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
PS 5 – Land Acquisition and Involuntary Resettlement
If IFC’s investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

The Project has been assessed as an E&S Category “B” investment. Category “B” projects according to IFC’s E&S Review Procedure are those projects with limited adverse social and environmental impacts that are few in number, generally site specific, largely reversible and readily addressed through mitigation measures, as outlined in the Environmental and Social Action Plan (“ESAP”) attached to this ESRS. The developments to be supported by the Project will be adjacent to established urban areas with existing connections to infrastructure, individually of small scale and limited footprint, and the developments will not be contiguous.

Main Environmental and Social Risks/ Impacts of the Project and Key Mitigation Measures:
The key E&S issues have been identified as: (i) the establishment of an Environmental and Social Management System to provide systematic and consistent management of E&S issues across a number of projects; (ii) E&S assessment of prospective projects including processes to ensure that land acquisition is the result of voluntary transactions; (iii) provision of fair, safe and healthy working conditions during construction and operations for both direct and contractors’ employees on construction sites; iv) pollution control measures during planning, construction and operations; (v) design of the proposed projects considering life and fire safety and incorporating energy efficiency measures in structure design; and (vi) minimizing construction nuisance to adjacent or nearby communities.
Information regarding how potential impacts will be addressed by Ciputra Residence is summarized below. Further information is provided in the attached ESAP as agreed upon by IFC and Ciputra Residence, which addresses compliance gaps between existing practice and IFC’s requirements.

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 & Social Assessment
Ciputra Residence has developed approximately 1,000 hectares of housing and related infrastructure during its operational history.
The Company retains a sizable group of experienced staff with strong real estate development and technical backgrounds. The Ciputra Residence project development cycle includes conceptual design, construction and management. Design and development are done in accordance with Indonesian legal requirements, including the specifications outlined in the regional and city master plans. Regulatory required Environmental Impact Assessments under Indonesian law (?AMDALs?) will be prepared and approved for all future site developments. These documents describe the impacts of new projects and provide measures to be implemented to avoid, manage or mitigate expected impacts in order to meet domestic requirements. As part of the IFC investment, the Company will develop a gap analysis between Indonesian requirements and IFC?s Performance Standards. The result of such analysis will be used as the basis for the development of a supplemental assessment with an action plan prior to Project commencement to fill identified gaps.
Engineering and construction contracts are outsourced on the open market via competitive bid processes with works being completed in a manner consistent with Indonesian regulatory requirements. As part of IFC investment, in addition to meeting all local regulatory requirements, the Company will ensure that seismic design meets good international industry practice. Residential buildings and building complexes with at least four floors, in addition to meeting all local requirements, will be equipped with fire/smoke alarms and at least two exit routes.
Environmental & Social Management System (?ESMS?):
As part of the IFC investment process, the Company will develop a comprehensive ESMS both at the corporate and project levels to identify and manage impacts and risks throughout the project development process, including managing construction related issues that are performed by contractors. Qualified environmental and labor specialists have been commissioned by the Company to undertake environmental audits and labor audits on all projects that are under construction based on national requirements and IFC?s Performance Standards. The results of these audits will form the basis for the development of a Construction E&S Management Action Plan and contribute to the development of a corporate level E&S management system to manage current and future project development including engineering and construction activities.
The corporate level E&S management system will provide systematic and consistent management of E&S issues across different projects in line with IFC?s Performance Standards requirements.
Organizational Capacity and E&S programs
Each project site has a dedicated management team of full-time professionals who oversee the project development including the construction progress, marketing and sales. Site inspectors are employed at each construction site to enforce requirements and must have the necessary educational backgrounds supplemented by experience (e.g. those working on site are civil engineers with appropriate college degrees and training required of their duties). These same individuals monitor contractors and report on them to the corporate office; the corporate function then tracks compliance with all requirements.
As part of the corporate E&S management system, the Company will hire a full-time corporate level E&S manager who will be responsible for the implementation of the ESMS, including the Construction E&S Management Action Plan across all project sites.
Construction managers will be held responsible to ensure site supervisors measure, monitor and report construction performance against Key Performance Indicators (?KPIs?) as a standard corporate approach to manage the E&S performance of all construction contractors.
The Company is also taking necessary steps to reduce the carbon footprints of the real estate assets it manages. A number of project-wide efforts have been piloted in several community properties including waste management, water management and energy saving mechanisms. The Company is also seeking to work with IFC?s Green Buildings team for better pollution control and energy efficiency.
Monitoring & Reporting:
As part of the corporate E&S management system, routine monitoring and supervision activities will be undertaken by site supervisors consistent with the corporate ESMS, including regular reporting on key environmental, social and occupational health and safety control factors. The Company will retain qualified specialists to conduct external third party monitoring.
Emergency Preparedness and Response
Life and fire safety are the main operational risks associated with real estate development and management. As part of the IFC investment, the Company will develop an Emergency Preparedness & Response Plan (?EPRP?) that covers foreseeable emergency scenarios associated with each project in its construction phase, including: fire, explosions, severe weather such as floods and storm events, earthquakes, release of hazardous materials, food poisoning and the spread of an epidemic.
Safety signage and emergency evacuation plans will be displayed at each site. All contractors will be required to follow emergency response procedures. All the supervisors and employees will be trained on the emergency procedures and regular mock drills will be conducted.
Training
Ciputra Residence?s current training programs are focused on improving communication and managerial skills. Training programs on environmental initiatives have also been undertaken and will continue to be elaborated. Labor and Occupational, Health and Safety (?OHS?) training for workers is yet to be developed.
As part of IFC?s investment, a corporate level training program with objectives, timelines and completion indicators will be developed as part of the Construction Management Plan. The training programs will cover activities related to construction, environmental protection, OHS, labor practices and environmental and social issues related to real estate management. All workers, including contract workers, at Ciputra Residence projects will undergo a full training program at induction and receive additional worker health and safety training relevant to individual job activities. Training records will be kept at each site and compiled at corporate level for monitoring and auditing.
Community Engagement:
Prior to the formal acquisition of land, the Company publicly discloses the proposed purchase, allowing potential interested parties and households to make offers and express concerns regarding the process.

Ciputra Residence currently employs 422 full-time staff who manage project related activities on a day-to-day basis, including activities undertaken by construction contractors for the development and operation of Ciputra Residence?s projects. Employees are all Indonesian. Female employees constitute approximately 28% of the total regular workforce of the Company. The construction contractors? workforce is predominantly male with a total number of contracted workers ranging from approximately 800 to 1,000 at any one time, and includes indirect workers hired through contractors to perform construction tasks.
Human Resource Policy Management
The Company?s Human Resource (?HR?) corporate policies and operational procedures are established based on Indonesian labor law requirements. An HR Manual has been produced which documents the terms of employment, policies and procedures for recruitment, compensation and other benefits, training, performance appraisal, and promotions. All employees of Ciputra Residence have access to the HR Manual.
Employees receive a Contract of Employment when commencing employment at Ciputra Residence, which provides details including wages, working hours, overtime compensation, insurance, maternity benefits and leave conditions. Direct employees hired by the Company are professionals whose salaries are above the regulated minimum wage and are within the reasonable range for industrial type employment.
There is no trade union in the Company for Ciputra Residence staff or construction contractors, though the Company does not restrict employees? freedom of association. Grievance channels are built on the existing management system; issues can be escalated to higher levels within the organization as and when needed. As a part of the Construction Management Plan, a grievance mechanism will be established at corporate and project levels to allow free flow of grievances from contracted workers and Ciputra Residence?s own staff to the relevant line managers for proper resolution.
Protecting the Work Force
The minimum age for employment under international standards and Indonesian Labor Law is 15 years. In compliance with local labor laws, the Company does not use child or forced labor. Contractors are required to strictly following the national labor law and hire only employees older than 18 year of age for construction works.
Labor and Safety Compliance by Contractors
Construction for low-rise buildings is undertaken by the informal sector in Indonesia, and typically by small to medium-sized companies, each with a limited workforce. Ciputra Residence needs to contract with 15 to 30 construction companies, with a total workforce ranging from 800-1000 working on its project sites at any given time. The contractors? workforces are those hired directly and indirectly by contractors and subcontractors.
Contractors are currently independently responsible for ensuring their labor practices, as well as OHS performance, at Ciputra Residence?s sites are in line with national requirements. However, it is recognized that the Small and Medium Enterprise (?SME?) contractors in the sector have limited in-house capability and resources to manage labor and OHS issues up to national standards. Ciputra Residence?s management does not currently oversee the performance of those contractors. As part of the IFC investment process, Ciputra Residence hired competent labor and OHS consultants to conduct a risk-based OHS and labor audit of its construction contractors who are currently working on Ciputra Residence?s project sites. Based on the audit result, Ciputra Residence will retain a competent consultant to develop a Construction Contractor Management Plan which should have the objective to bring about contractor compliance with Indonesian labor laws and IFC?s Performance Standard 2 for current and future projects.

IFC''s assessment considered the Company''s operations with regard to resource consumption (water, energy and fuel), efforts to optimize resource inputs, waste minimization and management practices, as well as the storage and handling of hazardous materials used in the construction and operation of facilities.
- Pollution Prevention and Resource Conservation:
Environmental impacts and mitigation measures during construction and operation are identified in the AMDAL reports. Impacts are mainly related to land preparation, air emissions (heavy equipment, vehicles and generators), noise, sewage from domestic use, visual impact (e.g. publicity and cranes) and waste management.
As mentioned previously, the Company will work with IFC?s Green Buildings team and good neighborhood initiatives to explore specific resource efficiency measures including the use of treated sewage for flushing and landscaping to minimize discharge to external environment; use of star rated energy efficient electrical appliances and T5/CFL/LED lighting; use of fly ash blended concrete and bricks; and rainwater harvesting.
Resource efficiency measures have been implemented in some project designs, with examples including the use of water-based paint, thermal insulation for roofing, natural cross-ventilation, blinds for shading, solar water heating systems, implementation of passive solar design principles, low-flow plumbing fixtures to minimize wastage of water and LED lighting in public areas.
Greenhouse Gases (?GHG?): The main source of GHG during the construction phase will be the fuel consumed by construction vehicles and electricity usage. Ciputra Residence will provide the GHG figures to IFC through its Annual Monitoring Report.
Hazardous Materials Management: Ciputra Residence will be required to have specific control measures, including secondary containment, spill kits, and fire safety controls where hazardous materials, such as cement additives and coating materials will be stored and/or used.

The Company will design public access buildings to meet all local fire regulations and the requirements of an internationally accepted life safety code. As part of IFC’s investment, during the design process, the Company will submit to IFC a fire safety master plan that identifies major fire risks, applicable codes, standards and regulations, and mitigation measures to follow such that the building will meet locally recognized code and an internationally accepted life safety code. The master plan will be prepared by a suitably qualified professional acceptable to IFC who will ensure that the design is consistent with IFC’s Life and Fire Safety (“L&FS”) requirements. The qualified professional who prepares the L&FS master plan also will undertake a review at the time of L&FS systems testing and commissioning and certify that construction of these systems has been carried out in accordance with the accepted design. The proposed structures and facilities will also adopt a disaster response plan for earthquakes, fires and other large-scale emergency situations.

In addition, measures to protect the community during construction will also be developed, including clear demarcation of construction areas; restricted access to construction sites; mitigating noise and air pollution; providing proper illumination of areas; and provision of safety information to visitors and people residing in the projects while construction is being completed.

The Company maintains good relations with local communities and its customers. Ciputra Residence is stationed in the project sites where neighboring communities can raise and register their concerns. There were no material concerns raised previously for the completed and ongoing projects. The interested parties can share their concerns with the local authorities who will follow-up and provide feedback. Following the same model, the Company will establish and maintain a good relationship with local communities and its customers of those proposed real estate development projects.

Ciputra Residence will disclose this document in the local prevailing language at JL. Prof. DR. Satrio Kav. 6, Jakarta 12940, Indonesia. For enquiries or concerns about the environmental and social impacts of the Project please contact:

Mr. Agussurja Widjaja, Director
PT Ciputra Residence
Jl. CitraRaya Boulevard Des Cikup
Kec. Cikupa, Kab. Tangerang 15710
Indonesia
Phone: +62-21-596-0888
Fax: +62-21-596-1060

Broad Community Support is not applicable for this project

Title	Anticipated completion Date	Status	Comments	Completion Date
Hire a permanent appropriately qualified individual supported by adequate financial and professional resources reporting to senior Ciputra Residence management with overall Health, Safety, Environmental and Social (HSE & S) corporate responsibilities.	06/30/2014 12:00:00 AM	Completed	Completed	06/02/2014 12:00:00 AM
Develop and implement a land acquisition screening mechanism to ensure land is acquired on a willing buyer-willing seller basis. The land screening shall be integrated within any project development approval process.	08/30/2014 12:00:00 AM	Completed	Completed	08/29/2014 12:00:00 AM
Develop and implement an Emergency Preparedness & Response Plan (EPRP) that covers all foreseeable emergency scenarios associated with projects’ construction phases.	08/30/2014 12:00:00 AM	Completed	Completed	08/15/2014 12:00:00 AM
Develop and implement a grievance mechanism to allow free flow of grievances from contractors, own employees and external parties as a supplemental measure to address issues in a timely and effective manner.	08/30/2014 12:00:00 AM	Completed	Completed	08/15/2014 12:00:00 AM
Develop and implement procedural measures to protect the community during construction, including clear demarcation of construction areas; restricted access to construction sites; proper illumination of areas; and provision of safety information to visitors and people residing in the projects while construction is being completed.	08/30/2014 12:00:00 AM	Completed	Completed	08/15/2014 12:00:00 AM
Complete gap analysis between Indonesian Regulatory Requirements and the International Building Code (IBC), 2012 with specific reference to seismic design and fire & life safety requirements. Augment/ develop Company policies and procedures per gap analysis findings.	08/30/2014 12:00:00 AM	Completed	Completed	05/30/2014 12:00:00 AM
Develop and implement a master training plan with objectives, timelines and completion indicators covering the wider Ciputra Corporate Level ESMS requirements.	08/30/2014 12:00:00 AM	In Progress	Under discussion with IFC client
Ensure that multi-story residential buildings with at least four floors have fire/smoke alarms and multiple exits in their design and constructed in a manner consistent with host national law, IFC guidelines and good international industry practice.	05/30/2014 12:00:00 AM	Completed	Completed	05/28/2014 12:00:00 AM
Life and fire safety master plan for each public-access building to be constructed that identifies major fire risks, applicable codes, standards and regulations, and mitigation measures; and demonstrates compliance with locally recognized code and an internationally accepted fire and life safety code;	05/30/2014 12:00:00 AM	Completed	Completed	05/30/2014 12:00:00 AM
As part of ESMS, develop LFS audit protocols to ensure implementation of above 2 Tasks	05/30/2014 12:00:00 AM	Completed	Completed	05/26/2014 12:00:00 AM
Develop a Contractor Management Plan (CMP) per the Labor Audit findings. CMP will manage labor related issues across all contractors and subcontractors for current and future projects to ensure consistency with host national law and IFC's Performance Standard 2 to the satisfaction of IFC. The CMP will include, although not necessarily limited to: i. measurable objectives, milestones and staged achievement indicators (% of completion); ii. grievance mechanism, and iii. a robust training program and external monitoring protocols to measure effective implementation.	09/30/2014 12:00:00 AM	In Progress	Under discussion with IFC client
Retain qualified labor consultant to conduct external labor monitoring every 3 months for the first year of the Contractor Management Plan implementation, then such monitoring frequency to be revised in agreement with IFC.	09/30/2014 12:00:00 AM	In Progress	Under discussion with IFC client