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

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 risks and issues related to this project include: company capacity, systems and staffing to manage social, environmental, health and safety aspects of its operations; adequate social and environmental assessment of the impacts of the Project''s designs and construction activities in accordance with legal requirements and IFC Performance Standards; engagement with local communities in accordance with local requirements and IFC Performance Standards; assurance of fair, safe and healthy living and working conditions for the workers (especially during construction); conservation of energy, water and process materials including recycling and reuse initiatives through green building design; management of air emissions, wastewater treatment and discharge during construction and operations, and solid and other waste disposal during project construction; acquisition of land for the projects in accordance with IFC Performance Standard requirements; life and fire safety design of the proposed projects and impacts on transport infrastructure during construction on nearby communities.

Typically, SPCL purchases land through commercial negotiated transactions directly from the land owners on a willing buyer-willing seller basis; in some cases as is customary in India, land is also purchased using brokers. Therefore, the type of risks and impacts envisaged in PS5 (Land Acquisition and Involuntary Resettlement) are not applicable.

Considering that proposed affordable housing developments will not be large land parcels, SPCL will normally not involve aggregators for land purchases and may only use them as an exception. In such a case, a complete due diligence will be conducted before involving any aggregators and such purchase process is audited through an external consultant. SPCL will only purchase land which has been zoned as residential and will not purchase agricultural land. For example, for a potential affordable housing development in Kolkata, SPCL has sub-leased the land (30 acres or 121410 square meters) from the master developer who had been leased the land by the Government of West Bengal.

However, as set forth in the ESAP, the Holdco will document the land acquisition policy/guidelines for the proposed affordable housing developments which will be part of the agreement signed between the Holdco and SPCL/SPRE. The policy will document abovementioned practices as well as; (a) purchase of land having no legal issues or claims; (b) detailed due diligence of land aggregated within the previous 3 years (from date of purchase) for ensuring that the purchase process followed by the aggregator was free from coercion and fair prices were paid to the previous owners; (c) not purchasing land which has resulted in any involuntary resettlement unless resettlement and income restoration are managed in a manner compliant with IFC’s Performance Standard 5. Further, the land acquisition process for the proposed developments will be audited against the documented policy/guidelines along with the construction practices review mentioned above under PS1 and the report will be shared with IFC.

All proposed affordable housing projects will be developed on land zoned under residential areas around major cities, and are thus not expected to result in adverse impacts on biodiversity, indigenous people or cultural heritage. Accordingly, the type of risks and impacts envisaged in PS6 (Biodiversity Conservation and Sustainable Natural Resource Management), PS7 (Indigenous Peoples) and PS8 (Cultural Heritage) are not applicable.

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: SPCL has an assessment process which is followed prior to land purchase. The company performs a due diligence of potential land which includes assessment of land use and presence of third parties at the proposed site, review of land titles and legal due diligence. SPCL is committed to purchasing land only through willing buyer seller transactions. Also, only land zoned as residential will be purchased for all the affordable housing developments. As per the ESAP, the Holdco will formalize by means of a documented policy or/and formal procedures, the commitment to assess and manage environmental and social aspects during project planning and development in a manner compliant with IFC’s Performance Standards.



SPCL follows local legal requirements for design, development and construction of the housing developments, including the specifications defined on the Master Plan of each city, the requirements defined by the Ministry of Environment and Forest and the National Building Code of India 2005 (NBC 2005). An accredited architect or engineer endorses the design, including structural and fire safety aspects, before it is submitted for the “Plan Sanction” by the local zonal authority and to obtain the “No Objection Certificate”. The plan presented needs to be aligned with the Building Byelaws for each region, if they exist, of by the building regulations defined by the Ministry of Urban Development.



In case required as per applicable legal requirements (i.e. if the built-up area is more than 50,000 square meters), SPCL commissions an Environmental Impact Assessment (EIA) and obtains the required environmental clearance prior to construction. Prior to hand over of the project to the residents, local authorities perform an inspection and issue an “Occupancy Certificate”.



Policy and Management Systems: As the construction of the projects will be executed through SP E&C, the appraisal focused on SP E&C’s management systems and procedures. SP E&C has a documented Quality, Health, Safety and Environment (QHSE) Policy and has QHSE systems in place which are certified as per the requirements of ISO 9001:2008, ISO 14001:2004 and OHSAS 18001:2007. SP E&S has documented all the processes to be followed on construction sites which are collectively referred as the “SPCL Way.” These processes cover key activities expected on construction sites, for example, site preparation, excavation, scaffolding, erection of steel structures, use of earth moving machinery and dumpers, demolition, underground construction, road works, handling of construction materials etc. The processes explain roles and responsibilities as well as key activities and control procedures. The processes also refer to applicable legal/other standards, provide monitoring formats to be used, specify records to be maintained and provide examples of visual displays. As set forth in the ESAP, the Holdco/Platform and/or SPCL will ensure that even if anothe
r contractor (except for SP E&C) is hired for construction of the proposed affordable housing developments, the SP E&C systems and processes will be implemented on construction sites. The same will be included in the contracts signed with such a contractor.



As the QHSE policy is an SP E&C policy, as per the ESAP, the Holdco/Platform and/or SPCL will develop and implement an overarching sustainability or environment, health, safety and social policy (based on SP E&C’s policies) defining its objectives and principles that will guide the company in achieving EHSS performance in compliance with the applicable legal requirements, IFC’s Performance Standards (PS) and the intent to align with SP E&C’s approach to projects.



Organization: SPCL has a Chief Sustainability Officer responsible for sustainability activities of the company and is also responsible for coordinating the EIA studies for any new projects. Within SP E&C, there is a Corporate Environment, Health and Safety (EHS or HSE) team headed by the General Manager and Corporate Head – HSE. SP E&C has divided its construction sites (for SPCL projects as well as other clients) in the country into eight regions. Each region has a Director – Operations as well as a Regional Head who are responsible and accountable for HSE performance within their region. Each region has a Regional EHS Coordinator. At construction site level, the Project Manager and each department’s Head of Department (HOD) are responsible and accountable for the safety of the subordinate staff and operations under their control. They are supported by the Site EHS Officer and other EHS team members.



Risks registers are prepared by the site level HODs of the respective department and approved by the Project Managers. Project Managers and HODs are responsible for, amongst other things, to ensure regular Safety Committee Meetings on-site, report any unsafe equipment, systems or procedures and ensure that all incidents and accidents are investigated and corrective actions are implemented. They are also responsible for the preparation of specific safe working procedures for all hazardous works in consultation with HSE Officer.



Site EHS teams are responsible to ensure that SP E&C’s own standards as well as client’s EHS procedures are followed. They are responsible to ensure regular safety training, safety inspections, accident investigation, preparation of monthly EHS statistics and reports, advising project managers on EHS matters including hygiene of labor camp, and ensure monitoring of the safety performance in tool box meetings and safety committee meetings.



For developing and implementing its Corporate Social Responsibility (CSR) activities, SPCL has a Group Head – CSR. As per the ESAP, the SPCL/Holdco will hire an E&S manager responsible for coordinating various E&S activities under the Project to ensure compliance with IFC Performance Standards in proposed affordable housing developments.



Emergency Preparedne
ss and Response: SP E&C has a specific process on emergency preparedness and response which also provides guidelines for the preparation of emergency preparedness plans and assist contractors in developing related procedures. As per the process, each site prepares a specific emergency response plan. Regular training and mock drills are conducted for staff and contractors. The visited sites had identified emergency assembly points, signs guiding towards the assembly points and display of emergency contacts. Visited construction sites also had first-aid rooms and an ambulance. The first-aid room is manned by a male nurse and a doctor has scheduled visits.



Fire extinguishers and sand buckets are provided at the construction sites. SP E&C has a specific process on maintenance and use of fire fighting systems which includes a format for inspection of these systems. The process includes requirements on conducting regular fire drills and training on use of fire fighting systems. It is ensured that trained fire personnel are present round the clock to mitigate any fire emergency. No flame/smoking zones are established where inflammable items are stored.



Monitoring & Reporting: As part of its management systems and processes, department heads and site engineers monitor the operations on-site. The EHS officers at the site conduct weekly walks to identify unsafe practices which are reported to the Project Managers and HODs. The findings of the weekly walks are documented and tracked for completion. The weekly walk summaries are prepared by the site and submitted to the regional EHS officer. All sites conduct environmental monitoring for parameters as per local pollution control board requirements including ambient air quality, ambient noise, and wastewater quality. All sites maintain records on quantities of water use, wastewater, hazardous waste and electronic waste generated on-site.



The sites submit monthly reports to the regional EHS coordinator which provides data on manpower, number of incidents/accidents/first-aid cases/near misses, number of HSE committee meetings and EHS induction trainings. The collated data for the region is then received by the corporate EHS team. Based on the reports, the corporate EHS team sends regular feedback to site teams through regional EHS coordinators on policies and processes to strengthen the EHS implementation at the site.



A monthly HSE conference is held by the corporate HSE team with all regional EHS coordinators. A regional EHS conference is held every six months where project managers and site EHS officers of each region present the EHS performance of their sites in the presence of the corporate HSE manager. Further, an annual national HSE conference is held where regional heads and regional EHS coordinators present the EHS performance of their respective regions to the top management, including the Chairman.



Additionally, as per the ESAP, for the proposed affordable housing developments, th
e SPCL/Holdco will conduct an annual construction practices review through an external consultant (acceptable to IFC) for the first two years of construction and share the reports with IFC. The review will focus on compliance of construction practices with respect to SP E&C’s own processes and IFC Performance Standards requirements. As part of the review for the first year, the land purchase process for the specific development will be reviewed to ensure its compliance with agreed land acquisition policy/guidelines (discussed under PS5 below) and IFC Performance Standards; the SPCL/Holdco will agree with IFC on a Terms of Reference (ToR) for this review.



As per the quality management system, SPCL follows documented internal processes and procedures to monitor construction on-site and ensure the construction is completed as per the building standards and codes to be applied and the client’s design specifications and requirements.

SP E&C directly employee individuals from the level of management to the level of site engineers, whereas other workers are hired through contractors (discussed below under third party workers). The number of workers on-site varies with the size of project, stage of construction and level of activities ongoing on-site. The Holdco will follow the same policies as SPCL and SP E&C as described below for all activities of the project.



Human Resources (HR) Policies and Procedures, Working Conditions and Terms of Employment: SPCL has a formal HR policy manual covering among other things, new employees assimilation, talent recruitment, remuneration and facilities (includes benefits, insurance, on-site facilities), grievance and disciplinary procedures, travel policies and welfare measures. Terms of employment are provided in the contracts the company signs with its employees. Every region has an HR manager to ensure implementation of policies in their respective region. The policy is consistent with the PS2 requirements as explained below.



Non-discrimination: SPCL has an Equal Opportunity Policy which aims to eliminate discrimination in employment on the grounds of age, gender, disability, race, color, nationality or religion. It also aims to comply with equal opportunity legislations as applicable, and to follow good management practices. As per the policy, all policies and practices of the company are applied equally to all employees.



Protecting the Work Force: In compliance with local labor laws and the company’s policy, SP E&C does not use child labor or forced labor at its construction sites. Contractors are also required to hire employees older than 18 years of age, which is confirmed through collection of documentation of age of workers and controls at construction site gates.



Workers’ Organizations and Grievance Mechanism: SPCL does not prevent employees to organize or participate in workers’ organizations. However, currently SPCL employees do not belong to any workers’ organizations or unions. As part of its policy, SPCL has a documented grievance/redresses procedure. As per the procedure, employees can raise their grievances to the immediate superior followed by the head of department and finally it can be referred to CEO/President/Chief People Officer (CPO). The grievance mechanism encourages employees to lodge grievances without fear of victimization. Also, employees lodging grievances have the right to be represented by fellow employee of his/her choice OR by a group spokesperson in case it affects the group. The employees can also raise their grievances anonymously through the HR team or the respective Head of Department.



Third party workers and labor camp facilities: SP E&C employs workers through legal entities with required permits from the statutory authorities and includes required conditions on legal compliance and occupational health and safety (OHS) in their contracts. The contractors are expected to adhere t
o the management systems and processes of SP E&C. Apart from their contractual obligations to do so, some contractors also have their own EHS manuals that they are encouraged to follow. The contractors are expected to ensure safety of the workers by providing safe working conditions and providing the relevant safety equipment. The contractors are also expected to adhere to all applicable central and state level labor laws. The contractors are expected, as part of their contractual obligations, to ensure that their employees undergo periodic health checkups and are physically fit to carry out the job.



Safety officers monitor the performance of contractors on OHS through continual supervision. Administration officers on-site monitor the contract workers’ compliance on wages and benefits. Contractors’ work orders/invoices are only processed after ensuring compliance on labor laws for their workers.



SP E&C provides adequate facilities and amenities in the labor accommodation including: adequate living/sleeping facilities and space per person; potable water treated on-site (meeting national standards); toilets, washing and cleaning facilities; kitchen (for each of the contractor); facilities for management and disposal of garbage, sewage and other waste and fire safety equipment.



Occupational Health and Safety: As discussed above, SP E&C has a documented occupational, health and safety (OHS) management processes for its construction. These processes cover key activities expected on construction site, for example, site preparation, excavation, scaffolding, erection of steel structures, use of earth moving machinery and dumpers, demolitions, underground construction, road works, handling of construction materials etc. The processes explain roles and responsibilities as well as key activities and control procedures. The processes also refer to applicable legal/other standards, provide monitoring formats to be used, specify records to be maintained and provide examples of visual displays. All workers, including contract workers, are required to have safety induction prior to working on-site. For working at height, the workers have to take a test before they are actually allowed to carry out similar work on-site. Safety officers at each site conduct regular inspections to ensure the processes are followed on-site. Currently SP E&C is working on 120 construction sites and employs 256 safety officers. During the sites visits, appropriate safety measures and use of personal protective equipment was observed. Metal scaffolding was noted to be use. Lifting equipment was noted to be certified. All the excavated areas/other construction areas were suitably barricaded.



There have been no fatalities on SP E&C’s construction sites in last 3 years. As per the data collected and reported by SP E&C, the Lost Time Incident Frequency Rate for last 3 years (Apr 2011-Mar 2012, Apr 2012- Mar 2013 and Apr 2013-Mar 2014) was 0.14, 0.19 and 0.17 (number of case
s per million man-hours), respectively which is significantly lower than Occupational Safety and Health Administration (OSHA) of United States Department of Labor average reported (for 2012) for total reported cases for construction of buildings i.e. 3.4 for 200,000 man-hours or 17 per million man-hours as well as cases with day away from work i.e. 1.4 for 200,000 man-hours or 7 per million man-hours. SP E&C also reports severity rate (man-days lost per million man-hours) of 172.58, 221.30 and 189.12 (respectively) and incident rate (no. of injuries per 1000 workers) of 0.54, 0.71 and 0.64 for the same periods, respectively.

Resource Efficiency: Resource efficiency measures will be considered in the design of the proposed affordable housing developments. SPCL will identify opportunities to improve energy efficiency associated with projects and reduce waste generation.



Pollution Prevention: Environmental impacts and mitigation measures during construction and operation are properly identified in the EIAs and are mainly related to land preparation, air emissions (heavy equipment, vehicles, generators), noise, sewage from domestic use, visual impact (e.g. publicity and cranes), and waste management. As result of the EIA’s, the company prepares Environmental Management Plans (EMPs) for mitigating adverse impacts along with delineation of project and post-project Environmental Monitoring Programs.



Water and Wastewater: During construction, typically water is sourced through on-site borewells. SP E&C installs required water treatment plants (supplied by Group company Eureka Forbes) to supply potable water of an acceptable quality to workers. Post construction, before the developments are handed over to the owners, water supply will be coordinated with local authorities; typically water is supplied by local government agencies and/or from on-site bore wells and water treatment (as required) is provided on-site by SPCL to ensure that water quality meets the national acceptability standards.



Wastewater during construction is treated using septic tanks. Sewage treatment plants will be built for each project and the treated water (meeting applicable standards) will be reused where feasible or discharged in the local municipal sewer line.



Waste Management: Waste streams generated during construction are segregated and collected on-site. Recyclable waste e.g. metal waste, packaging waste is sold to local agencies. Construction debris and excavated earth are temporarily stored at designated points and as feasible reused for back filling, sub base work for roads and pavements within the project. Hazardous waste generated on-site include used oil, used / waste solvents or solvent mixtures, empty containers that have come in to contact with hazardous wastes, asbestos, fluorescent tubes / bulbs and used batteries. The hazardous waste is collected and disposed through agencies authorized by the Central and State Pollution Control Boards. SP E&S has a specific process on Construction Environment Management which covers waste and hazardous materials management on-site.



Maintaining green areas: The requirement for leaving open/green areas varies from region to region depending upon the prevailing Development Control Regulations in the region. On an average, 40%-50% of the area is left as green area or open space.

As discussed above, SPCL follows local legal requirements for design, development and construction of the housing developments, including the specifications defined on the Master Plans of each city, the requirements defined by the Ministry of Environment and Forest and the National Building Code of India 2005 (NBC 2005). An accredited architect or engineer endorses the design, including structural and fire safety aspects, before it is submitted for the “Plan Sanction” by the local zonal authority and to obtain the “No Objection Certificate”. The plan presented needs to be aligned with the Building Byelaws for each region, if they exist, and by the building regulations defined by the Ministry of Urban Development. The developments consider the access to basic services such as electricity and water. Other impacts to the community such as water extraction, noise, air pollution and exposure both during construction and operations are identified in the EIAs and as needed mitigation measures are identified and implemented.



Life and fire safety systems for the proposed developments under the Project will be designed, implemented and tested in compliance with the requirements of NBC 2005 (as amended) and building bye laws of the city/region (as applicable).



SP E&C manages its construction activities in a way to minimize the impacts on neighboring communities. SP E&C provides 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. Access to potable water is guaranteed to all employees at the worksite and at labor camp. As per the ESAP, the Holdco/SPCL will develop and implement a documented community grievance mechanism i.e. a process of receiving and responding to the grievances which meets IFC PS requirements and will be implemented for all the proposed affordable housing developments.



The company hires unarmed security guards at the construction sites through external security agencies. The contractors are responsible for background verification of the guards and training the guards on dealing with the workers and neighbouring communities. The company will explicitly review during the selection of the providers of these services their rules of conduct, training and monitoring of their workers to ensure appropriate conduct towards the communities and require them to act within the applicable law.

SP Group has a documented Corporate Social Responsibility (CSR) strategy. The strategy is based on four pillars Quality of Life (affordable quality healthcare, safe drinking water, sanitation), Environment preservation (carbon footprint reduction, increasing green cover, promoting bio-diversity), Education and skills training (for underprivileged children and young adults, tribal communities) and Inclusion (training and earning opportunity to differently challenged, alleviation of poverty and financial inclusion for migrant labor). For developing and implementing its CSR activities, SPCL has a Group Head – CSR.

As part of the quality of life, SP Group company (Eureka Forbes Ltd) provides community drinking water plants and non- electric filters during times of disaster/natural calamities. The Group also supported one Ashramshala (where children live and study) located in Padsare village (about 80 km from Mumbai) by improving infrastructure (school building, toilet block, dormitory, drinking water plant), starting an organic vegetable garden, starting initiatives in participative learning and science camp, organizing a medical check-up and helping the school focus on nutrition. The Group also organizes blood donation drives, eye camps and medical check-up camps around its project sites.
The Group provides Crèche and day-school for children (0-13 years) at its construction project sites along with focus on nutrition and medical aid for these children. 500 children have participated in such programs and overall about 3500 covered over last 6 years. In case the number of children on-site are limited, the group adopts a Government school for abovementioned activities. Similar initiatives have been taken by the Group in Africa where they have support Girls’ School in Ghana, provided water hand pumps for 3 villages in Liberia, repaired and refurbished an orphanage and school.

Under the skill training initiatives, the Group has started a state-of-art construction skills institute at Kolkata where the curriculum has been formulated in partnership with UK based CITB. The training includes both classroom and on-site training. Over 230 youth have been trained through the institute.

Similarly, the Group has tie-up with the pan-Indian Institute of Technology (IIT) alumni organization (PARFI) to set up skills training center for tribal youth in Jharkhand where 30-45 days residential training is provided and after training the students get an opportunity for placement at construction sites. One of the Group’s call center EuroAble is completely managed by the physically challenged youth. The Group also supports a vocational training center for the mentally challenged.

For employee engagement and volunteering, the Group has a specific initiative under which over 1500 employees participate in week-long program. As part of the program, SP employees have visited 110 Non-governmental Organizations (NGOs), planted 465 trees, reached out to 5200 children, women and differently-abled people.
Further, the Group runs plantation drives at the project sites allied to employee awareness programs. A site audit has been conducted by the Group map the carbon footprint. Also, the Group has created a dedicated team for environmental initiatives called Planet Heroes.

Due to corporate nature of this investment, will disclose this ESRS and the ESAP at the following address:

Shapoorji Pallonji and Company Limited
SP Centre
41/ 44, Minoo Desai Marg
Colaba, Mumbai - 400005.

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

Mr. Venkatesh Gopal
Shapoorji Pallonji and Company Limited
SP Centre
41/44 Minoo Desai Marg
Colaba, Mumbai – 400005.
Tel: +91 22 6749 0000

Broad Community Support is not applicable for this project

SPAH(34628) Supervision Disclosure Snapshot – Version 2
Description	Anticipated Completion Date	Status	Comments	Completion Date
SPCL/Holdco to employ an Environmental and Social (E&S) manager responsible for coordinating various E&S activities under the Project and ensuring compliance with IFC Performance Standards in proposed affordable housing developments.	28-Feb-2015	Completed	Completed	10/15/2015
SPCL/Holdco to document land acquisition policy/guidelines for the proposed affordable housing developments covering the key elements described in the Environmental and Social Summary Review document (ESRS).	31-Jan-2015	Completed	Completed	10/15/2015
(a) SPCL/Holdco to agree with IFC on a Terms of Reference (ToR) for the construction practices and land purchase process review. (b) Conduct an annual construction practices review through an external consultant (acceptable to IFC) for the first two years of construction and share the reports with IFC focusing on compliance of construction practices with respect to SP E&C’s own processes and IFC Performance Standards requirements. [Expected timeline: As each proposed developments reaches the construction stage] (c) As part of the review for the first year, review the land purchase process for the specific developments to ensure its compliance with IFC Performance Standards and agreed land acquisition policy/guidelines. [Expected Timeline: Alongwith the first year review]	31-Jan-2015	Completed	Completed	10/15/2015
SPCL/Holdco to develop a community grievance mechanism which describes the process of receiving and responding to community grievances and implement for all developments covered under the Project.	31-Mar-2015	Completed	Completed	10/15/2015