Supply Chain Management

Impact on Business

Effective supply chain management is crucial for CKPower’s operational continuity and efficiency.  Given the Company’s reliance on maintenance equipment and components, and energy technologies sourced through suppliers across multiple countries, CKPower implements stringent supplier and contractor screening processes to mitigate risks and ensure supply chain resilience.
By extending sustainability management to its suppliers and contractors through ESG risk assessments and human rights training, CKPower strengthens long-term sustainability and investment throughout the value chain.

Challenges and Opportunities

In a rapidly evolving business landscape with increasingly stringent environmental regulations, CKPower is committed to developing guidelines for sustainable supply chain management that include:

  • Integrating ESG principles into procurement policies, supplier selection, and evaluations
  • Enhancing sustainability criteria in supplier assessments
  • Promoting responsible business practices throughout the supply chain

These initiatives help CKPower mitigate supply chain risks, optimize costs, advance its clean energy goals, and reinforce  stakeholder confidence, positioning the Company as a leader in sustainable renewable energy.

Commitment

CKPower is committed to sustainable supply chain management, ensuring transparency, risk mitigation, and operational efficiency.  The Company actively promotes responsible and sustainable business practices through:

  • Supplier selection and evaluation based on ESG (environmental, social, and governance) criteria
  • The Supplier Code of Conduct , which sets clear guidelines in adherence to legal requirements,  international standards, and ESG principles, covering business ethics, labor practices, human rights, safety, occupational health, and social responsibility

Additionally, the Company has developed comprehensive strategies encompassing supplier selection, risk assessment, and performance monitoring to ensure business transparency and compliance with labor, safety, and environmental, and human rights standards.

CKPower’s ultimate goal is to foster long-term sustainability for the business, its suppliers, and society as a whole.

Operational Guidelines

1) Procurement Policy and Supplier Code of Conduct

CKPower ’s sustainable supply chain management approach is designed to reduce risks, optimize efficiency, and enhance transparency.  The Company’s Procurement Policy and Supplier Code of Conduct ensure that all suppliers operate responsibly while upholding ESG principles, fostering ethical, sustainable, and resilient supply chain practices.

Procurement Policy
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Supplier Code of Conduct
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Procurement Policy

The Company has developed the Procurement Policy requiring suppliers to comply with legal requirements, regulations, and international standards in key areas, including labor practices, human rights, safety, occupational health, and environmental management. The policy also encourages suppliers to adapt to business growth and global-level shifts, ensuring long-term sustainable development alongside the Company.

Supplier Code of Conduct

CKPower has established a Supplier Code of Conduct to promote sustainable business practices among its business suppliers under environmental, social, and governance (ESG) principles. This Code provides guidelines for compliance with applicable laws, regulations, and international standards, covering business ethics, labor practices and human rights, safety and occupational health, environmental management at operational sites, and social and community responsibility.

To reinforce responsible supply chain management, CKPower has implemented a comprehensive strategic approach to supply chain management, encompassing every stage from supplier selection, risk assessment, and performance monitoring.  The Company also supports suppliers in conducting their business with transparency and respect for human rights ensuring adherence to labor, safety, occupational health, and environment, and social and community responsibility standards to drive sustainability throughout the supply chain.

Key Focus Areas of the Supplier Code of Conduct
Business Ethics
Human Rights and Labor
  • Corporate governance
  • Equitable and fair treatment
  • Intellectual property
  • Disclosure and confidentiality
  • Delivery and quality of products or services
  • Legal compliance
  • Non-discrimination
  • Labor protection
  • No use of forced labor
  • Remuneration, benefits, and work hours
Safety and Occupational Health
Environment
  • Workplace safety and environment
  • Personal protective gear
  • Emergency preparedness
  • Compliance with state environmental laws and regulations
  • Implementation of corrective and mitigation measures for environmental impact
  • Advocacy for efficient use of natural resources among employees
Social Responsibility
  • Consideration of impacts on communities and society in business operations
  • Respect for local cultures and traditions
  • Contribution to community and social development
2) Strategy and Roadmap

CKPower is committed to conducting its business in a manner that ensures sustainable growth while upholding its responsibilities to the community, society, and the environment. To this end, the Company has developed a comprehensive supply chain strategy covering supplier selection, risk assessment, and performance evaluation, actively supporting and encouraging suppliers to conduct their business ethically, with transparency and respect for human rights, in compliance with labor standards, safety, occupational health, and environmental regulations.

The Company has also implemented a sustainability assessment process for suppliers, which includes the preparation of information, questionnaires, and the establishment of guidelines and procedures for conducting assessments in line with international standards such as ISO 9001:2015, ISO 14001:2015, and ISO 45001:2018. The sustainability assessment of suppliers has been conducted annually since 2019, with an increased focus on conducting on-site inspections to ensure compliance with the Supplier Code of Conduct established by the Company. CKPower remains dedicated to continuously improving the supplier assessment process to align with its sustainability policies and strengthen the supply chain for long-term resilience.

Sustainable Supply Chain Development Plan
1
2022
Human Rights
2
2023
Awareness Raising
3
2024
ESG Focusing
5
2025
ESG Engaging
6
2026
ESG Excelling

Employee and Supplier Capability Development Training

CKPower provides annual capability development training for employees and suppliers, comprising of annual courses and potential enhancement programs aimed at effectively supporting organization transformation. In addition, policies, practices, and guidelines related to procurement processes are clearly communicated to enable personnel to operate systematically, properly, and in alignment with CKPower’s standards. These initiatives also encourage suppliers to adhere to sustainable business practices under environmental, social, and governance (ESG) principles in line with the Company’s strategy.

In 2024, supplier training and activities were organized to support their development and elevate sustainability standards. These programs provided CKPower personnel and suppliers insights into sustainable supply chain management and enabled them to put guidelines into practice to enhance operational efficiency and elevate the organization’s ESG standards in line with global trends. The programs offered are as follows:

Annual Program Description
Sustainable Supply Chain Management Overview and guidelines on sustainable supply chain management, its integration into operational processes , and the completion of national and international sustainability assessment forms
ISO 20400:2017 (Sustainable Procurement) Fundamentals of sustainable procurement according to ISO 20400:2017, including risk and impact management, due diligence, prioritization of sustainability issues, promotion of responsible supplier behaviors, and prevention of unethical practices.
Value Chain Analysis A foundational course for departments on improving sustainable supply chain management, emphasizing value chain analysis, stakeholder engagement, and sustainability-related disclosures in the 56-1 One Report to support CKPower’s long-term sustainable growth.
Potential Enhancement Program Description
Communication on CKPower’s Human Rights Policy and the Significance of Human Rights in Relation to Modern Slavery and Forced Labor Training on CKPower’s Human Rights Policy, the definition of human rights, modern labor practices, and the risks of modern slavery and forced labor in business operations.
Supplier Risk Assessment

The Company assesses supplier risks and potential impact on its business operations, with the assessment criteria consisting of the likelihood of risk and the severity of impact across various dimensions, including governance, economy, society, and environment. The assessment covers critical issues, such as business ethics, labor practices and human rights, safety and occupational health, environmental management, and social and community responsibility. The Company has divided supplier risk levels into four categories as guidelines for supplier management and development in alignment with sustainability standards.

Level of Risk
Extreme
Unacceptable levels of risk requiring immediate action to mitigate and bring within acceptable levels.
High
Unacceptable levels of risk requiring risk management measures to reduce exposure to an acceptable level.
Medium
Acceptable levels of risk requiring preventive measures to avoid escalation to an unacceptable level.
Low
Acceptable levels of risk can be tolerated without the need for additional risk control beyond standard monitoring.

In 2024, CKPower conducted risk assessments for all 497 suppliers, representing 100% of total supplier base. The results revealed that most suppliers fell into the low-risk category. If any issues with a high to extreme level of risk are identified, CKPower will implement appropriate risk management measures to bring the risk down to an acceptable level, in line with its sustainable supply chain management guidelines.

Risk Issues
Issues with an extreme level of risk Risk Management Measures
  • Employment of child labor/illegal migrant workers
  • Violation of human rights or forced labor
  • Establishing criteria for supplier qualification assessment
  • Company visits
  • The names / profiles / copies of ID cards of the workers employed
  • Registration documents for foreign workers
  • Supplier blacklisting
Occupational health and safety of the workforce Risk Management Measures
  • Pre-work safety risk assessments
  • Essential safety equipment requirements for contracted workers
  • Pre-work safety risk assessments
  • ESG requirements for subcontractors in the main supplier’s contract.
Management of subcontractors /suppliers. Risk Management Measures
  • Audits on compliance with CKPower’s safety measures
New Supplier Screening

CKPower has established selection criteria for new vendors covering corporate governance and economic, social, and environmental dimensions to ensure all suppliers conduct business responsibly and in alignment with the Company’s sustainability guidelines. This screening process verifues supplier qualifications and standards and considers  key factors such as business ethics, labor practices, human rights, environmental management, and social responsibility, ensuring transparency and long-term supply chain sustainability.

New Supplier Evaluation New Supplier Selection
CKPower has prescribed new vendor evaluation across the economic, social, and environmental dimensions of sustainability, covering key topics, such as product and service warranty, product delivery, environmental policies and social responsibility, respect for human rights, compliance with labor laws, and safety standards. In tandem, the Company also actively and continuously promotes and communicates its Supplier Code of Conduct to all suppliers.      As part of the new vendor selection, CKPower utilizes a comprehensive set of criteria to select qualified candidates, with every vendor required to meet the specified criteria, which include environmental practices and social responsibility, product and service quality, punctual delivery, business experience, product warranty, safety standards, and legal compliance. These established criteria are intended to foster confidence in the quality of the suppliers and the sustainability of the supply chain.

In 2024, CKPower onboarded 51 new vendors, all of whom were assessed against CKPower’s sustainability standards across the corporate governance, economic, social, and environmental dimensions.  The evaluation ensured the selection of responsible and transparent vendors aligned with the Company’s sustainability objectives. The evaluation process has enabled CKPower to select vendors with responsible and transparent business operations capable of supporting its business operations.

New Supplier Screening Criteria
Environment Dimension
  • Implement environmental management in compliance with laws, regulations, and requirements and monitor the management to comply with the legally mandated criteria.
  • Improve the operation to support efforts to address the issue of global warming and reduce greenhouse gas emissions.
  • Implement suitable, effective, and legally compliant water, pollution, and waste management.
  • Certified or compliant with international environmental standards
Social Dimension
  • Comply with the law and uphold international human rights.
  • Do not use or support the use of forced labor or child labor under the age defined by the law in any form.
  • Provide employee compensation and benefits that are suitable and compliant with labor laws.
  • Treat all employees equally and embrace diversity.
  • Implement policies for personal right protection and prevention of physical, sexual, and verbal abuse, threats, and harassment.
  • Offer employees an opportunity to negotiate in accordance with the legal procedure.
  • Provide safe and sanitary work environments and equipment and have an occupational health and safety management system that has been certified to international standards.
Governance and Economic Dimension
  • Report the operating results or financial position to related parties in a transparent and accountable manner.
  • Operate in compliance with laws, rules, codes of ethics on the basis of fair competition and fairness.
  • Support and cooperate with government agencies, private organizations, and the public sector in anticorruption efforts.
  • Respect intellectual properties and do not disseminate confidential information or other information obtained from business with customers.
  • Engage in knowledge and experience exchange to achieve operational efficiency and business innovation.
  • Acknowledge and comply with the CKPower Vendor Code of Ethics and Practice Handbook.
2024 Targets Percentage of new supplier assessed in 2024 2024 Targets Percentage of new supplier assessed in 2024 2024 Targets Percentage of new supplier assessed in 2024
100%
100%
100%
100%
100%
100%

Critical Supplier Analysis

CKPower classifies its suppliers into three major categories: Critical Tier 1 Suppliers, Non-Critical Tier 1 Suppliers, and Critical Non-Tier 1 Suppliers, to allow it to effectively analyze and formulate procurement strategies and risk assessment measures for each supplier group.

Supplier Performance Evaluation and Monitoring

CKPower evaluates supplier performance and compliance with the Supplier Code of Conduct across corporate governance, economic, social, and environmental dimensions through three key approaches:

  1. Annual Performance Evaluation – Continuous monitoring and assessment of supplier compliance
  2. Ongoing Performance Assessment – Supplier quality and efficiency tracking during project execution
  3. On-Site Audits – External auditor-led inspections to ensure compliance with CKPower’s standards

Suppliers who receive low evaluation scores or fail on-site audits may face temporary procurement suspension or removal from the vendor list. However, CKPower prioritizes supplier development by providing guidance and support to help them address compliance gaps and enhance capabilities for long-term business collaboration.

Green Procurement

The Company promotes environmental conservation and has implemented a green procurement policy to promote the selection of products made from renewable resources that do not produce pollution and meet sustainability standards, such as products with green label certifications.

This initiative focuses on resource efficiency and environmental impact reduction alongside the minimization of risks associated with the use of hazardous materials towards employees and the organization. Green procurement also helps cultivate green consumption values within the organization and society and create opportunities to reduce costs and expenses through sustainable consumption, ultimately maximizing benefits for both the economy and environment.

Local Procurement

CKPower prioritizes local procurement to enhance efficiency, speed, and strengthen local economies by creating jobs and increasing income for communities near its operations.

This policy also fosters strong community relations and regional economic growth while supporting CKPower’s business strategy.

Local Procurement
2024 Targets Percentage of local
procurement*
CK Power PCL
99.10%
Xayaburi Power Co., Ltd.
20.15%
Bangpa-in Cogeneration Ltd.
0.94%
Nam Ngum 2 Power Co., Ltd.
8.94%
Bangkhenchai Co., Ltd.
0.19%

*Local’ refers to suppliers within the same province as CKPower’s power plants or within Lao PDR for power plants in Lao PDR.

Trade Credit Management

The Company implements payment management for suppliers to assist them in maintaining sufficient financial liquidity and business continuity, with the Company’s policy stipulating a credit term of no more than 30 days.

In 2024, the average actual credit term was 30 days, which was consistent with the Company’s policy, enabling suppliers to effectively manage their cash flow and bolstering the Company’s supply chain stability.

Long-term targets, 2024 targets, and 2024 achievements

Long-term Targets 2024 Targets 2024 Achievements
100% Suppliers are assessed for ESG risks 100% of Critical and high-risk suppliers undergo a sustainability (ESG) 100% of Critical and high-risk suppliers undergo a sustainability (ESG)
100% of critical and high-risk suppliers undergo a sustainability (ESG) assessment (Tier 1) 100% of critical and high-risk suppliers underwent a sustainability (ESG) assessment (Tier 1)
Zero case Human rights violations across the value chain 100% of new suppliers sign to acknowledge the Company’s Supplier Code of Conduct 100% of new suppliers signed to acknowledge the Company’s Supplier Code of Conduct
Zero Violations of the supplier code of conduct 100% of suppliers undergo human rights training. 100% of suppliers underwent human rights training.
100% of suppliers acknowledge and comply with the supplier code of conduct. 100% of suppliers acknowledged and complied with the supplier code of conduct.

Project Highlight in 2024

In 2024, the Company conducted human rights training for critical and non-critical suppliers, totaling 497 companies, across all power plants. The objective was to communicate CKPower’s human rights policy and related practices to foster their understanding of human rights principles and ability to apply them in their business operations.

Project Goals:

  • Enhance supplier awareness of human rights.
  • Reduce and prevent human rights violation risks in the supply chain.
  • Strengthen compliance with the Supplier Code of Conduct and fair labor practices.
  • Foster positive social impacts.

Execution

  • Survey and select target suppliers → 497 suppliers with critical roles in the Company’s supply chain were selected.
  • Conduct training across all power plants → Both online and offline training was conducted to engage all suppliers.
  • Training content:
    • Universal human rights principles and related practices
    • Labor standards and guidelines for preventing labor rights violations
    • Supplier code of conduct and alignment with CKPower’s policies
Targets Outcomes
Number of suppliers trained
497
suppliers
476
suppliers
Understanding of human rights Human rights awareness and understanding among suppliers Suppliers were able to apply relevant practices in their own business.
Reduction of labor rights violation risks Compliance with the Supplier Code of Conduct and labor laws No reported human rights violation among suppliers
Expansion of practices across the supply chain Promotion of practical application Suppliers promoted fair labor standards within their own organizations.

Code of Conduct and Human Rights Training for Suppliers at Xayaburi Hydroelectric Power Plant

Code of Conduct and Human Rights Training for Suppliers at Nam Ngum 2 Hydroelectric Power Plant

Conduct and Human Rights Training for Suppliers at Bangpa-in Cogeneration Power Plant

Conduct and Human Rights Training for Suppliers at Bangkhenchai Solar Power Plant

CKPower strives to foster strong relationships with its suppliers through a wide range of training programs, seminars, and activities, where they are informed of the Company’s business approach, policies, and practices for effective implementation.

These activities help strengthen collaboration between the Company and its suppliers, enhance mutual understanding, and promote supplier capability development, thereby enabling them to operate sustainably in line with the Company’s standards.

In 2024, Bangpa-in Cogeneration Power Plant organized first aid and cardiopulmonary resuscitation (CPR) training for 15 Non-Critical Tier 1 Suppliers. The session was led by an expert physician, who provided training on medical safety knowledge and skills.

  • Enhance understanding and skills for basic life-saving emergencies.
  • Reduce severity and potential losses that may occur during work.
  • Elevate safety standards within supplier organizations.
  • Create a safety culture throughout the Company’s supply chain.

Through this training, the participating suppliers gained knowledge that they could apply in their workplace and transfer to their own employees to elevate their safety standards.

First Aid and CPR Training for Suppliers

CKPower recognizes the significance of emergency preparedness. In 2024, Bang Pa-in Cogeneration Power Plant conducted an annual fire drill and chemical spill response exercise in collaboration with 22 Critical Tier 1 Suppliers.

Objectives:

  • Enhance readiness for fire and chemical emergency response.
  • Reduce potential risks and likelihood of incidents during operations.
  • Prevent hazards and impacts that could affect employees and suppliers.
  • Improve safety and occupational health skills and awareness.

The drill and exercise enabled suppliers and employees to respond to emergencies effectively, thereby minimizing potential damage and losses while also reinforcing safety standards in line with organizational requirements.

Annual fire drill and chemical spill response training

Old Tire Repurposing Project

CKPower recognizes the importance of resource efficiency and strives to foster a circular economy. In 2024, Nam Ngum 2 Power Plant collaborated with its supplier Panmany Company to implement the Old Tire Repurposing Project.

Rationale

  • Recycling old car tires into children’s playground equipment.
  • Reducing waste and promoting efficient resource utilization
  • Fostering benefits for communities and supporting education
  • Target school: Muang Sum Kindergarten-Primary School, located near the power plant

Outcomes

  • Reduced the amount of discarded car tires by repurposing them
  • Promoted learning through playground equipment, enhancing youth development
  • Provided environmental education to students and cultivated sustainability awareness
  • Created collaboration between the power plant and suppliers for sustainable community development
  • Fostered a circular economy in production and waste management processes
  • 46 participants from suppliers, community, school, and the company joined the activity.