“bribery” means the act of SOLICITING, GIVING, OFFERING, ACCEPTING OR RECEIVING GRATIFICATION, directly or indirectly, to/from a person in authority either in the form of money, services or valuable goods as an inducement or reward to do or not to do an act in relation to the person’s principal affairs. Bribery and corruption are closely related. However, “corruption” has a wider definition (as set out below);

“business associates” refers to external parties with whom UPMHoldings has or plans to establish some form of business relationship. This includes, and is not limited to, business partners, joint venture partners, clients, customers, contractors, subcontractors, suppliers, vendors, advisors, consultants, agents, distributors, dealers, representatives, intermediaries, and others performing work or services with, for or on behalf of UPMHoldings;

“corruption” includes:

1. any action which would be considered as an offence of giving or receiving gratification under the MACC Act;
2. any acts of extortion, collusion, breach of trust, abuse of power, trading under influence, embezzlement, fraud or money laundering; and
3. all deeds or behaviours that are defined as “corrupt act” under the relevant laws of each jurisdiction where UPMHOLDINGS operates;

“directors” means the directors of the companies under the UPMHoldings Group, and includes all independent and non-independent directors, executive and nonexecutive directors, as well as alternate or substitute directors;

“employee” means any individual who is in the employment of UPMHoldings, whether on permanent or temporary employment basis or on secondment;

“MACC Act” refers to the Malaysian Anti-Corruption Commission Act 2009 and shall include all subsequent revisions and amendments thereto;

“Organizational Anti-Corruption Plan” (OACP) refers to a mandatory initiative under the National Anti-Corruption Plan (NACP) to ensure an organisation achieves the NACP’s strategic objective of Greater Corporate Entities Resilience Against the Threat of Corruption. OACP is formulated with the aim of assisting and helping an organisation in combating bribery and corruption. It also outlines the appropriate resources and reasonable timeline towards achieving the strategic objectives.

“Policy” refers to this Anti-Bribery and Corruption Policy;

“UPMHoldings Group” means UPM Holdings Sdn Bhd and its subsidiaries. The expression "UPMHoldings / Group" is used for convenience where references are made to UPMHoldings Group companies in general.

This refers to the act to please or to satisfy. Gratification may come in the form of money, donation, gift, loan, fee, reward, valuable security, property or interest in property of any description whether movable or immovable, finance benefit, or any other similar advantage as stated in the MACC Act.

A political contribution is a contribution or donation made to a politician or a political campaign or a political party. Political contributions can be a form of bribery if it is used to induce a party to engage in improper or unlawful conduct.

A facilitation payment is an unofficial payment in cash or in-kind (e.g. liquor, cigarettes, etc.) made to Government Officials or any other entity intended to ‘facilitate’, secure or expedite the performance of a routine action (e.g. clearing customs, processing visas, scheduling inspections, etc.).

This refers to a form of conflict between employees or director’s own interest and the interest of the employer. A conflict of interest will arise where an employee’s or director’s ability to perform his or her duties may be adversely affected by an outside appointment, relationship or activity whereby the employee or director can use his/her position/power for the benefit of himself/herself or for his/her relative or associate. It is the duty of the employee or director to report any actual, potential or perceived Conflict of Interest (COI) to the Head of the Group Human Resource.

A kickback is a form of negotiated bribery in which a commission is paid to the bribe-taker in exchange for services rendered. Generally, the remuneration (money, money in kind, promise, goods, or services handed over) is negotiated ahead of time.

Any person or agent who intends to deceive or mislead the principal with the submitted documents that contain statement, which is fictitious, false or erroneous or defective in any material form commits an offence under the MACC Act.

This refers to an act whereby any employee or director uses his position or the office in making decision or acting for the benefit of himself, his relative or associate.

UPMHoldings acknowledges that in many cultures the giving or receiving of incidental gifts or entertainment is important to maintain and develop business relationships. However, the giving and receiving of all such gifts and entertainment must be exercised with good judgement, be for genuine purposes without the intention of creating any improper advantage, given in the ordinary course of business.

1. If Employees and Directors were offered or have received a gift from Business Associates or Third Parties, Employees and Directors are required to politely return the gift with a note of explanation about the Group’s “No Gift” policy.
2. In circumstances where it is not possible to refuse or return a gift, Employees and Directors should report to his/her Head of Department, where applicable, or in the case of Director, to the Relevant Board, and record the gift received detailing the following:
   • (a) details of the gift;
   • (b) the estimated value of the gift;
   • (c) the purpose and occasion such gift were given; and
   • (d) the counterparty providing the gift, including the organisation or entity he/she belongs to and its role in the Group’s business.
3. The Group Chief Executive Officer (“GCEO”) or Head of Department, where applicable, shall decide if the gifts can be accepted and determine the treatment of the gift, if accepted. If the Head of Department is unsure of in his/her decision or on the treatment of gifts accepted, he/she shall consult the Head of Internal Audit of the Group.
4. If a decision has been made to accept the gifts, the GCEO or Head of Department, where applicable, shall decide on the treatment of gifts based on the following:
   • (a) donate the gift to charity;
   • (b) register it as company property to be used generally by all employees;
   • (c) display the gift in a common area;
   • (d) share the consumption of the gift with employees; or
   • (e) permit the gift to be retained by the employee.
   The decision to accept gifts and the treatment of gifts shall be recorded.
5. If the gift is given anonymously, the recipient must deliver the gift to the Head of Internal Audit and the Head of Internal Audit shall determine the treatment of the gift. The decision to accept gifts and the treatment of gifts shall be recorded.

Notwithstanding the above, Employees and Directors may accept gifts in the following situations, without having to report to his/her Head of Department, where applicable, or in the case of Directors, to the Relevant Board and recording the same:

1. (i) token gifts or promotional items (such as pens, notepads, calendars etc. of minimal value) bearing company logo or brand; and
2. (ii) fruits, flowers, food, hampers with an approximate or actual value not exceeding RM300,

provided that such gifts are shared amongst the Employees or placed in common area and are not extended and/or accepted for the purpose of or with intention to:

1. (i) influence any present or future act or decision by that Employee or Director;
2. (ii) inducing that Employee or Director to perform or omit any act in violation of his/her proper duties and responsibilities; or
3. (iii) inducing that Employee or Director to use or direct any person to use his influence with the government, or any of its representatives, divisions or agencies to affect or influence any act or decision of any such government, representative, division or agency and in any or all of the above cases, for the purpose of expediting, benefiting, prejudicing or affecting in any way whatsoever whether directly or indirectly the business dealings or relationship of the gift giver with the Group.

1. Generally, Employees and Directors are not allowed to give any gifts to Business Associates or to Third Parties.
2. Gifts to Business Associate or to Third Parties shall only be given mainly as a business courtesy. Any gifts offered shall be unsolicited and not affecting, or be perceived as affecting business judgment.
3. Gifts to Business Associates or to Third Parties by Employees shall only be given with the verification and authorisation according with the limits authorised for non-operating expenses.
4. All expenses incurred to provide the gifts must be properly documented, receipted and recorded detailing the following:
   • (a) details of the gift;
   • (b) the value of the gift;
   • (c) the purpose and occasion such gift were given; and
   • (d) the counterparty receiving the gift, including the organisation or entity he/she belongs with and its role in the Group’s business.
5. In the case where Directors are providing gifts to Business Associates or to Third Parties, Directors must conform to the guidelines specified by the Relevant Board.

The Group recognises that occasional entertainment and hospitality at a modest level (including meals, entertainment and recreational activities provided or paid for) is a legitimate way to foster good business relationships and is a common practice in the business environment. Hospitality and entertainment may include meals, receptions, tickets to entertainment, social or sports events.

It is important that Employees and Directors exercise proper care and judgment before providing entertainment and hospitality to Business Associates or to Third Parties and/or accepting entertainment or hospitality offered by Business Associates or Third Parties. This is to safeguard the Group, Employees, Directors, Business Associates and Third Parties from any impropriety or undue influence which may give rise to a risk of bribery.

1. Employees and Directors are strictly prohibited from soliciting entertainment and hospitality from Business Associates or Third Parties.
2. Employees and Directors are also prohibited from accepting entertainment that is excessive, inappropriate, illegal, or given in response to, or in anticipation of, or to influence business judgment.
3. In the event Employees or Directors find that entertainment and hospitality offered by Business Associates or Third Parties is beneficial to foster healthy business relationship and in a modest level, Employees or Directors may pursue the same after notifying his/her Head of Department, where applicable or if a Director, then the Relevant Board and recording the event detailing the following:
   • (a) details of the entertainment or hospitality;
   • (b) the value of the entertainment or hospitality;
   • (c) the purpose and occasion such entertainment or hospitality were given; and
   • (d) the counterparty receiving the entertainment or hospitality, including the organisation or entity he/she belongs with and its role in the Group’s business.
4. If Employees or Directors are unsure or doubtful of the appropriateness of entertainment or hospitality offered by Business Associates or Third Parties, Employees or Directors should either decline the offer or consult your Head of Department (who shall seek the advice of the Head of Internal Audit if deemed necessary) or if Director, then to consult the Relevant Board.

1. Employees, Directors and Business Associates are strictly prohibited from providing or offering entertainment and hospitality with a view to improperly influence any party in exchange for any advantage or benefit in return for the Group.
2. In providing or offering entertainment and hospitality to Business Associates or Third Parties to foster healthy business relationship, the Employees and Directors should always bear in mind to exercise proper care and judgment in order not to be perceived that the provision or offer of entertainment and hospitality is in response to, or in anticipation of, or to influence business judgment.
3. Employees must obtain prior approval from your Head of Department (who shall seek the advice of the Head of Internal Audit if deemed necessary) for providing or offering entertainment and hospitality to Business Associates or Third Parties to foster healthy business relationship. Employees shall maintain expenses within the limits approved according to Authority Limit for non-operating expenses when providing or offering entertainment to Business Associates or to Third Parties.
4. All expenses incurred to provide the entertainment must be properly documented, receipted and recorded together with the following details:
   • (a) details of the entertainment;
   • (b) the value of the entertainment;
   • (c) the purpose and occasion such entertainment were given; and
   • (d) the counterparty accepting the gift, including the organisation or entity he/she belongs with and its role in the Group’s business.
5. In the case where Directors are providing or offering entertainment and hospitality to Business Associates or Third Parties to foster healthy business relationship, Directors must conform with the guidelines specified by the Relevant Board.

Business-related travel expenditures, such as travel, meals or accommodations, may be incurred depending on the business arrangement with Business Associates when performing a work or task relating to the Group’s business, such as factory visits, site audits and business trips (“Third-Party Travel”). However, inappropriate, excessive or unnecessary Third-Party Travel poses a risk of bribery, especially when the business activity in question involves a material interest of a specific party (for example, auditors).

1. The Group strictly prohibits the provision of any non-business-related travels, such as vacation trips, holidays, tours or anything to that substance, to any Business Associates or Third Parties.
2. The Group also prohibits Employees and Directors from receiving any non-business-related travel from Business Associates or Third Parties.
3. Third-Party Travel shall not be provided or accepted for persons not relevant for the performance of the work or task in question. For example, family members, who has no official business, of the person performing the work or task in question.

1. When providing or receiving a Third-Party Travel, assessment shall be made considering the following:
   • (a) Relevance: whether the Third-Party Travel primarily relates to a legitimate business arrangement;
   • (b) Necessity: whether the Third-Party Travel and their recipients are necessary for the performance of the said business arrangement; and
   • (c) Proportionate and Reasonableness: whether the value of the Third-Party Travel (travel and accommodation class) is appropriate and reasonable in relation to the circumstances such as length or duration of trips and seniority level of the recipient.
2. When receiving Third-Party Travel involving outstation or overseas business-related travel provided by Business Associates or Third Parties to Employees, prior approval by his/her Head of Department must be obtained. In the case where Head of Department is the key liaison person involved in the business arrangement with Business Associates or Third Parties, the relevant approval shall be obtained from the GCEO for the acceptance of such Third-Party Travel.
3. When providing Third-Party Travel to Business Associates or any Third Parties, Employees must obtain prior approval from his/her Head of Department. In the case where the Head of Department is the one seeking approval for the provision of the said Third-Party Travel, prior approval shall be obtained from the GCEO.
4. The approval for providing Third-Party Travel shall be in accordance with the Authority Limit for non-operational expenses.
5. All expenses incurred to provide Third-Party Travel to Business Associates or to Third Parties must be properly documented, receipted and recorded.
6. In the case where Directors is the key liaison person involved in the business arrangement with Business Associates or Third Parties, Directors must conform with the guidelines specified by the Relevant Board in relating to receiving or providing Third-Party Travel.

Caution must be exercised when dealing with public officials as bribing an Officer of a Public Body or a Foreign Public Official (“Public Officials”) is an offence under the MACCA.

“Officer of a Public Body” is defined under the MACC Act as any person who is a member, an officer, an employee or a servant of a public body, and includes a member of the administration, a member of Parliament, a member of a State Legislative Assembly, a judge of the High Court, Court of Appeal or Federal Court, and any person receiving any remuneration from public funds, and, where the public body is a corporation sole, includes the person who is incorporated as such.

“Foreign Public Officials” is defined under the MACC Act to include (a) any person who holds a legislative, executive, administrative or judicial office of a foreign country whether appointed or elected; (b) any person who exercises a public function for a foreign country, including a person employed by a board, commission, corporation, or other body or authority that is established to perform a duty or function on behalf of the foreign country; and (c) any person who is authorized by a public international organization to act on behalf of that organization.

Employees, Directors and Business Associates who have dealings with Public Officials shall not engage, directly or through a third party, in any activity or transaction that may constitute, or be perceived to constitute, as an attempt to bribe Public Officials.

1. Employees and Business Associates are strictly prohibited from paying for or providing gifts, entertainment and hospitality and Third-Party Travel to Public Officials for or on behalf of the Group.
2. Gifts, entertainment and hospitality and Third-Party Travel to Public Officials for or on behalf of the Group must only be paid or provided for by the decision of the GCEO (who shall seek the advice of the Head of Internal Audit if deemed necessary). The GCEO must notify the Board and are prohibited from paying for or providing gifts, entertainment and hospitality and Third-Party Travel that are excessive, lavish and directed to Public Officials in his/her personal capacity.

As part of the Group’s commitment to contribute and give back to the communities where the Group operates, the Group provides such assistance in appropriate circumstances and in an appropriate manner.

Employees and Directors must ensure that all donations and sponsorships by the Group are not used to circumvent, avoid, or evade the laws or regulatory requirements. More importantly, it shall not be used to facilitate corruption, illegal and money laundering activities.

1. All request for donations and sponsorships by the Group shall be directed to the Head of Internal Audit and shall be carefully examined with appropriate due diligence by evaluating the request against the following criteria:
   • (a) the objective of the donation and sponsorship does not contradict with the Group’s values;
   • (b) the intended recipient is a legitimate organisation and proper due diligence/background checks have been conducted;
   (c) the intended recipient does not have affiliation with a Public Body (defined under MACCA); and
   • (d) there is no risk of a perceived improper advantage for the Group.
2. If the request meets the above criteria and it is reasonably ascertained to be legitimate in nature, the Head of Internal Audit shall proceed to recommend the request for approval according to the Authority Limit for non-operating expenses.
3. Once a donation or sponsorship has been made, the Group shall undertake necessary measures to validate the carrying out of the intended utilisation of the donation or sponsorship, and where possible, make note on whether the objectives of the donation or sponsorship has been achieved.
4. A trail of documentary evidence relating to donations and sponsorships by the Group (including all expenses incurred for donations and sponsorships) shall be compiled and kept in a database within the relevant business unit of the Group.

Generally, UPMHoldings Group does not make or offer contributions whether monetary or in-kind to any political party, political party officials or candidates for public offices. However, UPMHoldings Group may make contributions which are permissible under applicable law, subject to the approval of the UPMHoldings Board of Directors.

It is prohibited to offer, promise, make, request and accept facilitation payments or kickbacks of any kind.

Employees are expected to notify their immediate superior when encountered with any requests for a facilitation payment or kickbacks.

Each department/division/operating company/strategic business unit shall ensure that:

1. (i) all payments to be made to third parties must be made in good faith and comply with all applicable laws and regulations;
2. (ii) payments to government officials or authorities must be made against official rates published by the government, for which the payment is made into a government account and for which a receipt is given; and
3. (iii) a report is to be escalated to the Head Group Risk Management & Integrity if the employee is requested or collaborated to pay any facilitation payment or kickback.

Payment that is made in the belief that life, health and safety may be in imminent danger is not a facilitation payment. However, such incident must be reported immediately to the Head, Group Risk Management & Integrity.

Each department/ unit/ and operating company shall ensure that:

1. (i) any potential bribery and corruption risk in their operation is being identified and assessed;
2. (ii) adequate procedures/controls to prevent and mitigate the bribery and corruption risk are in place; and
3. (iii) employees that may be exposed to bribery and corruption in their work environment must be identified and periodically rotated as well as attend regular anti bribery and corruption training.

All employees and directors shall disclose any of their interest arising from their internal or external appointments, relationships or activity. COI can arise when employees have interest that makes it difficult to perform their specific role objectively.

Each department/ unit/ operating company shall ensure that:

1. (i) employees are aware of the need to declare any actual, perceived or potential interest in the COI form to Group Human Resource;
2. (ii) line managers are required to record actions taken to mitigate the conflict reported by their employees;
3. (iii) the UPMHoldings’s Code of Conduct is strictly adhered to.

Directors are required to:

1. (i) adhere to the COI requirement as stated in the Board Charter; and
2. (ii) declare any actual, perceived or potential conflicts to Company Secretary for escalation to the Group Chairman, if necessary.

UPMHoldings shall keep financial records and have adequate internal controls in place which will evidence the business reasons for making payments to third parties.

All employees and directors are to ensure all expenses claims relating to hospitality, gifts or entertainment incurred to third parties are submitted in accordance with the Authority Limit.

All accounts, invoices and other documents and records relating to dealings with third parties, such as customers, suppliers, contractors, agents and business partners, should be prepared and maintained with accuracy and completeness. No accounts must be kept “off-book” to facilitate or conceal improper payments.

All financial records must be retained and must not be destroyed as required by prevailing laws.

Any employee or director or business associate who knows of, or suspects, a violation of this Policy is required to whistle blow or report the concerns through the mechanism set out under UPMHoldings’s Whistle Blowing Policy available on the UPMHoldings’s website.

All bribery and corruption cases, including suspected attempts to commit bribery or corruption, must be reported via the Whistle Blowing channel. The Whistle Blowing channel is specified as follows:

E-mail : wecare@upmholdings.com.my

Mail :
Head of Internal Audit
UPM Holdings Sdn Bhd
Block F-2,
UPM-MTDC Technology Centre,
Universiti Putra Malaysia,
43400 Serdang,
Selangor Darul Ehsan

If the report of concern involves the Head of Internal Audit, the report can be channelled to the Group Chief Executive Officer.

No individual will be discriminated against or suffer any sort of manner of retaliation for raising genuine concerns or reporting in good faith any violations or suspected violations of this Policy. All reports will be treated in strict confidentially.

UPMHoldings will report to the relevant authority such as the Malaysian Anti-Corruption Commission (MACC) or Police if there is reasonable belief that such act of bribery and corruption has been committed.

All employees, directors and business associates are required to be familiar with and comply with this Policy.

All employees and directors operating in areas that are perceived as high risk will receive regular, relevant training on how to implement and adhere to this Policy.

UPMHoldings’s zero-tolerance approach to corruption and bribery shall be communicated to all business associates at the outset of business relationships and as appropriate thereafter.

All employees and directors are responsible for the implementation of this Policy and ensure that any suspected danger or wrongdoing is to be disclosed.

The Policy shall be reviewed periodically and approve by Board to assess its effectiveness, and in any event, at least once every five (5) years.

Internal control systems and procedures will be subjected to regular audits as an assurance that adequate procedures are in place for combating bribery and corruption.