ETHICS IN ACTION

Upholding Integrity Through Innovation, Security, and Governance

Strong corporate governance is a cornerstone of QES’s long-term success. Transparency, accountability, and integrity are the pillars of our governance framework. We adhere to comprehensive ethical guidelines as outlined in our Code of Ethics and Conduct, Anti-Corruption and Bribery Policy, and Whistleblowing Policy. These policies ensure that all employees and stakeholders act with the highest levels of integrity and compliance.

QES has implemented stringent anti-bribery measures, supported by training sessions on anti-corruption practices for Board members and employees. We aim to achieve 75% training participation across our Malaysian workforce by FYE 2025. Our governance practices extend beyond policies, as evidenced by our proactive approach to monitoring regulatory changes and updating internal controls accordingly.

As of FYE 2024, QES recorded zero substantiated whistleblowing reports or instances of corruption, reflecting our steadfast dedication to ethical business practices.

PRODUCT INNOVATION & RELIABILITY

Technology & Quality Innovation at QES
At QES Group Berhad, we recognize that technological innovation and quality excellence are critical to maintaining our competitive edge in the semiconductor equipment industry. We are committed to delivering high-quality, precision-engineered solutions while ensuring sustainability, efficiency, and compliance with global industry standards. Guided by our PRIDE core values, we strive to meet and exceed customer expectations, regulatory requirements, and sustainability benchmarks. Our commitment extends beyond product development to encompass responsible sourcing, ethical business practices, and continuous improvement in our quality management systems. This section outlines how we drive product innovation, uphold quality standards, and ensure compliance through our internal controls, research and development (“R&D”) investments, and international certifications.

Driving Innovation Through R&D
In an increasingly competitive market, innovation is the foundation for long-term success. At QES Group, we place strong emphasis on R&D to:
• Develop next-generation semiconductor and automation equipment with enhanced performance and energy efficiency.
• Refine existing products and manufacturing processes to improve quality, durability, and sustainability.
• Shorten product delivery lead times by streamlining production workflows.

To achieve these goals, 7% to 8% of our manufacturing division’s annual revenue is allocated to R&D investments, ensuring continuous technological advancement and market relevance.

We are committed to delivering high-quality, precision-engineered solutions while ensuring sustainability, efficiency, and compliance with global industry standards. Guided by our PRIDE core values, we strive to meet and exceed customer expectations, regulatory requirements, and sustainability benchmarks. Our commitment extends beyond product development to encompass responsible sourcing, ethical business practices, and continuous improvement in our quality management systems. This section outlines how we drive product innovation, uphold quality standards, and ensure compliance through our internal controls, research and development (“R&D”) investments, and international certifications.

Commitment to Product Quality & Compliance
At QES Group, quality is the cornerstone of everything we do—from design and manufacturing to product delivery and customer support. We implement rigorous Quality Assurance (“QA”) processes across all operational stages to ensure consistency, reliability, and compliance with industry and regulatory standards.To uphold our commitment to quality, we:
• Implement a structured Quality Management System (“QMS”) that governs product lifecycle processes.
• Monitor and assess product performance metrics to ensure compliance with customer specifications and international standards.
• Conduct internal audits and risk assessments to prevent product defects and operational inefficiencies.
• Train employees and partners to ensure alignment with our quality objectives.

Our QA process follows a comprehensive quality control framework, covering procurement, production, assembly, and non-conformity management.

Internal Controls for Manufacturing Division
To uphold product quality and safety standards, QES Group has established stringent internal controls across our manufacturing, engineering, and production processes:

Quality Management Systems & Certifications
To reinforce our commitment to product quality, safety, and regulatory compliance, QES Group adheres to internationally recognized quality management standards.

The Importance of Quality & Certification Compliance
Maintaining high-quality standards and internationally recognized certifications is essential to:

Ensuring compliance with global industry regulations (ISO, IEC, and customer-specific requirements).
Enhancing customer confidence in QES products and manufacturing capabilities.
Supporting supply chain sustainability by implementing eco-friendly and energy-efficient practices.
Expanding market access by meeting international quality and safety benchmarks.

By securing ISO and IEC certifications, QES Group demonstrates its commitment to world-class manufacturing, sustainability, and customer satisfaction.

Our Future Commitment to Quality & Innovation
QES Group remains committed to:

Advancing R&D investments to drive innovation in semiconductor and automation equipment.
Strengthening ESG-aligned quality management practices to meet evolving global standards.
Expanding certification coverage to ensure compliance with new environmental, quality, and sustainability
regulations.
Enhancing supply chain traceability and ethical sourcing to meet customer and investor expectations.

Through technological innovation, continuous quality improvement, and compliance with international standards, QES Group is positioned as a leader in precision automation and semiconductor equipment solutions.

BUSINESS GROWTH & CONTINUITY

At QES Group Berhad, our commitment to long-term customer satisfaction, market competitiveness, and business continuity is driven by a structured approach to customer engagement, continuous improvement, and industry collaboration. These pillars form the foundation of our ability to deliver high-quality products and services, strengthen market positioning, and ensure sustainable business growth.

Customer Engagement & Service Excellence
Our customer engagement strategy is designed to enhance satisfaction, strengthen relationships, and deliver value-driven solutions. From pre-sales consultation to post-sales support, we ensure that every customer interaction is seamless, responsive, and focused on long-term partnerships.

Customer Engagement Process:
• Personalized Consultation – Sales representatives analyze customer needs and recommend the most suitable solutions.
• Transparent Order & Delivery Updates – Customers receive real-time updates on delivery schedules and installation processes.
• Post-Installation Satisfaction Survey – Customers provide feedback on sales experience, product performance, and service quality.
• Continuous Improvement Through Feedback Analysis – Data-driven insights from customer feedback drive service enhancements and innovation.

Customer Satisfaction Surveys are conducted post-installation, evaluating four key areas:
1. Sales Personnel – Product knowledge, responsiveness, and professionalism.
2. Products – Quality, reliability, and compliance with specifications.
3. Service Personnel – Installation efficiency, technical support, and troubleshooting.
4. Overall Purchase Experience – End-to-end customer journey evaluation.

Customer Engagement & Service Excellence
Impact on Long-Term Customer Satisfaction & Business Continuity: • Strengthens brand loyalty by addressing customer needs proactively.
• Reduces service disruptions by improving issue resolution and response times.
• Enhances trust and reliability, ensuring repeat business and long-term customer retention.
Through proactive customer engagement, continuous service improvements, and adherence to global quality standards, QES Group remains committed to delivering excellence while driving sustainable business growth.

Customer Feedback & Continuous Improvement
To maintain high service standards and product excellence, QES Group conducts regular customer satisfaction surveys and leverages data-driven insights for continuous improvement.
Customer Feedback Process:
• Meticulous data analysis to identify key areas for enhancement.
• Departmental reviews during monthly meetings to drive actionable improvements.
• Integration of feedback into product development and service refinement.

Key Benefits for Market Competitiveness & Business Continuity:

Proactive issue resolution improves customer trust and brand reputation.
Enhanced service response times and technical support strengthen customer retention.
Refined product quality and functionality ensure QES Group stays competitive in a rapidly evolving market.

Through this structured, data-driven approach, QES Group remains at the forefront of customer-centric innovation and service excellence.

Industry Engagement & Market Expansion
At QES Group Berhad, we recognize that long-term business sustainability requires strong industry partnerships, continuous market expansion, and global networking. One of the key pillars of our market growth strategy is active participation in national and international tradeshows and conferences, which provides:

Invaluable networking opportunities with industry leaders, partners, and potential customers.
Insights into emerging trends, innovations, and best practices in our key sectors.
Brand recognition and market expansion opportunities, strengthening QES’s reputation as a trusted industry player.

Key Tradeshows & Conferences Participated in FYE 2025:

Strategic Expansion of QES Group’s Supplier Network
At QES Group Berhad, our commitment to business sustainability, technological innovation, and market resilience drives our continuous expansion of strategic supplier partnerships. In FYE 2024, we have further strengthened our distribution division by introducing three new suppliers to our global network of technology partners, reinforcing our ability to fill critical market gaps, meet evolving customer demands, and maintain a competitive edge in our industries.

The newly added suppliers—Semishare (China), Eviscan 3D and Lubrication Plus—bring cutting-edge technologies and specialized solutions that enhance QES’s product offerings across semiconductor, electronics, precision engineering, and industrial automation markets.

Semishare is a leading Chinese provider of wafer probing and semiconductor testing solutions, specializing in:

Probe stations for high-precision electrical testing of semiconductor wafers.
Automated and manual probing systems for advanced R&D and production environments.
Flexible wafer-level testing for microelectronics, optoelectronics, and MEMS applications.

Market Gap Filled:
With increasing complexity in semiconductor devices, the demand for high-precision testing solutions is growing. Semishare’s advanced wafer probing technologies strengthen QES’s ability to offer cutting-edge solutions for semiconductor manufacturers, research institutions, and integrated device manufacturers (IDMs).

Eviscan 3D introduces state-of-the-art three-dimensional scanning and imaging solutions, catering to industries requiring precise measurement, reverse engineering, and non-contact inspection technologies.

Ultra-high accuracy 3D scanning for quality control, product development, and digital archiving.
Portable and automated 3D scanning systems for industrial and biomedical applications.
Enhanced metrology solutions for aerospace, automotive, and semiconductor industries.

Market Gap Filled: The demand for high-precision 3D imaging and metrology is increasing in advanced manufacturing, aerospace, and automotive sectors. Eviscan 3D’s cutting-edge technology enables QES Group to offer industry-leading solutions for component inspection, quality assurance, and rapid prototyping.

Lubrication Plus focuses on advanced lubrication and maintenance solutions to improve equipment longevity, energy efficiency, and operational performance across various industries.

- High-performance industrial lubricants for precision machinery and automation systems.
- Eco-friendly lubrication solutions to reduce friction, wear, and maintenance costs.
- Customized lubrication programs tailored for semiconductor, automotive, and heavy manufacturing sectors.

Market Gap Filled: With sustainability and operational efficiency becoming key concerns, Lubrication Plus enhances QES’s ability to provide sustainable, high-efficiency lubrication solutions that extend equipment lifespan and reduce downtime.

By integrating these new supplier partnerships, QES Group is:

- Expanding its product portfolio with high-tech solutions that address unmet industry needs.
- Enhancing its market position as a one-stop provider for advanced manufacturing and automation solutions.
- Supporting business continuity by ensuring access to cutting-edge technologies that drive industry innovation.
- Filling critical technology gaps in wafer testing, 3D imaging, precision tooling, and industrial lubrication.
- Aligning with sustainable business practices by offering eco friendly, high-efficiency solutions that promote energy savings and waste reduction.
- These new additions solidify QES’s role as a leader in providing innovative and sustainable solutions, ensuring that we continue to meet customer needs, drive technological advancements, and maintain a resilient business model in an evolving global market.

Wafer Phase Shift Deflectometry (“WPSD”) – A New Standard in Precision Measurement
This cutting-edge optical metrology system revolutionizes wafer surface measurement by utilizing the deflection of light waves to achieve unparalleled accuracy in topography analysis. Designed to address critical challenges in semiconductor manufacturing, offering:

High-Resolution Surface Defect Detection – Traditional metrology tools often struggle to identify nanometer-scale surface anomalies that can affect semiconductor performance. WPSD provides ultra-precise surface mapping, ensuring superior quality control and defect detection.

Non-Destructive Testing – Many conventional techniques require destructive sample preparation, increasing costs and reducing production efficiency. WPSD enables comprehensive surface analysis without compromising wafer integrity, ensuring seamless process monitoring and optimization.

Rapid Throughput & Real-Time Data Acquisition – Precision often comes at the expense of speed, creating bottlenecks in production. WPSD enhances metrology efficiency by enabling fast, high-resolution measurements, facilitating real-time process control and enhanced production yields. By integrating WPSD into our product portfolio, QES Group reaffirms its commitment to innovation, quality excellence, and sustainable semiconductor manufacturing. This breakthrough technology not only strengthens our position as an industry leader but also aligns with our goal of driving precision, efficiency, and sustainability in semiconductor production.

BUSINESS ETHICAL & CORPORATE GOVERNANCE

At QES, we are firmly committed to upholding high standards of corporate governance and ethical business practices across all levels of our operations, and to ensuring full compliance with all applicable laws and regulations in the jurisdictions where we operate. The Group recognizes that robust corporate governance is integral to its sustained success and is fully committed to implementing practices that ensure transparency, accountability, performance, and integrity. These elements are crucial for fostering trust and confidence among stakeholders. Upholding high standards of corporate governance is a cornerstone of our long-term business strategy. The Board of Directors plays a central role in upholding the Group’s corporate governance principles. We believe that a sound and effective Board structure is the foundation of strong governance and strategic oversight, helping safeguard the interests of stakeholders while enhancing long-term shareholder value. These commitments are further detailed in the Corporate Governance Overview Statement contained within this Annual Report.

In addition to the overarching commitment to governance principles, the Group has formalized various policies and frameworks to guide its conduct and operations, including:

Code of Ethics and Conduct: A comprehensive set of guidelines outlining the ethical standards and behaviors expected of all employees and stakeholders.
Anti-Corruption and Bribery Policy: A robust policy aimed at preventing corrupt practices and ensuring compliance with anti-bribery laws and regulations.
Whistleblowing Policy: A mechanism for employees and external parties to report any unethical behavior, misconduct, or violations of company policies, with assurances of confidentiality and protection from retaliation.
Corporate Governance Report: A detailed account of the Group’s governance structure, processes, and practices, providing stakeholders with insight into how governance principles are upheld within the organization.
Board Charter: A document delineating the roles, responsibilities, and expectations of the Board of Directors, guiding their actions in accordance with best practices and regulatory requirements.
Directors’ Fit And Proper Policy: Sets out the fit and proper criteria for the appointment and re-appointment of Directors on the Board of QES Group Berhad (“QES”) and its subsidiaries.

Anti-Corruption and Bribery

QES maintains an unwavering zero-tolerance policy towards bribery and corruption, as outlined in our Anti-Corruption and Bribery Policy (“ACAB Policy”), which is publicly accessible on our corporate website. The ACAB Policy details the types of conduct that may constitute bribery and corruption, such as gifts, entertainment, hospitality, donations, and other behaviors that may be deemed unethical, as well as, clear guidelines for directors and employees to adhere to, ensuring compliance with all applicable laws, rules, and regulations in the performance of their duties.

To ensure the relevance and effectiveness, the Board conducts regular reviews, updates, and oversight to ensure the ACAB Policy covers anti-corruption comprehensively, particularly in response to regulatory changes such as Section 17A of the Malaysian Anti-Corruption Commission (“MACC”) Act 2009 (Amendment 2018). These reviews are crucial for maintaining alignment with evolving legal requirements and best practices in the field of anti-corruption.

We proactively communicate the ACAB Policy through various communication channels, including the corporate website, training or awareness sessions, integration with supplier and vendor documents and documentation in the Group Corporate Handbook, ensuring accessibility to all parties. The ACAB policy applies to all entities within the Group, including directors, employees, consultants, agents, suppliers, customers, and third parties associated with QES.

In FYE 2024, we achieved an anti-corruption training participation rate of 88.45%, surpassing our previous target of 75% for Malaysian employees. We remain committed to ongoing education efforts and will continue implementing training and awareness sessions to strengthen employee understanding and awareness of anti-fraud, bribery, corruption matters, and whistleblowing mechanisms, fostering a culture of integrity and compliance throughout the organization. For FYE 2025, we are targeting a participation rate of 90% as part of our continuous improvement efforts.

Our commitment to transparency and accountability extends beyond policy formulation. In FYE 2024, QES has conducted internal corruption risk assessments integrated within our Enterprise Risk Management (“ERM”) framework across all Malaysian business units. This proactive approach helps identify and mitigate vulnerabilities in our operations. Moving forward, the Group will implement more structured assessments of corruption-related risks, further reinforcing our focus on integrity and regulatory compliance.

Whistleblowing and Ethical Oversight
At QES, we strongly encourage a culture of openness and integrity. Our Whistleblowing Policy provides a secure and confidential channel for employees and stakeholders to report concerns about unethical behavior, misconduct, or violations of our internal policies or applicable laws. For FYE 2024, the Group recorded:

Zero substantiated whistleblowing reports;
Zero incidents of bribery, corruption, or unethical behavior;
Zero employee disciplinary actions or dismissals due to non-compliance with anti-corruption or unethical behavior; and
Zero fines or penalties for non-compliance with anti-corruption or unethical behavior.

This clean record reflects our unwavering commitment to ethical conduct and business integrity. We will continue strengthening our internal controls, promoting awareness, and fostering a culture where doing the right thing is everyone’s responsibility.

DATA PRIVACY & SECURITY

At QES Group Berhad, we recognize that data privacy and cybersecurity are critical to maintaining stakeholder trust, regulatory compliance, and business resilience. As digital transformation accelerates, protecting sensitive information and mitigating cybersecurity threats remain a top priority. We are committed to safeguarding the data of employees, customers, and business partners by implementing robust security measures, compliance frameworks, and proactive risk mitigation strategies.

To effectively manage our expanding IT infrastructure and user base, we have implemented the following data security controls:

Advanced IT Security Infrastructure – Deployment of firewall protection, endpoint security solutions, antivirus software, emergency power supply, server backup, and user access controls to safeguard data integrity.
Compliance with Data Protection Laws – Adherence to the Personal Data Protection Act 2010 (PDPA) and internal IT user policies governing the responsible handling of sensitive information.
Enterprise IT Management Systems – Adoption of centralized IT management software with advanced monitoring and threat detection capabilities to oversee large scale IT infrastructure.
Cybersecurity Workforce Strengthening – Regular enhancement of IT team capabilities, ensuring comprehensive coverage of operations (ITOps), development (DevOps), and security needs.

Zero substantiated complaints concerning breaches of customer privacy or data loss were reported for FYE 2024, reflecting our strong cybersecurity governance framework.

SUPPLIER CODE OF CONDUCT

The Group is committed to establishing a diverse, responsible, and sustainable supply chain to bolster long term value creation. Our goal is to foster enduring, mutually beneficial partnerships with suppliers, driving collective growth within a profitable framework that minimizes disruptions and enhances efficiency. In alignment with our core values, we prioritize ethical business conduct, environmental responsibility, and compliance with legal and regulatory requirements, ensuring that our supply chain upholds the highest standards of integrity.

To uphold these commitments, the Group has established a Supplier Code of Conduct, which outlines key expectations regarding business ethics, human rights, labor standards, health and safety, and environmental responsibility. In FYE 2024, we formally communicated our Supplier Code of Conduct and Code of Ethics and Conduct to all active and new suppliers via email and incorporated these codes into our procurement documentation. Suppliers are required to adhere to strict guidelines on anti-corruption, fair labor practices, and environmental stewardship, aligning their operations with internationally recognized principles of corporate responsibility. Compliance with these standards is monitored through regular assessments, and corrective actions are implemented when necessary to address nonconformities.

The Group is committed to fostering sustainability throughout our supply chain by enhancing supplier engagement and performance. We aim to strengthen supplier relationships through initiatives focused on sustainability, ethical practices and continuous improvement. As part of this commitment, we will explore opportunities to implement supplier evaluation and risk assessments to ensure alignment with our sustainability objectives. Moving forward, we will actively engage with suppliers, particularly those in higher-risk categories, to mitigate environmental and social risks. Our supplier selection process will emphasize due diligence, ensuring alignment with the Group’s sustainability standards and reinforcing responsible procurement practices across all business units. These initiatives reflect our ongoing dedication to advancing sustainability, transparency and ethical business practices throughout our supply chain.

The Group also acknowledges the importance of supporting local economies. By partnering with local suppliers, we contribute to economic growth, job creation, and community development in the regions where we operate. Collaborating with local suppliers also offers strategic advantages, such as reduced lead times, enhanced communication, and improved supply chain flexibility. Despite our unwavering dedication to sourcing locally whenever feasible, our expenditure with local suppliers for the Malaysian business units increased from RM25.56 million in FYE 2023 to RM29.18 million in FYE 2024, representing a rise in local sourcing from 17.88% to 22.17% of our total procurement spend. While this percentage reflects our commitment to quality and sustainability, we continue to explore opportunities to deepen our engagement with local suppliers, ensuring that our procurement strategies align with both operational efficiency and sustainable business practices.

Striking a balance between local supplier engagement and operational requirements remains a key focus. As we uphold our commitment to responsible procurement, we are actively working to strengthen the resilience and integrity of our supply chain. By enforcing our Supplier Code of Conduct and fostering responsible supplier relationships, we aim to drive sustainable growth, enhance supply chain accountability, and promote ethical business conduct across all our operations.

Business Practices

Anti-Bribery and Corruption
Communication
Confidential Information
Conflict of Interest
Fair Competition
Intellectual Property
Trade Compliance

Employment Practices

Applicable Local Labor Laws
Freedom of Association
Forced Labor, Slavery & Human Trafficking
Child Labor Practices
Non-Discrimination or Equal Opportunities
Right to Collective Bargaining
Elimination of Excessive Working Hours
Right to a Minimum or Living Wage
Harassment & Abuse
Diversity & Equality
Compensation
Workplace Environment
Worker’s Accident and Safety
Conduct ESG-Related Awareness Training To All Employees

Environmental Practices

Energy Use
Climate Change Impact Including Co2/Ghg Emissions
Water Use
Biodiversity Issue
Pollution Prevention
Waste Reduction
Resource Use

The Code is applicable to all our suppliers and contains the minimum standards of adherence. It is integrated into contracts with our suppliers. Suppliers may also have individual contracts with QES that contain specific provisions and/or agreements relating to these standards. In case of conflict between the requirements outlined in law, individual contracts, and this Code, suppliers must comply with the strictest requirement. It is the supplier’s responsibility to disseminate, educate, and exercise diligence in verifying compliance with this Code among their employees, agents, and suppliers.

Suppliers who believe that a QES employee or anyone acting on behalf of QES has engaged in illegal or otherwise improper conduct with respect to their business with the supplier should report the matter to us. All reports will be handled confidentially. A supplier’s relationship with QES will not be affected by any honest report of potential misconduct.

Our Commitment to the Future

In “Ethics in Action,” QES, we remain committed to upholding the highest standards of corporate governance, ensuring that our business practices reflect integrity, transparency, and ethical responsibility. Through continuous innovation, rigorous data security, and unwavering governance, we pave the way for sustainable growth and long-term success.

2024 @ QES GROUP BERHAD (201401042911)