While all Performance Standards are applicable to this investment, IFCs 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. If IFCs investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

PS 1 – Assessment and Management of Environmental and Social Risks and Impacts
PS 2 - Labor and working conditions
PS 3 - Resource Efficiency and Pollution Prevention
PS 4 – Community Health, Safety and Security
If IFC’s investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

This proposed investment is expected to have limited environmental and social impacts which are expected to be site-specific and none is expected to be significant. Those impacts can be avoided or mitigated by adhering to recognized performance standards, procedures, guidelines and design criteria as described in the following sections. Thus, this is a Category B project in accordance with IFC’s Environmental and Social Sustainability Policy. This categorization is in accordance with other similar type of projects within the sector. The project is designed to avoid, minimize and manage environmental and social risks and impacts of the Company’s operations in compliance with applicable IFC’s Performance Standards and World Bank Group (WBG) General and sector-specific (Food and Beverage processing) Environmental, Health and Safety (EHS) Guidelines.

Key E&S issues applicable for this investment are: (i) operational licenses of the four facilities; (ii) environmental, occupational health and safety (OHS), food safety and social management system and related procedures, including Hazard Assessment and Critical Control Point (HACCP) Principles and ISO 22000 certification; (iii) EHS organizational structure and internal capacity; (iv) adherence to Indonesian labor law, working conditions, standards and OHS risk prevention and management, including each facility’s employees, contractors and nearby communities; (v) Life and Fire Safety (L&FS) provisions and emergency preparedness and response; (vi) use of public utilities (water supply and energy), optimization of water and energy use through project design and resource conservation measures and greenhouse gas emissions; (vii) wastewater collection and treatment, solid waste disposal, air emissions from generators and boilers, potable water quality, treatment and monitoring, hazardous material handling, management and control of pest and rodent; (viii) food and transport safety, and (vix) engagement with communities on EHS, food and traffic safety and social performance. PT TAS is an existing IFC client and its E&S performance to date has been satisfactory.

IFC's appraisal considered the environmental and social management planning process and documentation for the project and gaps, if any, between these and IFCs requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable period of time, are summarized in the paragraphs that follow and (if applicable) in an agreed Environmental and Social Action Plan (ESAP). Through the implementation of these measures, the project is expected to be designed and operated in accordance with Performance Standards objectives.

Environmental and Social Assessment. PT SMU, PT TAS, PT MAS and PT HAS have been respectively commissioned in 1989, 2005, 2010 and 2012. In accordance with Indonesia’s Environmental Protection and Management Law (2009), and based on the limited E&S impacts of its operations, all facilities have successfully completed the environmental impact assessment requirements (AMDAL/UKL – environmental management efforts and AMDAL/UPL – environmental control efforts). A detailed Environmental Impact Assessment (EIA) Study has been prepared for PT SMU. Prior to commissioning, local environmental authorities (Badan Lingkungan Hidup/BLH daerah) undertook an inspection to ensure that government’s environmental standards had been effectively implemented during construction phase, including technical specifications for the wastewater treatment plant (WWTP). All facilities have successfully obtained necessary and required provincial and district certificates, permits and/or licenses (e.g. land use and building permit, letter of authorization from Ministries of Environment and Industry, water extraction permit, safety of the electricity system installation, Life & Fire Safety, including fire prevention system, genset and boiler permit). Copies of these have been reviewed during the due diligence. All facilities have incorporated management system and procedures during project design as well as installation of state-of-the-art equipments to prevent environmental, OHS and food safety impacts. Japanese 5S concept (sorting, straightening, systematic cleaning, standardizing and sustaining) is applied at all sites. Certification from the Food and Drug Monitoring Agency (Badan POM RI) has been obtained for the production of ready-to-drink beverages (“RTD”) and coffee mix, namely PT TAS, PT MAS and PT HAS.



Management Program. From commissioning, even though key focus is geared toward effective processing efficiency and outputs, all facilities have been developing and implementing an integrated Environmental, Labor, OHS, Food Safety Management System, including policies, plans, manuals and procedures. Implementation of plant-level EHS management system procedures are on-going at all sites. Going forward, as set forth in the attached Environmental and Social Action Plan (ESAP), all these Companies have agreed to further develop and integrate these Environmental, Occupational Health and Safety (EHS) and food safety management system elements – consistent with ISO 14001, OHSAS 18001 and HACCP/ISO 22001 – into an Integrated Management System in compliance with IFC’s PS1 requirements and applicable WBG General and Sector-Specific Environmental, Health and Safety (EHS) Guidelines. Voluntary commitment to achieve ISO22000 certification has been made for PT TAS by February 2013. PT TAS, MAS and HAS have obtained Halal Certification.



Organization. All facilities have already established a comprehensive plant-level EHS structure for the effective implementation of their res
pective EHS procedures and plans. Under the overall responsibility of each facility’s experienced Plant General Manager, specific roles and responsibilities have been assigned to the Production Head for the effective management of the WWTP, the Engineering Head for workers’ OHS issues, including emergency preparedness and response, and finally to the Human Resources and General Affairs Head for labor and working conditions issues. These resources are supported by an assigned EHS committee (ref. Department’ heads and supervisors) to ensure effective implementation in all workplaces. These HSE’s role and responsibilities are clearly defined in each plant-level organization chart which have been reviewed during due diligence. In addition, EHS’s work plan and training effectiveness have been validated during IFC appraisal through review of each plant-EHS performance discussed under Performance Standard 2 (OHS – lost time hours) and PS3 (effluents parameters).



Training. All plants have adopted and implemented a plant-level training procedure to ensure continuous training of staff in order to improve operational efficiencies and accident and incident prevention. Among others, compulsory basic safety orientation is provided to all employees during their induction training while supervisors conduct daily refresher briefings on OHS and food safety measures before and after every shift. In addition, a Task Hazard analysis has been conducted for establishing specific training need assessment for confined space entry, elevated work, chemical loading, hot works areas, scaffold erection, excavation, heavy lifts, etc. Prior to performing work at the facilities, contractors are also requested to attend a formal safety orientation on applicable EHS’s directives and procedures. The plant manager or supervisor delivers these courses. A record of attendance is kept by the EHS Plant Safety Committee. Contractors are then required to sign the “Contractor Safety Commitment” prior to commencing work. Weekly operational meeting to review plant’s performance, including OHS, and identify necessary mitigation measures is taken place. Minutes of the weekly and monthly OHS meetings are being registered and corrective action plan (CAP) tasks addressed immediately. Effectiveness of this system has been verified during due diligence. A mentoring program, including cross-fertilization, has been established among plant managers to ensure dissemination of best EHS practices and lessons learned. Lastly, plant managers have provided themselves with on-going EHS training through interaction with consultancy firms on the development and implementation of EHS management system and procedures. Specific training on first aid is conducted every six months, and emergency response (ref. earthquake) and a fire drill is conducted quarterly, in coordination with the plant-level security team and district fire brigade.



Monitoring and reporting. A structured EHS monitoring system has been
adopted at each plant, including weekly operational review by EHS team (Production, Engineering and Human Resources and General Affairs Heads) and their supervisors as well as in each department and inherent workplace. A daily walkthrough maintenance and safety inspection by the Plant Manager also takes place. As mentioned above, weekly safety patrol and monthly safety committee review, including production of an OHS report takes place, with corrective measures implemented within an agreed timetable. Review of the inspection forms, quality of the inspection and safety reports and effective implementation of the recommended corrective actions has been validated during IFC’s due diligence. Indonesia’s Food and Drug Monitoring Agency (BPOM) and MUI (Halal) periodically visit and monitor factory compliance to prescribed product quality norms and conditions. In addition, local environmental authorities (BHL) and Department of Labor undertake biannual and annual monitoring compliance inspections. Each facility undertakes daily/monthly (raw water, wastewater effluents) and semestrial (ambient air quality and air emissions, noise level) measurements. Analysis is undertaken by certified and independent laboratories and sent to local environmental authorities. All facilities have or are in the process (PT HAS) of adopting Key Performance Indicators (KPIs) to monitor overall plant’s performance (quality, cost, staff, service). As set forth in the ESAP, all plants will update these KPIs in order to better capture the following EHS parameters: a) Safety – Lost Time Incidence Frequency Rate (LTIFR), Accident Free Days; b) Sustainability – Carbon (kg/ton), Water Usage (kiloliters/ton), Energy Usage (kWh/ton), wastewater monitoring effluents and air emissions parameters (including VOC); c) Staff - Retention and training days. In addition, going forward, and as set forth in the ESAP, each Plant General Manager will define an integrated EHS report format and based on critical EHS key performance indicators (e.g. compliance with legal and regulatory requirements, EHS management system progress report and certification, including food safety management system (HACCP/ISO22000), energy and water consumption and efficiency; air emissions (NOx, SOx, particulates), including GHG emissions; noise levels and management, solid and hazardous waste management and disposal, effluent discharges from WWT unit, compliance with national OHS requirements, including accident rates (lost-time accidents); customers complaints, supplier performance and community engagement activities) will report annually to concerned Indonesian authorities and IFC as part of the Annual Monitoring Report (AMR).



Community engagement. Regular interaction and communication takes place at all plant sites through an open door policy with the local community leaders and residents. Two way approaches are being implemented, either the leaders visit the plants or the Plant General Manager visits the co
mmunity office. This community engagement is being supported by Corporate Social Responsibility (CSR) initiatives at each site. A grievance mechanism procedure has been adopted in order to receive and to address any issues and/or complaints raised by surrounding stakeholders and end-customers resulting from production and transport activities. Main E&S concerns from surrounding communities could only include induced traffic as beverage manufacturing does not pose any serious risks on the health, safety and security of surrounding community. Only the liquid waste disposal, controlled by the WWTP operations, if not efficiently operated, can result in adverse impacts on the recipient water quality. As it is, all plants (PT HAS – still pending) have on-site WWTPs that demonstrate compliance with Indonesia’s effluent guidelines, which are, in some cases, more stringent than the WBG’s effluent parameters.

Human Resources (HR) Policy and Management. All four plants have adopted an Internal Regulation (Peraturan Perusahaan) which outlines human resources policies and set of procedures, including recruitment and selection; admissions process and documentation; planning and approval of holidays and time off; attendance and working hours; payment processing, including health insurance and benefits to workers and their families; performance evaluation; training; access to grievance mechanism; disciplinary measures and cessation of employment. Plant-level Internal Regulation is discussed and agreed upon with the worker’s unions and/or workers associations, when these are present (PT SMU and PT MAS). All Internal Regulations are required to be in compliance with Indonesia’s legal labor requirements, namely Law No. 13 of 2003 on Manpower (Manpower Law), the Law No. 2 of 2004 on Industrial Relations Dispute Settlement and Law No. 21 of 2004 on Labor Unions, including non-discrimination and equal opportunity. The Internal Regulation is communicated to all new employees during the induction process and a signed acknowledgement of receipt from each employee is requested. Certificate of Legality/Registration of each plant’s Internal Labor Regulation has been delivered by the Indonesian’s Labor Department (still pending for PT HAS). The Regulation also includes information on internal communication and grievance channels, including daily briefing between supervisors and workers, weekly meeting between the plant general manager and departmental heads/supervisors, participation of worker’s representative in management meeting. Lastly, the Internal Regulation explicitly outlines each company’s commitment to non-discrimination, equal opportunity, strict compliance with minimum wage law, prevention of harmful child and forced labor. Based on the above, each Company complies with labor laws and related PS2 requirements to protect the workforce. The site visits confirmed companies’ efforts in providing optimum working conditions to staff. Inputs for drinks production include water, fruit, tea, coffee, sugar, and flavorings and are purchased through intermediaries. As such, all facilities do not have leverage and/or control over primary agricultural suppliers where presence of child labor and/or biodiversity related issues may occur.



In addition to permanent employees at PT TAS, SMU, MAS and HAS, contractual workers are recruited through HR service providers. All plants undertook due diligence before establishing contractual arrangement with a service provider, including its registration to the Ministry of Labor and verification of effective payment of social benefits. In the context of the expansion of production lines at all facilities, additional workers will be recruited. Specific numbers are not yet available. Gender breakdown is 60% male versus 40% female on average. Staff turnover at all plants (10% on a yearly basis), is consistent with local and industry a
verage. Each plant has its Human Resource and General Affairs Department. This Department is responsible for the development and implementation of the Internal Labor Regulation that must be followed during human resource management cycle. The recruiting process at all sites involves a background check of diploma, professional experience and a medical test. As part of the HACCP’s implementation process, PT TAS, MAS and HAS will also conduct employee health check once a year for workers at critical control points. None of the four companies engage in child or forced labor with a minimum legal age of employment of 18 years old. Similarly, employees are required to have been educated to a senior high school level.



In addition to payment of minimum salary wage (40 hours/week, 6 days/week) to its workers, other benefits depending on work assignment and responsibilities could enhance wage by additional 2.8% to 16%. Payment to the Social Security is deducted from the workers’ monthly pay to a level of 2% for the employees’ retirement plan. In addition, all companies are required to pay 4.89% of workers’ monthly salary to the Social Security, covering workplace accidents and family allocations, including pregnancy. There are 3 shifts of 8 hours per day at all operations. Changing rooms, toilets and showers facilities are available for workers and respect gender sensitivities.



Working Conditions. All four companies complies with Indonesian law recognizing workers’ rights to form and to join workers’ organization of their choosing without interference and to bargain collectively (ref. compliance of the all plant’s Internal Regulation with Law No. 2 of 2004 on Industrial Relations Dispute Settlement and Law No. 21 of 2004 on Labor Unions). PT SMU and PT MAS do have unions in place. There is no history of recent labor strikes among employees directly targeting the four companies.



Grievance Mechanism. At each plant, there is an established and structured grievance mechanism procedure which meet IFC’s PS2 requirements and which is found in each Internal Regulation. This procedure include steps to be taken for workers to manifest any concern, engage in a mediation process, contact responsible persons at each facility, and provide feedback. Awareness raising on grievance mechanism procedure take place during the worker’s induction session and/or workers’ associations. Scope of this grievance mechanism also apply to contractors’ workers.



Occupational Health and Safety. As indicated above, all plants have adopted OHS management system procedures and monitoring plan, and established (or in the process of), in accordance with Indonesian legal requirements, plant-level EHS Committee. The EHS Committees’ tasks are the following: task hazard analysis based on SOP for each activity, enforcement of use of Personal Protective Equipment (PPE), safety record, safety orientation during induction/orientation program complemented by on-the-job training supervise
d by their immediate superior, contractor safety, plant emergency response organization (fire fighting equipment identification and mapping, emergency route, meeting point during evacuation, fire fighting, first aid and evacuation leader assignment), emergency contact number (police, hospital, plant calling tree), weekly and monthly safety inspection, near miss management, incident investigation, fire drill, weekly and monthly meeting. Effective implementation of these tasks has been validated during the IFC due diligence through on-site meetings and log reviews. Presence of heat extractors was also noted. Introduction of pertinent sections in contracts, in order to ensure that all contractors and sub-contractors are in compliance with payment of workers’ legal benefits; timely payment of wages; OHS regulations, including personal protective equipment (PPE) and ILO Conventions 138 on Minimum Age have been implemented in all companies. Each Plant Manager monitors monthly the compliance of service providers to minimum age employment requirements. Employees are obliged to wear appropriate PPE (overall, safety shoe, facial mask at location where dust or fume exposure and ear plugs at noisy works areas). Site visits have confirmed effective implementation of these measures. All plants have an on-site medical clinic staffed with a nurse on 3 shift basis. In case of work accidents, the company will take the employee to a hospital and pay for all emergency care expenses. All companies are required to prepare an annual report on work-related accidents and submit it to the local Ministry of Labor as part of its yearly supervision.



The ratio of total lost man-hours due to accident to total man hours worked was made available during the due diligence only for PT TAS and PT MAS. Lost Time Injury Frequency Rate (LTIFR) has been 0.82 for PT TAS from 2010-12, which is excellent based on USA data LTIFR for the food manufacturing sector (7.0) and beverage manufacturing (9.5). This being said, LTIFRs for PT MAS in Surabaya have been 11.38 for 2011 and 10.57 for the first six months of 2012. An OHS campaign, via team briefing, communication and training has resulted in slightly improved OHS performance but more structured preventive action is needed. As set forth in the ESAP, PT MAS, PT HAS and PT SMU will commission an industrial safety engineer to review safety management processes, to advise how to move from the current performance levels towards best OHS practice levels. Revised safety management processes are likely to build upon the considerable work already undertaken in PT TAS, and focus on identification and replication throughout all Companies of existing best practices, and more systematic “mining” of accident records to identify and disseminate the knowledge captured therein. In addition, as already indicated under PS 1 – Monitoring and Reporting, all plants will mainstream Lost Time Injury Frequency Rate (LTIFR) into its monthly KPIs which will allo
w making pro-active and continuous improvement. At last, a comprehensive OHS training should be specifically targeted to seasonal and piece-worker. To date, no fatality has been reported at any of the four facilities since the last two years.



Life and Fire Safety. All plants are associated with fire and explosion risks, including diesel containers for genset and boilers in all sites. In addition to the preventive maintenance measures to prevent such risks, all plants have installed fire prevention system, including fire hydrant and hose and extinguishers, and are in the process of establishing a Life and Fires Safety Committee. The full efficiency of these systems is assessed by each plant’s Engineering Head prior to plant commissioning and on-going monitoring during operational phase. In addition, local authorities have been delivering a fire hydrant certificate at all plants. As part of the plant monthly EHS inspection, fire extinguishers, hydrant and fire fighting system are also inspected. In coordination with local fire brigades, security teams at all plants also undertakes quarterly fire drills. PT SMU has its own fire truck and ambulance on site.

As part of its integrated EHS management system and program under development as requested by PS1, all plants have adopted state-of-the-art technology and design for its production demonstrating considerable attention to resource efficiency issues, through continuous improvement of their processes, equipment selection and choice of fuels. Continuous improvements are on-going in the area of water loss reduction and energy efficiency. The applicable parameters requirements have been so far the Indonesian’s effluents parameters (aside from PT TAS, an IFC’s existing client) but all plant management teams has demonstrated engagement to comply with the World Bank Group’ EHS Guidelines, including effluents parameters.



Energy use. Provision of energy to all plants is provided by the Indonesia State Electricity Corporation (PLN) and stand-by diesel generator sets, used on an emergency basis only. Energy use has been increasing considering the increased of production capacity at all sites. Steam and heating sources are generated through natural gas fired boiler and a stand-by diesel fuel fired boiler (not applicable for PT HAS). All plants are monitoring closely their energy consumption. Use of electricity is the main source of energy usage in all factories and energy reduction measures include, among others, the following: use of sky lights during day time in the warehouse areas, lights and air conditioning off policy when there are no ongoing activities, energy saving light bulbs, replacement of diesel forklift trucks with electrical models, variable speed drive for compressors (PT TAS), utilization of exhaust air from roasters for pre-heating coffee beans prior to roasting (PT HAS). In relation to truck fleet’s diesel consumption, this information was not available at factory levels during IFC appraisal as product hauling and distribution are being undertaken and handled by 3rd party contractors between plants and distribution centers. Diesels reservoirs at all sites have installed secondary containment walls in case of leakage.



Water supply and consumption. All plants are sourcing raw water from deep underground wells (70-100 meters), aside from PT TAS which is sourcing its water from MM2100 Industrial Estate, in order to prevent any E.coli contamination. Extraction water rights are approved by local authorities. Raw water is processed via reverse osmosis for production use. From the total extraction volume, an estimated of 65-70% is used for product purposes while 30-35% is concentrate water (ref. by-products of reverse osmosis). Total raw water consumption used per ton versus ton of goods produced remain on average from 1.90 to 2.35 (PT-TAS), which is considered excellent based on Table 3 of the WBG EHS Guidelines – industry benchmark of 6.5 for fruit juices). As indicated under PS1, all plants will adopt a specific KPI which will monitor this performance on a monthly basis. Water meters have already been installed. Fees for underground water
consumption are nominal (9 cents U.S.). Water quality analysis for underground water is conducted every quarter by a third-party licensed provider. Reduction of water use is being actively pursued at each plant, including improvement of the water quality to reduce boiler blow down, steam condensate recovery system and use of concentrate water for use in plant’s domestic system (toilets, hand washing / cleaning and gardening). As part of the daily/weekly inspection carried by the plant manager and the EHS officer, water leakage is incorporated into the Plant Walkthrough Inspection report.



Wastewater treatment. All plants (PT TAS, MAS and SMU) have existing Wastewater Treatment Plants (WWTP) in place, where treatment capacity is being expanded at all sites to serve the proposed investment. Considering the high concentration of biochemical and chemical oxygen demand (BOD & COD), treatment encompasses sedimentation of suspended solids through clarifiers and biological treatment (anaerobic and aerobic). In the case of PT TAS, this plant also have to comply with wastewater standards entering the sewage system as per the MM2100 Industrial Estate. Strict monitoring systems have been established for daily compliance of the effluents with Indonesian’s parameters and monthly reporting to local environmental authorities. As mentioned above, the Indonesian effluents levels are in some cases, more stringent than the WBG’s EHS Guidelines (e.g. 100 versus 250 mg/l for COD). Monthly data reviewed for all plants over the last six months demonstrate compliance with Indonesia and WBG effluents guidelines. PT MAS has installed a bio-indicator mechanism to demonstrate full efficiency of its WWTP, where the bio-treated water effluents are used for a fish pond. A WWTP to serve PT HAS is yet to be built. It is planned to build a standard wastewater treatment system (settling system with 3 compartments) by October 2012. In the meantime, as this facility uses a dry process and volume of water is low (only domestic sewage), local authorities have agreed to allow surface discharge to a settling pond with three month retention time before discharge to the sea.

Management of solid & hazardous waste. Waste at all plants are characterized by used plastic, wood pallets, printing paper, cardboard, resin which are 100% either reused or segregated, sorted and sold for recycling. Wastes generated are registered at all sites. For PT HAS, the exhaust air of the roasting machine is cleaned of the coffee bean chaff (1,200kg/day). The separated chaff is then compacted using a briquetting or pellet press and used as solid fertilizer. Organic wastes from canteen are disposed by licensed contractors to authorized landfill sites. Hazardous wastes present in all operations are minimal and characterized by used oils and used reagents from laboratory’s product analysis. The former are collected by authorized license providers which are registered members of the Indonesia’s Association o
f Hazardous Waste Management for recycling while the latter are flushed into the effluent stream and treated on site by the WWTP. Sludge from WWTP is dried and distributed to surrounding farming communities for soil fertilizer. Sludge analysis for heavy metal residues (e.g. mercury, lead, cadmium, copper) are carried out every year. At PT SMU, Material Safety Data Sheets (MSDS) were visible on products used for detergent production (e.g. sodium triphosphate, soda ash, sodium sulfate) in the warehouses.

Air emissions monitoring. The main source of air emissions are mostly from natural gas fired boilers and large gensets that burn diesel to produce electricity, heat and hot water, under emergency basis only. Boilers and generators undergo trimestrial maintenance inspection to optimize efficiency. All plants, through an independent and certified laboratory, are required to carry air emissions monitoring every six months (June/December) from the stack and ambient quality outside and inside the plants. Results are within the permissible parameters outlined within the WBG EHS guidelines for point source emissions to air (PM10: 50-150mg/Nm³; NOx: 460mg/Nm³; SO2: 2,000 mg/Nm³).



Cooling agents. PT MAS and PT TAS are equipped with Air Handling Units (AHU) for air conditioning and refrigeration systems for product conservation and are using HFC 134a and mono ethylene glycol respectively.



Noise. While noise levels at most workplace in the plants are complying with WBG’s noise level guidelines of 70 dbA, excedances have been noted in the packaging, process and crusher areas in PT TAS and PT SMU. Plant management has imposed a strict observance of use of personal protective equipment (e.g. ear plug or ear muff) to protect employees from high noise level. As set forth in the ESAP, in order to monitor any deterioration of hearing capabilities of its employees, noise levels measurement will be established at all sites. In the event of exceedances to WBG Guidelines, each Company will be requested to seek mitigation through engineering preventive measures (e.g. confinement of equipment). As well, annual semestrial hearing tests be conducted by a doctor in the on-site health clinic. In the event of deterioration of hearing, employees will be moved to other workplaces.

Pest management and control. Legally registered companies conduct rodent control in all operations. Products used included cypermethrin and lambda cihalotrin which are acceptable. The product used for rats control is bromadiolone which is listed under WHO Class 1a chemical formulations (highly hazardous). As set forth in the ESAP, all companies will prepare a management system procedure to implement pest and rodent management. The procedure will aim to eliminate the use of WHO Class 1a and 1b chemical formulations in their premises. All companies will modify service contracts to require contractors and suppliers for mandatory training to workers and ensure provision of adequate PPE based up
on MSDS and/or ICSCs for the materials used. This requirement will be added in employee’s OHS training programs.

Community Health and Safety. As indicated above, all four targeted companies are either located within industrial estate or relatively isolated from human settlements (illegal settlements were noticed at proximity of PT SMU site). As such, potential adverse impacts from their operations would limit itself to induced increased traffic which should not represent a significant risk for the local population. Transport sub-contractors are requested to produce a validated driver license. As set forth in the ESAP, all four companies will develop and implement a safe driver and transport safety vehicle procedure, including training session for its own and third party haulage contractors. Forklift operators at all sites are trained and certified by the Department of Labor. Copies of their certification have been provided during the due diligence. For product quality, corporate level consumer complaints call center has been established to address any issues. Additionally, there is a direct line of communication between Directors and Plant General managers at all time.



Emergency Preparedness and Response. All facilities have adopted an emergency preparedness and response protocols, procedures and plans. The emergency plans respond to the needs of accidents, bomb threats, fire, breach of security, oil, chemical and fuel spills, and severe weather alerts. An emergency team has been established at each facility.



Community Grievance Mechanism. All plants have adopted a formal Community Grievance Mechanism. Management procedure has been provided during the due diligence and assignment of role and responsibilities for its effective implementation delegated to the Head of Human Resources and General Affairs.



Security Personnel. Security personnel at all operations are being sourced through a licensed service provider. Staffs assigned to security purposes are trained and equipped for defensive measures and are not armed. In addition, all facilities have installed CCTV cameras. Biometric control for employee access has been established at PT MAS.



Corporate Social Responsibility initiatives. All plants have adopted a policy to recruit most of their workers from local surrounding communities. In addition, health and education, water and sanitation, and cultural activities are being supported by each company.

The ESRS and the attached ESAP will be made available via the World Bank Group’s InfoShop. All companies will be requested to place an advertisement in a local newspaper to inform the public that results from IFC’s environmental and social review (ESRS) and ESAP is available at public sites, such as municipality offices.

Mr. Handoyo Sutanto, Finance and HRD Director
PT Sayap MAS Utama
Kawasan Perluasan Utara PT JIEP (Cakung Drain), Jalan Tipar Cakung Kav. F 5-7
Jakarta 13910, Indonesia, P.O. Box 7668 Jakarta 13076
Tel: +62 (21) 4602696 (standard); Fax: +62 (21) 4603494
E-mail: mailto:handoyo.sutanto@wingscorp.com

Broad Community Support is not applicable for this project

	Description of the Action Item	Anticipated Completion Date
	Performance Standard 1: Assessment and Management of Environmental and Social Risks and Impacts
1	All production sites will design and implement an Integrated Environmental, Occupational Health and Safety, and Social Management System – consistent with ISO 14001, OHSAS 18001 and HACCP/ISO 22001 – in accordance with IFC PS1 requirements to be reviewed and approved by IFC, defining roles and responsibilities, and other necessary elements (manual procedures) to enable it to comply with Indonesian laws and regulations, IFC Performance Standards and applicable WBG’s Environmental, Health and Safety Guidelines. The Management System will include mechanisms for the EHS officer to report monthly E&S monitoring results to Company’s senior management who will need to sign off on the reports. a) ESMS design in place and approved by IFC for all sites b) Evidence of complete and effective implementation of the ESMS at all sites (e.g. final documentation of the ESMS, including policies, plans, manual procedures and programs, e.g. training logs, monitoring records, minutes of progress reviews).	a) August 2013 – for all sites b) PT – TAS: September 2013; PT – MAS and HAS: December 2013; PT – SMU: December 2014
2	All Companies will review and expand its existing Key Performance Indicators (KPIs) to mainstream Environmental, Health and Safety parameters, including a) Safety – Lost Time Incidence Frequency Rate (LTIFR - Number of injuries per million of hours worked); Accident Free Days ( Number of Days since last Lost Time Incident); b) Sustainability – Carbon (kg/ton - CO2 emitted / tons produced); Water Usage (kiloliters/ton) and Efficiency - Consumed versus tons produced; Energy Usage (kWh/ton) - Energy consumed/tons produced; Wastewater monitoring effluents and air emissions parameters (including VOC); c) Staff - Retention - Number of full time equivalents leaving in the period /Avg. full time equivalents - and Training days - Number of training days provided to new and existing employees. Monthly and annual report will be reviewed during each Company’s Monthly EHS Review and annually during the Company’s planning and budgetary management review.	a) December 2012
3	All Companies will prepare an integrated EHS report format based on critical EHS key performance indicators (e.g. compliance with legal and regulatory requirements, EHS management system progress report and certification, including food safety management system (HACCP/ISO22000), energy and water consumption and efficiency; air emissions (NOx, SOx, particulates), including GHG emissions; noise levels and management, solid and hazardous waste management and disposal, effluent discharges from WWT unit, compliance with national OHS requirements, including accident rates (lost-time accidents); customers complaints, supplier performance and community engagement activities) and report annually to concerned Indonesian authorities and IFC as part of the Annual Monitoring Report (AMR).	a) November 2013 and annually thereafter.
	Performance Standard 2: Labour and Working Conditions
4	For PT SMU, PT MAS and PT HAS, commission an industrial safety engineering professional to review companies’ management of occupational health and safety (OHS) issues, and to devise mitigation measures to enhance OHS management, building upon PT TAS’s existing safety management structure and processes. a) Provide a copy of the occupational health and safety professional’s audit report to IFC for all sites, including Corrective Action Plan (CAP). b) Audit recommendations and CAP fully implemented at all sites, including comprehensive OHS training, starting in September 2013 and delivered every six months, to identified companies’ employees and seasonal piece-workers.	a) April 2013: PT MAS, PT HAS and PT SMU b) September 2013: PT MAS and HAS; December 2013: PT-SMU
5	To prevent any hearing loss for workers in some workplace areas (especially packaging, process and crusher areas), all Companies will implement preventive engineering measures (e.g. equipment confinement), if feasible, or provide protection equipments for workers. As part of the annual health check up required under HACCP certification for employees exposed to noisy working environment, a hearing test will be required. In case of hearing deterioration, employees will be moved to other workplaces.	May 2013
	Performance Standard 3: Resource Efficiency and Pollution Prevention
6	All Companies will develop and implement a Pest and Rodent Management System Procedure. The procedure will eliminate the use of WHO Class 1a and 1b chemical formulations in its facilities. All Companies will modify service contracts to require service providers mandatory training of its workers and adequate PPE based upon MSDS and/or ICSCs for the materials used. a) Provide copy of the procedure to IFC; b) Provide adequate documentary evidence of incorporation into management system procedures manuals, including the training plan giving contractors’ employees.	a) January 2013 b) November 2013 and annually thereafter in the AMR
7	PT HAS will design and construct a Waste Water Treatment unit in compliance with Indonesian and applicable WBG’s effluents guidelines, especially for pH, BOD, COD, total suspended Solids, Grease, total nitrogen and total phosphorus. a) Submit completion certificates and photo evidence to IFC (PT HAS) b) All effluents from PT MAS (including domestic wastewaters and washing/cleaning) will be treated when its WWT plant expansion is completed. c) Report on wastewater monitoring program at all sites, including all parameters within WBG’s effluents guidelines	a) December 2012 b) December 2012 c) November 2013 and annually thereafter in the AMR
	Performance Standard 4: Community Health, Safety and Security
8	All Companies will develop and implement a Vehicle Operator Safety Training Procedure and Program for its drivers and contractors (to the extent that it is commercially feasible, for the fleet of transportation sub-contractors) emphasizing the following: safety aspects among drivers, improving driver skills, licensing of drivers, and overall truck maintenance. a) Provide IFC with documented evidence of the training program; b) Demonstrate full implementation	a) February 2013 b) August 2013