The sponsor has presented plans to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the environmental and social requirements - the host country laws and regulations and the IFC Performance Standards on Social and Environmental Sustainability and relevant Environmental, Health and Safety guidelines. The information about how these potential impacts will be addressed by the sponsor/project is summarized in the paragraphs that follow. Further information is provided in the attached Environmental and Social Action Plan (ESAP).
- PS1: Social and Environmental Assessment and Management Systems
Soktas places a high priority on product quality, environmental management, and worker health and safety performance, and demonstrated strong environmental and social development performance in the two investments financed by IFC previously. Soktas’ textile operations are ISO 9001 (Quality) and ISO 14001 (Environmental Management) certified, with certification provided by international certifiers. The company has also been certified as meeting the OKOTEX 100 standard developed by European institutions to test and label textile products as free of harmful chemicals to consumers. Annual E&S Monitoring Reports (AMRs) submitted as part of earlier IFC investments indicate that Soktas’s textile plant complies fully with Turkish and IFC requirements.
In 2004, the company contracted Siemens to undertake a detailed energy and water use audit of the textile plant, and has since adopted many of the recommendations from the study to reduce water and energy utilization. Water and energy use are monitored by each department on a monthly basis, and results reported to Soktas’s senior management group. As part of its expansion into India, Soktas will roll out the E&S and OHS management systems in place at the Soke textiles plant at both the dairy farm and the Kolhapur textiles plant, and create a corporate E&S/OHS management team with designated E&S/OHS managers at each plant. Training on the E&S/OHS management system will be provided to all staff. The systems will be revised to incorporate IFC’s Performance Standards, which were not in effect at the time IFC made its earlier investments in Soktas. As the single largest employer in Soke and a presence in the community for more than 30 years, Soktas has an ongoing program of engagement, social responsibility and information sharing with nearby communities.
Because the site for the dairy operations is located in a predominantly agricultural area, no change in land use resulted from development of the dairy project in Incirliova. Turkish regulations did not require submission of an Environmental Impact Assessment for the project prior to approval by Government authorities. Although the project is currently in an early stage of development, Soktas has reviewed IFC’s Environmental, Health, and Safety Guidelines for Dairy Processing and confirmed that the plant will comply fully with these guidelines, as applicable, and with all Government of Turkey requirements. Management of the dairy operations will be integrated into Soktas’s overall environmental management system, as discussed above.
In India, environmental assessment of the Project is being undertaken in accordance with all relevant Indian laws and regulations. The company was not required to undertake a Rapid Environmental Impact Assessment (REIA) or Environmental Management Plan (EMP) under Schedule I of the Ministry of Environment and Forests (MoEF) Environmental Impact Notification Act, 1994. Instead, Soktas provided detailed plans regarding its water and energy requirements, wastewater quality and volumes, and air emissions to the Maharashtra Industrial Development Corporation (MIDC) and Maharashtra Pollution Control Board (MPCB) to obtain Environmental Clearance for the Project. The company has applied to the MPCB for a No Objection Certificate and Consent to Establish. Copies of all Government clearances, permits and authorizations for the new Project will be provided to IFC within 30 days of receipt by Soktas.
- PS2: Labor and Working Conditions
Soktas is in the process of consolidating its human resources (HR) policies and procedures into a comprehensive HR management system that will apply to all of Soktas’s operations. The company has reviewed PS2 and confirmed that the HR system will comply fully with all of its provisions. A copy of the draft HR policy and procedures will be provided to IFC for review, according to the timeline stipulated in the attached ESAP.
Soktas has confirmed that it complies with all relevant labor laws in Turkey. Much of the labor force in Soktas’s Turkish textiles operations is unionized. Soktas negotiates a new labor contract with the union every three years; the company recently concluded negotiations and the new three-year contract has taken effect. In addition, Soktas received ‘Fair Trade’ certification in 2007, after undergoing a detailed audit and inspections to confirm that its policies and practices ensure that its workforce is treated in accordance with international standards of fair treatment and non-discrimination. Fair Trade certification addresses the same key labor issues as does PS2, including working relationships, non-discrimination, grievance mechanism, and child and forced labor, indicating that the company’s existing labor practices are consistent with all of the major elements of PS2. The company monitors noise and heat levels in all departments regularly, provides all requisite personal protective equipment (PPE) and ensures that the use of PPE is stringently enforced. Soktas provides annual medical examinations to all employees, and will add hearing tests to the required medical examinations for employees working in high noise areas. The company has a compulsory training program for all staff, ranging from one month to several months depending in the Department to which an employee is assigned. All training includes mandatory sessions on basic OHS principles and procedures, including safe use of equipment, need for and proper use of PPE, accident prevention, fire control, emergency response. Soktas employs two doctors (one full time, one part time) in its HR department. The Department tracks accident and injury events, including lost time injuries (LTIs) and costs associated with accidents, on a monthly basis for all Departments. A review of recent reports indicates that the company has a strong OHS record in all areas of operations and that LTI rates are consistent with industry good practice. Soktas’s employee benefits package includes a medical insurance program for employees and their families.
The Kolhapur plant has been designed to meet all requirements of the Factories Act with respect to OHS. Construction is expected to commence in November 2007, under the daily oversight of both the Soktas Unit Head based in Kolhapur, and the Pune-based architectural design firm engaged by that the company to handle all aspects of Project design and construction. Soktas required all construction bids to include specific occupational health and safety (OHS) policies and procedures to ensure that construction is undertaken in accordance with international standards and Government of India requirements. Non-compliance with these provisions will be grounds for punitive action, including daily fines and default. Soktas expects to employ 250-300 full time workers in Phase 1 (which is expected to be operational in June 2008). The company has employed an experienced Unit Head who has worked in the Indian textiles sector for 15 years and will ensure that all local employment laws and regulations are fully complied with.
- PS3: Pollution Prevention and Abatement
Electric power for all textiles and dairy operations at Soktas in Turkey is drawn from the national grid. Given the unreliability of grid power in the 1970s-1990s, Soktas previously operated its own 4 MW captive power plant at the textiles plant in Turkey (using diesel fuel and, subsequently, naphtha). Reliability has since improved and the cost of operating the on-site plant has made it no longer a viable energy option; its use was discontinued in 2001. The company has no plans to use the on-site electric power plant in future. In addition, Soktas operates four on-site boilers comprising one fluidized bed of coal, two LNG boilers (one used for stand-by purposes only), and one hot-oil boiler. Soktas has undertaken an energy conservation program for the past decade and will continue these efforts going forward. The company has agreed to provide current consumption data for fuels and grid electricity to enable the calculation of an estimate of annual greenhouse gas emissions at the Soke plant, in accordance with the schedule in the ESAP. This information will be provided subsequently for all of its operations, together with production data, in the context of the AMRs it provides to IFC for the Project.
Soktas controls dust generating operations of cotton handling and storage by effective enclosure of the relevant equipment and areas Dust is removed in the spinning yarn, weaving and twisting departments by using an air condition and air-washing system. Stack gas emissions from all the boilers are regularly monitored. A review of the most recent AMR provided to IFC indicates that all boiler emissions are in compliance with both local regulations as well as IFC guidelines. The fluidized bed boiler is equipped with electrostatic precipitators to remove particulate matter. Process exhausts including the singeing machine, foulard finishing (all operating with LNG) are also monitored and reported on a regular basis. HCFCs (mainly Freon-22 in cooling units) are used at the plant, but ozone depleting substances are avoided in new equipment and the replacement is going on in a timely manner.
Water for the plant is drawn from underground sources for which the company has obtained permission from the relevant authorities. As noted, Soktas has in place an ongoing water conservation program and monitors results on a monthly basis. The wastewater treatment plant (WWTP) at Soktas includes primary, secondary and tertiary treatment units. The tertiary treatment unit consists of a sand filter and UV disinfection provides the possibility of wastewater reuse in floor washing and flush tanks of toilets. The secondary treatment unit is composed of both biological and chemical treatment. The chemical treatment is presently out of operation because monitored parameters of the effluent from biological treatment meet all local regulatory limits and IFC guidelines without chemical treatment, owing to the extensive use of bio-eliminable compounds in the production processes. Soktas will extend its monitoring of wastewater to include the additional parameters listed in the new IFC guideline for textile manufacturing. A similar WWTP will be installed at the new facility in India.
Hazardous materials are managed in accordance with requirements set be national legislation and industry good practice. All hazardous materials are stored either in bulk tanks in the processing areas, or in a single controlled storage area (for smaller volumes). Waste water collection channels have been installed near the small volume chemicals storage area, in the event of a leak or spill. Soktas will review these areas and install secondary containment structures if these are indicated, as described in the ESAP. Soktas’s policy is to minimize the use of hazardous substances in its operations. As indicated before, the company is certified according to the international certificate of OKOTEX 100 Standard, given the fact that all its products are free of any harmful chemicals to human health. In compliance with this standard, phenol and formaldehyde content of the chemicals used in the production operations are each limited to 75 parts per million (ppm). Hydrogen peroxide is used as bleaching operations instead of sulfur and chlorine based bleaches. PVA is used as sizing agent. PVA containing solutions are reused several times in the processes in order to minimize chemical and water consumption. All dyes and chemicals are supplied from the producers committed for environmental sustainability, preferably certified on ISO 14001, operating under Responsible Care principles and consistent with EU good practice. Part of Soktas’s manufacturing is dedicated to fully organic textile certified by EKO Sustainable logo which ensures that the raw material cotton originates from organic cultivation and is processed using sustainable textile production methods. Soktas will provide IFC with a documented assessment of the chemicals used in the plant referring to the listed chemicals in the OKOTEX 1000 standard.
Types and quantities of all wastes - as well as means of recycling, reuse and disposal - are closely tracked by Soktas. Hazardous and non-hazardous wastes are appropriately segregated, stored and disposed of when recycle or reuse is not practicable. The sludge generated from the wastewater plant is disposed at the plant premises since its content of heavy metals complies with the regulatory criteria of the use of sludge for agricultural purposes.
As noted, Soktas intends to replicate the Soke plant – both in terms of processes and pollution control – almost identically at the new operations in Kolhapur. Power will be drawn from the national grid. The Kolhapur plant will have a daily water requirement of 4000 m3/day, which will be purchased from MIDC. MIDC draws water for the entire industrial plant from underground sources and treats to potable levels before distribution. As at Soke, the Kolhapur plant will be equipped with a wastewater pre-treatment plant capable of treating all process effluent streams to levels specified by the MIDC. Pre-treated wastewater will be discharged to MIDC’s onsite Common Effluent Treatment Plant (CETP) for secondary treatment to levels that meet both MPCB and IFC limits; MIDC uses water from the CETP for irrigation purposes within the industrial park. Soktas will provide independent test results from its WWTP to IFC confirming that all limits are being met within 30 days of the commencement of production. As at Soke, the company will monitor the volume and quality of treated wastewater weekly, and provide these results on a regular basis to the corporate EHS team at Soke, and to regulatory authorities as required. Soktas will implement the same water and energy conservation programs at Kolhapur that it has successfully used at the Soke plant.
- PS4: Community Health, Safety and Security
As part of its overall management system at the textiles plant in Soke, Soktas has prepared and periodically updates Fire Safety and Emergency Response Plans, which consider situations that could affect the plant itself as well as communities outside the plant boundaries. These include planning for major risks and incidents, under both normal and emergency scenarios. Accident and fire drills are undertaken periodically, in conjunction with local fire and emergency response providers. Given the fire risk at its textiles plants, the company has established strict rules and procedures regarding smoking and other potentially dangerous activities within the plant boundaries. Soktas has established Safety Committees in each Department, and modifications to its Fire Safety and Emergency Response Plans based on input from these Committees are made regularly. Soktas’s management team has reviewed PS4 and indicated that the facility will comply with its requirements in full, at all of its facilities. At the India plant, the company intends to collaborate with other facilities in the industrial park on shared issues such as fire preparedness and response and emergency medical incident response.
- PS5: Land Acquisition and Involuntary Resettlement
Land for the Kolhapur facility was acquired on a 99-year lease from the MIDC. The land for the industrial park was acquired in 1992 from a number of sources, including both Government-owned lands and private plots purchased on a willing buyer-willing seller basis. Land for the dairy farm in Turkey also was purchased on a willing buyer-willing seller basis. Soktas does not intend to acquire additional land in Turkey in the context of this project. Nonetheless, the company will review its internal land purchase procedures against the requirements of PS5 (Land Acquisition and Involuntary Resettlement) and amend these if necessary to ensure future compliance with PS5 requirements.
