5 in 5 – GSS Energy (SGX Code: 41F)

Company Overview

GSS Energy conducts operations in precision engineering, and the electric vehicles business with a non-operational interest in the oil and gas services business. Since 1980, its Precision Engineering Division (under its wholly-owned subsidiary Giken Sakata (S) Limited) has established itself as an integrated contract manufacturer providing supplying to the consumer electronics, healthcare/medical, gaming, safety equipment, industrial equipment, automotive industry. In the electric vehicles business, the Group has invested in a Thailand subsidiary, Edison Motors Co., Ltd and in partnership with Iso, an established Italian brand, has developed its first model of electric motorcycle, UNO-X.

1. Can you share about the Group’s sustainability approach and how has it integrated into the business operations?

• We have anchored our sustainability approach to the United Nations' Sustainable Development Goals (SDGs). At the core, the approach is segmented into five distinct yet interconnected pillars: Social, Customer Experience, Environmental, Governance, and Economic.

• The Social pillar directly influences the Group’s day-to-day operations by providing a nurturing environment for employees. This includes health and safety measures, employee development programmes, and a strong stance on non-discrimination and diversity, to ensure a productive and harmonious workplace.

• The Environmental facet sees GSS Energy embed water and waste management initiatives into daily operations, coupled with energy conservation strategies and measures to combat climate change.

• The Governance and Economic pillars shape operational decision-making. A stringent governance framework ensures that operations are transparent and ethical, while a focus on sustainable business performance balances both growth and sustainability.

2. How has the Electric-Vehicles (EVs) segment changed the industry and operations for GSS Energy?

• In recent years, we have expanded into the electric vehicles (EVs) segment with electric motorcycles manufactured by subsidiary Giken Mobility. This has reshaped the industry dynamics for GSS Energy, aligning with the global transition towards environmentally friendlier modes of transportation, and positioning the Group at the forefront of sustainable solutions.

• Operationally, the EV foray has introduced significant changes for GSS Energy, including the shift towards sourcing materials such as tyres, motors, batteries, and other specialised spare parts, aside from primarily sourced materials (e.g. rubber, steel, carbon). This has led to new strategic partnerships and the potential adaptation of existing ones with partners.

• Furthermore, GSS Energy's customer demographic has expanded. Beyond the traditional precision engineering clientele, we now cater to individual and corporate customers keen on sustainable transportation options, allowing the business to diversify and expand revenue streams.

• Lastly, the expansion into the EV sector has allowed GSS Energy to venture into a new segment – battery packing. With the establishment of a battery packing line in Batam specifically for electric motorcycles, we have further diversified our product offerings, enabling the Group to play a crucial role in the electrification of transportation.

3. How is the board committee involved in ensuring sustainability goals are met?

• The Board serves as the strategic anchor, advises and oversees the development of the Group’s sustainability strategy, which is spearheaded by the Sustainability Committee which includes senior management from various support units led by the Chief Financial Officer. Three main focuses for the Group are:

1. Strategic Formulation – The Board is at the helm of the Group's long-term strategic direction, integrating sustainability issues directly into the strategic formulation, and ensuring that the Group remains aligned with the evolving sustainability landscape.

2. Determining and Overseeing Sustainability Factors – The Board has a decisive role in identifying the 'Sustainability Factors' — these are the critical areas where the Group needs to focus its sustainability efforts. Once these factors are determined, the Board continues to actively oversee the management and monitoring of these factors to ensure that the set objectives are being met.

3. Institutionalising Sustainability through Policy – To ensure a systematic approach towards sustainability, the Board has established a Sustainability Policy (SR Policy). This policy provides a roadmap for the Group, detailing sustainability strategies, reporting structures, materiality assessment, and the processes for identifying and monitoring the Sustainability Factors.

4. GSS Energy has recorded a product reject rate of 0.1% in FY2022, what are its goals for FY2023 and how does the company plan on achieving these goals?

• For FY2023, GSS Energy has outlined clear goals and plans emphasizing quality, environmental conservation, and waste management. In terms of quality and product reject rate, we reported a 0.1% rate in FY2022 and are determined to either maintain or improve this metric. We plan to achieve this by bolstering our quality management system, ensuring employee familiarity with quality benchmarks through regular training, obtaining certifications such as ISO 9001:2015, ISO 13485:2016, and IATF 16949:2016, and actively using customer feedback for continual enhancements.

• Environmentally, our focus spans across water and energy conservation, as well as waste management. In FY2022, GSS Energy decreased water consumption to 58,160 CuM from 65,195 CuM in the previous year and would like to continue to do so. We also concentrate on energy conservation and climate change by utilising cleaner energy. Our major energy source is electricity, and to offset this, we have initiated the use of solar panels at our China subsidiary, CGP. In FY2022, we purchased 18,942,866 kWh of electricity but also produced 333,917 kWh from our solar installations, leading to indirect GHG emissions of 14,290 tonnes CO2e.

5. What internationally recognised accreditations did GSS Energy attain in the previous year and can you elaborate more about it?

• GSS Energy attained the following internationally recognised accreditations in the previous year:

1. ISO 9001:2015 – This certification specifies requirements for a quality management system. It emphasizes the need for organisations to consistently provide products and services that meet customer expectations and adhere to applicable statutory and regulatory requirements.

2. ISO 13485:2016 – This certification focuses on quality management systems specifically for the medical devices sector. It signifies that an organization has the capability to provide medical devices and related services that consistently comply with customer and regulatory requirements.

3. IATF 16949:2016 – This the International Standard for Automotive Quality Management Systems. This accreditation underscores the emphasis on a process-oriented quality management system that aims for continual improvement. It focuses on defect prevention, reduction of variation and waste in the supply chain, ensuring that customer requirements from the automotive sector are met efficiently and effectively.

5 in 5 – 5 Questions in 5 Minutes with SGX-listed companies with a focus on Sustainability

Designed to be a short read, 5 in 5 provides insights into SGX-listed companies’ sustainability efforts through a series of 5 Q&As with management. Through these Q&As, management will discuss the company’s sustainability journey, governance structure & commitments, material ESG topics and many more.

This report contains factual commentary from the company’s management and is based on publicly announced information from the company.

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For more company information, visit gssenergy.com.sg Click here for GSS Energy’s latest Annual Report.