Charoen Pokphand Foods : Annual Report 2023 (Form 56-1 One Report)

Charoen Pokphand Foods Public Company Limited

Annual Report 2023 (Form 56-1 One Report)

KITCHEN OF THE WORLD

Nurturing the Health of the World

Table of Contents

Page
Part 1	Business Operation and Performance
1. Structure and Business Operation	1
2. Risk Management	41
3. Driving Business towards Sustainability	61
4. Management Discussion and Analysis	96
5. General Information	105
Part 2	Corporate Governance
6. Corporate Governance Policy	108
7. Corporate Governance Structure and Key Information Related to	123
Directors, Sub-Committees, Executives, Employees and Others
8. Major Implementations of Corporate Governance	135
9. Internal Control System and Related Party Transactions	148
Part 3

Report of the Board of Directors' Responsibility on the Financial Statements and Financial Statements

Attachments shown on the website

Attachment 1 Details of Directors, Executives, Company Secretary and Bookkeeper

Attachment 2 Directors of Subsidiaries

Attachment 3 Details of Head of Internal Audit and Head of Compliance Attachment 4 Report of Sub-Committees

Attachment 5 Corporate Governance and Sustainable Development Policy and CPF Code of Conduct Attachment 6 Charters of Sub-Committees

Definition : "The Company" mentioned in Part 1-2 refers to Charoen Pokphand Foods Plc. ("CPF") and its subsidiaries (companies which CPF has direct and indirect control)

In case this 2023 Annual Report (Form 56-1 One Report) references information disclosed on the Company's website, the disclosed information shall be deemed to be part of 2023 Annual Report (Form 56-1 One Report). The Board of Directors certifies the correctness and completeness of disclosed information and annual information disclosure in this 2023 Annual Report (Form 56-1 One Report).

Message from Executives

The Company's goal is to attain Net Zero Emissions by the year 2050 across its entire value chain.

We are the first food company that has been approved for both short-term and long-term goals which align with the Forest, Land and Agriculture Guidance (FLAG) standards for agriculture and food industry by the Science Based Targets initiative (SBTi).

Charoen Pokphand Foods Public Company Limited	that aims for benefits of the country, the people, and
operates a fully integrated agro-industrial and food	the Company, all under the umbrella of good corporate
business, aiming to establish food security to become	governance.
"Kitchen of the World". The Company and its joint
investments have manufacturing base in 17 countries	In the past year, the economic landscape faced significant
and distribution networks extending over 50 countries	challenges stemming from various factors. These included
globally. The Company is committed to develop and	a less-than-anticipated rise in purchasing power,
deliver highly nutritious food products that satisfy	heightened agricultural raw material expenses due to
consumers. Our production process and operations strive	political tensions, escalated interest rates, and an
to maintain the balance between economic success and	oversupply of meats across several nations. Consequently,
creating shared value with all stakeholders, in accordance	the Company's performance in 2023 fell short of
with the 3 Benefit Principles of Charoen Pokphand Group	expectations, evidenced by a total sales revenue of

585,844 million baht, a 5% decline compared to 2022. Assets were valued at 887,218 million baht, with a tax expense of 4,442 million baht*, resulting in a net loss of 5,207 million baht.

In the face of these challenges, the Company focuses on enhancing operational efficiency and maximizing yields from its assets by reducing investments in sectors where growth opportunities do not align with current conditions. Nevertheless, the Company continues to uphold operational strategies that emphasize fostering an innovative organizational culture. This approach aims to refine operational processes, products, and services to resonate with evolving consumer and stakeholder behaviors.

In 2023, one of our missions was to announce the goal to achieve Net Zero Emissions by 2050. The Company becomes one of seven companies worldwide to join pilot projects and is the first food company that has been approved for both short-term and long-term goals which align with the Forest, Land and Agriculture Guidance (FLAG) standards for agriculture and food industry by the Science Based Targets initiative (SBTi). Such mission is beneficial to business operations and environmental management.

Although the economic growth undergoes various challenges, the Company does not neglect the balance in sustainable development, maintaining stakeholders' human rights, climate change management, water resources management, and biodiversity. Through effective corporate governance practices, the Company ensures food security in both stable and crisis situations.

On behalf of the Board of Directors, executives, and employees, we would like to extend our gratitude to all stakeholders for continuous support and trust. The Company is committed to operates business following the vision of "Kitchen of the World" to strengthen food security based on the good corporate governance with the consideration of the society, communities, and environment as well as sustainable economic growth.

Mr. Soopakij Chearavanont

Mr. Prasit Boondoungprasert

Chairman

Chief Executive Officer

DISCLAIMER : THE USE BY CHAROEN POKPHAND FOODS PCL OF ANY MSCI ESG RESEARCH LLC OR ITS AFFILIATES ("MSCI") DATA, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT, RECOMMENDATION, OR PROMOTION OF CHAROEN POKPHAND FOODS PCL BY MSCI. MSCI SERVICES AND DATA ARE THE PROPERTY OF MSCI OR ITS INFORMATION PROVIDERS, AND ARE PROVIDED 'AS-IS' AND WITHOUT WARRANTY. MSCI NAMES AND LOGOS ARE TRADEMARKS OR SERVICE MARKS OF MSCI.

* Income tax paid according to the cashflow statement in Charoen Pokphand Foods Public Company Limited and its subsidiaries.

Our Purpose

VisionMission

The Company operates vertically integrated agro-industrial and food businesses to offer top-quality products in terms of nutrition, taste, food safety, and traceability. The company emphasizes the creation of a world-class, modernized production process, as well as efficient and eco-friendly consumption of natural resources, in order to enhance its competencies and competitive edge on an international level. The Company takes into account the interests of all stakeholders to ensure sustainable growth while continuously generate appropriate returns to shareholders.

Corporate Governance

Three Benefits to Sustainability (for the Country, People and the Company)

Adapt to Change

Speed and QualitySimplification

Integrity, Honesty and ReciprocityInnovativeness

CPF Operation Structure

as of 31 December 2023

* % of Sales Revenue in 2023

38%*

32%*

6%*

27%*

• 20%* 7%*

Associate and JV of CPP (1)

CP-Meiji (59.99%)

HyLife Investment (50.10%)

Ross Breeders Siam (49.99%)

Arbor Acres Thailand (49.98%)

62%*

35%*

Other (2)SuperDrob (49.45%)Well Well Invest S.A.

• (1) % of shareholding represent both direct and indirect holding. Presenting only major associates and joint ventures.

  Note :

• (2) List of other operation areas.

• (3) Group of associate and joint venture of CPP. Details are available in Note to Financial Statements for the year 2023.

(33.33%)

CPF Worldwide

The Company and its joint investments have manufacturing base in 17 countries.

Distribute to >50 countries 5 continents

Asia

Thailand

China

Republic of China (Taiwan)

Vietnam

India

Cambodia

Philippines

Malaysia

Laos

Sri Lanka

Cater to >4,000 million people

As of 31 December 2023

Europe

United Kingdom

Russia

Türkiye

Belgium

Poland

North America

United States

Canada*

South America

Brazil*

Farm

Note : * Business of associates and joint ventures.

Food

Business at a Glance

The Company operates a vertically integrated agro-industrial and food business in animal proteins, with main animals namely swine, broiler, shrimp, and layers. The process starts from animal feed production, commercial animal breeding, farm operation, primary processing, manufacturing of food and ready-to-eat products, meat and food products distribution as well as restaurants. The businesses are categorized into 3 product categories.

1

Committed to develop innovation in feed production processes as well as pet snacks, while prioritizing environmental conservation and surrounding communities. In addition, raw material are sourced locally to support local agricultural production with traceability system of raw materials, fostering transparency and trust from stakeholders.

1

Feed Business

Production and distribution of animal feed as well as pet snacks.

Farm and Processing Business

Animal breeding, commercial farming, and primary processing as well as distribution of fresh meat.

The Company leverages modern technology and extensive field experience to foster competitive and environmentally friendly practices. Throughout the entire farm process well-being of animals are prioritized based on international animal welfare principles, to produce products of the highest quality and safety.

Scope of Business Operations Consisted of 2 Main Categories

38%

of total revenue

62%

of total revenue

Operate an integreated agro-industrial and food business for domestic distribution in Thailand, as well as export to more than 50 countries worldwide.

Operates in integrated agro-industrial and food business across 16 countries outside Thailand namely, Vietnam, China as well as Republic of China (Taiwan), Russia, India, United States, United Kingdom, Philippines, Cambodia, Malaysia, Türkiye, Laos, Poland, Belgium, Sri Lanka and joint investment in Canada and Brazil.

3

Food Business

Produces and distributes a variety of processed meat products, including semi-cooked, cooked or ready-to-eat, as well as restaurants business.

Value added processed food products, ensuring high nutritional quality in ready-to-eat meals, and offering competitive pricing for healthy food products. The Company also prioritize modern and eco-friendly production innovations and maintain a comprehensive traceability system throughout the entire production process.

Distribution Channels

The Company distributes products through various channels to ensure consumer convenience access, including our own channels sush as Chester's restaurants, Five Stars product point of sales, Food World food court and through CP Group's wholesale and retail stores such as Makro, Lotus and 7-11, as well as other distribution channels.