32475 - Laureate Equity

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Environmental & Social Review Summary

Project Number

32475

Company Name

Laureate Education, Inc.

Date ESRS Disclosed

Sep 6, 2012

Country

World Region

Region

Global

Last Updated Date

Dec 16, 2022

Environmental Category

B - Limited

Status

Completed

Previous Events

Approved : Nov 29, 2012
Signed : Dec 21, 2012
Invested : Jan 15, 2013

Sector

Colleges, Universities, and Professional Schools

Industry

Health, Education and Life Sciences

Department

Regional Industry MAS LAC & EUR

Project Description

IFC is considering an investment of up to $150 million in Laureate Education Inc., including $100 million for its own account and $50 million for IFC’s Asset Management Company. The investment would take the form of either a convertible loan or an equity investment. Laureate will use the proceeds from such investment to finance growth through capital expenditures and potentially acquisitions.

Overview of IFC's Scope of Review

The review of this project comprised meetings with Laureate (the “Company”) management team, at their HQ office in Baltimore MD. Staff had previously visited at the Laureate facilities in Panama City and in Lima, Peru, where IFC staff inspected several sites and interviewed management, administration and academic staff. IFC staff also reviewed the EHS Appraisal Questionnaire completed by the Company, as well as relevant supporting information regarding: environmental management and procedures, human resources management, occupational health and safety policy and procedures, emergency preparedness protocols, training programs and corporate social responsibility.

E & S Project Categorization and Applicable Standard

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
PS5, PS6, PS7 and PS8 do not apply to this project because Laureate Universities are located in urban areas with no involuntary resettlement, biodiversity, indigenous peoples or cultural heritage issues.

Environmental and Social Mitigation Measures

Environmental and Social Assessment and Management. At their corporate offices in Baltimore, Laureate defines policies and development strategies to be applied worldwide. The Company also provides oversight and guidance on best practice for such issues as building design and construction as well safety and security. Best practices are shared with regional and country offices through a MS SharePoint portal. Apart from following global corporate policy, whose application is monitored from HQ, regional and country offices have an autonomous decision making process.

Laureate''s corporate management systems comprise a number of procedures, codes and best practice guidelines that fulfill PS1 requirements as follows:
• Code of Ethics and Compliance
• Risk Management Procedures throughout campus planning, construction and operation.
• Best Practice in Campus Design
• Global Safety and Security System, which comprises procedures for: Security Personnel; Emergency Preparedness and Response; Life and Fire Safety; Environmental Protection; Technical Safety for buildings and installations; and Occupational and Site Health and Safety

Organization. Laureate has a capable and dedicated EHS teams at its local offices. These are organized in a similar fashion, where the Operations Director is responsible both for the academic and infrastructure operations, whereas the Infrastructure Director has responsibility for the development of the sites and major renovations. Locally Laureate has a Chief of Safety and Security, who is supported by a small team of regular staff and from outsourced security personnel. Corporate standards require that security firms provide training to employees according to international good practice, including forming and training life and fire safety brigades and planning emergency drills. Life and fire safety, and security policies, guidelines and operations are coordinated by the Vice President of Global Safety and Security.

Community Engagement. Given Laureate''s location within the urban areas there is close interaction with the neighboring community. When available, medical attention is provided free of charge, or at very low cost, at the University’s medical facilities to the community on appointment. At corporate level Laureate implements corporate social responsibility initiatives through such institutions as the Sylvan/Laureate Foundation, the International Youth Foundation, and the Clinton Global Initiative.

Monitoring and Reporting.
Commensurate to the size and type of installations, the Company has monitoring programs for operational efficiency, quality, environment, and occupational health and safety. Laureate operations in LAC are now producing annual social reports with other regions gradually joining in. Laureate’s website provides information on the company background, operations and academic activities and quality issues, and subsidiaries are working to add relevant information regarding environmental management and safety.

Pollution Prevention, Resource Conservation, Energy Efficiency. Laureate is committed to comply with national environmental requirements and to have the corresponding permits and licenses wherever it locates.

The Company outsources the design of its buildings, either for construction or retrofit, under strict specifications and seeks to enhance energy efficiency when practical and achievable through building practices including efficient air conditioning and lighting. Laureate’s building specifications are being consolidated into a Building Code, which is focused on space distribution and other environmental features, including green building practices, and the Global Safety and Security (GSS) system, dealing with structural safety as well as life and fire safety.

Since Laureate’s main source of energy is electricity from the grid for lighting, at the local level the Company uses energy efficient IT equipment and air conditioning, which is used intensely during working hours. Cafeterias in the various sites, as well as hospitality kitchens, may use electricity and LP Gas. Sites normally have power generators for emergency lighting and other essential services. Local water companies provide Laureate universities with water and sewerage services.

Waste Management. Laureate universities typically have negligible air emissions and discharge wastewater to municipal sewerage systems, so no treatment is normally required. Wastes are minimal and by company policy are collected for recycling or disposed of in sanitary landfills by municipal or private companies as appropriate.

Hazardous Materials. Small amounts of hazardous materials such as cleaning materials and disinfectants are produced at Laureate’s installations, as well as small quantities of bio-hazardous waste from the clinics. According to GSS procedures, these are collected by specialized companies and disposed of according to international good practice and in full compliance with national regulations

Emergency Preparedness and Response. Laureate’s GSS includes emergency preparedness and response procedures which are regularly enhanced to comply with corporate practice. Corporate emergency procedures are very comprehensive and consistent with international good practice.

Greenhouse Gases. Greenhouse emissions from small and medium universities normally fall below the amount required by IFC for regular reporting. Collectively, however, Laureate universities do exceed the threshold of 25,000 Tons of CO2 equivalent and thus reporting requirements apply.

Stakeholder Engagement

Given Laureate''s location within the urban areas there is close interaction with the neighboring community. When available, medical attention is provided free of charge, or a very low cost, at the University’s medical facilities to the community on appointment. At corporate level Laureate implements corporate social responsibility initiatives through such institutions as the Sylvan/Laureate Foundation, the International Youth Foundation, and the Clinton Global Initiative.

Broad Community Support

Environmental & Social Action Plan

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

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

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

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

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

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

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

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

Complaints can be submitted by any of the following methods:

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

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

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

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

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Environmental & Social Review Summary

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Overview of IFC's Scope of Review

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Environmental and Social Mitigation Measures

Environmental and Social Mitigation Measures

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

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