The Company 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 including: the host country laws and regulations; IFC’s Performance Standards; and the relevant WBG EHS guidelines. The information about how these potential impacts will be addressed by the Company is summarized in the paragraphs that follow.
PS1: Social and Environmental Assessment and Management System
IFC’s assessment considered the ATG’s management of its EHS performance in the establishment and operation of its facilities; compliance with national and local permit requirements; and ATG’s engagement with local communities as well as its suppliers, regarding EHS performance.
- Environmental & Social Assessment:
As a part of regulatory approvals for the operational facility in India, the Company conducted Environmental Impact Assessment (EIA) studies with the help of external consultants to identify appropriate mitigation measures, which have been included in the environmental permit conditions.
The company has already commissioned external consultants for conducting the EIA for the proposed capacity expansion and cogeneration facility at Tirunelveli. ATG will conduct similar EIA studies for the upcoming Project in Gujarat, as part of its regulatory approval, once the Company takes possession of the land and all the project layout plans and other technical details are finalized. The EIA report will also suggest mitigation measures that the Company will implement.
- Management Systems:
ATG has articulated corporate level quality, safety, health and environment policies covering all its operations. The Company also developed an energy policy, which articulates the Company’s commitment to conservation of natural resources and energy, enhancing energy efficiency, reduction in carbon impact and continuous benchmarking and improvements.
ATG’s existing facility in Tirunelveli has implemented quality and EHS management systems certified compliant with ISO9001:2008; ISO14001:2004 and OHSAS 18001:2007.
ATG will adopt IFC Performance Standards on Social and Environmental Sustainability as part of applicable legal and other requirements in its environmental management system. Moreover, the Company plans to implement and certify similar management systems at its proposed facility in Gujarat in due course.
- Organization:
ATG has full-time dedicated teams in place to manage the EHS related issues, with defined roles and responsibilities. For the Tirunelveli facility, the President (operations) heads the EHS organization, with the support from Deputy General Manager (Engineering) on environment related matters; and Technical Head and Manager Safety supporting the occupational health and safety related matters. This management team is supported by a safety officer and other operators. This team is being strengthened by hiring 2/3 new recruits. In addition, it is proposed to hire an independent consultant to conduct safety audits and offer advice. Similar organization shall be established at the Gujarat facility, once it is operational.
- Monitoring & Reporting:
ATG has developed comprehensive monitoring program for the operational and EHS aspects of their operations. Accordingly, the Company regularly monitors its stack emissions, and ambient air quality, process effluents, domestic effluents as per its legal register and monitoring calendar. Production and energy consumption reports are daily submitted to the corporate management, together with monthly consolidated reports for all other parameters. Adequate monitoring and analysis capability (including equipment) is available in-house, in addition to the monitoring services provided by external vendors.
The company will further review WBG EHS Guidelines and accordingly, update its monitoring program to cover relevant parameters for workplace monitoring, such as particulate matter and volatile organic compounds (VOCs).
- Suppliers, Contractors:
ATG has a rigorous vendor registration methodology which also includes site visits by ATG staff. The vendor review process covers issues such as ISO certifications and suppliers’ compliance with European REACH regulations (Registration, Evaluation, Authorization and Restriction of Chemical substances).
ATG has outsourced the operations of effluent treatment plant, finished goods warehouse, housekeeping and security to specialized agencies and contractors. These are closely monitored by ATG’s HR department for their compliance with statutory requirements as well as ATG’s contract conditions.
PS2: Labor and Working Conditions
ATG’s facility in Israel employs 767 employees, of which 115 are temporary (through contractors or having a term of less than 2 years).
The Tirunelveli facility employs 209 regular employees in executive, management, supervisory and staff positions and approximately 100 management/supervisor trainees. In addition, 183 workers are in the various stages of being regularized in a span of two and half years as they progress through an Apprenticeship Program. Additionally the company has short listed approximately 200 workers to be inducted shortly into the apprentice program. In addition, the Company employs 600 unskilled workers on contractual basis for non-core activities such as material handling in warehouse, housekeeping, gardening, etc.
For the Project in Gujarat, the Company expects to employ 200 regular employees in executive, management, supervisory and staff positions and 1000 temporary workers on contract basis, once the facility reaches its normal production levels. Over time the Company shall introduce a similar apprentice program for all workers employed in core activities.
At its Tirunelveli facility, Company is implementing an Apprenticeship Program (described below) for skill development and on-boarding of temporary workers to regular employees. Similar program will be implemented at Gujarat facility, once it is operational.
- Human Resource Policy, Management
ATG’s corporate HR department oversees the HR management across all its facilities, supported by the HR teams at each facility. The corporate HR team is responsible for talent Acquisition, talent Management and administration, covering key aspects of hiring, training, performance appraisal, compensation and benefits, rewards and recognition, career development, infrastructure and facilities management and internal communication.
Deputy General Manager, reporting directly to the President (Works), heads HR department at facility level. This department is responsible to ensure the compliance with statutory requirements as well as ATG’s HR policies. Additionally, this team ensures that all the basic amenities and facilities to be provided to the employees and workers (such as canteen, toilets, drinking water, and transportation) are well in place. This department also interacts with the workers on daily basis, to understand and resolve any impending issues.
HR policies and procedures are in place for the regular employees, which are consistent with the national labor laws and PS2 requirements. The terms of employment and other details about the HR policies are communicated to the employees through a formal appointment letter.
As a part of the IFC investment, Company, with the help of a qualified external expert, will undertake a Compliance Review of specific (minimum wages, provident fund, ESIC, Bonus Act) HR policies and practices for contract / temporary workers vis-à-vis applicable legal requirements. Based on the outcomes of this review, it will develop and implement an action plan to update its HR policies and practices, as necessary.
- Freedom of Association
There is a trade union at Tirunelveli. The Company engages with this union from time to time. As a policy, Company respects Freedom of Association of the workers and shall not prevent formation of a workers’ union at Tirunelveli or Gujarat Project in the future.
- Grievance Mechanism
A grievance redressal mechanism has been put into place by way of an Improvement Committee (IC), which meets every month for an understanding as well as resolving all workplace issues. This committee comprises of workers and management to bring improvements in Working relationship between management and workers, general hygiene, conditions of work, productivity, welfare and addressing any grievances. The IC meetings are structured with a clear agenda and the minutes of these meetings are recorded for further follow-up actions.
The Company is also in the process of placing suggestion boxes across the facility, which will provide an additional medium for the employees to raise their grievances.
- Temporary Workers
Tirunelveli, in Southern Tamil Nadu has a very low level of industrialization and ATG is among the first few major industrial units established in the area. As such a majority of the workers come from a rural or agricultural background, and as per Company’s experience, need time to understand industrial culture, discipline and requirements of productivity and quality. Hence it is working on a definite plan for skill development of its workforce with a view to gradually absorb suitable workers from among the temporary workers as regular employees.
Accordingly, the Company has introduced an Apprenticeship Program, under which the Company conducts assessment of its workers over a 12-month period for parameters such as attendance, punctuality, discipline, interest in learning the job, etc. It then selects and inducts candidates with good potential on a 2-year Apprenticeship program. After their 2-year apprenticeships, those whose performance meets the Company’s standard, would join the Company as regular employees on its roll, after a period of further 6 months probation.
In the first phase, Company has inducted 183 apprentices in April 2011 and another batch of workers is currently being short-listed. Over the next 5 years, more than 40% of its blue-collar workers are expected to come on Company rolls.
For all contract workers, recruited through labor contractors, ATG ensures their compliance with the requirements of Contract Labor Act provisions, through relevant clauses in contracts and also through regular monitoring of contractors by its own HR team.
In addition to the wages (higher than the stipulated minimum wages), Company provides canteen and transportation facilities to all the workers (including temporary workers) which are partly subsidized. ATG has an occupational health center on its premises which is also available to all employees.
Company is constructing a dormitory for the workers which will accommodate 240 workers. This is also available for contract employees, in lieu of housing allowance which is part of the total wages. Company plans to build similar dormitory in Gujarat for its upcoming Project. For this purpose, it will review the IFC’s guidelines on workers’ accommodation and adopt the relevant recommendations to the extent possible.
- Training and Human Resources Development
Training needs for the workforce are identified through the appraisal process, feedback from supervisors and also the technical requirements for specific roles. Accordingly, Company develops a training plan covering regular as well as contract employees, and training budget is allocated accordingly.
EHS issues form an important part of ATG’s training calendar, and covers trainings on: occupational health and safety, environmental safety, accident reporting and investigations, emergency preparedness, housekeeping etc. EHS issues are covered in induction training too, which is mandatory for each new employee.
Going forward, in line with the Company’s emphasis on skill development of its workforce, ATG will review and enhance its training requirements for all the employees.
- Occupational Health and Safety
Israel facility has 2 full time Internal Safety Officers and 1 External Safety Officer. Facility at Tirunelveli also has dedicated positions for Safety Officer, responsible for ensuring the overall safety across the facility. In addition to the in-house safety team, ATG conducts an external safety audit every year to identify safety gaps or areas for improvement.
Adequate fire detection and suppression fighting equipment is fitted across the facility based on a detailed assessment of potential fire risks, which is currently being further upgraded. Fire fighting systems consists of smoke detectors, sirens, fire extinguishers, fire hydrants as well as sprinkler system in various sections of the facility, in accordance with specific fire risk of each section. Fire exits and the locations of fire extinguishers are clearly marked. Similar safety system shall be implemented in the upcoming Project in Gujarat.
While basic housekeeping and safety standards are adequately in place, Company recognizes that it can make further improvements to achieve international best practices. In order to systematically address these issues, Company is engaging external safety consultants to conduct a safety audit at the Tirunelveli facility and develop an action plan. Moreover, based on this safety audit, Company will develop a generic safety manual for all ATG’s facilities. The manual will include hazard risk assessment for different activities in the production process, prepare standard safety practices and minimum PPE required for each activity.
- On-site Emergency Response Plan:
On-site emergency response plan has been developed for Tirunelveli facility. Accordingly, potentially hazardous areas have been identified and evacuation routes and assembly points have been designated and clearly marked. Mock drills are conducted twice a year to ensure the emergency preparedness.
PS3: Pollution Prevention and Abatement
IFC’s assessment considered the Company’s operations with regard to resources consumption (water, energy, fuel), efforts to optimize resource inputs, waste minimization and management practices as well as the storage, handling hazardous materials used in the construction and operations of facilities.
The tyre manufacturing processes comprises of various steps, such as (i) compounding and mixing of elastomers, carbon black, and other chemicals such as vulcanizing agents, accelerators, plasticizers, and initiators in a banbury mixer; (ii) component preparation, involving extrusion and calendaring (where the mixture is extruded between pairs of large rollers to prepare tread, sidewall and liner materials) and bead preparation; (iii) tyre assembly, where all the components (bead wires, coated fabrics, treads, etc.) are assembled on a tire-building machine and the green tyre is inflated and shaped; (iv) curing, where the tyre undergoes heat and pressure treatment to stimulate the vulcanization reaction between the rubber and other materials, before the final product is ready for final testing. Tyre inspection is the last step in the tyre manufacturing process, and includes: (i) trimming of the mould flash and micro-vents; (ii) visual inspection for appearance and to identify obvious defects; (iii) X-ray examination (in the case of steel belted tires) to check internal structure and to identify defects and (iv) tyre durability, uniformity, and weight balance inspection.
Tyre manufacturing process does not result in high volumes of wastewater. The air emissions from tyre manufacturing operations consist of dust from mixing processes, fume from vulcanization and emissions of combustion products from the steam boilers. The solid waste generated during the manufacturing process includes: non-vulcanized rubber waste, scrap rubber tyres, household waste and other waste such as packaging material, empty oil drums etc.
- Pollution Prevention and Resource Conservation:
ATG uses only those raw materials which comply with REACH regulation. It also uses low aromatic oils in its manufacturing processes.
ATG has a strong focus on resource conservation and waste minimization. Through concerted efforts, it has achieved significant reductions in yield loss (technical losses + quality related losses) from the 2009 levels.
ATG is striving to minimize energy consumption in the manufacturing process and has made some impressive achievements. Based on the energy audits undertaken in the past, ATG has been able to reduce the specific power consumption by 10% and coal consumption by around 17% during 2011 at its Tirunelveli facility.
As a part of the Project, Company is installing a combined steam and power cogeneration system at the Tirunelveli facility, which is more efficient than traditional separate systems. As per preliminary estimates, the Company will be able to reduce nearly 24% of coal and grid electricity consumption and thus associated GHG emission reductions in Tirunelveli due to this cogeneration system.
Currently it is engaged in steam and condensate audit and hopes to optimize the unit water consumption in near future. Similar initiatives will be implemented at the proposed Project in Gujarat.
As a part of its resource conservation efforts, Company has rainwater harvesting program and has constructed a 300 cum capacity tank for this purpose.
- Water Supply and Effluent:
The daily water consumption for ATG’s Tirunelveli plant is 600cum/day for the process including cooling tower evaporation losses and nearly 90 cu. m/day for domestic use. The raw water is supplied by the state government from the nearby Tamarabharni River. Company has its own Reverse Osmosis (RO) based water treatment plant to enhance the freshwater quality.
The process wastewater is treated in the effluent treatment plant on site (capacity – 375 cum/day, average flow 250 cum/day) and the domestic wastewater is treated in sewage treatment plant (capacity – 90 cum/day, average flow 55 cum/day). The treated water is recirculated in toilet flushes and for gardening. As a result ATG facilities are zero discharge facilities, and the same is planned for the upcoming Project.
- Electricity / Steam:
The daily power requirement for the Tirunelveli facility is met with the supply from the national grid. Backup diesel generators are place to handle the power outages – especially frequent during summer.
Generators are provided with acoustic enclosures. All fuel storage tanks are constructed with dyke bunds to avoid discharge of fluids like HSD, Naphtha and process oil into soil / ground in case of an accidental spill or discharge. The coal yard is covered and has a RCC flooring to prevent contamination of soil.
- Air Pollution:
The main sources of emissions are the process areas and boilers. ATG has taken several steps to minimize air pollution impacts from its operations.
A pneumatic carbon handling system has been installed at Tirunelveli facility to avoid spills in the carbon black supply system. The dust collection system installed at the carbon handling day bins and feeding systems and fume extraction system for mixers prevents dust in carbon feeding process.
The cyclone dust collection system has been installed in coal mill to prevent dust generation in coal feeding / conveying system. Mechanical dust collection system installed in boiler flue gas duct removes dust from the fuel gas, and avoids dust emission along with the flue gas. The Wet Scrubber installed in the boiler flue gas duct controls the emission of dust in the fuel gas through the chimney. Stacks of adequate heights have been provided for boiler and diesel generator exhaust.
For the proposed expansion at Tirunelveli and the upcoming project in Gujarat, Company will install electrostatic precipitators (ESP) as air pollution control devices.
ATG has confirmed that the proposed Project shall meet the IFC’s relevant EHS Guidelines with regard to air emissions.
- Green House Gases (GHG) Emissions:
The GHG emissions of the Project comprise of those due to the electricity consumption and coal combustion in boilers. The Project will result in estimated GHG emissions of around 225,000 t CO2e/year when all the proposed facilities become operational at full capacity. At Tirunelveli, these emissions are about 24% less than the without-cogeneration case.
- Solid and Hazardous Waste:
Majority of ATG’s waste is non-vulcanized rubber waste, which can be to large extent recycled within the plant. ATG complies with all relevant regulations for the storage, handling and disposal of hazardous materials used in the production process. The notified hazardous wastes are disposed of through licensed waste management contractors, as per the regulatory authorizations.
Adequate controls during the storage and handling are in place. The designated hazardous material store room is constructed as per regulatory requirements for safe storage of hazardous waste till disposal. The quantities of solid waste thus generated and disposed of are regularly monitored and reported to the regulatory authorities through annual environmental statement.
PS4: Community Health, Safety and Security
The existing as well as proposed Project sites are located in industrial areas, far away from the nearby residential communities and are connected wide national highways. Hence the impact of vehicular movement on surrounding communities is expected to be minimal.
While the impacts on the nearby communities due to ATG operations are expected to be minimal, all the facilities have developed detailed emergency response plans for its operations, and the same will be developed for proposed Project.
On the basis of the above information, it is concluded that the Project has been designed and will be operated in compliance with IFC’s PS and relevant environmental, health and safety guidelines.
