Arab Potash : 2022 Sustainability Report English

APC SUSTAINABILITY REPORT 2022

Partners in Global Food Security

CONTENTS

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INTRODUCTION

6 Message from our Chairman

1. Message from our President & CEO

1. About this Report
2. Our Performance and Progress During 2022
3. About APC

OUR PRIORITIES

1. APC's Corporate Strategy

1. APC's Sustainability Journey

1. Our Governance Structure

1. Our Enterprise Risk Management Strategy

THRIVING

FUTURE

1. Economic Performance

1. Our Market Presence

1. Enhancing Efficiency and Reliability of Operations
2. Ensuring Customer Satisfaction
3. Procurement

52 Our Research, Development, and Innovation Center

ENVIRONMENTAL

STEWARDSHIP

1. Our Management Framework

1. Our Environmental Aspirations
2. Addressing Climate Change

1. Conserving Natural Resources

PEOPLE

CENTRICITY

72 Our Commitment to Health and Safety

81 Our People

1. Our Local Communities

1. Appendices

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APC Sustainability Report 2022

APC Sustainability Report 2022

His Majesty	His Royal Highness
King Abdullah II Bin Al Hussein	Crown Prince Al Hussein Bin Abdullah II

APC Sustainability Report 2022

Introduction	Our Priorities	Thriving Future	Environmental Commitment	People Centricity

MESSAGE FROM OUR CHAIRMAN

Eng. Shehadah Abu Hdaib

Chairman of the Board of Directors

On behalf of the Board of Directors, I am delighted to introduce Arab Potash Company's (APC) 2022 Sustainability Report, which documents the progress of our continued sustainability journey by communicating our impacts on people, the planet, and operations

in a transparent and comprehensive manner. This report is a platform for us to reiterate our continued sustainability commitment to all our stakeholders and interested parties.

As stated in our Annual Report, APC faced significant challenges during 2022, many of which were exacerbated by the unprecedented high rates of inflation, persisting supply chain disruptions due to the global COVID-19 pandemic, and the various geo-political tensions around the globe. Despite these challenges, APC continued to thrive, achieving exceptional performance in production and sales, that has resulted in a historical and record net profit of JOD 601 million.

I am proud of APC's financial success, which can be attributed to the strategic planning and implementation of initiatives aimed at maximizing operational and marketing flexibility to diversify production and access key markets. In addition, it is

also important to recognize our organization's significant contribution to safeguarding global food security.

In the year 2022, we witnessed a series of unprecedented global events that have significantly impacted food security. The Russian-Ukrainian

conflict has disrupted food and fertilizer supply chains from Russia, Ukraine, and Belarus and the severe droughts in the Horn of Africa and the Americas have further exacerbated existing food insecurities. These events have occurred against the backdrop of global economic pressures and governments around the world have struggled to address these challenges, with their capacity limited by the constraints of climate change. We have also seen global trade affected, with transportation costs increasing and product delivery times being extended.

In this challenging environment, we have witnessed large fluctuations in fertilizer prices, which affected APC's sales revenues throughout the year. To address these fluctuations, governments and international organizations, such as the International Fertilizer Association (IFA), have taken steps to promote fertilizer price stability, including lifting restrictions on fertilizer trade and exports. This

has helped alleviate food crises by providing access to affordable fertilizers and maintaining food production. Furthermore, public and private institutions such as APC have continued to promote the efficient use of fertilizers, as well as investing in innovation to develop international best practices and increase productivity using cutting-edge technology. These efforts are aligned with APC's mission to prioritize the principles of sustainable development to support long-term food security and stability.

We believe that collaboration is vital for achieving sustainability goals, especially during times like these. As part of our five-year strategy, we are committed to continue working closely with both internal and external stakeholders to build a sustainable global economy that prioritizes positive environmental and social outcomes, creating a thriving future for all. We are particularly proud of our contribution to the local economy by

sourcing over 40% of our procurement needs from local suppliers in Jordan; to society by safeguarding the health and safety of our employees reflected in the 25% decline in injury rate compared to 2020; and to the environment by having reduced our production emission intensity by 18% compared to 2019 values.

As we enter 2023, sustainability will remain central to our purpose of promoting prosperity and ensuring food security globally as a leading potash producer.

To achieve a sustainable future, we must all work together towards

a common goal. Let us embrace collaboration and partnership, as we strive to create a world that is environmentally sound, socially just, and economically prosperous. Our individual actions may seem small, but together, they can make a significant difference in shaping a better future for generations to come.

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APC Sustainability Report 2022

Introduction	Our Priorities	Thriving Future	Environmental Commitment	People Centricity

MESSAGE FROM OUR CEO

Dr. Maen Nsour

President & CEO

I am delighted to present APC's Sustainability Report, outlining our progress towards contributing to the United Nations' Sustainable Development Goals (SDGs) and Jordan's 2025 Vision. As a leading producer of fertilizers, we recognize our responsibility to promote sustainable practices and reduce our environmental impact. Our commitment to sustainability is at the heart of our business operations, corporate culture, and long-term strategies.

As a leading producer of potash fertilizers, APC operates in an industry that has been impacted by global political, economic, and health events in 2022, such as the Russian-Ukrainian conflict, droughts, floods, and other natural disasters. These challenges have led to higher fertilizer prices and a difficult operating environment for many companies in our industry. In the midst of these challenges, APC has remained resilient, achieving the highest profits in our company's history. This historical achievement is the result of our 2025 strategy, which allowed us to maintain flexibility

in our production and marketing operations by scaling up production to the maximum capacity while ensuring the sustainability and safety of the production process, diversifying product offerings, and expanding our marketing network in the European Market and entering into new markets in Southeast Asia, Australia, and Brazil.

At APC, we understand the importance of energy and water efficiency in reducing production costs while simultaneously benefiting the environment. In fact, in 2022, we achieved a significant energy intensity reduction of 20% relative to 2019. Furthermore, as we work to continue to expand production and enhance the competitiveness of APC, we are launching several projects aimed at increasing energy and water efficiency in our operations, with the aim of reducing our carbon footprint, and minimizing waste generation.

These achievements will be further supported by the APC Advanced Center for Research, Development, and Innovation, developed

in collaboration with the best

international research centers and for which construction is nearing completion. The center will advance research activity, development, and innovation in the production of fertilizers and in their application in the agricultural sector while considering the environmental impacts and opportunities.

We recognize that our success is largely attributable to our human capital, and we continue to invest in our employees by equipping them with the correct knowledge and skills. In 2022, 18,499 hours of collective training were provided to our employees to upskill them and support their development. As we strive to build a strong institution, we place a large emphasis on creating

a corporate culture that promotes employee engagement, diversity and inclusion, and personal and professional development. We are also proud of the JOD 7 million donated to support our communities in 2022.

As we move forward, we remain steadfast in our commitment to sustainability and to contributing to a more sustainable future for all. We recognize the vital role that businesses play in promoting sustainable practices, and we are proud to be at the forefront of this effort. At APC, we will continue to improve our sustainability practices and maintain our position as a leader in the fertilizer industry.

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