PS1 Social and Environmental Assessment and Management systems:
Vonpar manages its environmental and social aspects seeking compliance with national and local laws and regulations. Vonpar has obtained all the valid environmental licenses for its existing operations and has already received the Environmental License for the construction phase of the manufacturing plant (Licença Prévia, LP). Vonpar has developed OHS risk prevention and health monitoring plans, as described in PS2 section below. Vonpar follows Better Manufacturing Practices (BMP) and is currently implementing a 5S management program (based on Toyota Management practices). Vonpar will implement an integrated EHS Management system covering Environmental, Occupational Health and Safety and Food Safety. In addition, all sites will be certified under the most relevant internationally recognized E&S management system standards, such as ISO 14001, ISO 2201 and OHSAS 18001.
Environmental and Social Assessment: Prior to the construction of the chocolate manufacturing plant, Vonpar conducted a streamlined environmental assessment consistent with local regulation requirements and covering the most relevant environmental aspects of the project, such as water and energy consumption, air emissions, wastewater emissions and management, biodiversity conservation and solid wastes management. As part of the integrated management system implementation, Vonpar will further identify and consolidate all the applicable environmental aspects/impacts, OHS hazards/risks and food safety critical points of control of its operations
Management Program: Vonpar currently has some E&S mandatory programs in place, such as OHS risk prevention and health management programs, solid waste management program as well as non mandatory programs, such as BMP and 5S management program. Vonpar is planning to further developing its OHS program, including an hearing protectionprogram, ergonomic program, OHS job observation program and food safety inspection program. As part of the above mentioned integrated EHS management system implementation, Vonpar will further develop all necessary management procedures and programs to deal with the possible gaps identified during the preparation of the EHS risk assessment, as part of the management system implementation process.
Organization: Vonpar E&S organization includes an Environmental and Quality Assurance manager, an OHS manager, environmental analysts, OHS technicians, physicians and nurses.
Training: Vonpar provides a basic EHS training for all workers during their induction program. Other specific trainings are provided based on a need basis, such as training for working in confined spaces, in working at highs, working with electrical devices and for the boilers operator. As part of the integrated EHS management system implementation Vonpar will further structure and consolidate a comprehensive training program for each business unit.
Monitoring: Vonpar monitors relevant E&S aspects/risks, such as wastewater quality, water consumption, energy consumption, gas consumption, air emissions, wastes generation and accident rates. Vonpar is currently monitoring air emissions following local regulations requirements and using Ringlemann Smoke Chart system. Vonpar will start monitoring boilers’ emissions using quantitative methodologies. As part of the integrated EHS management system implementation Vonpar will further develop specific overall monitoring program covering all relevant E&S performance indicators.
Reporting: Vonpar reports relevant mandatory E&S indicators to the competent authorities (e.g. solid wastes, hazardous wastes, air emissions, wastewater, and accident rates). Vonpar reports internally selective E&S performance indicators, such as production loss, energy efficiency, wastes. As part of the integrated EHS management system implementation Vonpar will further structure and develop a formal internal E&S reporting to managers and Directors showing key E&S impacts and risk indicators.
PS2 Labor and Working Conditions:
Human Resource Policy and Management: Although Vonpar does not have a formal General HR policy, they follow Brazilian labor regulations, which are consistent with the International Labor Organization (ILO) standards (Brazil is a signatory of most relevant ILO conventions). The terms of employment, such as wages and benefits, hours of work, overtime arrangements and overtime compensation, annual and sick leave, maternity, vacation or holiday, are established by national labor regulations and applicable sector specific collective bargaining agreements. Vonpar Alimentos follows Vonpar Group’s HR practices and manages HR aspects seeking compliance with local laws. All workers have to sign a formal contract with the terms of employment and retain a copy of that. Workers also have a worker’s labor book (“carteira de trabalho”), provided by the Brazilian Ministry of Labor, in which all information related to the terms of employment in the contract is registered, including hiring period, compensation, leave, promotions, salary increase and termination of contract.
As set forth in the ESAP, Vonpar will develop a formal corporate HR policy statement with a commitment of compliance with local law, non discrimination and equal opportunities, to provide a safe and respectful workplace and to stand against forced labor, child labor, sexual or other forms of harassment. Vonpar will also develop and put in place a series of formal HR policies, such as hiring and termination of contract policy, duties and compensation policy, performance assessment and promotion policy, Benefits policy, Occupational Health and Safety policy.
Worker’s Organizations: As defined by law, worker’s organization is compulsory in Brazil and all workers have to contribute to its respective sector workers’ union. Annual salary increase, sector specific minimum wage, profit sharing and some benefits are bargained directly with the unions under collective bargaining agreements, but respecting the minimum standards defined by the Federal Administration. Vonpar has some union’s Representatives working in their factories and there is no evidence that the Company restrict freedom of worker’s association.
Non-Discrimination and Equal Opportunity: Vonpar informed that the employment relationship is based on the principle of equal opportunity and fair treatment. Vonpar currently hires 1057 permanent workers from that 60% are male and 40% female, which is consistent with the nature of the work and other industries benchmarking. During the field visit, noevidence of discrimination based on workers personal characteristics unrelated to the job requirements, such as race, gender, religion or region of birth was identified.
Retrenchment: The new chocolate manufacturing site development will be located in Arroio do Meio municipality, 150km far from the existing factory, which will imply a plant decommission and some layoffs. As part of the Brazilian labor requirements, the workers will receive proportional annual leave compensation, proportional compensation of the 13th additional salary, the severance package (FGTS) and additional 40% compensation. The chocolate factory currently has 590 workers, and the client is negotiating with workers’ unions some options that will include a relocation package, job opportunity offers in the other units of the group (Mu-Mu and Vonpar Bebidas) and a termination of contract incentive package.
Protecting the Work Force, Vonpar ensures that no forced or child labor is used at their operations by direct hiring all workers (no intermediaries) and following national laws, as described above, and the minimum worker’s age is 18. Vonpar provides one to two meals for all workers per shift that are served in the dining hall. Vonpar will improve the dining hall general building conditions at the milk processing and chocolate manufacturing plant, as well as the toilets conditions, consistent with the best hygiene industry practices.
Occupational Health and Safety: Vonpar manages OHS risks seeking compliance with national and local regulations. Vonpar has developed and implemented individual OHS mandatory risk prevention plans for each plant, identifying the work related risks, the workers exposure to hazards agents and the need for protection. Vonpar also has individual health monitoring program and specific procedures on the safe ways to do the job. Vonpar will also develop a workplace monitoring program with periodic field inspections and reporting of key performance indicators and corrective actions. This program will cover all aspects of the Brazilian OHS Standard, including moving parts and machinery protection (NR12), ergonomic conditions and aspects, working at highs, adequate use of PPEs, working with electrical devices (NR10), chemicals handling and storage. As set forth in the ESAP, Vonpar will deploy emergency prevention equipment in the ammonia storage and refrigerating systems, such as leak detectors (indoor areas), emergency tank, secondary contention, segregation, proper warning signs and emergency equipments. Vonpar already conducted an OHS assessment of electrical safety at its facilities according to Brazilian national standard (NR10) requirements, and will put in place a corrective action plan covering all gaps identified in the assessment. Vonpar is conducting an OHS assessment of moving parts and machinery protection according to Brazilian national standard (NR12) requirements, and will put in place a corrective action plan covering the gaps identified in the assessment. Vonpar will develop emergency response and preparedness plans covering all emergency scenarios and risks. Vonpar will set up and train the emergency brigades for each plant and will conduct periodic emergency drills. Vonpar will replace all old and deficient chairs at the production lines in the chocolate manufacturing plant to new ergonomic chairs appropriate to the work characteristic.
PS3 Pollution Prevention and Abatement
Resource Conservation, Energy Efficiency: The new chocolate factory is being designed as a state of the art plant in terms of energy efficiency and resources conservation. The water consumption will be dramatically reduced from 5L per kg of chocolate to 0,5, due to new and modern dry machinery cleaning technology equipment. The energy consumption per ton of chocolate production will be reduced from 24.8 kw/ton to 9.3 kw/ton and the use of gas LPG will be reduced from 0.58kg/ton to 0.12kg/ton.
Solid wastes – The solid wastes are mainly process organic waste, sludge from wastewater treatment facility, ashes from boilers, paper and paperboard, plastic material and metal scarps. The hazardous wastes are mainly empty chemical containers and used lubricant oil. All the wastes are properly segregated and disposed accordingly.
Air emissions – The main source of air emissions are the small boilers (from 3 to 8MW capacity) that burn wood from plantations. Vonpar is currently required to monitor opacity trough Ringelmann scale and do not exceed the No 1 threshold (20% density). As set forth in the ESAP, Vonpar will start conducting quantitative air emissions monitoring from boilers and deploy air emissions control systems at the new chocolate plant to achieve compliance with Brazilian legal requirements (CONAMA 382/06), if necessary.
Wastewater – At the existing chocolate plant, Vonpar treats wastewater using a combined system of equalization tank, flotation and anaerobic digestion. The wastewater is discharged to the municipality sewage system and the BOD is kept below 30 mg/l. At the milk processing plant, Vonpar built a new complete wastewater treatment facility that includes equalization tank, flotation, anaerobic digestion, aerobic digestion and stabilization tank before discharge. The treatment plant capacity exceeds the existing volume by more than five times and wastewater parameters (BOD 12 mg/l; Phosphorus 0, 13 mg/l; Suspended Solids 13 mg/l) are far below Brazilian requirements. Wastewater is discharged to a local river. At the candies plant, the existing wastewater treatment plant is designed to achieve Brazilian requirements for discharges to rivers. As part of the site expansion project to accommodate the new chocolate manufacturing plant, Vonpar will deploy a new wastewater treatment plant consistent with local regulation requirements and World Bank Group General EHS Guidelines.
Hazardous Materials – The Vonpar plants does not use large amounts of chemicals and the two main products are diesel for the spear generators and ammonia for the refrigerating system. Vonpar will deploy emergency prevention equipment in the ammonia storage and refrigerating system, such as leak detectors (indoor areas), emergency tank, secondary contention, proper warning signs and emergency equipments. At the milk processing plant, Vonpar uses caustic soda and phosphoric acid to clean the pipes and equipment. The soda comes in containers that are kept isolated, contained and with warning signs. Vonpar have some emergency showers close to the main storage area and will install an additional one close to the diluting and pumping equipment.
Greenhouse Gas Emissions- Vonpar emissions are mainly related to the use of energy from the grid, steam production in the boilers, Liquefied Petroleum Gas consumption in the ovens and diesel consumption in the stand by energy generators. Vonpar already uses renewable energy from biomass (wood) in the boilers and with the new chocolate plant Vonpar will replace old and inefficient machinery to new and modern ones that will allow a reduction in energy consumption from 24.8 kw/ton to 9.3 kw/ton of product, which is a 62% increase in energy efficiency.
PS4 Community Health and Safety and Security
Vonpar is a food manufacture company and, as such, food safety is a critical aspect related to the safety of its clients and communities. Vonpar is currently developing Good Manufacturing Practices, Lean Production and 5S programs. As described above, Vonpar will develop an EHS management system, which will encompass the management of food safety aspects according to ISO 22001 standard. In addition with the new chocolate manufacturing plant, Vonpar will replace an old site and machinery to a state-of-the-art factory that will help them to improve the quality of its products, optimize resource efficiency and reduce its impacts on the environment.
Emergency Preparedness and Response - Vonpar will develop emergency response and preparedness plans covering all emergency scenarios and risks. Vonpar will set up and train the emergency brigades for each plant and will conduct periodic emergency drills.
PS6 Biodiversity Conservation and sustainable resource management
The construction of the new chocolate manufacturing plant in Arroio do Meio will entail the clearing of 1 ha of natural vegetation. As part of the environmental assessment of the expansion project, Vonpar conducted a biodiversity study, including an inventory of the flora and existing fauna in the area. No threatened species were identified and Vonpar will have to compensate the loss of trees by planting the double of removed individuals, according to local regulations and as defined by local Authorities.
