28684 - The Alutech Group

Who We Are
Who We Are

IFC is the largest global development institution focused on the private sector in developing countries. By encouraging growth, IFC advances economic development, creates jobs and improves the lives of people.
More About Us
About IFC

Our Leadership

Development Partners
Accountability

Learn more about accountability
Annual Report

Download the Report
What We Do
What We Do

IFC advances economic development and improves the lives of people by encouraging the growth of the private sector in developing countries. We achieve this by investing in impactful projects, mobilizing other investors, and sharing expertise.
What We Do Overview
SOLUTIONS

Our products and services
OUR PRIORITIES

Climate Business

Fragile & Conflict Afflicted Situations

Gender

Mobilizing Private Capital

Sustainability
SECTORS & EXPERTISE

Agribusiness & Forestry

Creative Industries

Education

Financial Institutions

Funds

Health

Infrastructure

Manufacturing

Public-Private Partnerships

Tourism, Retail & Property

Trade & Supply Chain Finance

Venture Capital

Working Upstream
Where We Work
Where We Work

As the largest global development institution focused on the private sector, IFC operates in more than 100 countries around the globe. We apply lessons learned in one region to solve problems in another.
Overview
By Region

Africa

East Asia and Pacific

Europe

Latin America and the Caribbean

Middle East and Central Asia

South Asia
Our Impact
Our Impact

Our impact improves lives. IFC brings a clear set of advantages to the world’s most challenging markets. Including a history of innovation, a global mandate, and a determination to achieve measurable development impact.
Our Impact Overview
PRINCIPLES & MEASUREMENT

Impact Investing at IFC

Measuring and Monitoring (AIMM)

Evaluation

Sustainable Development Goals (SDGs)

Owned by 186 member countries and consistently rated AAA/Aaa. IFC aims to achieve our mission of promoting development by providing debt and equity to the private sector, through a range of benchmark and bespoke products.

For Partners

For Investors

Get in Touch

Environmental & Social Review Summary

Project Number

28684

Company Name

THE ALUTECH GROUP

Date ESRS Disclosed

May 26, 2010

Country

Belarus

Region

Europe

Last Updated Date

Jun 3, 2021

Environmental Category

B - Limited

Status

Completed

Previous Events

Approved : Jun 28, 2010
Signed : Oct 6, 2010
Invested : Dec 10, 2010

Sector

Aluminum

Industry

Manufacturing

Department

Gbl Ind, Manufact, Agribus & Services

Project Description

The proposed transaction is a corporate loan to complete Alutech’s modernization program (the “Project”).
The program includes a new production line for thermo-insulated panels for garage and industrial sectional doors and construction of a new building where Alutech’s main operations will be merged.

Overview of IFC's Scope of Review

Environmental and social (E&S) appraisal of the Alutech group of companies (the “Company”, “Alutech”, “Group”) operations included a visit of IFC’s environmental specialist to four manufacturing sites in Belarus producing aluminum products, including roller shutter systems, sectional doors and aluminum profiles as well as interviews with Alutech environmental, health and safety (EHS) and HR experts in February 2010. During the visit IFC’s expert has reviewed management procedures, accident records, relevant emission and discharge data, and the actual implementation of occupational health and safety standards.

E & S Project Categorization and Applicable Standard

While all Performance Standards are applicable to this investment, IFC’s environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards:

PS1: Social and Environmental Assessment and Management Systems
PS2: Labor and Working Conditions
PS3: Pollution Prevention and Abatement

The following Performance Standards were screened for but not found relevant for the actual project:
PS4: Community Health, Safety and Security. The Project site is located in the Special Economic Zone (SEZ) "Minsk" established by Belarus Government in 1998. The area of 1,000 hectares has been designated as an industrial park, where more than 60 industrial estates are located as of today. The buffer zones around Alutech’s plants are situated within industrial zone, with no people living there. As such, the Project is not likely to have an adverse impact on health of communities living in vicinity. The cumulative impact of the multiple business activities located in SEZ on the ambient air quality is monitored by local sanitary authorities. They are granting emission permits to SEZ tenants based on the estimated contribution to the "headroom" between pre-project background ambient air quality and limits defined by standards.
PS5: Land Acquisition and Involuntary Resettlement . The acquisition of the land plot for Project development through a long-term lease from the state didn’t cause physical or economic displacement of people.
PS6: Biodiversity Conservation and Sustainable Natural Resource Management. The Project will not have adverse impacts on biodiversity as the project is being developed within a long-established industrial zone.
PS7: Indigenous People. There are no Indigenous People living in the project area.
PS8: Cultural Heritage. The Project will not have adverse impacts on cultural heritage as the project is being developed within a long-established industrial zone.

Alutech’s environmental performance is in material compliance with the regulatory requirements of the Belarus. The key environmental, health and safety (EHS) impacts identified during IFC’s appraisal are limited and can be mitigated upon implementation of the specific measures agreed in the Environmental and Social Action Plan (ESAP) and, hence, this Project is a Category B project according to IFC’s environmental and social review procedure.

Environmental and Social Mitigation Measures

PS1: Social and Environmental Assessment and Management Systems:As part of the Project, the Group is planning to relocate two existing enterprises (Alstrong and Alutech Doors System), which are now operating at rented premises, to the new production site.
For this purpose, the Government of Minsk Oblast allocated the land plot of 7 hectares within the Special Economic Zone (SEZ) "Minsk" in 2008.

Land acquisition is possible through long-term lease only and is strictly regulated by the state. New land plots with designated zoning are offered through bidding procedures, carried out solely by the state authorities. Local authorities are responsible for initial assessment of the land plots before offering them for bidding, including environmental and social screening. Local authorities are also responsible for organizing consultations with stakeholders potentially affected by the new development. The provided land plot is not a subject to the past environmental or social liabilities.

The final land allocation for construction will be possible only upon obtaining of positive opinion of the state regulators on design documentation, including environmental approval. To obtain the latter the Company would need to present the findings of the Environmental Impact Assessment of the proposed development, including air dispersion modeling; and mitigation measures to achieve local environmental, health and safety standards. Public consultations for this particular project are not required by the Belarus authorities having regard for the limited potential for adverse social and environmental impacts arising from the project.

Existing facilities of Alutech currently rely on the legally required management systems for environmental, health and safety performance (EHS). These systems envisage designated in-house personnel responsible for management of environmental, health and safety issues, including routine monitoring activities and periodic external reporting to relevant government authorities on key environmental and safety control factors. The management programs at individual plants include Action Plans to ensure compliance with local regulatory requirements and secure permits.

While the existing procedures meet the requirements of the Belarus legislation, they may be improved to provide a good platform for a system that identify opportunities for better EHS practices and performance. Therefore, the Company and IFC have agreed in the E&S Action Plan (ESAP) that the existing corporate ISO 9001 Quality Management System will be supplemented with environmental, health and safety targets and objectives.
PS2: Labor and Working Conditions:The Alutech Group employs 2520 people, including 1132 specialists and 1388 workers. The vast majority of the workforce is located in Belarus.

The Group’s Human Resource Policy is consistent with Labor Code of Belarus, which incorporates the ILO core labor standards and, hence, corresponds with PS2 requirements. In addition to the requirements of the national legislation, various benefits for Company’s employees are addressed in internal labor regulations. As such, Alutech maintains or exceeds legislated standards of workers’ salary and benefits. The Group has a strong focus on the development of its personnel and is planning to spend up to 280,000 Euros in 2010 on the training purposes.
The Group’s employees are not organized in any form. The Group is enabling additional means for workers to express their grievances regarding working conditions and terms of employment, including assessment of workers’ satisfaction through periodic questioning and placement of suggestion boxes for receiving anonymous complaints. The Group has committed to support it with the grievance procedure consistent with IFC PS requirements, through which workplace concerns and suggestions can be brought to the management’s attention and addressed expeditiously. The client will inform the workers of the grievance mechanism at the time of hire, and make it easily accessible to them.

The most recent survey carried out for AluminTechno indicates 72% satisfaction rate. The annual turnover of workers on a Group’s level does not exceed 3%. However, some dissatisfaction of workers with workplace air quality at foundry and paint shops was revealed during the survey. The Group’s management is aware of this deficiency. It will be partly corrected when Alstrong and Alutech Doors Systems plants will be relocated from rented premises to a new production site in 2013. As the condition of IFC’s financing, Alutech will also investigate the options to achieve workplace air quality for particulate matter and carbon monoxide at the foundry shop of AluminTechno consistent with local exposure guidelines. Meanwhile, the workers are provided with respiratory protective equipment and other compensatory social benefits.

In accordance with the regulative requirements of Belarus, Alutech is carrying out annual medical checks of its workers. As of today, there were no cases of professional diseases identified.
The Company provides safety induction and ongoing training for all workers and visitors. Alutech had 3 lost time accidents in its 4 production subsidiaries in 2007-2009, which is a good OHS performance compared to international benchmarking of the sector.

For further details on labor-related matters please see Environmental and Social Action Plan.

PS3: Pollution Prevention and Abatement:
The SEZ is supplied with engineering infrastructure, including electricity, gas and water supply; and sewage system connected to public wastewater treatment plant. Heat is supplied by Alutech’s in-house gas fired boilers.
Air emissions at the Alutech’s facilities are mainly associated with foundry operations; casting; metal shaping, thermal treatment, surface preparation; metal and plastic coating, and painting operations.
Painting booths at all plants of the Group, except Alstrong, are equipped with secondary treatment, including cyclones and bag filters for capturing particulate matter (powder coating) and afterburning unit for thermal destruction of VOC emissions. Painting booth of Alstrong will be equipped with appropriate emission control after its relocation from rented premises to a new production site in 2013.

The largest source of air emissions is a foundry shop producing aluminium billets for extrusion. Melting of aluminium is performed in 2 reverberatory furnaces fired by natural gas. While PM levels are achieved within IFC’s guidelines without secondary emission control, CO and NOx levels, due to combustion in oxygen starved environment to prevent oxidation of aluminium, are high and exceed IFC’s guidelines.

Currently the company is investigating the possibilities to reduce CO and NOx emissions by optimizing combustion process through changing of air/fuel ratio. Upon its finalization, Alutech and IFC will agree on the target reduction of concentrations of these polluting substances at point source and target dates of its achievement.
Wastewater from anodic coating and other process wastewater are treated at internal wastewater treatment plants and is recycled as process water. Sanitary water is delivered to the municipal wastewater treatment systems, sometimes together with the limited industrial waste water from the production. The company is carrying out frequent analysis of its waste water before it is delivered to the municipal treatment facilities to ensure it is within the norms these facilities can accept for treatment.

Secondary aluminum scrap generated during the production is recycled in the process. The permanent mold technique is used, without destroying the mold after solidification.
Non-recyclable solid waste streams are disposed at licensed landfills. Hazardous waste streams (e.g. used mercury lamps) are handled by the licensed contractors.

The combined CO2 emission from the 2009 operations of Alutech’ facilities has been estimated to 18,140 tons.

A short description of the visited manufacturing and servicing facilities are given below:

“Alstrong”: The facility, employing 168 people, produces a range of products by die casting and polyester powder coating. Foundry shop consists of 3 holding-melting furnaces. Point sources of air emissions are not equipped with emission control. Alstrong has a high technology horizontal powder coating production line. Powder coating shop includes chrome-free pretreatment of the profile surface and automated polymer powder coating booth. Generated wastewater is treated at local wastewater treatment facility before its discharge to public sewage system.

“Alutech Doors Systems”: The production division, employing 421 people, manufactures garage and industrial sectional doors of various types The plant is equipped with a new production line for thermo-insulated panels with the polyurethane for garage and industrial sectional doors. Painting booth is equipped with bag filters. As well 12 bag filters are installed at other technological equipment.

“Alutech Incorporated”: The enterprise, employing 297 people, manufactures a wide range of profiles, components and accessories for the rolling shutter systems, including roll-formed profiles. Aluminium strip is applied in two layers by a continuous coil coating technique. The polyurethane foam used as the profile filler does not contain hydrocarbon and fluorine-chloride compounds. VOC emissions from painting booth and drying process are thermally destructed in the afterburning unit.

“AluminTechno” is an extrusion and powder coating plant, employing 576 people. It implements a closed manufacturing cycle, starting with melting of primary aluminum and ends up with the production of finished extruded powder coated profiles. Foundry shop consists of 2 gas fired melting furnaces, casting machine and billet homogenizing furnace.. Powder coating shop includes chrome-free pretreatment of the profile surface and automated polymer powder coating booth.

Stakeholder Engagement

The procedure of receiving and addressing grievances from the communities is prescribed by the Belarus Law, adopted in 1996. The company is obliged to handle a grievance, take an action and/or provide a constructive feedback within 1 month upon its receiving. As of today, the company didn’t receive any complaints in regards to environmental, health or safety performance.

Publication of this ESRS and associated Environmental and Social Action Plan constitutes the client’s first community engagement related to its project plans. Such engagement is not required by the Belarus authorities having regard for the limited potential for adverse social and environmental impacts arising from the project.

EHS Summary of Alutech operations and Corporate Action Plan based on the ESAP agreed between Alutech and IFC will be available in Russian. Hard copies of these documents will be made available to the local communities and employees at the entrance information desk of Alutech at Selitskogo street, 12 in Minsk.

For environmental and social inquires about the Project please contact:
Vladymir Kroshko,
Technical Director of Alutech Group
12 Selitskogo, 220075, Minsk, Belarus
e-mail: kroshko@alutech-mc.com

Client Documentation

File Name	Actions
ESAP.pdf

**Information on IFC's Policy and Performance Standards on Environmental and Social Sustainability can be found at www.ifc.org/sustainability

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Environmental and Social Review Summary (ESRS) is prepared by IFC to disclose its findings and recommendations related to environmental and social considerations regarding potential investments. Its purpose is to enhance the transparency of IFC's activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this ESRS is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein.
It is distributed in advance of IFC Board of Directors' consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following ESRS is disclosed in accordance with IFC's Access to Information Policy (AIP).

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

Projects

Environmental & Social Review Summary

Project Description

Overview of IFC's Scope of Review

E & S Project Categorization and Applicable Standard

Environmental and Social Mitigation Measures

Stakeholder Engagement

Client Documentation

Similar Projects

Projects

Environmental & Social Review Summary

Project Description

Overview of IFC's Scope of Review

E & S Project Categorization and Applicable Standard

Identified Applicable Performance Standards

Environmental and Social Categorization and Rationale

Environmental and Social Mitigation Measures

Environmental and Social Mitigation Measures

Stakeholder Engagement

Stakeholder Engagement

Local Access of Project Documentation

Press-Release

Related SII

Client Documentation

Similar Projects

Information on E&S Complaints and Grievance Mechanisms

Disclaimer