泰鼎國際股份有限公司

Risk Management Policies and Procedures

In order to strengthen corporate governance and establish a sound risk management system, the Board of Directors approved a risk management policy on December 16, 2020, guiding the company’s units to identify effectively, measure, supervise and control various risks when handling their business. The resulting risks are controlled to an acceptable level to achieve the goal of rationalizing risks and rewards and the goal of sustainable operation of the company.

Scope of Risk Management

Risks involved in the Company's businesses include operational risk, market risk, financial risk, climate change and environmental risks, occupational safety risks, information security risk, compliance risk, etc.

Risk Management Organization

Risk Management Operation Situation

The Company started to promote the Risk Management Mechanism in 2020 and reported its operation to the Board once a year from 2020. In 2023, the Company held a risk management meeting to identify the risks faced by the Company, risk assessment and risk response measures and reported to the Sustainable Development Committee and the Board of Directors on December 19, 2023, on the implementation of the Company's risk management, including risk identification, assessment of the impact of risks (including (including sustainable issues, TCFD) and the operation of the risk management strategies adopted. The major risk types of the Company, their responsible units and risk management methods are as follows.

Rank	Risk Factors	Impacts Description	Control Mechanism
1	Product Quality Management	Negative: potential impacts are (1) difficulty of introducing new product which block business development; (2) present orders could possibly drain. Positive: catch the trend of movement of industry then introduce more orders from European and American areas.	Customer Management: Reduce the risk of concentrated sales through customer credit and control. Supplier management: Carefully evaluate and actively develop new sources of suppliers. Understand the market condition through data collection or market surveys to respond in advance.
2	Customer Relationship Management	Negative: potential impacts are (1) difficulty of introducing new product which block business development; (2) present orders could possibly drain. Positive: catch the trend of movement of industry then introduce more orders from European and American areas.	Periodically review information of market demand, frequently interact with customers and agents to ensure credibility; periodically review customer complaint and progress to manage core problems of defect.
3	Research Development and Innovation	Negative: insufficient competitiveness may lead lose orders. Positive: beneficial to marketing development, energy saving and efficiency increasing, increase job opportunity and shareholder value.	We’ve set up a laboratory and relative management standards; keep review manufacturing ability and quality management practice then find improvement opportunity; improve factory ability through develop new product with customers.
4	Supply Chain Disruption and Cost Fluctuation	Negative: (1) unstable plans and implementation of material preparation; (2) trends of fragmentation of global market, pandemic disease, carbon cost and climate change make regional supply unstable. In addition, metal and material price are affected by political and economic situation that make range and frequency of price fluctuation of materials bigger. Purchase department face significant challenge of cost control. Positive: the irreversible change of international politics has pushed the industry to move to South-East Asia which indirectly induces joint of suppliers.	Carefully evaluate and actively develop new sources of suppliers. Understand the market condition through data collection or market surveys to respond in advance.
5	Change of Political and Social Environment	Negative: rising uncertainty level of market demand will control ability of orders decline; population structure and social environment change will make recruiting harder which affect integral competitiveness. Positive: based on existed scale advantage, strengthen linkage to society and counter parties then keep competitive advantage and inject new blood of orders and talents.	Legal department is responsible for managing legal risks, internal systems, regulatory compliance, disputes and lawsuit events, investments and acquisitions, and intellectual property rights, as well as providing legal advice and providing recommendations.
6	Effectiveness of Board and Corporate Governance	Negative: declining of governance effectiveness would impact operation significantly, it could be strategic mistake, major operation loss or damage of survival ability. Positive: good governance effectiveness could increase scale, continuous growing profit and shareholder value.	The operating units regularly report strategic issues to directors to reduce strategic risks through participation, counselling, and monitoring of the board members. Attainments of policies and goals each year are managed through business performance meetings.
7	Energy Management	Negative: unstable supply of energy and its price would directly impact operating cost; trend of increasing electricity price is certain and clear; if supply of electricity is not stable, cost of shut down is quite big. Positive: speed up innovation of reducing cost or increasing efficiency; to think of possibility of self-owned power plant in the future.	Establish energy-saving goals and waste recycling mechanisms, and continue to research renewable energy installations, wastewater recycling solutions, and ISO50001 certification planning.
8	Capital Management	Negative: insufficient working capital will disrupt operation. Positive: well management of capital can expand operation leverage and create room for business upgrade.	Monitor interest rate and market changes, control positions of long-term and short-term loans, and use market tools to fix interest rate costs in a timely manner. Monitor the Company's financial condition and evaluate financing methods and instruments based on annual budget requirements to reduce financing cost. Maintain good relationships with banks to obtain the best interest rates on loans and savings. The financial department keeps a close watch on changes in the exchange market, collect related information and assess future tendencies to make currency exchanges and also evaluate the status of forward exchange contracts and foreign exchange options. Purchases and expenses are paid as much as possible in the same currency used for related sales items to achieve natural hedging.
9	Credit Management	Negative: fail of account receivable management, declining of investor confidence. Positive: helpful to capital management.	Periodically analyse AR and review overdue with BIZ in order to early control customer status; periodically review credit status of customers; F&A keeps monitoring macroeconomic and industrial change.
10	Uncertainty of Market Information	Negative: increasing uncertainty of market information would possibly lead mistake in planning of balancing production and sales which indirectly increase risk of stock and cash flow. Positive: we have scale advantage on quantity of purchase and amount of financing, therefore if we could well plan and well utilize the scale advantage, it could increase negotiation room.	Raise management intensity on present market analysis, management of customers, agents and logistic vendors in order to strengthen judge ability to market change.
11	Sustainability Risk	Negative: overly chase after short-term performance would harm long-term competitiveness. Positive: think of operating strategy by macro and chronic aspect to improve competitive base.	We’ve set up corporate governance relative internal control system and complied with it to make process of decision-making diversified; major investment projects have been executed by following internal control rules with managers’ appropriate managing and discussion; we have multiple channels for employees to comment and complain.
12	Rising Price of GHG Emission	Negative: carbon fee could be reflected in energy cost, material cost, management cost, regulation fee cost and transportation cost etc. That it may increase operation cost gradually. Positive: speed up innovation of reducing cost or increasing efficiency.	We have proceeded GHG inventory count and been installing ISO 14064-1; keep promoting energy-saving projects. Study schedule of installing carbon footprint and carbon pricing; adjust carbon strategy during the instalment.

Material Topics Matrix

The implementation of risk management (including sustainability issues and TCFD) in 2023 is as follows:

TCFD and Risk Management

Information Security Management Strategy and Structure

(I) Information security risk management framework

A. Information Security Organization
Apex Circuit (Thailand) Co., Ltd. (APT), the operating entity of the Group, established the Information Security Management System Committee (ISMS Committee) in Year 2022 with a total of 34 members, and a total of 13 meetings were held in 2023. The ISMS Committee governs the APT Information Security Operation Center (Cyber Security Operation Center; CSOC) is responsible for coordinating the group's information security and protection related policy formulation, implementation, risk management and compliance assessment. The information security supervisor of the center will report the effectiveness of information security management, issues and directions related to information security to the parent company's board of directors and CEO every year. The audit office of the Group conducts audits to ensure internal compliance with the related standards, procedures and regulations of information security.

In order to implement the information security strategies set by CSOC and ensure internal compliance with relevant information security standards, procedures and regulations, the dedicated information security supervisor and the personnel of the center will work with the business department, human resources department, engineering department and legal department, etc., to review and decide on information security and information protection guidelines and policies every year, and implement the effectiveness of information security management measures.

B. Group's ISMS Committee Organization Structure

(II) Information Security Policy

A. Group’s ISMS strategy and structure Information security and operational data protection are important cornerstones for the sustainable development of enterprises and the maintenance of core competitiveness. In order to enhance the safety and stability of the Group's information and communication operations and ensure the confidentiality, integrity and availability of information assets, smoothly promote the Group's various businesses, the Group is committed to strengthening the information security management mechanism and defense capabilities, establishing a safe and reliable computerized operating environment, and ensuring the security of systems, data, equipment and networks to protect the company's important information assets and information systems are operating normally. In order to effectively implement information security management, the Group's information security organization holds regular meetings every month through the CSOC.　 Based on the management cycle mechanism of Plan-Do-Check-Action; PDCA, review the applicability and protection measures of information security policies, and regularly report the implementation results to the ISMS Committee.

B. Concrete Management Programs

C. Investments in Resources for Information Security Management

For improving information security, we invested 8,605,000 baht.

Risk Management

Risk Management Policies and Procedures

Material Topics Matrix

The implementation of risk management (including sustainability issues and TCFD) in 2023 is as follows:

Information Security Management Strategy and Structure

Investor Relations

Sustainable Focuses

News Center

+886-2-2717-0032

+886-2-2717-0032

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Risk Management

Risk Management Policies and Procedures

Material Topics Matrix

The implementation of risk management (including sustainability issues and TCFD) in 2023 is as follows:

Information Security Management Strategy and Structure

Investor Relations

Sustainable Focuses

News Center

+886-2-2717-0032

+886-2-2717-0032