Climate Strategy

Challenges and Opportunities

Climate change poses both significant risks and compelling opportunities for businesses worldwide. The Company recognizes the rising physical risks of climate change, including the increased frequency and severity of natural disasters, which may disrupt operations and impose additional operational costs. Furthermore, transition risks are intensifying as the global shift to a low-carbon economy accelerates, which are driven by initiatives such as the Paris Agreement and the agreements from the 26th Session of the United Nations Framework Convention on Climate Change (COP26) that enforced collaborative efforts to cap the global temperature rise at 1.5¡C above pre-industrial levels. Moreover, Thailand’s national goals to achieve carbon neutrality by 2050 and net zero greenhouse gas (GHG) emissions by 2065 have further reinforced the urgency for businesses to adapt and enhance operational climate resilience. Both physical and transition risks may lead to more stringent government regulations, changes in carbon pricing mechanisms, shift in market expectations, and changes in consumer behaviors. These could expose the Company to potential regulatory non-compliance, reputational risks, and competitive disadvantages. Proactive environmental management reduces resource consumption, and minimizes greenhouse gas emissions, thus decreasing associated operational expenses

Key Achievements

Reduced Scope 1 GHG emissions by 19% (against 2022 baseline)
Reduced Scope 2 GHG emissions by 8% (against 2022 baseline)

The Company implements the following management approach to address climate change issues effectively. 

1.Environmental Policy

The Company’s Environmental Policy, outlined in the Code of Conduct, was endorsed by the Board of Directors. The Policy encompasses the following key principles.

Complying with environmental laws and regulations relevant to the Company
Supporting public interest initiatives that contribute to societal, community, and environmental development, including natural resource conservation efforts
Recognizing environmental stewardship through responsible business operations
Encouraging the efficient use of resources
Reducing natural resource and energy consumption by fostering environmental awareness among employees

For additional information, please refer to https://www.ktc.co.th/en/sustainability-operations/economic-dimension/corporate-governance under the “Code of Conduct” topic.

2.Climate Change Strategy

The Company aligns climate strategy with global trends to develop innovative, low-carbon solutions and sustainable practices that meet stakeholder expectations to enhance competitive advantage, build trust, and strengthen market position. Additionally, the Company has adopted the Task Force on Climate-related Financial Disclosures (TCFD) framework, which outlines the climate governance, strategy, risk management, and metrics and targets. This approach ensures alignment with global practices, which enhances the transparency and accountability of KTC’s climate change strategy. The key details are as follows.

Governance

The Company’s governance structure ensures that climate-related risks and opportunities are effectively managed. Comprehensive roles and responsibilities are designated to ensure proper oversight and management of climate-related factors.

The Company established a corporate KPI that is related to the organization’s sustainability achievement, including the effective management of climate change issues. The KPI is upheld by all employees, including those in designated roles responsible for ensuring the effective implementation of the climate change strategy. The achievement of this corporate KPI is linked to all employees’ financial incentives.  

Strategy

KTC integrates climate-related risks and opportunities, including physical and transition risks associated with the business value chain, into the enterprise risk management framework. Through this approach, the Company can better enhance its resilience and develop appropriate adaptation plans to alleviate potential climate impacts. Relevant departments are subjected to annual risk assessments of physical and transition climate-related risks through the corporate ESG risk assessment tools. If the assessment outcome indicates that climate-related risk is at above a ‘rather high’ level, the relevant department must prepare associated contingency plans and present results to the management and the Risk Management Committee.

Risks Management

The following climate-related risks and associated mitigation measures were assessed. 

ENVI-02-4 the ESG risk assessment performed in 2024

Nonetheless, the ESG risk assessment performed in 2024 indicated climate related risks as a rather low level. Thus, no significant impacts were identified.

Climate Change Opportunities

The rising emphasis on climate change, environmental conservation, and eco-friendly products presents a significant business opportunity. The Company recognizes the opportunity to develop products and services that align with these growing consumer preferences. The Company aims to enhance competitiveness and drive business growth by targeting this new market segment as detailed below.

Metrics and Targets

To assess climate change risks and opportunities per the organization’s risk management strategies,   the Company has established metrics and targets to reduce greenhouse gas emissions. KTC monitors climate-related risks and opportunities and discloses annual scope 1, scope 2, and scope 3 greenhouse gas emissions.The greenhouse gas footprint calculations follow the carbon footprint guidelines set by the Thailand Greenhouse Gas Management Organization (Public Organization). 