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

While all Performance Standards (“PSs”) are applicable to this investment, IFC’s environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the PSs 1–4. Impacts related to PS5: Land Acquisition and Involuntary Resettlement, PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources, PS7: Indigenous People and PS8: Cultural Heritage are not anticipated for this investment. Lands for existing facilities and orchards were acquired from private owners and legal entities on a willing seller-willing buyer principle. No involuntary resettlement and/or economic displacement have taken place as well as conversion of natural/critical habitats. There are no Indigenous People in proximity to any of the Company operations. Finally, the likelihood of finding of unknown cultural heritage, particularly archaeological resources within of the existing consolidated agricultural and industrial zones is remote. Therefore, PS’s 5-8 are not applicable to this Project. In the event that issues anticipated by these PSs arise, Noyan will provide feedback to IFC. Screening and assessment of these issues against Performance Standards requirements will be done through Noyan’s existing environmental and social management system (ESMS) which will be improved throughout this Project. None of impacts is expected to be significant. Therefore, this is a Category B project according to IFC’s Environmental and Social Sustainability Policy.

The proposed investment will have limited and site-specific environmental and social risks and impacts including: (i) management system capacity to identify and manage EHS risks and impacts associated with existing and new plants; (ii) food safety, including Hazard Assessment and Critical Control Point (HACCP) Principles and ISO 22000 certification; (iii) water supply and wastewater management; (iv) labor and working conditions of permanent and seasonal employees, including occupational health and safety; (v) waste management. Those risks and impacts can be avoided or mitigated by adherence to project’s design criteria, host country laws and regulations, IFC’s PSs and applicable the World Bank Group EHS Guidelines. The information about how these potential impacts will be addressed by the Project is summarized in the paragraphs that follow, and in the project’s Environmental and Social Action Plan (“ESAP”) which is disclosed with the Environmental and Social Review Summary.

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, Identification of Risks and Impacts.

The existing plant complies with local laws and regulations and has necessary operational licenses and environmental permits from the Armenian regulatory authorities. ISO 9001 certificate was granted in 2003. The Environmental Impact Assessment (EIA) was done for the new plant in accordance with local regulations and its scope included assessment of air emissions, water supply, wastewater discharge systems, and overview of solid and organic waste management. The EIA of the plant in Vanand, Armavir region has been approved by the Ministry of Nature Protection. To ensure effective and timely management of the EHS risks and impacts associated with operation of the new and existing plants, as set forth in the attached Environmental and Social Action Plan (ESAP), the Company has agreed to further develop and integrate these Environmental, 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 applicable local laws and regulation, IFC’s PS1 requirements and applicable WBG General and Sector-Specific (Food and Beverage Processing Guidelines) Environmental, Health and Safety (EHS) Guidelines.



Policy and Management Programs

Effective use of resources including organic waste /water recycling, reduction of fresh water consumption and air emissions were set up among criteria for selection of processing and packaging lines being installed at the new plant. Operational and maintenance programs at the existing plant are developed and implemented regularly to ensure that equipment is in proper condition and operations comply with local regulations. Noyan has started the development and implementation of food safety principles consistent with ISO 22000. Final certification audit of the food safety management system status is scheduled for end of 2013. Also, as set forth in the ESAP, the Company will develop E&S Management Plans/ Programs (E&SMPs) for the existing and the new plant to address E&S impacts and risks and achieve sound E&S performance of these business operations. E&SMPs will outline the following: (i) E&S risks and impacts associated with plants’ operations; (ii) E&S performance indicators; (iii) Corrective Action Plan to be taken by Noyan to mitigate/address these impacts and risks, including but not limited by organizational measures and monitoring of water supply, air emissions, effluents, waste management; (iv) responsibilities for implementation of mitigation actions, as measurable events that can be tracked over defined time periods; (v) costs, if needed, to implement the actions. ESMPs will be consistent with the IFC PSs and the WBG EHS guidelines.



Organizational capacity and competency, training, monitoring and review.

The E&S responsibilities are assigned to production line managers. Day-to-day control of occupational health
and safety (“OHS”) matters is delegated to the chief mechanical engineer. OHS training is in line with local regulations; it includes basic safety orientation during induction sessions and regular specific OHS training focused on workplace conditions. Professional external and on-the-job training of line managers and specialists ensure that the personnel have the skills necessary to perform their direct responsibilities. Operational procedures and organizational structure provide sufficient control over EHS matters at the existing plant. Going forward, and as spelt out in the ESAP, the Company will assign/ engage a full or part time environmental specialist and provide him/her training to gain in-house EHS expertise and knowledge appropriate to the nature and scale of the growing organization. Key role and responsibilities of the specialist will include establishing and review of EHS performance indicators, planning and implementation of management plans, including mitigation measures to address E&S impacts and risks, regular monitoring and reporting to Noyan’s senior management and relevant authorities on EHS performance of the Company.



Emergency Preparedness and Response

The Company has an emergency response plan focused on responding to potential situations associated with operation of gas-fired boilers and use of chemicals (caustic soda, nitric acid, hydrogen peroxide) for equipment and production premises washing. The Company’s personnel are provided with special training, including basic knowledge in the risks and threats associated with use of chemicals; safe handling and storage. Operators handling chemicals are trained in emergency response actions related to these materials.



Monitoring and reporting.

The reporting is carried out in accordance with local regulations. It covers water supply and wastewater discharge within approved limits, air emissions, and occupational health and safety statistics. Monitoring and reporting on E&S performance to Noyan’s management will be introduced upon improvement of the E&S management system as mentioned above. All plants will adopt EHS key performance indicators (KPIs) in order to better capture the following EHS parameters: Water Usage (kiloliters/ton), Energy Usage (kWh/ton), wastewater monitoring effluents and air emissions parameters; Staff - Retention and training days. In addition, going forward, and as set forth in the ESAP, each plant will define 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 a waste water treatment unit, compliance with national OHS requirements, inc
luding accident rates (lost-time accidents); customers complaints, supplier performance and community engagement activities) will report annually to relevant authorities and IFC as part of the Annual Monitoring Report (AMR).



Stakeholder engagement.

Key stakeholders of the Company are juice manufacturers and end-users of juices and canned food. Noyan receives and addresses inquiries of any interested parties through communication procedures developed within the ISO 9001 certified quality management system. Noyan will develop a grievance mechanism for potentially affected communities as described PS4 section to address concerns on Noyan’s E&S impacts associated with its core operations.

Human resources policies and procedures, terms of employment, non-discrimination and equal opportunity.

The Company has about 180 employees in juice and food production businesses. Female workers constitute about 40% of the workforce. Annually, Noyan employs about 150 seasonal workers for fruit and vegetable processing; most of them are women. Upon commissioning of the new plant, additional 50 local jobs will be created in the first year of production and about 70 in the second year. Permanent and seasonal staff undergo initial due diligence and/ or interview before documenting terms of employment. Upon appointment, permanent and seasonal personnel are provided initial induction training that facilitates an employee’s awareness of responsibilities, disciplinary requirements and rights, conditions of work and further occupational, health and safety training. Noyan enforces the implementation of Company’s human resources (HR) standards based on equal opportunities, non-discrimination and worker rights to participate in professional associations and trade unions. Head of HR service maintains a set of internal procedures and keeps records to ensure observance of national labor laws. Terms of employment, including salary, working time, maternity leave, illness and vacation, overtime payment, safe working conditions, promotion and bonuses are outlined in the internal regulations and based on national labor laws. Noyan offers additional benefits for employees in special cases.



Protecting the Work Force and Supply Chain

Individuals below the age of 18 years are not employed and no forced labor is used at Noyan facilities. The Company purchases fresh vegetables and fruits from approximately 570 suppliers in Armenia. Noyan sources its products from either the primary producers directly, who are mostly local family farms, or local wholesalers. The risk of forced and /or child labor in Noyan primary supply chain is unlikely. Child and forced labor is prohibited by the national labor laws. The Company requires its suppliers not to use children below 18 years. Moreover, Noyan’s extension services attending on-farm procurement monitor occurrence of harmful child and forced labor.



Workers’ Organizations. Noyan management has stated that each employee is free to join a worker organization. The national laws stipulate procedures for maintaining a collective agreement between selected worker’s representatives and administration. There is presently no union at Noyan’s facilities.



Grievance Mechanism. The Company actively encourages employees and managers to openly discuss and resolve internal conflicts and enforces informal ways to address employees concerns. As set forth in the attached ESAP, Noyan will create and implement a formal and documented internal grievance process which allows grievances to be presented without the risk of oppression consistent with IFC’s Performance Standard 2. The grievance procedure will be made available to all employees
during workers’ induction sessions. The grievance procedure will be made available to all employees including seasonal workers during induction sessions.



Occupational Health and Safety (OHS)

As indicated above, the chief mechanical engineer was given part-time responsibility for OHS issues. He is mainly involved in the organization of OHS training and addressing requests from relevant authorities. The Company fully relies on authorities’ opinion and expertise. To make OHS management system more functional and to ensure its internalization within Noyan’s operations, the Company will develop and implement a formal OHS management plans for both plants. The plans will be based on results of hazard identification and risk assessment; the plans will include risk mitigation actions, as measurable events that can be tracked over defined time periods including training schedules; medical examination/ availability of medical certificates for employees handling food products; inventory and provision of personal protective equipment; monitoring of workplace conditions; first aid; reporting and review of OHS performance. Noyan reports zero accidents at the existing plant since its commissioning in 1998. The Company implements procedures on incident registering, investigation, reporting and corrective measures as prescribed by legal regulations. Employee medical examinations are carried out at the time of employment and thereafter repeat the health examinations according to a schedule.



Life and Fire Safety (LFS) in the operations is provided by the installation of fire extinguishers and fire alarms. The risk of fire is relatively small, as all production equipment is stainless steel based, and all products are liquid. Equipment and systems are inspected and tested annually by the relevant authorities.

Resource and Energy Efficiency

Noyan implements technically and financially feasible measures for improving efficiency in consumption of energy and water. Particular actions completed to date at the existing plant include insulation of steam generation facilities; recirculation of water used for initial washing and delivering of products to processing lines. Noyan is leading in the area of boiler efficiency technology with the energy efficient boilers installed at the new plant. Also, Noyan started a project for identification of further energy efficient solutions applicable to its operations.



Total raw water consumption used (ton per ton of goods produced) remain on average 3.8 tons of water for juice production, which is below industry benchmark of 6.5 for fruit juices (Table 3 of the WBG EHS Guidelines).



Water, resources and energy supply

Processing water is supplied to the existing plant from municipal drinking water network and on-site UV treated additionally. Water to be used at the new plant will be sourced from a well and treated additionally. Noyan will develop a plan for regular monitoring of drinking water quality against requirements of national regulations and WHO’s water quality standards. An action plan will be developed to ensure compliance, if needed. Water from the water extraction well is delivered to Noyan orchards through irrigation channels depending on the soil conditions and rainfalls. Electricity for Noyan operations is supplied from municipal grid. Land acquired for the new plant was re-zoned from agricultural to industrial category, according to the strict national regulations.



Air Emissions

Air emissions of both plants are limited to gas fired boilers. Air emissions from the plant in Yerevan are within national limits and below the WBG limits. The plant holds relevant permits for air emissions.



Wastewater management

Processing wastewater after fruit washing will be reused in the process and for orchards’ irrigation after mechanical separation of solid particles. Processing wastewater after equipment/ premises washing and domestic wastewater will be pumped to a municipal system. According to design documentation and the EIA report, estimated concentrations of contaminants including biological oxygen demand (BOD) and total suspended solids will meet requirements of the local municipal wastewater treatment system. Industrial wastewater from the existing plant after mechanical separation of suspended solids and sanitary wastewater are discharged to a municipal system. The plant has the relevant permits for wastewater discharge, periodic monitoring confirms compliance with limits approved by local authorities for discharging into the municipal wastewater treatment system.



Hazardous materials are limited by caustic soda, nitric acid, hydrogen peroxide used for equipment and production premises washing. All chemicals were approved for use by equipment’s manufacturers and stored in the special desi
gnated areas.



Wastes

Non hazardous solid organic waste from the new plant will be used as fertilizer after composting. Fruit and vegetable residues generated by the existing plant are delivered to municipal land fields. Limited amount of packaging materials containing chemical residues and other dry industry wastes are segregated, collected for temporary on-site storage in designagted areas and then moved for further disposal or recycling. Wastes are transported from the sites by contractors licensed by the relevant authorities.



Pesticide Use and Management

The Company has been starting a process for obtaining “organic production” certificate for vegetables and fruits grown at its own orchards. Therefore, only allowed crop protection substances are used. Pesticides classified by the World Health Organisation (WHO) as extremely/ highly hazardous (Class 1A/1B) are not used in any of the Company’s fields. Noyan applies the same procedures for selection of its suppliers to ensure product quality. Additionally, the Company will revise its checklist and contractual conditions and request its suppliers not to use hazardous pesticides, as spelt out in the ESAP

The existing production plant is located in the vicinity of residential areas at the city outskirts. Given the nature of production, the impacts are not expected on nearby communities. Noyan has reported no complaints from local residents over recent years. Formal grievance mechanism consistent with PS4 will be developed and adopted. There are no immediate households or neighbors in the vicinity of the new facility. Noyan maintains ISO 9001 certified quality management system and enforces local regulations on genetically-modified organisms consistent with the Cartagena Protocol that entered into force in Armenia in 2004. Food safety measures implemented to date by Noyan include, inter alia, quality control of production processes from fruit/vegetable selection till filling in cans and aseptic bags; additional UV treatment of drinking water used for product processing and regular monitoring of drinking water quality. The Company maintains regular cleaning and disinfection of equipment. Equipment maintenance program, inter alia, includes selection of licensed washing substances and analyses of residue levels. Fruit juices and concentrates are packaged in aseptic bags. Finished products are tested for conformance to the specifications consistent with Russian standards (GOST), the European Fruit Juice Association (AIJN) codes, and the international food standards (Codex Alimentarius and WHO) depending on export. Going forward, the Company will implement the formal HACCP/ISO 22000 food safety management system.



Security Personnel. The Company employs licensed and unarmed security personnel at all sites contracted from private companies who are trained and certified as per the local regulatory requirements.

Key stakeholders of Noyan are wholesale consumers, retailers and end-users of juices, canned fruits and vegetables. Noyan maintains relationships with wholesale consumers and retailers that deliver the end-users’ requests related to product quality to the Company. Also, Noyan receives and addresses inquiries of any interested parties through ISO 9001 certified quality management communication procedures.

Information about environmental and social aspects associated with the construction of the new plant will be addressed as part of the project’s environmental impact assessment. Additionally, Noyan will disclose E&S information on the proposed project via website and local newspapers.

For more information, inquiries and comment about the Project please contact:
Mr. Vahe Ghazaryan, General Manager,
Tel: +37410-634101, 37410-647587
Email: mailto:vahe.ghazaryan@euroterm.am
Address: 15/2 Amiryan Str., Yerevan, Armenia

Broad Community Support is not applicable for this project

Noyan(32799) Supervision Disclosure Snapshot – Version 2
Description	Anticipated Completion Date	Status	Comments	Completion Date
Integrate Environmental, 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 applicable local laws and regulation, IFC’s PS1 requirements and applicable WBG General and Sector-Specific (Food and Beverage Processing Guidelines) Environmental, Health and Safety (EHS) Guidelines. Submit a manual of Integrated Management System to IFC	31-Mar-2014	Completed	Completed	3/31/2014
Prepare E&S Management Plan (ESMP) consistent with the IFC PSs and the WBG EHS guidelines for the existing plant and submit it to IFC. E&SMP shall outline (i) E&S risks and impacts associated with plants’ operation; (ii) E&S performance indicators; (iii) the actions to be taken by Noyan including but not limited by organizational measures and monitoring of water supply, air emissions, effluents an waste management; (iv) responsibilities for implementation of mitigation actions, as measurable events that can be tracked over defined time periods; (v) costs, if needed, to implement the actions.	31-Oct-2013	Completed	Completed	10/31/2013
Prepare E&S Management Plan (ESMP) consistent with the IFC PSs and the WBG EHS guidelines for the new plant and submit it to IFC. E&SMP shall outline (i) E&S risks and impacts associated with plants’ operation; (ii) E&S performance indicators; (iii) the actions to be taken by Noyan including but not limited to organizational measures and monitoring of water supply, air emissions, effluents an waste management; (iv) responsibilities for implementation of mitigation actions, as measurable events that can be tracked over defined time periods; (v) costs, if needed, to implement the actions.	29-Nov-2013	Completed	Completed	11/29/2013
Assign/ engage a full or part-time suitably qualified environmental, health and safety (EHS) specialist and provide him/her due training to gain in-house EHS expertise and knowledge.	31-Jul-2013	Completed	Completed	7/31/2013
Develop 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, including GHG emissions; noise levels, solid and hazardous waste management and disposal, effluent discharges from a waste water treatment unit, compliance with national OHS requirements, including accident rates (lost-time accidents); customers complaints, supplier performance and community engagement activities)	31-Mar-2014	Completed	Completed	3/31/2014
Develop a formal grievance mechanism for permanent and seasonal workers consistent with IFC’s Performance Standard 2 and submit it to IFC	30-Aug-2013	Completed	Completed	11/15/2013
Develop formal OHS action plans for both plants and submit to IFC. The plans shall be based on results of hazard identification and risk assessment. The plans shall include risk mitigation actions, as measurable events that can be tracked over defined time periods including training schedules and programs; medical certificates and tests for employees handling food products; inventory and provision of personal protective equipment; monitoring of workplace conditions; first aid; reporting and review of OHS performance.	29-Nov-2013	Completed	Completed	11/29/2013
Develop a plan for regular monitoring of supply water and processing wastewater of the new plant against requirements of national regulations and the WBG EHS guidelines and submit it to IFC	30-Aug-2013	Completed	Completed	11/15/2013
Develop a formal community grievance mechanism consistent with PS4 and submit it to IFC	30-Aug-2013	Completed	Completed	11/15/2013
Request suppliers not to use hazardous pesticides classified by the World Health Organisation (WHO) as extremely/ highly hazardous (Class 1a/1b). Revise supplier product specification checklist and contractual conditions and submit to IFC.	29-Nov-2013	Completed	Completed	11/29/2013