs attributes with direct correlation to all environmental factors, feed constituents and characterization of their interplay dynamics. This AI driven platform facilitates our R&D to achieve new scientific discoveries and frontier cutting edge technology breakthroughs in an unprecedented manner.

On the public engagement front, we resolve to communicate and disseminate clear, concise, precise and scientific evidence-based knowledge and information on our environment continuous improvements, impacts, achievements, new innovative product developments and services through diverse green initiatives programs and activities with public schools, general public and various government authorities towards a better built environment.

We will continually endeavor and strive to incorporate environmental sustainability objectives and industry best practices into plant expansion plans and facilities, conduct assessment of the life cycle impact of our products in relation to environmental risk management. Moving forward, we plan to implement ISO14001:2015 Environmental Management System so as to strategically manage our environmental performance and responsibilities holistically and systematically to achieve environmental sustainability, compliance, increased credibility, risk management, cost reduction and environmental objectives.

In our endless pursuit for environment performance excellence to achieve ultimate company success and maximize realizable potential growth, we shall perform the necessary operational duties rigorously through the implementation of ISO 14001:2015 Environmental Management policy in a progressive and calibrated manner as follow:
(a) gather feedback from the management, stakeholders, staff and suppliers;
(b) evaluate feedback, quantify and qualify performance of system and policies with respect to objective metrics;
(c) develop and implement incident reporting mechanisms for transparency and action plans to mitigate, prevent or eradicate such occurrences;
(d) conduct an independent audit of our Environment Management Policy (EMP); and
(c) revise EMP annually or on a need-basis to continually enhance and improve productivity, efficiency and effectiveness towards achieving environmental excellence and company growth

In general the company assesses its risk of committing bribery & corruption, sanctions and money laundering violations as low, because of the internal procedures already in place, but recognises there is room for improvement.

The company takes criminal activity of any kind, not least bribery, corruption sanctions violations and money laundering, very seriously. Being a relatively young company, we have a centralised decision making and control structure with relatively few external counterparties limiting opportunities for violations. However, as the company grows we recognise the need to put in place adequate controls, training and other procedures, to address the increasing risks that come with expanded operations.

An advantage of being a small company (less than 200 employees) with a centralised structure has been our ability to set an appropriate corporate culture with a clear tone from the top which is laid out in the Employee Handbook.

We have recently updated our Employee Handbook, provided to all staff which directly references:
- Code of Conduct
- Whistleblowing Policy
- Honesty at Work
- Receipt and Giving of Gifts
- Disciplinary Procedures including specific reference to paying or receiving bribes and other illegal or criminal acts

Employees are required to sign to acknowledge receipt and understanding of the terms set out in the Handbook. To ensure these are not merely signatures we will be introducing training as described below to ensure understanding.

Management System:
- All employee expenses claims are reviewed by their line manager;
- All payments outside of petty cash must be approved either by the CEO or CFO who retain control over the bank accounts;
- No clients or suppliers from sanctioned countries, even where exemptions exist, can be taken on without board approval; and
- We hold investor KYC files.

Evaluation & Monitoring:
- The company has a separate Audit Committee at a board level to monitor the company’s compliance;
- As required by statute the company engages a third party audit firm to audit the Financial Statements of the company;
- The management perform a periodic review of policies and procedures for suitability and operational effectiveness.

Implementation
Description of concrete actions to implement anti-corruption policies, address anti-corruption risks and respond to incidents. Suggested topics...
Suggestion box, call center or grievance mechanisms
Awareness raising or training of employees about the company's policies regarding anti-corruption and extortion (e.g. mailings, internet, internal communication, etc.)
Allocation of responsibilities for anti-corruption within the company
Participation in industry initiative or other collective action on anti-corruption

NT ANSWER:
Generally, in Corruption, Bribery, Sanctions and/or Money Laundering violations, something of value moves into or out of the company and so we focus on our interactions with external parties when assessing risk.

Our external counterparty relationships are predominantly suppliers and customers, but also include investors, regulatory government bodies and others.

With respect to policy development we are in the process of updating our (i) Master Supply Agreements, (ii) Supplier Code of Conduct and (iii) Purchase Order Terms to address not only bribery, corruption, sanctions and money laundering but also the wider UN SDGs

Within twelve (12) months we will have a new standalone anti-bribery and corruption policy along with a publically issued compliance statement setting out the company’s position with respect to, not only to suppliers but all external parties. Training will also become mandatory, with courses developed and the first delivery made to relevant staff.

We will also look to implement a new counterparty KYC check, screening suppliers, customers and investors against news reports, sanctions and anti-money laundering lists using existing digital tools.

We consider the above to be achievable in the next twelve (12) months and to represent a significant step up in the company’s anti-bribery and corruption efforts.

Generally, in Corruption, Bribery, Sanctions and/or Money Laundering violations, something of value moves into or out of the company and so we focus on our interactions with external parties when assessing risk.

Our external counterparty relationships are predominantly suppliers and customers, but also include investors, regulatory government bodies and others.

With respect to policy development we are in the process of updating our (i) Master Supply Agreements, (ii) Supplier Code of Conduct and (iii) Purchase Order Terms to address not only bribery, corruption, sanctions and money laundering but also the wider UN SDGs

Within twelve (12) months we will have a new standalone anti-bribery and corruption policy along with a publically issued compliance statement setting out the company’s position with respect to, not only to suppliers but all external parties. Training will also become mandatory, with courses developed and the first delivery made to relevant staff.

We will also look to implement a new counterparty KYC check, screening suppliers, customers and investors against news reports, sanctions and anti-money laundering lists using existing digital tools.

We consider the above to be achievable in the next twelve (12) months and to represent a significant step up in the company’s anti-bribery and corruption efforts.

As we are a young and growing company, we consider success over the next 12 months will include:

- Updated (i) Master Supply Agreements, (ii) Supplier Code of Conduct and (iii) Purchase Order Terms being issued;
- A new standalone anti-bribery and corruption policy being developed and published;
- The implementation of a new counterparty KYC check;
- Introduction of a training program for all relevant staff covering Ethics, Bribery & Corruption, Money Laundering and Sanctions. All management and finance staff will receive two hours of training per year; and
- The issuance of a public position and compliance statement.

We would also like, following the implementation of the KYC management system, to set up a periodic review of KYC files and an alert system to flag any warning signs so we can proactively manage counterparties.