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
If IFC’s investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

This is a Category B project according to IFC’s Policy on Environmental and Social Sustainability because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.

Key environmental and social (E&S) risks and issues associated with this Category B Project include: development and implementation of management systems covering environment, health and safety and food safety; engagement with local communities in accordance with local requirements and IFC’s Performance Standards ; assurance of fair, safe and healthy working conditions in compliance with local regulatory requirements and relevant Performance Standards; resource efficiency of the operations (mainly energy and polypropylene); monitoring and management of air emissions, wastewater treatment and discharge, solid and other waste disposal; and life and fire safety management including emergency preparedness and response.

The Project is being implemented within FIL’s existing facilities. All the facilities have unarmed security guards. The DTA and SEZ facilities are located in notified industrial areas. Though the DTA and Kashipur facilities are located close to residential areas, no significant impacts are expected due to the Project as no expansion is planned at the DTA facility. The Kashipur facility is accessible through the main Moradabad-Kashipur road. The additional traffic generated will be 50 trucks a month which is two additional trucks every day. The facility has adequate facilities for parking and drivers to cater to the post-expansion needs. Thus no impacts as envisaged in PS4 (Community Health, Safety and Security) are expected.

As mentioned, the Project activities in India will be undertaken within FIL’s existing facilities and no new land acquisition is envisaged for any of the activities in the Project. Thus PS5 (Land Acquisition and Involuntary Resettlement) is not applicable. Similarly, the type of impacts envisaged in PS6 (Biodiversity Conservation and Sustainable Natural Resource Management), PS7 (Indigenous Peoples) and PS8 (Cultural Heritage) do not apply.

The future development to be undertaken in South Africa and Brazil are in the early stage of conceptualization, however, as part of the management system procedures (discussed in the following sections), the company will identify social and environmental risks and impacts of future operations with respect to IFC Performance Standards and local regulations. Further, FIL will ensure implementation of PSs at these proposed facilities as part of its management systems.

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: For expansion of the operations at existing facilities in India, FIL does not require a formal Environmental and Social Impact Assessment (ESIA) as per national environmental regulations, however the company will obtain all the required E&S regulatory permits and approvals. The company has the necessary regulatory permits for its operating facilities except for use of Toluene at its facility in Kashipur in the ink making operations. The company plans to shift the ink making and printing operations to new buildings with storage of Toluene in an aboveground tank. Thus at this time the company will obtain required approval of plans for these new buildings and the license for storage and use of Toluene.



Regarding the proposed overseas operations, as part of the management systems discussed below, the company will develop specific procedures for identifying social and environmental risks and impacts of the company’s future operations (at these proposed facilities); undertaking ESIA studies as may be required by the local regulations and IFC Performance Standards if required; procuring all the necessary approvals and permits and complying with all the conditions stipulated by the local authorities.



Policy and Management Systems: FIL has policies on Environment, Health and Safety, Social Accountability, Quality, Hygiene and Food Safety. The company has implemented an integrated Quality, Environment and Food Safety Management System certified compliant with ISO 9001, ISO 14001, and ISO 22000 requirements at its SEZ facility. Also, the SEZ facility is certified by AIB International (as per Consolidated Standards for Food Contact Packaging Facilities Programs) and certified by British Retail Consortium (BRC), UK for Food Packaging System (for both Class-A and Class-B Packaging).



The other facilities (DTA and Kashipur) are covered under the ISO 9001 certified Quality Management System, however they are not covered under the environment management system (EMS). FIL has committed to extending the same EMS to the other facilities and obtain ISO 14001 certification for the other facilities as well. As part of this extension the company will define roles and responsibilities for EMS implementation; complete an aspects and impacts analysis; document the EMS manual with management programs, standard operating procedures and related work instructions; establish objectives and targets for continual improvement; and develop monitoring and review procedures to ensure effectiveness of the system. These requirements are defined in the project ESAP.



As regards Occupational Health and Safety (OHS), FIL has implemented various safety procedures at its facilities (including job safety analysis, work permit system, and accident-incident investigation), however currently there is no clearly defined formal OHS management system (OHSMS). FIL plans to implement an OHSMS at all its facilities meeting the requirements of OHSAS 1
8001. Further information on this issue is provided in the subsequent section.



For the proposed new operations , based on the ESIA (if required) or a risk assessment conducted as part of the management systems procedures, FIL will develop a project specific Environmental and Social Management Plans (ESMP) setting forth: (a) measures to mitigate adverse risks and/or impacts, (b) monitoring requirements for ensuring the mitigation measures are implemented effectively and in a timely manner; (c) organizational and financial resources for carrying out the measures; and (d) an implementation schedule for these activities If FIL undertakes acquisition of an existing operation or in the case of new projects, the project specific ESMP would then form the basis for the respective project company’s environmental, occupational health, safety and social management systems. In addition, the company will ensure that the quality, environmental management and occupational health and safety systems defined above at existing operations are extended to the new project management systems and are consistent with the IFC Performance Standards.



Organization: At the group level, the responsibility for EHS management is with the Vice President - HR and Corporate Affairs, followed by the Group EHS Manager. At each of the facilities, there are dedicated Safety Officers who report to the Group EHS Manager. The environmental compliance responsibilities are handled by the Production and Human Resources Department. The SEZ facility has a dedicated person responsible for EMS implementation and monitoring. For the other facilities, the responsibilities will be redefined as part of extension of the EMS and implementation of the OHSMS.



Monitoring and reporting: Environmental monitoring is currently being conducted only at the SEZ facility including ambient air quality, domestic wastewater and drinking water testing. As defined in the ESAP, FIL will ensure regular environmental monitoring e.g., related to ambient noise, stack emissions monitoring for the diesel generators and wastewater,) at all facilities in compliance with the legal requirements as well as the World Bank Group (WBG) EHS guidelines.



Also, regular internal audits are conducted as part of the EMS at the SEZ facility and results are shared in the management review meetings. As part of implementation of the EMS and OHSMS required under the ESAP, the company will provide required social, environmental, occupational health and safety training to employees as well as contract workers; have procedures for periodic monitoring of environmental and OHS performance; have periodic internal and corporate EMS and OHSMS audits; regular management review of effectiveness of management systems and regular reporting of EMS and OHSMS performance to management.



Emergency response: An on-site emergency plan has only been documented for the SEZ facility. The plan covers emergency situations like fire, storm and f
loods. The plan describes the provisions made at the factory for emergency situations, actions to be taken during and post such emergency situations with roles of various departments. However, the plan does not provide details of how the evacuation will take place and roles and responsibilities related to that. FIL will update the plan for the SEZ facility to include more detail on evacuation plans and document and implement on-site emergency plans for other facilities (DTA and Kashipur). Emergency response plans for new activities acquired or greenfield developments will also be developed; these latter requirements are defined in the ESAP.



Based on the on-site emergency response plans for each of the facilities, it will be ensured that all areas have adequate emergency exits and there are marked assembly points. Also, more markings will be provided on emergency evacuation routes along with emergency lighting, as required. Currently FIL does not conduct regular evacuation drills and thus these will be implemented at all facilities and documented.



Fire safety: The fire safety system at the SEZ facility is based on fire extinguishers and a fire hose reel system with dedicated water storage. The SEZ facility is located within a kilometer of a fire station and also has an understanding with the neighboring facilities to use their fire fighting system (including their fire tender) in case of emergencies.



Fire hydrant and fire extinguishers have been provided at the DTA facility. At the Kashipur unit, fire hydrant installation is in progress. As part of the ESAP, FIL will provide an evacuation alarm at the DTA facility and ensure timely completion of fire hydrant installation at the Kashipur facility. A fire incident (not involving any injuries) was reported at the Kashipur facility in last year. To strengthen the fire safety systems, as part of the safety audit (discussed in the next section) and OHSMS implementation process, these systems will be reviewed for any areas of improvements.

FIL employs about 7000 workers including 2600 at the SEZ facility, 2300 at the DTA facility, 2000 at the Kashipur facility and 35 at the Barwah stitching facility. In addition, 320 contract workers are employed for the canteen, part of cutting operations, loading/unloading/material handling and some stitching operations.



Human Resource Policies and Procedures, Working Conditions and Terms of Employment: FIL has a Corporate Personnel Policy (HR) Manual which describes policies and procedures applicable to all employees.



FIL signs a contract with the worker at the time of employment. Most of the workers are paid through bank accounts. The wages and benefits were noted to be in line with the legal requirements. However, FIL needs to align employee working hours, weekly breaks and overtime compensation with the statutory requirements. FIL will ensure this in a phased manner at all its facilities within a year and undertake a third party review of the same.



Through periodic reviews, the company ensures that contractors are providing the legislated minimum al wages and benefits to their workers. However, currently, the compliance with requirements in PS2 is not part of this review. As part of the ESAP, FIL will review contractor compliance procedures with respect to IFC PS 2 requirements to implement measures to address gaps where identified.



Non-discrimination and Equal Opportunity: FIL has an Equal Opportunity Policy whereby the company has committed to equal opportunity to all without discrimination. During the review, no discriminatory practices were noted.



Freedom of Association, Child Labor and Forced Labor: The company as part of its Social Accountability Policy is committed to Freedom of Association as well as prevention of Child and Forced Labor. The management thus does not restrict its workers from becoming a member of trade unions, however currently there is no worker union at any of the operating facilities.

To prevent use of child labor, FIL reviews relevant personal records at the time of recruitment of the worker. Regarding forced and bonded labor, no such practices were noted and the company does not support such. Loans provided by the company are restricted to three months’ salary.



Grievance mechanism: Currently the company does not have a documented employee grievance mechanism. As part of the ESAP FIL will develop and implement a grievance mechanism meeting requirements of IFC Performance Standard 2 (PS2) and create awareness about it among the workers. FIL will also ensure that contract workers also have access to a similar mechanism. Such mechanisms will allow for anonymous reporting.



Occupational Health and Safety (OHS): As noted FIL has no formal OHSMS. A job safety analysis is undertaken for all activities and based on this assessment job instructions are defined for workers and the required personal protective equipment (PPE) is determined and provided. Also, the facilities have a work
permit system as well as an accident-incident investigation process. The company conducts noise and lux level measurement in the production areas and takes corrective actions based on the measurement results.



Usage of PPE was noted to be adequate at the SEZ facility. However, PPE usage needs to be improved for workers working in the ink making operations at Kashipur (where solvents and pigments are used) and in high noise areas at the DTA and Kashipur facilities. As part the first part of the OHSMS development process, the company will complete an OHS audit/risk assessment of all the individual facilities by an independent suitably experienced third party. This audit will also include a review of the company’s systems and structures applicable to life and fire safety. Thereafter and in agreement with IFC the company will develop a time bound corrective action plan (CAP) based on the audit findings. In addition, FIL will develop and implement an OHSMS at all the facilities aligned with the requirements of OHSAS 18001 and the requirements of this Performance Standard. These requirements are defined in the project ESAP.



The FIL facilities document and investigate accidents/incidents/injuries. Two fatal accidents are reported to have occurred in last two years, one at DTA and the other at the Kashipur facility. FIL took necessary corrective and preventive actions based on investigation of these.

Resource Efficiency: The manufacturing processes at FIL’s facilities are energy intensive. The company’s electrical department has prepared an electrical energy conservation strategy and associated action plan. Further, as part of the ESAP, FIL will commission an energy audit to improve energy efficiency at its facilities and implement cost-effective recommendations of this audit. Also, FIL reuses in-house waste poly-propylene in its recycling and compounding facility to develop products out of recycled plastic.



Air Emissions: The only source of air emissions at FIL are the 1000 KVA capacity diesel based back-up generators, one at DTA and four at the Kashipur facilities used only in case of power outages. The company however will undertake regular monitoring of emissions from these sources as part of the environmental monitoring plan to developed as part of the ESAP and ensure these comply with the requirements of the WBG EHS Guidelines.



Water and wastewater (including stormwater): The main source of water at the SEZ facility is the industrial area supply. The DTA facility has both industrial area supply as well as an on-site borewell whereas the Kashipur facility only has on-site borewells. The process water use is only limited to cooling in extrusion. No process wastewater is generated at any of the FIL facilities. The domestic wastewater is treated in the sewage treatment plants (STP) on-site and used for irrigating the gardens. Stormwater is currently drained off-site at all facilities through stormwater drains except at the SEZ facility where rainwater harvesting system has been provided.



Waste Management: The main waste streams generated at FIL’s facilities include packaging wastes and polypropylene wastes generated from the process. Due to ink operations, empty containers of chemicals are also generated at Kashipur. The packaging wastes and empty containers are sold to external agencies who sell it further for recycling. The process wastes are shredded and reprocessed. Specifically at Kashipur, the waste management practices were noted to have scope for improvement with respect to segregation and storage of wastes. As per the ESAP, the company will upgrade waste management systems in accordance with good industry practices at all its facilities. In particular, the company will, as part of the environment management systems, implement a program to: (a) identify all hazardous and non-hazardous wastes generated; (b) label, segregate and store all hazardous and non-hazardous wastes; (c) dispose of hazardous wastes through authorized entities only; and (d) maintain records of all wastes disposed from sites.



Hazardous chemicals management: FIL uses diesel at DTA and the Kashipur facilities for back-up power generators. Also, at Kashipur, Toluene, thinner, pigments and inks are stored and handled in 210 liter drums and smaller plastic cans. The diesel is stored at the DTA facility in day-tanks without any secondary containmen
t. Also, storage of inks and pigments in Kashipur is without secondary containment and labeling. Toluene will be stored in an underground storage tank as part the proposed modifications in ink preparation and printing areas. The storage and handling of Toluene will be ensured as per license requirements which include the need for secondary containment.



Further, as part of the ESAP, FIL will ensure storage, handling and use of hazardous chemicals (e.g., diesel, lubricating oil, Toluene , pigments etc.) on-site is in accordance with good industry practices including but not limited to: (a) secondary containment for all the aboveground storage tanks and drums; (b) spill prevention and control; (c) labeling of storage tanks; (d) inspection and maintenance programs to ensure integrity and operability of underground and aboveground storage tanks; emergency shutdown and relief and vent valve systems for underground storage tanks; and (e) provision of appropriate PPE and training of all workers involved in storage, handling and use of these chemicals.



Greenhouse Gas (GHG) Emissions: The current GHG emissions for all the facilities are from consumption of electricity and diesel (for back-up power and forklifts). GHG emissions from FIL’s current operations are estimated to be 50,000 tons CO2/annum. The expected additional GHG emissions from the Project (except the proposed new facilities in Brazil and South Africa) are 11,000 tons CO2/annum. Considering that proposed facilities in Brazil and South Africa will be only involved in finishing, there should not be a significant addition to the GHG emissions due to the Project.

As part of its Corporate Social Responsibility (CSR) initiatives, FIL has undertaken and established 14 skill development centers (SDCs) across the Malva and Nimaad regions of Madhya Pradesh under a Public Private Partnership (PPP) initiative of the state government. Close to 100 people are trained through these SDCs every year. Also, under another state government scheme, FIL trained and employed 300 people belonging to other backward castes (OBCs) in 2012. FIL has also initiated a program to train and employ physically challenged persons of which 50 people were employed last year.

Further FIL has started a computer training institute near its Kashipur facility where free computer training is provided to rural youth.

To facilitate community engagement FIL will develop and implement a documented community grievance mechanism meeting the IFC PSs requirements.

FIL will disclose this ESRS at its website: http//:http://www.flexituff.com, as well as locally at the following addresses:
Flexituff International Limited
C 41-50, Special Economic Zone (SEZ)
Sector-3, Pithampur – 454775
District Dhar (Madhya Pradesh), INDIA.
Tel : +91 7292420351

Flexituff International Limited
94, Sector-1
Pithampur – 454775
District Dhar (Madhya Pradesh), INDIA.
Tel : +91-7292-401685-87

Flexituff International Limited
Pipalgaon Road
Mahukheraganj, Kashipur - 244713
District Udham Singh Nagar (Uttarakhand), INDIA.
Tel: +91-5947- 266000

Any queries and/or comments about the project may be directed to:

Mr. Manoj Dwivedi
Flexituff India Limited
C 41-50, SEZ
Sector-3, Pithampur – 454775
District Dhar (Madhya Pradesh), INDIA.
Tel : +91 7292420351

Email: mailto:manoj@flexituff.com

Broad Community Support is not applicable for this project

Flexituff(33525) Supervision Disclosure Snapshot – Version 4
Description	Anticipated Completion Date	Status	Comments	Completion Date
Develop and implement Environment Management System (EMS) and Occupational Health and Safety Management Systems (OHSMS) consistent with IFC Performance Standards requirements at all applicable facilities. SEZ Facility (OHSMS) – March 2014 DTA Facility – June 2014 (EMS) and October 2014 (OHSMS) Kashipur Facility – October 2014 (EMS) and December 2014 (OHSMS)	31-Dec-2014	Completed	Completed
As part of the management systems, develop and implement specific procedures for identifying social and environmental risks and impacts of the company’s future operations (at proposed overseas facilities); undertake Environmental & Social Impact Assessment (ESIA) studies if required by local regulations and in doing so in compliance with IFC Performance Standards; procure all the necessary approvals and permits and comply with all the conditions stipulated by the local authorities; and developing and implementing social and environmental management plan (SEMP), as required.	31-Jul-2014	Postponed	Changed project circumstances mandated a delay of this task
Upgrade the fire safety and emergency response systems by: (a) Providing an evacuation alarm at DTA facility and ensuring timely completion of fire hydrant installation at the Kashipur facility. (b) Updating the on-site emergency response plan for SEZ facility to include more details on the evacuation plan. (c) Documenting the on-site emergency plans for DTA and Kashipur facilities. (d) Based on the on-site emergency response plans for each of the facilities, review provision of emergency exits to ensure that all areas have adequate emergency exits and all facilities have marked assembly points. (e) Improve markings provided on emergency evacuation routes along with emergency lighting, as required. (f) Conducting regular evacuation drills with documented reports.	28-Feb-2014	Completed	Completed
(a) Align working hours, weekly breaks and overtime compensation with statutory requirements for: - Finishing operations at DTA Facility - Pre-finishing operations at SEZ Facility - All operations at all facilities (b) Complete a third party review of working hours, weekly offs and overtime compensation at all facilities through a consultant acceptable to IFC.	31-Dec-2014	In progress	Under discussion with IFC Client
Review contractor compliance procedures with respect to IFC PS 2 requirements and where necessary require amendments to ensure contractor compliance with IFC PS requirements.	31-Mar-2014	Completed	Completed
Develop and implement a grievance mechanism (covering both permanent and contract workers) meeting requirements of IFC Performance Standard 2 (PS2) and create awareness about it among the workers.	31-Dec-2013	Completed	Completed
Review existing operational practices related to use of personal protective equipment (PPE) by all the workers working in high noise areas (in DTA and Kashipur facilities) and in the ink making operations (in Kashipur) and implement an improvement plan as necessary.	30-Nov-2013	Completed	Completed
Ensure regular environmental monitoring at all the facilities in compliance with the legal requirements (on ambient air quality, ambient noise, stack emissions monitoring, workplace noise, water and wastewater testing etc.) as well as World Bank Group (WBG) EHS guidelines.	31-Dec-2013	Completed	Completed
Develop and implement a waste management plan in accordance with good industry practices at all facilities in order to: (a) identify all hazardous and non-hazardous wastes generated as per rules on hazardous waste handling and management; (b) label, segregate and store all hazardous and non-hazardous wastes; (c) dispose of hazardous wastes through authorized entities only; and (d) maintain records of all wastes disposed from site.	31-Jan-2014	Completed	Completed
Prepare and implement a Chemical Control Plan on order to ensure storage, handling and use of hazardous chemicals (e.g. diesel, lubricating oil, solvents, pigments etc.) on-site is in accordance with good industry practices including but not limited to: (a) secondary containment for all the aboveground storage tanks; (b) spill prevention and control; (c) labeling of storage tanks; (d) provision of PPE and training of all workers involved in storage, handling and use of these chemicals. Ensure storage and handling of licensed chemicals (like Toluene) as per license requirements.	31-Mar-2014	Completed	Completed
Develop a documented community engagement and grievance mechanism including a method of receiving, handling public grievances and providing feedback on them. The information to be communicated to the local community through appropriate means.	31-Dec-2013	Completed	Completed
Commission an external energy efficiency audit for all facilities and implement cost-effective recommendations arising from this audit.	31-Dec-2014	Completed	Completed
Apply for license for toluene storage and handling and other building plan approvals	31-Dec-2013	Completed	Completed
Conduct as audit at all the facilities through a third party (acceptable to IFC) of occupational health and safety systems and practices against accepted industry practices and national legislative requirements. This audit is to also to include a review of life and fire safety against the requirements as defined in the WBG EHS Guidelines and national requirements. Based on the audit findings agree with IFC on a time-based action plan to address any deficiencies identified.	30-Nov-2013	Completed	Completed
Align working hours, weekly offs and overtime compensation for finishing operations at SEZ and Kashipur facilities with statutory requirements starting 1st December 2013.	01-Dec-2013	In progress	Under discussion with IFC Client