PEC : Sustainability Report FY2023

PEC LTD. (PEC) has established itself as a reliable engineering specialist providing Project Works, Maintenance Services, and other related services to the energy, petrochemical, oil, and chemical terminals, and pharmaceutical industries in Asia and the Middle East. With our sizeable pool of skilled labour force, as well as a large fleet of construction equipment, PEC can provide single-source full turnkey engineering, procurement, construction, and maintenance services.

Our reputation for being a reliable and trusted provider of engineering solutions has won over a growing number of customers in the industries we serve, including prominent MNCs. Over the years, these relationships have allowed us to establish a firm foothold in Asia and the Middle East, where we continue to expand our presence.

One of PEC's core businesses is project works, under which we provide engineering, procurement

• construction (EPC), EPC project management and project management consultancy services. Providing plant maintenance services, including plant turnarounds, and upgrading, makes up our other core business, where we offer customers all the advantages of a 'one-stop' service.

With our established processes and methodologies, PEC aims to be the engineering specialist of choice for customers. To better meet client needs, we are constantly enhancing and deepening our capabilities to broaden our outreach.

Our headquarter is situated in Singapore and our international network spans across Asia (China, India, Malaysia, Myanmar, Singapore, Thailand, and Vietnam) and the Middle East (Oman and UAE). PEC has been serving diverse needs of its local and international customers via its subsidiaries. The Group comprises PEC Ltd, and its local and overseas subsidiaries as illustrated in the Organisation Chart below.

At PEC, we pride ourselves on our deep commitment to doing things right, the first time, every time. We have received numerous awards in recognition of our operating excellence, the enterprising spirit of our experienced management team, as well as our innovative use of technology to enhance our business. Moreover, we place a strong emphasis on staff learning and development and are committed to the most rigorous safety, health, and environment and quality standards.

We believe that the fact that some of our customers have been with us since our inception attests to our ability to deliver on time and perform to the exacting standards of our customers. We will continue to build on our strengths and our established reputation to achieve our vision of becoming a leading service provider and preferred business partner.

About this Report

PEC is focused on growing the business on a sustainable basis and the reporting promotes transparency, helping decision makers make informed decisions. PEC is proud to present the sixth annual sustainability report which presents the key aspects of our Environmental, Social and Governance (ESG) strategies and policies and the approach in integrating sustainability into them. Through this report, PEC hopes to share its commitment towards sustainability and build stronger relationships with its stakeholders and the community.

Scope of the Report

[GRI 2-3a] - Reporting period, frequency, and contact point.

[GRI 2-2a] - Entities included in the organization's sustainability reporting.

This report covers our sustainability performance of the financial year 2023, from 1 July 2022 to 30 June 2023 for the Group operating in Asia (China, India, Malaysia, Myanmar, Singapore, Thailand, and Vietnam) and the Middle East (Oman and United Arab Emirates) unless otherwise stated. There was no significant change to the Group's size, structure, ownership, or supply chain during the reporting period. This report contains no restatement.

Confirmation and Approval

[GRI 2-3c] - report the publication date of the report or reported information.

The sustainability performance data presented in this report has been obtained from the formal documents and operational statistics of PEC Group. The sustainability report has received endorsement from the Board of Directors on 29 August of

2023 and was published on 12 October 2023.

Report Assurance and Review

[GRI 2-5] - External assurance

In line with the requirements outlined in SGX Practice Note 7.6 Sustainability Reporting Guide, an internal audit of the sustainability reporting process has been introduced at PEC. This internal audit function is built on the Group's existing governance structure, internal controls, and risk management systems to ensure the accuracy and reliability of the ESG data disclosed in this report.

Our external assurance statement can be found on pages 37 to 39 of the report. This external assurance was conducted in accordance with AA1000 Assurance standards.

Reporting Framework

This report has been prepared in accordance with the Singapore Exchange Securities Trading Limited's (SGX-ST) Listing Manual Rules 711A and 711B. It has also been developed while referencing the six primary components stated in SGX-ST Listing Rule 711B on the "comply or explain" basis, which includes - 1. Material ESG factors, 2. Climate-related Disclosures consistent with the recommendations of TCFD, 3. Policies, Practices and Performance, 4. Targets, 5. Sustainability Reporting Framework and 6. Board Statement and associated governance structure for sustainability practices.

The Global Reporting Initiative (GRI) Standards

2021 have been selected as it is an internationally recognised reporting framework that covers a comprehensive range of sustainability disclosures that is relevant to the energy sector.

Feedback

[GRI 2-3d] - Contact point for questions about the report or reported information.

We value all feedback from stakeholders as they are crucial to the sustainability reporting process and long- term success of PEC. If you have any feedback and questions about this report, please contact us at

Address:

14 International Business Park, Singapore 609922 Email: ir@peceng.com

Tel: +65 6268 9788

Fax: +65 6268 9488

Anti-Corruption & Compliance

Maintain zero incidents of corruption and non-compliance in our organisation

Zero incidents of corruption or non-compliance

To have a zero- tolerance approach to bribery and corruption as per the applicable laws and regulations and ensure policy

of anti-corruption is applied by all our stakeholders to conduct our work in an honest and ethical manner.

Economic Performance

Achieved 86.34% of our total procurement spend on local suppliers with a total value of $76 mil

Achieved 84.31% of our total procurement spent on local suppliers with a total value of $123 mil. This year we met the number of suppliers but did not achieve the purchase value and the spending percentage as we need to follow the clients Approved Vendor List (AVL) and majority are located overseas.

At least 85% of procurement spending on local suppliers

Employment

PEC will continue to devise measures to retain talent and create sense of belonging among employees.

PEC has improved average training hours and implemented Annual Site Learning Plan for self-learning which includes development courses for employees.

Progressively lower turnover rate and achieve better retention rates