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 IFC's 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

This investment is a Category B project in accordance with IFC’s Policy on Environment and Social Sustainability. Based on information reviewed by IFC, this investment will have limited adverse E&S impacts that are few in number, site-specific, and largely reversible and readily addressed through mitigation measures, as outlined in the Environmental and Social Action Plan (ESAP) attached to this ESRS. The key E&S issues include: (i) Copeval’s ability to provide systematic and consistent management of E&S issues across its operations; (ii) compliance with local permits and licenses for operation, transportation and distribution of products and services; (iii) handling, storage, distribution and transportation of hazardous materials, (iv) compliance of the portfolio of products with WHO hazards class (e.g. exclusion of Ia and Ib products) and the Food and Agriculture Organization(FAO)’ International Code of conduct on the distribution and use of Pesticides; and (v) labor and working conditions, including occupational health and safety.

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.

Identification of Risks and Impacts and Management Programs: Copeval has implemented an integrated management system for quality, OHS and environment for its distribution activities. Such system includes policy, procedures, and management plans; the system is operational and functional with periodic audits and comprehensive bi-annual managerial reviews. The company is currently certified under ISO 9001 for quality management system; and all distribution branches have implemented cleaner production programs under a national agreement (“Acuerdo de producción limpia sector fabricantes importadores y distribuidores de plaguicidas de uso agrícola”). Copeval was recognized by DuPont Crop Protection and the Magazine Farm Chemicals International as the 2011 Ambassadors of Respect for the Southern Cone Region, for its environmental commitment. The company is working voluntary towards the OHSAS 18001 certification. As set forth in the ESAP, Copeval will expand its integrated Environmental, Social and Occupational Health and Safety Management System (ESMS) to cover the storage and feed processing plants; in addition, Copeval will formalize its management programs, procedures, monitoring and reporting protocols to address risks and impacts of the storage operations consistent with IFC’s PS requirements.



Copeval performs a comprehensive assessment of legal requirements, including operational and environmental permits and licenses. Copeval assesses land use and nearby communities when selecting the location of new distribution sites. Required permits acquired for all locations include: municipality permit (“Patente Municipal”); construction permit and project completion declaration (“Permiso Edificación, Recepción Final Obra”); water and sewage reports (“Informe Sanitario, Autorización Agua Potable y Alcantarillado”); declaration of electricity installation (“Instalación Eléctrica”); and land use permit (“Certificado para Cambio uso de Suelos”). The Company has issued, as a voluntarily initiative, Environmental Impact Declarations (“Declaración de Impacto Ambiental”) in which key environmental impacts and mitigation measures are described.



Organizational Capacity and Competency: Copeval has appointed the Operations Manager as the management representative for the ESMS. The Quality, Safety and Environment Chief all reports to the Operations Manager and is in charge of leading the implementation of E&S elements; however, day to day implementation of the ESMS is responsibility of the each department’s coordinator, demonstrating the integration of the ESMS to the current operations. Human Resources elements are managed at corporate level by a Human Resources (HR) manager. Copeval has three safety analysts who support the implementation at the branches level, mainly by providing training to employees and auditing the system. An induction program is available for all employees and contractors.



Emergency Preparedness and Response: Copeval has developed
and effectively implemented emergency response plans; the Company has identified potential accidental and emergency situations during storage, transportation and delivery of materials. Mitigation measures in place include: containment basins at agrichemicals warehouses, placement of emergency kits at warehouses, branches and vehicles, availability of Material Safety Data Sheets (MSDSs), and training on emergency response. All drivers are trained on management of emergencies, documentation on the materials being transported is provided, a kit for emergencies with protective personal equipment is placed in all vehicles, and phone numbers are available to report events. In addition; the vehicles have a tracking and communication system that would facilitate response in case of emergency. All preventative measures are implemented in coordination with local authorities and the Chilean association of agrochemical producers.



Monitoring and Review: As part of the ESMS, Copeval has well defined key performance indicators and monitoring programs for human resources, environment, occupational health and emergency response. Such programs include contractors’ EHS performance. Copeval performs periodic internal and external audits. Monitoring results are communicated to senior management using well documented semi-annual reviews; corrective action plans are implemented, as needed. Copeval will ensure that all the operations, including the storage facilities have incorporated monitoring and reporting programs.

Copeval has a total workforce of 1104 direct employees, 20% are female employees.



Human Resources Policies and Procedures, Working Conditions and Terms of Employment: Terms of employment are provided in (i) Copeval’s labor rules and regulations booklet (“Reglamento Interno de Orden, Higiene y Seguridad”), required by local law; (ii) collective agreements with workers’ trade unions; and (iii) contracts signed between the Company and the employees. Conditions of employment are well described and include information regarding working hours, duties and functions, overtime, remuneration and benefits, disciplinary measures, ethics, occupational health and safety provisions, and termination of employment among others. Conditions of employment follow Chilean law. Copeval, as part of the ESMS have formal procedures for recruiting and training. All employees receive an induction booklet with comprehensive information regarding the company and the working conditions.



Workers’ Organizations and Grievance Mechanism: Near 45% of Copeval employees belong trade unions. Copeval has signed collective agreements with four unions, differences on the agreements are based on scope of the operations as well as the region where the branch or plant is located. The company negotiates with the unions every two years and conditions are applied to both unionized and non-unionized employees. The management team of Copeval confirmed that they do not prevent employees to organize or participate in workers’ organizations. Copeval has a formal grievance mechanism for workers to raise workplace concerns, the mechanism named “Casilla Denuncia” allow workers to submit their complaints in anonymity and all complaints are treated with confidentiality, grievances are addressed by the top management of the company.



Non-Discrimination and Equal Opportunity: Copeval applies principles of Non-Discrimination and Equal Opportunity and there is no evidence of discrimination based on personal characteristics or gender; explicit statements regarding protection of workers, no discrimination, and prohibition of sexual harassment are documented in the values of the company and in the internal rules and regulations. Fair treatment is observed in the company, including processes of hiring, promotion and termination of employment.



Protecting the Work Force: In compliance with Chilean labor laws and Company’s policies, Copeval does not employ child or forced labor. Employees submit identification documents at the time of application and signing contracts. Contractors are also required to hire only employees older than 18 year of age and to be in compliance with Chilean law.



Workers Engaged by Third Parties: Copeval’s activities are mostly conducted by direct employees, specialized tasks such as maintenance and construction works are sub-contracted. Copeval has well documented provisions for contractors, including safety measures, access to facilities and legal compliance with labor
law.



Occupational Health and Safety (OHS): Copeval has OHS programs for safe handling, storage and transportation of materials, as well as on emergency response. Copeval has documented safety procedures; topics covered include identification of hazards and risks; emergency procedures during storage and transportation; investigation of accidents; and inspection among others, few operational procedures are in place among them confined spaces entries. Safety and emergency response training is provided to all employees during induction training. Copeval performs periodic monitoring of workplace exposure for noise and dust level for the operations, such measures are in compliance with local requirements. Engineering as well as administrative measures are in place to control occupational risks on the workplace. In addition workers are provided with personal protective equipment as required. The distribution centers are well designed with functional eye and body washers, containment kits, and natural and forced ventilation systems. Systematic use of PPE and control in the access to deposits and silos were observed. Silos are well maintained with proper housekeeping conditions. As set forth in the ESAP, Copeval will commission a qualified professional to conduct an assessment of occupational exposure and risks (e.g. biological risks, fire risk, emission of oxides of nitrogen and carbon dioxide) at the animal feed processing facilities and will implement the corrective action plan.

Resource efficiency: Distribution centers and branches uses electricity from the national grid and the distribution fleet uses mostly diesel. Silos have drying operations only during the harvest season; therefore, silos operate five or six months during the year, using wood. Wood is purchased from authorized vendors with Chilean permits for commercialization of wood; total annual use of wood is near 14,800 tons per year for all the operations. In the two plants that have animal feed processing and wheat flour, small boilers, less than 3MWth, are used. The activities do not require water use, other than for sanitary purposes; therefore, no industrial liquid effluents are generated at Copeval’s facilities; sanitary water is discharged to the municipality sewage system or are treated through septic systems aligned with the requirements of water and sewage reports/permits (“Informe Sanitario, Autorización Agua Potable y Alcantarillado”) mentioned previously in this report.



Greenhouse Gas Emissions: Greenhouse emissions of the operations are associated with electricity consumption, the use of wood for the dryers for grains, and fuel for the fleet used to distribute the products and for technical assistance. The Greenhouse emissions of the current operations have been estimated as 22,100 tons of CO2-equivalent, most of which is derived from wood use.



Pesticide Use and Management: Agrochemicals distributed by Copeval are all approved by the Chilean Ministry of Agriculture, specifically by the Servicio Agrícola y Ganadero (SAG). The responsibility of registering a product for sale in Chile lies on the manufacturer of the product; and distributors, such as Copeval, aren’t involved in the registration process. The driving force behind the products distributed is the demand of such products by the farmers, which at the same time is strongly influenced by the phyto-sanitary plans defined by the fruit and crop exporting companies. Exporting companies, in cooperation with the SAG, considers the legislation of the country where the fruits/crops will be exported, including threshold level for agrochemicals and prohibition of use of some products. The Chilean system regarding use of agrochemicals is highly driven by exports, agronomists indicate the products to apply and strict controls are in place during application of the products, in particular training and use of PPEis required. Label of the products are required and all products have material safety data sheets (MSDS) in Spanish. Elements such as registration, labeling, packaging, and storage were observed in accordance to international codes. In addition Chilean associations of producers and distributors have implemented training programs, collection of empty containers programs, cleaner production programs among other initiatives to enhance the use of products among the users; in compliance with the FAO’s International Code of Conduct on the distribution and Use of Pesticides or other good internat
ional industry practice. Such measures provide assurance that agrochemicals are not accessible to personnel without proper training, equipment and facilities to handle these products properly. In particular, Copeval’s employees only manipulate sealed containers and are trained on handling of the materials, use of MSDS and emergency response both during storage and transportation.



Copeval’s portfolio of agrochemicals is extensive as it services a wide range of crops, including grains, fruits, vegetables, nuts, spices, and pastures throughout Chile. Near 65% of agrochemicals sales of Copeval correspond to products containing active ingredients that are unlikely to present acute hazard in normal use (Class U) or are slightly hazardous (Class III); based on the classification of active pesticide ingredients from the World Health Organization. Currently, Copeval has in its portfolio products with eight (8) active ingredients Class Ib. Copeval will present to IFC a plan to phase out the products containing WHO class Ib ingredients as spelt out in the ESAP; the Company will commission externally a risk assessment study per product to identify alternatives for the products Class Ib currently in the portfolio. In addition, Copeval will implement supplemental measures to promote proper use of those products. For products Class II (moderately hazardous) the company will maintain its practices regarding inspection of labels and information provided to farmers; and will continue to participate in national initiatives in promoting the safe use of agrochemicals.



Copeval is aware of the trends and benefits of Integrated Pest Management (IPM) and has in its portfolio some biological products, such as biostimulats for crops and biofungicides. Copeval has been following national recommendations and has been proactive in offering pesticides containing less hazardous active ingredients. Copeval Servicios has provided training to farmers on: management and use of agrochemicals (71 courses during 2011 and 2012 with over 950 participants), good agricultural practices and Integrated Pest Management (12 courses between 2009 and 2012 with over 120 participants), among other topics. Copeval will continue to promote IPM among its clients.



Waste Management: Waste produced in the branches is non-hazardous waste, cardboards are recycled and metal-scrap generated is collected centrally in the main distribution center (San Fernando) and sold for recycling. Small amounts of oil from the equipment and fleet maintenance are generated and disposed of using authorized vendors. Copeval does not use directly agrochemicals; however, as part of a National initiative, the Company promotes proper agrochemicals handling and container disposal, and has agrochemicals container collection centers in five branches. Containers are only received if they have been tripled washed and punctured; containers are chipped and disposed through vendors approved under the Chilean agrochemicals p
rogram. Copeval has been active on promoting proper disposal and educating farmers on management of the containers and has set targets to increase the collection of the containers.

Infrastructure and Equipment Design and Safety: Copeval’s distribution centers have specific areas for storage of agrochemicals, the warehouses have containment basins with sufficient capacity, eye and body washers, containment kits and fire suppression equipment. Natural and forced ventilation is provided. Copeval takes a preventative approach by ensuring proper storage and segregation of materials, the company manages low inventories to minimize risks. In addition, access to the storage areas is restricted to workers and authorized personnel (e.g. suppliers). New expansion projects have considered the construction of specific facilities for flammable materials. Warehouses and storage areas are provided with fire protection.



The fleet used for distribution of products and diesel is modern, the Company has policies to renew it periodically to ensure proper conditions; a preventative maintenance plan is followed. Tracking system is available as well as communication procedures to report significant events, this facilitate response in case of emergency. Copeval’s safety analysts perform periodic audits and reviews of facilities and vehicles.



Hazardous Materials Management and Safety: As described previously, warehouses and the fleet has the infrastructure required to prevent potential safety events. Drivers have been trained on emergency response and all vehicles transporting agrochemicals have an emergency response kit and information regarding the products being transported. Copeval will continue to provide continuous training to all drivers, including road safety training, interpretation of MSDSs and emergency response. Procedures are aligned with proper recommendations from the Food and Agriculture Organization’s International Code of Conduct on the distribution and Use of Pesticides.

Copeval representatives interact with local authorities during the planning and operation of new branches or grain processing facilities. Given the location of the branches and distribution centers, interaction with local community is limited. There are not local requirements to disclose or consult before new branches are open. Copeval is an active member of Chilean association of agrochemicals distributors and participates actively in emergency response plans for the sector. Engagement with communities in which company facilities are located is on an informal basis; however any concerns from the community are addressed through the existing integrated E&S management system, specifically under the communication procedures and all queries should be recorded. Copeval will publicly disclose the contents of this report (ESRS) and will respond to concerns, and where necessary will undertake actions to address these concerns.

This Environmental and Social Review Summary (ESRS) and accompanying Environmental and Social Action Plan (ESAP) will be publicly disclosed locally at Copeval’s headquarters as well as in the following sites:

Casa Matriz: Manuel Rodríguez 1099, San Fernando and
Sucursal San Fernando: Rura 5 sur km 140 San Fernando.

Please contact the following for inquiries or concerns about the environmental and social impacts of this project.
Osvaldo Parada L. / Gerente de Operaciones
Phone: +56 72 740 300
Address: Ruta 5 sur Km 140 San Fernando
E-mail: mailto:o.parada@copeval.cl

Copeval will make adequate public disclosure of this transaction in the Chilean business and trade press.

Broad Community Support is not applicable for this project

Title	Anticipated completion Date	Status	Comments	Completion Date
Extend environmental and social management system to the storage and feed processing plants: Copeval will expand its integrated Environmental, Social and Occupational Health and Safety Management System (ESMS) to cover the storage and feed processing plants; Copeval will formalize management programs, procedures, monitoring and reporting protocols to address risks and impacts of the storage operations consistent with IFC’s PS requirements.	12/30/2013 12:00:00 AM	Completed	Completed	11/29/2013 12:00:00 AM
Conduct a hazard assessment at the animal feed processing facilities: Copeval will conduct an assessment of occupational exposure and safety risks (e.g. biological risks, fire risk, emission of oxides of nitrogen and carbon dioxide) at the animal feed processing facilities and will implement the corrective action plan and related measures.	09/30/2013 12:00:00 AM	Completed	Completed	11/29/2013 12:00:00 AM
Conduct a Risk Assessment Study for agrochemicals class Ib: Copeval will commission externally an independent study (risk assessment) to review the technical and economic feasibility to replace the agrochemicals in the existing portfolio which contain ingredients Class Ib and to identify alternatives such as cultural practices, biological, genetic, and as last resort chemical means. In addition; Copeval will implement supplemental measures to promote proper use of those products.	12/30/2014	In Progress	In Progress
Phase out the sale and distribution of the agrochemicals containing Methomyl, Methamidophos: Copeval will eliminate stocks and distribution of products Methomyl, Methamidophos and two additional agrochemicals which contains ingredients Class Ib. Phase out of the products will be done according to an agreed schedule between Copeval and IFC.	6/30/2015	In Progress	In Progress
Phase out the sale and distribution of two additional agrochemicals: Based on the results of the study completed in item 3, Copeval will eliminate stocks and distribution of at least two additional agrochemicals containing ingredients Class Ib. Phase out will be done according to an agreed schedule between Copeval and IFC.	6/30/2016	In Progress	In Progress