30663 - Primorsky

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Environmental & Social Review Summary

Project Number

30663

Company Name

AVA-PETER, OOO

Date ESRS Disclosed

Feb 13, 2012

Country

Russian Federation

Region

Europe

Last Updated Date

Jun 3, 2021

Environmental Category

B - Limited

Status

Completed

Previous Events

Approved : May 25, 2012
Signed : Jun 1, 2012
Invested : Aug 29, 2012

Sector

Hospitals and Clinics

Industry

Health, Education and Life Sciences

Department

Regional Industry MAS LAC & EUR

Project Description

The Project represents construction of a greenfield multi-functional clinic comprising a diagnostic center and a 96-bed general hospital. The new facility will strengthen the Company’s position as a leading private health network in St. Petersburg and will create additional capacity to serve patients needing specialized care (including inpatient care) and referred by primary care satellite clinics. The existing inpatient clinic at Scandinavia hospital (currently operating at close to 100% capacity) will focus on delivery and maternity services while general surgery and inpatient services will be provided at the new clinic. The new clinic will located in Primorsky district of St. Petersburg, a large residential area with population of 500,000 and insufficient existing outpatient and inpatient capacity at public facilities.

The Project is expected to cost US$34 million and will be part of the general corporate investment program with estimated cost of US$40 million. The proposed IFC investment will be in the form of an equity investment in the Company of up to US$14 million.

Overview of IFC's Scope of Review

IFC’s review of the proposed investment in OOO AVA-Peter (“Ava-Peter” or the “Company”), an existing IFC client, to finance the construction of a new multi-functional medical center in St. Petersburg (the “Project’) consisted of appraising technical, environmental and social information submitted by the Company, including:
- Minutes of public hearings held in St. Petersburg on March 23, 2006;
- Minutes of public consultations on a city planning decision held on April 12, 2006.
- A specimen employment agreement;
- The Company’s response to IFC’s E&S questionnaire (11/8/2011)
- The Company’s Annual Monitoring Report for 2010.

A site visit to the company’s facilities was carried out by IFC’s environmental specialist in December 2011 to get the latest update on E&S matters associated with the existing operations and ongoing construction. In addition, IFC review used the conclusions of the Life and Fire Safety due diligence carried out by the independent consulting company, FPC (Belgium), in December 2011.

To date, IFC has concluded 2 transactions with the company. In 2003, IFC has provided a US$2.1 million loan to NMC Holding Oy (NMC project, # 10407) to finance the construction of the Scandinavia clinic in St. Petersburg. The loan was fully repaid in September 2011.
In 2008, IFC committed a US$12.5 million loan (NMC II project, #26119) to finance the expansion of a satellite network of primary care clinics in St. Petersburg and construction of a greenfield maternity hospital in Kazan. The satellite clinics’ program was completed with 10 clinics operational. Completion of Kazan hospital is expected in 2012.

The Environmental and Social (E&S) reviews of the earlier investments (Project ID #10407 and ID #26119) were disclosed on the IFC’s site and locally. The company is in compliance with the requirements of IFC loans and has demonstrated a commitment and capacity to effectively manage environmental and social (including life and fire safety) matters.

The most recent monitoring visit to the Company’s facility was undertaken in June 2011, when an independent Life and Fire Safety Consultant conducted a site visit to the company’s new property in Kazan to monitor a proper implementation of the Life and Fire Safety Master Plan during a construction phase.

E & S Project Categorization and Applicable Standard

While all Performance Standards (PS) 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
- PS4: Community Health, Safety and Security

IFC’s review did not identify impacts related to:

- PS5: Land Acquisition and Involuntary Resettlement
In 2006, AVA-Peter entered into an investment agreement with the City of St. Petersburg which provided a long-term lease on land for the new clinic. Before, the land plot was leased to a car park company. They were informed in advance that the City authorities were planning a capital construction and were offered another land plots for their business. The representatives of the car park company participated in public hearings in 2006, where they raised no concern. AVA-Peter has compensated part of the car parking company’s investment in physical assets such as lighting poles, security post, and phone number.
Land acquisition caused no physical or economic displacement of persons, and the previous business was adequately compensated.

- PS6: Biodiversity Conservation and Sustainable Natural Resource Management.
Due to the Project being developed in a large residential area of St. Petersburg with no protected species or protected areas at or near the project site, there will be no adverse impacts on biodiversity.

-PS7: Indigenous People
There are no Indigenous Peoples in the project area.

-PS8: Cultural Heritage
The Company has renovated the Scandinavia clinic (which is in a preservation area in the centre of St. Petersburg) and adjacent public open space in a sensitive and culturally appropriate manner that was approved by the city regulators. Cultural heritage at Kazan (essentially the retention and preservation of the façade of a protected building), is also managed in accordance with local requirements. The new proposed investment is a greenfield development in a large residential area of St.Petersburg away from its historical centre and, thus, the Project is not expected to have any adverse impacts on cultural heritage.

Similarly to the previous IFC’s investment with the company, this proposed investment is classified as a Category B project according to IFC’s Environmental and Social Review procedures, because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized design criteria, construction and operational standards. The major environmental and social issues of this project are associated with construction impacts and a risk of fire occurrence in company''s clinics.

Environmental and Social Mitigation Measures

The Company has presented plans to ensure that the proposed project will, upon implementation of the specific agreed measures, comply with host country environmental and social requirements, as well as IFC’s Environmental and Social Performance Standards and applicable World Bank Group (WBG) Environmental Health and Safety (EHS) guidelines. The information about how these potential impacts are and will be addressed by the project is summarized for each of the applicable PSs.

PS1: Social and Environmental Assessment and Management System

- Environmental and Social Impact Assessment (ESIA):
A new site is developed between tower blocks in the Primorsky district, a large residential area of St. Petersburg.

The land is owned by the city and leased to the Company under a construction lease contract. On completion of the facility, the company will sign a 49 year operating lease with the city.

The company obtained a permit to start the construction, which required a range of planning documents and permits including assessment of environmental and social aspects and mitigation measures.

Given the proximity of residential housing, a number of measures to minimize construction impacts were developed, including forbiddance of any construction works during night time, week-ends and public holidays. Construction works associated with exceeded levels of noise are allowed only between 9 am and 6 pm. The use of compressors is allowed only in soundproof casing. These and other measures are spelt out in the construction regulative document. Their implementation is closely monitored by the specialists of a technical supervision department of AVA-Peter, who carry out daily physical inspections of the construction site.

In addition, the company has a valid contract with an independent company, which carries out geotechnical monitoring to identify any possible soil subsidence.

- Environmental, Health, Safety (EHS) and Social Management Systems:

The Company’s environmental and social management system (ESMS) is focused on continuous compliance with local E&S regulatory requirements in the field of environmental protection; sanitary and epidemiologic safety; occupational health and safety; fire safety; and social security of personnel, which are generally consistent with IFC’s PS.

Designated managers are appointed at the company level for each of the aforementioned fields of the ESMS, and they are required to ensure effective management of E&S issues across all sites.

The Company has a written corporate policy for safety and environmental protection. Its implementation is achieved through a number of procedures and manuals, like “Rules for collection, storage and disposal of wastes”, “Procedure on disposal of vaccines not suitable for use” and others. The documents are periodically reviewed. In 2010 the company revised 43 internal documents related to sanitary safety only.

The fulfillment of the procedures is controlled using the system of periodic inspections and internal audits. In 2010 the company has conducted an internal audit on medical waste collection, storage and removal.

The company has introduced a feedback system for its customers – complaints, thanks and proposals can be expressed personally in a written or oral form at any clinic, via the company’s web or telephone hot line. All public complaints and appeals are registered and addressed within a certain time period by the designated company’s specialists.
The existing ESMS capacity, which is consistent with PS1 requirements, is effective enough to handle E&S aspects imposed by new company’s operations.

PS2: Labor and Working Conditions
Currently the company employs 1192 people. The project is expected to create 775 new jobs.

The company has a written human resources (HR) policy which is cross-referenced with the national Labor Code, which guarantees core labour rights to employees. Individual contracts provide staff with information on their terms and conditions and are presented to new employees at the time of hire.

Hiring is conducted in accordance with the Russian Labor Code and there is a strict policy against discrimination based on gender, race, age or nationality. The HR department asserted that there is no discrimination and there is a broad mix of employees including disabled/ visually impaired, and employees from several different regions/ ethnicities.

In addition to compliance with the national labor requirements, the Company continues to provide additional social support to its employees, including health care under the state insurance and additional clinical examination and immunization; continuing education at the Company’s expense; opportunity to participate in various professional workshops in Russia and abroad; birthday presents to employees.

Workplace concerns and suggestions can be brought to management’s attention through HR department and/or “suggestion” box to protect the confidentiality of the employee.

Occupational health and safety (OHS): The Company runs a wide-ranging training program in various aspects of safety. Personnel are trained in handling of medical waste (senior nurses); decontamination, cleaning and disinfection after leakages of biological materials (nurses and drivers); prevention of infections while working with biological materials (nurses and drivers); transportation of biological materials to laboratories (drivers); radiation safety when performing X-ray and radiological procedures (2 people trained in 2010); electric safety (5 specialist in 2010); fire safety (2 people in 2010); traffic safety for drivers of vehicle equipped with emergency devices (14 people in 2010); operation of lifting platforms for disabled persons (8 people in 2010); lifts and lift equipment (4 people in 2010); labor protection (2 people in 2010); and other.

The company maintains an accident log and investigates all incidences of accident. There was only 1 minor lost time accident in 2010.

Radiation Safety: The company has a procedure on radiation safety that currently covers X-ray diagnostics. This procedure has been developed in accordance with local sanitary regulations and covers all the related aspects, including personnel’s training on radiation safety; provision of means of personal protection and dosimetry; periodic health checks for exposed personnel; periodic radiation control of the equipment and workplaces; constant monitoring of the changes in local regulations on radiation safety; and others.

New clinic: The company’s labor and working standards, which are consistent with IFC’s PS2, will be extended to cover new personnel hired at Primorsky clinic.

Construction Work Force: For the construction/development of a new clinic, the Company applied labour (OHS and minimum age requirements) to the Baltic Construction Company. Accident statistics is reported to AVA-Peter, and there were no construction accidents up to now.

PS3: Pollution Prevention and Abatement
The Company is compliant with sanitary and environmental regulatory requirements and will utilise similar approaches to waste water effluents and solid waste management at the new clinic building.

Liquid effluents at the existing facilities are discharged to functioning municipal sewers under licence and there is pre-treatment of effluents prior to disposal (including disinfection as necessary). Wastewater discharge is periodically tested by the accredited laboratory to ensure that polluting substances are not entering the sanitary sewer at concentrations greater than locally regulated levels.

Stormwater from the territory of the site will be collected and treated for suspended solids and petroleum hydrocarbons. During a construction, a vehicle wheel washing system (a closed-loop water system) is installed to prevent city streets contamination.

Solid Waste Management: The Company’s procedure on solid waste handling is developed based on the requirements of federal sanitary regulation. Solid wastes generated as the result of AVA-Peter’s activity is categorised into 3 classes. Class A – non-hazardous general health care wastes - are collected separately from medical wastes and removed by the licensed company for further disposal at a landfill site. Class B –hazardous medical wastes - are collected separately for further disinfection. The company has a separate valid contract with the company “Eco-Service” authorised for the removal of disinfected medical wastes and its final treatment. There is also a special procedure for the collection and storage of Class G - mercury/bactericidal lamps and other hazardous non-medical wastes. These types of waste are removed for a recovery of metals by the specialized company licensed to handle industrial wastes. AVA-Peter does not generate highly hazardous wastes containing toxic or infections materials (Class C). Besides, contract provisions with waste contractors require full compliance with applicable state disposal rules for applicable waste types.

Refrigerant management:
At its existing facilities, the Company is only running small HVAC&R units, standard refrigerators, medical and other small cooling equipment. All the cooling equipment is using R410a refrigerant, which is not an ozone-depleting substance (ODS).

For the new building’s HVAC&R systems, the Company will also purchase the equipment that uses non-ozone depleting substances. While considering substitutes for ozone-depleting refrigerants, the company will also be aiming at minimizing direct contribution to global warming as some substitutes, such as HFCs, are potent greenhouse gases.

Greenhouse Gases emission:
The combined GHG emission from the 2010 operations of AVA-Peter’s facilities has been estimated as 1,100 tons of CO2 equivalent.

PS4: Community Health, Safety and Security
Principal risks to community health and safety are related to fire and life safety risks for patients (especially immobilized patients) and visitors to the company’s facilities.

The fire safety design of the hospital in Kazan, which is under construction, contains most essential elements of fire safety. In addition to local requirements, a water mist system will be installed in the in-patient zone of the clinic, including corridors; and firm compartmentation between in- and outpatient part of the building will be provided as per NFPA requirement.

The Company has also committed to the installation of relevant LFS systems at the Primorsky facility in line with international guidelines. The property will be protected throughout by an addressable fire detection and voice communication system; with an automatic sprinkler system; hose reel cabinets, including ABC type hand extinguishers; and safe evacuation distances well below the limit of 61 m for sprinklered health-care occupancies.

The Company will engage professional services of a qualified Life and Fire Safety Consultant acceptable to IFC to review engineering design for client facilities in St. Petersburg (Primorsky) and Kazan (in relation to sprinkler and water mist systems accordingly); and to perform post construction inspections to verify that the above and other LFS systems were installed as designed and tested in accordance with international life and fire safety code.

As a condition of subscription, the Company will provide a certification by a qualified professional that the design of life and fire safety systems (sprinkler and water mist systems) for each facility complies with Life and fire Safety requirements of the IFC General EHS Guideline.

The aforementioned and other LFS requirements were agreed in the Environmental and Social Action Plan, which is disclosed together with the ESRS and will be covenanted under a Subscription Agreement.

There are no other significant community health risks associated with this investment.

Stakeholder Engagement

The Company has provided evidence that details of the proposed clinics in St. Petersburg were disclosed to local community in accordance with Russian requirements for public consultation.

The newspaper announcement on local access of project documentation and public hearings was published in “Stroitelniy Ezhenedenik” (Construction Weekly) N6 (02/20/2006). Project materials were displayed for 20 days at the building of the district Administration (Savushkina str., 83).

Public hearings took place on March 23, 2006 and were attended by 19 people. No specific concern was noted. The consensus was to support the project.

The Company continues to keep the lines of community engagement open. Local residents and general public can express their grievances and concerns to the construction contractor’s manager or directly to AVA-Peter’s manager, whose contact details were posted at the construction site.

There were no complaints received from local residents since the beginning of construction

Further information is available on the company’s website: http://www.avaclinic.ru . To contact the project company, please write to:

Ludmila Nikulina
Deputy General Director
Address: Nevskii av. 72, of.11, Saint-Petersburg, Russian Federation.
Tel.: (812) 336-30-65
Fax:(812) 336-30-61

Email: Nikulina-LV@avaclinic.ru

Client Documentation

File Name	Actions
Final ESAP 16 January 2012.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.
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