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
Issues related to PS5: Land Acquisition and Involuntary Resettlement, PS6: Biodiversity Conservation and Sustainable Natural Resources Management, PS7: Indigenous Peoples and PS8: Cultural Heritage are not expected with this investment for the following reasons: this corporate loan does not involve any green field developments or expansion of the footprint of existing facilities and therefore will not trigger resettlement or economic displacement. The four facilities are located within existing consolidated agricultural land (India/HIL and SVI) or in industrial areas (Nigeria/sesame and CFM) and no conversion of natural/critical habitats will take place from their direct (processing) or plant-level sourcing operations, based on a supply chain risk assessment. There is no presence of Indigenous Peoples or known cultural artifacts within the companies’ operational footprint.

This proposed corporate loan with specific use of proceeds targeting existing agro-processing plants are expected to have limited environmental and social impacts which are expected to be site-specific and none is expected to be significant. This project is classified as Category B as per IFC’s Environmental and Social Sustainability Policy. The project is designed to avoid, minimize and manage E&S risks and impacts in compliance with Indian and Nigerian’s legal and regulatory requirements, IFC’s Performance Standards and World Bank Group (WBG) General and sector-specific (food and beverage processing, sugar and oleo-chemical manufacturing) Environmental, Health & Safety (EHS) Guidelines.

Key E&S issues associated with this investment are: (i) acquisition or renewal of necessary operational licenses; (ii) performance effectiveness of environmental, social (labor), occupational health and safety, and food safety management systems, procedures, management programs, and timely implementation of recommendations from internal and external/third-party audits; (iii) provision of fair and safe working conditions, compliant with Indian and Nigerian labor law, Olam’s corporate Human Resources and OHS policies and IFC PS2, for permanent and temporary (seasonal) employees, contractors and supply chain labor; (iv) emergency preparedness and response, including Life and Fire Safety (L&FS) provisions; (v) promotion of water and energy use efficiency through selection of best available technology; (vi) solid and liquid waste treatment; (vii) air emissions, including GHGs, and (viii) traceability of sugar cane, spice and sesame’ primary suppliers and certification against Olam’s Livelihood Charter (OLC) principles and criteria (P&C) and/or voluntary agro-commodity standards (e.g. Bonsucro, Rainforest Alliance).

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 Policies. Olams sustainability vision is "to generate economic prosperity, contribute positively to social wellbeing and manage our stewardship of the environment by providing sustainable agricultural products and food ingredients. With the expansion of its business model from its original supply chain trading business toward upstream and mid/downstream operations, Olam invested measurable efforts since 2011 to develop its corporate environmental and social management system, entitled "Olam Sustainability Standard Framework (OSSF). Using applicable national legal and regulatory requirements, IFCs Performance Standards and voluntary agro-commodity standards (e.g. FSC, Roundtable on Sustainable Palm Oil - RSPO) to define its corporate EHS performance-based requirements, the OSSF is made up of a set of policies and standards applying to its 6 operational segments, namely (i) Olam plantations, concessions and farms, (ii) processing, (iii) farmer suppliers, (iv) sourcing and trading, (v) logistics, and (vi) offices. This framework include Olams corporate responsibility and sustainability, environmental, human resource, occupational health and safety, sustainable land development, water, social and quality policies. The environmental, OHS and quality policies originally approved by Olam CEO in 2011 are being updated in order to better reflect the expanded scope of Olams business operations and Olams commitment to comply with IFC Performance Standards (2012) and applicable WBG General and Sector Specific EHS Guidelines. Draft policies were reviewed during appraisal. Official approval by Olam CEO is scheduled by September 2015. Other approved policies under this Framework include, among others, Business Ethics Policy and Child Labor Policy. Specifically, Olam has adopted two Standards applying respectively to its upstream and midstream operations, namely the Plantations, Concessions, and Farms (PCF) and MATS QEHS Management System Standards. These Standards are periodically reviewed and validated by Olams Executive Committee. Olam also adopted in October 2013 a Supplier Code applying to its primary suppliers over which Olam has management control and/or leverage. Finally, Olam has adopted a palm, forest and rubber sustainability policy applying to its palm oil, forestry and rubber operations, committing to achieve recognized industry standards, including RSPO and FSC certification. These policies have been communicated to all its employees, subsidiaries contractual workers, and primary suppliers, and are available at olamgroup.com/sustainability/. Specific operationally-based QEHS policies have been adopted at the four targeted subsidiaries, as part of the ISO 9001, ISO 14001, OHSAS 18001, and HACCP/ISO 22000/BRC management system preparation and certification process.

Environmental & Social Assessment. In accordance with India and Nigerias Environmental Impact Assessment (EIA) Laws, an EIA Study has been conducted for HIL in 2006 and the environmental clearance was provided by the Maharashtras Ministry of Environmental and Forest (MOEF) and the Pollution Control Board (MPCB) in 2007 and 2010. An EIA study was also conducted for the sesame processing plant in Saghamu in February 2013. These two studies were shared with IFC during appraisal. Proposed mitigation measures recommended in the EIAs Environmental Management Plan (EMP), such as resource efficiency, OHS, and pollution prevention and control measures, have been mainstreamed into technical design, equipment selection and construction/operations management procedures, including contractors OHS Handbook. Environmental risk screening for SVI and CFM did not take place as this is not required as part of the local permitting process. SVI nevertheless commissioned an EHS audit in September 2012 to ensure compliance with local legal and regulatory requirements while defining mitigation measures for inclusion in the CAPEX definition. For any green-or brown-field processing investments, a MATS Steering Committee is systematically established (composed of Country Director, Business Product Leader and MATS specialist) to define and select state-of-the-art facility design processes and equipment. Olams subsidiaries targeted by this investment have all successfully obtained operational licenses and permits from Indian and Nigerian authorities, including water extraction rights from the Governor of Maharashtra, Keralas governmental permits (Department of Factories and Boilers, Pollution Control Board), Lagos Environmental Protection Agency (EPA) and Ports Authorities (Fire certificate), etc. Copies have been provided to IFC. Olam operations maintain a legal and regulatory registry in order to pro-actively and timely ensure permit and license renewal process. Copy of such registry has been sighted at Hemarus sugar mill and SVI in India. In the event where Hemarus proceeds with the construction of its bio-ethanol plant, a Hazard and Operational Study (HAZOP) will be conducted in order to further assess quantitative risk assessment associated with such facility.

EHS Management System and Programs. In accordance with MATS QEHS management system standard, Olam has committed itself to implement an Integrated EHS Management System (IMS) at all its processing operations within three years. The four targeted subsidiaries are at different phase in successfully implementing such standard. Annual QEHS improvement roadmap produced by MATS regional team was provided to IFC for all four subsidiaries during appraisal. Updated corporate QEHS management standards manual of procedures has been shared with IFC during appraisal. This set of procedures encompass four series, namely QEHS management systems (M-series), Environment (E-series), Quality (Q-series) and Occupational Health and Safety (S-series). Based on gap assessment carried out by IFC during appraisal, these manual of procedures covered most of IFC Performance Standards requirements and WBG EHS Guidelines, with the exception of Human Resources, Stakeholder Engagement Plan and Community Grievance Mechanism, and Security Personnel procedures to be added to the M-series, Integrated Pest Management procedure to be added to the E-series, and Life and Fire safety and Vehicle Safety procedures to be added to the S-series. Supply chain risk assessment and managements management procedures also need to be developed and included into the M-series. Integration of the procedures will be done by Olam within the next three months. Specifically, India/HIL has successfully completed ISO 22001 and Halal certification in 2013 and ISO 9001, ISO 14001 and OHSAS 18001 certification in 2015. HIL has also successfully cleared the audits of institutional buyers such as Kraft, Pepsi, Coke, Metro, etc. India/SVI has been developing and implementing a comprehensive set of quality and food safety management systems and programs, including ISO 9001 certification since 2004, Global Standard for Food Safety (BRC) Level A since 2006 encompassing HACCP/Good Manufacturing Practices (GMP), Star K Kosher, Halal and IPQC since 2004. SVI has obtained ISO 17025 (NABL) certification in 2014 for its on-site quality control laboratory. Copies of these certificates were provided to IFC during appraisal. SVI has also successfully cleared the Custom-Trade Partnership against Terrorism audit in 2010; the USFDA audit in 2010; and the EU Directives. Finally, third-party or customer audits are regularly taken place, including Marks and Spencers, Kerry Ingredients, Griffith Labs, Nestle, Wal-Mart, Greencore, Safeway. SVI has not failed a third-party food safety audit or customer audit for the last 6 years. SVI is aiming to complete certification process for ISO 14001 and OHSAS 18001 by June 2016. Nigeria/CFM is in the process of completing BRC certification by June 2015 while aiming to implement its IMS as per MATS standard and manual of procedures by June 2016. The sesame processing plant has been commissioned in March 2014. As per its QEHS improvement road map, this plant is scheduled to reach IMS completion point and obtain BRC certification by June 2016. As finished sesame products are for human consumption by end-customers in the USA, including McDonald and large bakery companies, USFDA certificate will be required.

Samples of voluntary certification, follow-up audits and Corrective Action Plans (CAPs) for all four subsidiaries were provided to IFC during appraisal. Main regulatory or internal/third-party CAPs identified food safety, provision of safe working conditions through workplace risk assessment, use of PPEs and continuous training, establishment and effectiveness of OHS Committees interventions, improved monitoring/reporting of near miss and unsafe acts, hazardous waste management, efficient use of energy and water, effluents treatment and performance of existing on-site WWT plant (applicable only to India/HIL), and emergency preparedness and response plan. IFC found that implementation progress of MATSs QEHS management system at the four subsidiaries is satisfactory based on site visits, Olams corporate and plant-level managerial commitment and assigned technical EHS capacities, and, finally, supporting performance-based OHS and resource efficiency statistics (refer to PS2 and PS3). Strengthened OHS management plans and training programs at all sites still remain a priority action item. Olam will continue, as set forth in the ESAP, the implementation of IMS, including plant-level SOPs, management and training plans for environmental and OHS related issues associated with SVI in India, CFM and sesame plants in Nigeria. Olam have set out in its 2014 CSR a series of corporate "aspirational objectives applying to all its operations. These encompass operational targets for 2015 and 2020 relating to livelihood, water, food security, land, labor, climate change and food safety. These are already under implementation for the four targeted subsidiaries even though no specific plant-level targets have been yet defined.

Organizational structure. In order to ensure effective implementation of its overall OSSF, including PCF and MATS Standards, Olam has strengthened its MATS and CSR teams at corporate and regional levels over the last few years. For its midstream (processing) operations, MATS leadership team is composed of 8 regional senior and experienced professionals who support plant-level EHS managers and monitor effective and progressive implementation of MATSs QEHS management system standard in Olams 135 primary and secondary processing units. This leadership team is supported by a MATS Community of Practices, which include business heads, plant managers, engineers, projects managers and technical experts, and who provide technical support on diverse EHS issues (e.g. wastewater, air emissions, OHS, waste valorization). In India, HIL has established a QEHS team composed of three managers responsible for quality, OHS/life and fire safety, and environmental issues. This team is supported by seven QEHS officers. QEHS managers report directly to the plant manager. In addition, two OHS committees have been established, namely a central safety committee chaired by the plant manager and an operational safety committee involving the 20 departmental heads. An industry relationship manager was recruited for strengthening relationships with employees and third-party sugar cane suppliers. For the other three facilities, overall EHS responsibilities have been assigned to the plant managers, who are supported by production and human resource managers (ref. OHS), engineering (environmental) manager and sustainable sourcing manager (ref. Hemarus/sugar, SVI/red chili and sesame). An EHS Committee exist in all plants, as per local OHS regulations. Roles and responsibilities at all plants are clearly defined in subsidiarys organizational chart while structure effectiveness validated during IFC appraisal through review of the comprehensiveness and implementation progress of QEHS management and training plans and assessment of performance-based KPIs. Olam confirmed the assignment of competent regional MATS coordinator(s), including OHS experts, for the four subsidiaries during appraisal to ensure close monitoring of IMS implementation progress and compliance with applicable legal and regulatory requirements, IFC Performance Standard requirements, WBG EHS Guidelines and voluntary EHS obligations. Overall oversight of E&S Action Plans (ESAPs), agreed upon with Development Financial Institutions (DFIs), including IFC, is assigned to Olams Corporate Treasury, thus demonstrating Olams senior management commitment for their effective implementation. MATS President and CSR Senior Vice-President also provide quarterly update to Olams Board of Directors on MATS and CRS activities, including progress status of agreed upon ESAP with IFC.

Training. Considering the rapid expansion of Olams operational footprint toward midstream and upstream operations, comprehensive training programs have been delivered over the last years, especially on the OSSF, PCF and MATS Standards, including QEHS self-Assessment GAP tool and scorecard. In 2014, Olam launched a special corporate training campaign entitled "Embedding a safety culture in Olam supported by one-day safety leadership training targeting country managers, business heads, plant managers and the dissemination of 30-minute video on OHS risk prevention. The reason this initiative was needed was due to deficient OHS performance at numerous operations, including India/Hemarus where two fatalities took place in November 2013 and August 2014 and in Nigeria/sesame where one fatality took place in January 2015. More than 500 managers have participated in this training so far. Train-the-trainers sessions, targeting 200 employees, were initiated in June 2014. MATS President has also assigned regional OHS teams in Asia, Africa and Latin America to undertake OHS audits at high-risk operations. Detailed training plans were provided to IFC at all four subsidiaries over the last three years. Needs assessment for the preparation of these training plans is aligned with each subsidiarys legal and regulatory EHS requirements, MATS QEHS requirements, management systems requirements, OHS audit findings and performance-based KPI results (especially recordable injury - LTIFR, near miss incidents and unsafe acts). Implementation of these training programs is done through MATS regional team, plant-level EHS manager, and specialized consultancy firms. Examples of internal training provided over the last year include emergency preparedness and response (fire drill), occupational health and safety, hygiene and food safety, use of PPEs, first aid, traceability and certification of primary suppliers, and road safety. Training effectiveness was judged generally satisfactory based on internal/third-party environmental, OHS and food safety audits findings and KPIs results shared with IFC. OHS training for temporary and seasonal workers remains a priority however. This is addressed in the ESAP. Formal safety training is extended to contractors, including compliance with permit system, at all sites.

Emergency Preparedness and Response. Incidents that could potentially result in emergencies have been identified at targeted Olams subsidiaries. A risk identification and assessment process leading to the definition of corrective action plans (CAPs) has been carried out by a third-party consultancy firm at all sites, as part of an independent life and fire safety audit. This process has followed the respective countrys life safety code requirements; potential L&FS incidents include leakage and spillage of fuels and chemicals at all sites, fires at all sites, serious workplace accident at all sites, especially Hemarus, traffic accident, strike, civil unrest and severe weather alerts. All targeted subsidiaries have adopted an Emergency Preparedness Plan. Upon successful implementation of the audits recommendations, fire certificates have also been obtained at all sites. These L&FS audits were provided to IFC during appraisal and valid fire certificates were either received or sighted. All subsidiaries perform monthly (HIL) and/or semiannual fire drills and first aid training session which are duly documented and recorded. During the site visits, installed fire prevention systems, including fire hydrants, hoses and extinguishers, were observed at all subsidiaries. HIL recently upgraded its fire hydrants around its bagasse storage area considering the high flammability risk. Emergency preparedness committees at all sites have been established and are responsible for fire prevention, response and training. Evacuation plans and fire accident meeting points are well defined at all subsidiaries. Employees are made aware of these plans during induction workshop and mock drills. In the event where HIL proceeds with the construction and operation of its bio-ethanol plant, its Emergency Preparedness Plan will need to be updated to reflect HAZOP assessment results, safety requirements for on-site bio-ethanol storage and transport as well as risk explosion which will need to be built into its Safe Working Operating Procedures.

Monitoring and Reporting. For midstream operations, MATS introduced in 2012 standard performance metrics and reporting framework (ref. Olam balanced scorecard across QC4S) using 16 key parameters, including quality, cost, safety (LTIFR and Incident Free Days), Sustainability (carbon, water and energy usage (absolute versus relative per ton of products produced), waste “ biomass produced, staff (retention, training days). The comprehensiveness of these indicators is judged satisfactory to assess the effectiveness of implementation and performance of subsidiaries EHS management system. It also covers indicators identified in WBG EHS general and sector-specific (food and beverage processing, sugar manufacturing) guidelines and IFCs Development Outcomes Tracking System (DOTs) for agro-processing investments. Going forward, as set forth in the ESAP, Olams QC4S will include the monitoring of air emissions, effluents and noise measurements, primary suppliers risk assessment and management, and contractors EHS performance. MATS use these reports to establish Communities of Practices on cross-cutting issues and pro-actively identify resource efficiency projects (e.g. cleaner production, waste valorization). QC4S scorecards have been received for the four plants and demonstrated continuous improvement. Since 2008 Olam has been producing Corporate Responsibility and Sustainability (CRS) Reports. In 2012, Olam started reporting on its E&S performance using the Global Reporting Initiative (GRI) Sustainability Reporting Guidelines (G3.1) and to the Carbon Disclosure Project since 2011. Olam is encouraged to adopt GRI G4 guidelines for reporting on all its processing operations. Olam purchased and started the implementation of a comprehensive monitoring and reporting software (ref. ENABLON) in 2014. This software, which capture all IFCs AMR, E&S DOTS and GHG parameters, among others, will allow to standardize monitoring/reporting format for all Olams business lines; to define corporate and product lines KPIs (allowing benchmarking between similar processing operations and against industry benchmark); to monitor progress status against corporate QEHSs policies, objectives and targets spelt out in annual CSR, and; finally to generate monthly/annual EHS monitoring report. Olam will continue reporting to concerned country/local authorities and IFC, using ENABLON format for the four targeted subsidiaries. IFC was informed during its appraisal that Olam is further consolidating its website, including its sustainability platform. Indian and Nigerians environmental, labor, industry and food safety authorities undertake monitoring of Olams subsidiaries, mostly for operational permit renewal purposes. As indicated above, major customers of Olams finished products also undertake third-party audits against own company and/or industry benchmarks. Based on information provided during appraisal, the four Olam subsidiaries did not incur over the last three years any material regulatory penalties, fines or sanctions for contraventions or non-compliance with statutory obligations. As mentioned above, two fatalities occurred at Hemarus sugar mill in November 2013 and August 2014 while one fatality occurred in sesame plant in January 2015.

Stakeholder Engagement Plan and Community Grievance Mechanism. MATS is reviewing and updating its MATS Master List of Controlled Documents to mainstream all applicable IFC Performance Standards requirements, including the development of Stakeholder Engagement Plan (SEP), when applicable, and Community Grievance Mechanism. The integration of such procedure in the M-series is still a work in progress. Recognizing that some of the targeted Olams subsidiaries are located in industrial zone (CFM, sesame) while others are in isolated rural areas (Hemarus, SVI), there is no need for these operations to develop a Stakeholder Engagement Plan (SEP) as there is no direct operational interface with any community. This being said, considering the induced traffic generated by Hemarus sugar cane sourcing and related third-party harvester/transport companies (more than 420 trucks) operating in rural access roads, it is of utmost importance that such mechanism be developed, formalized and implemented. This requirement will only be rolled-out for sites having potential and direct community interface. This framework and mechanism shall, in accordance with IFCs PS1, include identification of stakeholders, determination of their level of interest and influence in the project (by importance and relevance), establishment of appropriate methods for engaging each group, and identifying strategic and forward looking programs and activities to support and partner with affected communities. The plant-level HR and/or EHS manager should act as community liaison officer (CLO) to manage and respond timely to any community grievances on EHS risks and impacts associated with the companys operations.

As Olam celebrated its 25th year of operations in 2014, it launches four key community engagement initiatives in its Silver Jubilee year, with an initial corpus of US$3 million. These initiatives are: 1) Olam Prize for Innovation in Food Security; 2) Olam Scholarship Program; 3) Olam Foundation, and 4) Building Sustainable Futures Forum. Further information can be obtained at mailto:crs@olamnet.com. Community social programs are also implemented at subsidiaries level, supporting children education, access to water and sanitation and maternal health care.

Human Resource Policy and Management. Olam employs more than 23,000 employees while the four targeted subsidiaries employ almost 1844 permanent and temporary employees. With Olam corporate and targeted subsidiaries expansion plan in India and Nigeria, corporate and subsidiaries employment should expand over the next years. Based on a gap analysis, Olam is required to update its corporate Human Resource Policies and Manual of Procedures in order to incorporate applicable IFC PS2, including the need to make explicit references to the right of employees to freedom of association and collective bargaining agreement, retrenchment provisions, prohibition of child and forced labor among its employees and contractors, development of a contractor management system procedure and verification mechanism to ensure compliance with local labor and OHS laws, workers grievance mechanism for Olam employees and contractors, etc. The review of the corporate Human Resource Policy and Manual of Procedures is presently under review process by Olams HR global function. When completed, as set forth in the ESAP, these procedures will be incorporated into MATSs Master List of QEHS Procedures (M-Series) and implemented (amended) by HR function in India and Nigeria to ensure inclusion of national labor laws requirements, translation in local languages and effective and timely rolled out in all targeted Olams subsidiaries. Main provisions of these updated Policies will encompass the general rules of recruitment, working conditions and terms of employment, freedom of association and collective bargaining agreement, non-discrimination, equal opportunity, workers grievance mechanism, prohibition of child / forced labor, protection of contractors worker. HRs SOPs will outline the following provisions, among others: term of employment and recruitment, values of diversity and dignity at work, hours of work, overtime arrangements, wages, including deductions, benefits and pensions, sickness pay provision, leave arrangements (annual, maternity), freedom of association, occupational health and safety, training and professional development, and separation/retirement. The scope of these policies and procedures is/will be applicable to all permanent employees with indefinite term of contract. An HR handbook is given to all employees during the induction period. Such handbook has been sighted at Hemarus sugar mill and SVIs spice processing plant (dated May 2013). The intent is to extend the application of these policies requirements to casual and contractual workers. Minimum age of employment is 18 years old in Olam operations. Inspection by the Indian and Nigerian labor services takes place annually. Human Resources management in every Olams subsidiaries is under the leadership of an HR manager and a team of HR officers.

Salary grids associated with job grades in Olams subsidiaries were discussed during appraisal. Monthly minimum salary for low skill employees is in compliance with minimal salary defined by state and/or local labor authorities. Annual salary increase is offered to labor based on bi-annual team and individual performance review. A standard work week is 48 hours spread over 6 days considering seasonality of the production. Changing rooms, toilets and shower facilities are available for workers at all sites, and respect gender sensitivities. Canteen is provided at Hemarus and SVI in India as well as in the sesame plant in Nigeria. Due diligence of food service provider is also carried out.

Grievance Mechanism. Olam and its subsidiaries are seeking to establish a strong and consensual social dialogue with its workers to ensure harmonious and productive working conditions and performance. Grievances from workers are channeled through staff delegates or workers organizations at each plant; this provision is codified in India and Nigerias Employee HR Policy Manual but not operationalized through a management procedure. Going forward, as set forth in the ESAP, Olam corporate HR function will formalize a structured grievance mechanism procedure, in accordance with PS2 requirements, including steps to be taken for workers to manifest any concern, engage in a mediation process, contact responsible persons in each facility, and provide timely feedback. Employees awareness raising on such procedure will take place during the induction session. This mechanism will be accessible to permanent and temporary employees, contractors and service providers workers. Complainants may remain anonymous and analysis of systemic issues are documented and addressed, as needed.

Workers organizations. In accordance with its HR corporate policies presently under review, Olam and all its subsidiaries will explicitly support the freedom of association of its workers and workers seeking collective bargaining arrangements. Two unions represent SVIs workers (ref. CITU and BMS) while a worker association exists in Hemarus but is not affiliated. CFM and the sesame plant in Nigeria have their respective workers organization, which representatives are elected by staff. A three-year Collective Bargaining Agreement has been reached in SVI, starting in October 2013. Minutes of monthly meeting between plants senior management and workers association have been sighted in Hemarus and CFM. Main issues discussed relates to salary increase, working conditions, and benefits. There is no history of recent labor strikes among these targeted Olams subsidiaries.

Life and Fire Safety. Olam subsidiaries have been inspected by an external Life and Fire Safety auditor and Corrective Action Plans (CAPs) implemented. The facilities OHS Committee was accountable for the timely implementation of these CAPs. Olam subsidiaries have successfully implemented these CAPs and complied with Indian/Nigerian fire prevention standard. Fire certificates delivered by local authorities have been sighed at all subsidiaries during IFC appraisal.

Occupational Health and Safety. Olam made a strong commitment to ensure safe working conditions of all its workers through adopting a corporate OHS policy in 2011, translating this set of principles into comprehensive OHS manual of procedures found in MATS Master List and in delivering OHS management and training plans. This corporate OHS policy is in the processing of being updated as mentioned under PS1. MATS and external/third-party service providers have also undertaken OHS audits, against local OHS laws and regulations, OHSAS 18001 standard, and IFC PS2 requirements. As Olam has been rapidly expanding its midstream and upstream operations, Olam launched a special corporate training campaign entitled "Embedding a safety culture in Olam in 2014 to raise the critical importance of safe working conditions for its permanent and temporary workers and contractors. Six key OHS imperatives have been promoted, namely lock out and tag out (LOTO), permit to work in hazardous areas, reporting and recording unsafe acts, near misses, accidents and systematic OHS performance review by plants senior management and business line leaders, semiannual OHS system audit, workplace inspections, and driving safety rules. These are found in QEHSs Manual of Procedures (M-series). These are pro-actively implemented at all plants and progress status reported monthly to MATS team. Warehouse guidelines, based on fatality investigation report in Indonesia and India, have also been developed and implemented at all Olams warehouses. Finally, Olam launched a pilot project in Asia (including the two targeted Indian facilities) where plants OHS system effectiveness are assessed against a scoring system, using OHSAS 18000 elements as reference document. Olam is conducting one second-party OHS audit each year for two consecutive years to ensure continued compliance. Once two consecutive years with high compliance score has been achieved, 2nd party audit will be reduced to every two years. Each site will also be required to conduct two internal audits by a senior person on site. HIL has successfully obtained OHSAS 18001 in 2015 while SVI is committed to achieve it by June 2016. CFM and sesame are not aiming for OHSAS 18001 certification per se but are committed to achieve MATS Standard and related IMS completion point by June 2016. Improved safe working conditions, provision of PPEs, annual OHS training, on-site clinic for first aid assistance and ambulatory transport (Hemarus only) have been sighted at all sites. An OHS Committee exists in all facilities. Effectiveness of these efforts has been assessed through improved documentation of annual OHS statistics (Loss Time Injury Frequency Rate and Injury Severity Rate) which are now rigorously and systematically monitored and benchmarked against Indian and Nigerian-based industry benchmarks. The CAPs (e.g. meeting legal and regulatory requirements, establishment and effectiveness of the OHS Committee, workplace risk assessment, warehousing practices, working at height, electrical safety, permit system for contractors, traffic management, etc.) are still under implementation at the sesame plant. All Indian and Nigeria subsidiaries were within sub-sector OHS LTIFR benchmarks for the last trimester of 2014 (U.S. data, 2010). As the sesame plant has been commissioned in March 2014, provision of documented LTIFR statistic is pending. Ear plugs have been observed for operators in machine rooms at HIL, SIV and CFM. Going forward, HIL, SVI, CFM and sesame plant will provide to IFC annual consolidated OHS report, demonstrating full compliance with Indian and Nigerians legal and regulatory requirements, including implementation of CAPs satisfying OHS management system requirements at all sites (should be available in Hindi and English), as defined under PS1, and effectiveness of OHS system performance against industry-based US benchmarks (sugar milling: 7.0; food processing: 6.5; grain milling: 6.0).

Workers engaged by third-parties. Due to the seasonality of agricultural activities, Olams operations can involve significant number of directly contracted and sub-contracted workers (e.g. security personnel, loading laborers at sugar mill, canteen workers). For the four targeted operations, more than 800 employees are recruited during high season with a turnover of more than 40% from season to season. This represents a significant challenge for Olam in ensuring appropriate temporary and third-party workers OHS training. For example, SVI recruits 80-90 contractual workers on a monthly basis through HR service providers. SVI undertakes due diligence before establishing a contractual arrangement with a contractor / service provider, including registration with Ministry of Labor, as well as complying with local labor and OHS provisions, namely payment of workers legal benefits, timely payment of wages, OHS training and provisions of PPEs, ILO Convention 138 on minimum age. This provision is specifically of importance for the recruitment of third-party sugar cane harvesting and transport companies by HIL (420 trucks and 8,400 workers). Due diligence procedure for contractors OHS practices are included into corporate QEHS management standards manual of procedures (S-series) and such contractual provision have been sighted at Hemarus, SVI, CFM and sesame plants.

Supply Chain Risk Assessment and Management. As indicated above, Olam has adopted in 2013 a corporate Supplier Code. This code applies to primary suppliers over which Olam has a management control or leverage through long-term contractual or financial agreements. Strategic implementation of this code started in 2013-14 and encompassed the following steps: (i) initial screening of all agro-commodities sourced by Olam against IFCs Performance Standard related supply chain requirements (harmful child/forced labor, significant OHS risks leading to life-threatening situations and conversion of natural/critical habitats leading to biodiversity loss) to identify E&S risk factors and potential risk mitigation strategies. Olam used IFCs Global Map for risk assessment and management of Agro-Commodities Production (GMAP, available at http://www.ifc.org/GMAP) for this screening process; (ii) for identified "high risk commodities, further investigation of country-sector risks in supply origins. Olam followed the risk management methodology outlined in IFCs Good Practice Handbook on assessing and managing E&S risks in Agro-Commodity Supply Chain for this screening process; (iii) establishment of supplier database and supplier due diligence using tailored E&S questionnaire and supporting evidence of suppliers compliance with risk outlined in Olams Code; (iv) final risk assessment of suppliers and agreement on increasing sustainable sourcing strategies over time; (v) legal representation of supplier through signing Olams Supplier Code. Olam has started to roll-out its Code with critical commodities such as palm oil and rubber in Indonesia and Malaysia, cocoa from Ivory Coast and hazelnut from Turkey. Third-party audits have also been conducted by Fair Labor Association (FLA) of Olams cocoa and hazelnut suppliers in Ivory Coast and Turkey. These reports are available at http://www.fairlabor.org/affiliate/olam. Olam also commissioned, at the request of end-customers, third-party audits of its 30 on-going Olam Livelihood Charter (OLC) initiatives, including cocoa cooperatives in Ivory Coast. Based on lessons learned from this preliminary roll-out, Olam will expand its supply chain risk assessment and management to high volume supply chain, such as sugar in Indonesia, India, Brazil; rice in Thailand, Vietnam, India, Myanmar; cotton in Tajikistan, Turkmenistan, Brazil, Nigeria, India, Zambia, Zimbabwe, Mozambique, Tanzania; coffee in Brazil, Vietnam, Indonesia, Colombia, Peru; and cocoa in Nigeria, Ghana, Indonesia, Cameroon. Olam is committed to develop sustainable sourcing strategies for all its "high-risk commodities by 2018, as outlined in its 2014 CRS report.

As it relates to this specific investment, based on Olam subsidiaries sourcing operations, three out of the four targeted operations trigger PS related supply chain risks, namely sugar cane and spice (red chili) in India and sesame in Nigeria. Using the IFCs GMAP, these three countries-commodities combinations are associated with medium/high risks of harmful child / forced labor. Sugar cane is identified as high risk for child labor by the United States Department of Labor “ List of Goods produced by child labor and forced labor. Nigeria/CFM is purchasing wheat from Bunge, Cargill and ADM. There is no supply chain issues as these major agro-commodities traders sourced wheat from North America and Eastern Europe (Ukraine), where primary production is located in consolidated agricultural areas and where harvesting is done through a mechanical process.

To manage supply chain risk associated with sugar cane, spice (red chili) and sesame, aside from ensuring that respective sourcing teams be trained on the effective implementation of Olams corporate child labor policy, Olams Supplier Code and Olams Livelihood Charters (OLC) principles, including prohibition of child /forced labor in primary suppliers, Olam has also taken a number of mitigation measures, namely: for India/HIL, HILs sourcing team has established a supplier database for the 12,500 smallholders cultivating on average 2-3ha, including farmer name, coordinates, acres planted, yield, cane variety, access road, irrigation system used, and bank details (payments are directly transferred into smallholders bank account). In partnership with IFC, Solidaridad and HUF, HIL launched a three-year sustainable sugar cane cultivation initiative in 2012 to strengthen smallholders technical capacity building, soil sampling and soil health (fertility) recommendations, improve fertilizer and water use efficiency, ratoon management, yield improvement, extension agronomic services, demonstration plots, and field visits have been provided. Results achieved so far include an outreach to the 12,500 smallholders; sustainable sugarcane cultivation on 12,500ha; productivity improvement of 15%; water saving of 20%; no incidence of harmful child/forced labor and increased gender participation; development of training material: farmer flipchart, e-learning modules, sugarcane package of practices booklet, training videos. Future projects include development of irrigation infrastructure development, using drip irrigation, land leveling, soil fertilizer mapping, fertilizer recommendations and availability, in partnership with local government authorities under a PPP scheme. HIL is committed to support the traceability and certification of its sugar cane suppliers against Bonsucro or Olam Supplier Code; for India/SVI, Olam launched an OLC targeting the 900 primary suppliers of red chili. Full traceability system has been completed and achievements after one-year implementation include the training in Good Agricultural Practices (GAP) improving average yields by 10% within the first year; six farmer schools established; farmer training based on Rainforest Alliance (RFA) Sustainable Agricultural Standards for farmer certification, and US$113,197 paid in premiums. Finally, in relation for Nigeria/sesame seed sourcing, Olam launched an OLC initiative reaching 2,000 farmers, including women farmers (38%) which has resulted in a 400% increase in primary suppliers reached and 300% area increase, establishment of ten farmer field schools, and US$ 112,500 premium paid to farmers. Bonsucro and RFA principles and criteria include specific requirements to prohibit harmful child and/or forced labor practices among primary suppliers. Going forward, as set forth in the ESAP, Olam will undertake an internal/external audit of its supply chain for its sugar cane, red chili and sesame primary suppliers against its Supplier Code and/or voluntary standards. If deficiencies are identified, Olam will take necessary remediation measures (e.g. training on PS related supply chain requirements or proceeding with certification its primary suppliers against a voluntary standard). Olam will also roll-out its Enablon monitoring system to these three targeted supply chains within a three year period.

Energy use and greenhouse gas emissions. Provision of electricity to Olam’s subsidiaries in India and Nigeria is provided by local distribution grid. In addition, back-up generators are found at every processing unit in case of power outage. The boiler at different processing plants runs on diesel/furnace oil (e.g. SVI) or natural gas (e.g. CFM, sesame). Energy consumption is being closely monitored at all sites, and data on electricity and diesel/gas consumption were available during appraisal. All Olam’s subsidiaries aim to reduce their operational cost and energy efficiency audits have been conducted at all sites or best available technology selected (e.g. sesame). As an example, based on energy consumption data received from Hemarus (sugar cane milling), energy consumption per ton of raw material is within WBG EHS sector guidelines for sugar manufacturing. HIL is generating its own energy from an on-site 20MW co-generation power plant, using, to the extent possible, own and third-party mill’s bagasse. Use of coal (less than 5%) is only needed at the start of the sugar cane season when insufficient bagasse is available as feedstock. More than 65% of energy produced from the plant during the sugar cane harvesting season (October-April) is sold to local grid while this increases to 95% during the down season. HIL also implemented energy saving measures including low power consumer two roller milling evaporator, variable frequency for pumps and conveyors, heat recovery system, installation of falling film evaporator, direct contact heater for juice heating, continuous sugar crystallizer. HIL is considered one of the most efficient sugar mill plant in India. Energy savings at SVI include adoption of LED bulbs, using natural light to the extent possible and closely monitoring use of water pump. The sesame plant will further assess the possibility of using sesame hulls for use as feedstock for its boiler. In order to optimize its energy efficiency, all Olam subsidiaries are pro-actively ensuring a preventive maintenance of all energy-related equipment, operator training, improvement of the operating conditions and optimizing production planning schedule. None of the subsidiaries own its own fleet of trucks, which are all third-party contracted.



Air emissions monitoring. Main source of air emissions are the gensets at all sites and boilers at the processing plants. Gensets are only used for emergency basis as power outage seldom happens. IFC was informed that gensets are being used for less than 500 hours/year at all sites. Boilers and gensets undergo semiannual maintenance inspection to optimize efficiency. All subsidiaries monitored boiler air emissions as per Indian and Nigerian regulations. Data provided for Hemarus (only parameter required to be monitored is particulate matter as per Maharashtra’s Pollution Control Board license), SVI, CFM and sesame plant confirm that stack air emissions from boilers are in compliance with local regulations
and WBG EHS guidelines for point source emissions to air.



Water use and efficiency. Water is either sourced from surface water (HIL) and on-site underground wells (e.g. SVI, CFM and sesame). Authorized water abstraction permit from Tambraparni River (to a maximum of 2260 m3/day) has been obtained by Hemarus from the Indian Ministry of Environment and Forest. To date, Hemarus daily consumption has been less than 1165m3/day on average. Based on a rapid water balance assessment, this volume represent less 0.0188% of the Tagarathi dam located 6 km upstream. Total water consumption is monitored at all sites through installment of water meters. Raw water is treated at HIL using clarification process, pre-sand bed filter, ultra-filtration, reverse osmosis, electro-deionization and finally on-line chlorination system. For other sites, raw water is softened and disinfected (chlorine treatment) before it is used at processing units. Water used for cleaning and fire prevention comes from wells or rainwater harvesting system (SVI) and does not undergo any treatment. Based on water consumption data received from Hemarus, water consumption per ton of raw material is slightly above the range suggested by WBG EHS Guidelines for sugar manufacturing (1.0 m3/ton of cane versus 0.5-0.9 m3/ton). Based on KPIs shared by all subsidiaries (QC4S), improved water use efficiency has been achieved at all sites during the last three years through the adoption of water saving practices. Such measures have included adoption of high pressure water cleaning system, water efficiency awareness training to staffs, review of water efficiency procedure and cleaning manuals, and improved water quality to reduce boiler blow down and re-use of condensate.



Wastewater Treatment. All Olam’s subsidiaries targeted by this corporate loan (e.g. Hemarus and sesame) have established on-site and industrial-based wastewater treatment plant. SVI and CFM does not require such investment as it only carry out dry processing (e.g. flour mill). Based on effluents measurements provided to IFC during appraisal for the last three months, all parameters met the Indian (Maharashtra and Kerala’s Pollution Control Board) and Nigerian guideline values for pH, BOD, COD, total nitrogen, total suspended solids (TSS). These parameters also met all WBG effluents limits. None of the effluents are released to surface waters as Hemarus’s treated effluents are used for green belt irrigation on-site as well as being pumped to farmers’ field in surrounding areas (ref. ferti-irrigation system). Treated effluents to sugar cane smallholders has resulted in increased yield of up to 15-18%. SVI has recently installed an on-site 60m3/day sewage treatment plant for sanitary water treatment. Effluents test reports for the period of September 2014 to March 2015 confirms compliance with Kerala’s PCB and WBG effluents limits. Treated effluents are also used for on-site irrigation. Same analysis and results applies to the se
same plant. Sanitary effluents at CFM are collected by a licensed service provider and disposed into a municipal WWT plant in Lagos.



Management of solid and hazardous wastes. Wastes from Hemarus, SVI, CFM and sesame processing are characterized by organic waste (bagasse, filter cake, molasses, hulls), solid waste (cardboard, nylon, packaging, metal, plastic, etc.), sludge from WWT plants, boiler’s ashes (HIL), and hazardous waste (light bulbs, used oil and clothes, oil tanks, chemical containers, batteries, ashes from coal use at HIL’s oilers, etc.). Organic wastes (bagasse) are used as feedstock for the co-gen plant, filter cake used as fertilizers by smallholders, molasses being sold to third-party distillery for bio-ethanol production, boiler’s coal ashes sold to brick and cement manufacturers, WWT plant’s sludge used as soil conditioner by smallholders while all others wastes are collected and disposed by authorized service providers. Due diligence of providers is done by Olam’ subsidiaries as per procedures outlined in S-series. Appropriate secondary containment structures consisting of walls capable of containing more than 110 percent of the tank volume (diesel) were been observed at all sites.



Pest Management and Control. Procedures under ISO22000 address pest management and control; as previously mentioned, most Olam’ subsidiaries have completed ISO 22000 certification. At all sites, licensed service providers are recruited to conduct rodent control. This activity includes inspection and maintenance.

Community Health and Safety. As indicated under PS1 review, Olam’s subsidiaries are located in industrial parks (CFM, sesame) while HIL and SVI are isolated in agricultural areas with a buffer zone of 500 meters. As such, adverse impacts to surrounding communities are relatively remote, aside from induced increase in road transport, especially at HIL during sugar cane harvesting season. All Olam drivers and transport sub-contractors undergo driver training as part Olam’s Safe Driver and Transport Safety Vehicle procedure, which is in the process of being developed and included into MATS’s Master List of controlled documents (S-series). Forklift driver certificates, transport safety procedure and training plan were available during appraisal.



Security Personnel. All four of Olam’ subsidiaries contract licensed service providers for security purposes. These sub-contractors benefit of the same training as subsidiary employees as it relates to life and fire safety, including active involvement in the annual fire drills, emergency preparedness and response, and first aid. The contracted security officers are not armed and are trained for defensive measures. Aside from CFM located in Lagos, there is no significant level of security issues where Olam’s subsidiaries are located. Two twelve hours shifts have been adopted at CFM to ensure that workers can leave in daylight. All production site visited during the appraisal were surrounded by a 3 meters high fence. A logbook for visitors is also kept at the entrance gate.

The ESRS and the attached ESAP will be made available via the World Bank Group’s Info Shop. Olam will also be requested to place an advertisement on its website (http://www.olamgroup.com) to inform the public from IFC’s E&S review (ESRS) findings.

Name and Address.
Mr. Jayant S. Parande
Senior Vice President and Group Treasurer
9 Temasek Boulevard, #11-02 Suntec Tower Two
Singapore 038989
Tel: +65 6339 4100
Fax : +65 6339 9217
Email : mailto:jayant@olamnet.com
Website: http://www.olamgroup.org

Mr. Chris Brett
Senior Vice President
Head of Corporate Responsibility and Sustainability (CRS)
Olam International (UK) Limited
New Zealand House, 80 Haymarket, London, SW1Y 4TQ, UK
Tel : +44 207 389 6475
Email : mailto:chris.brett@olamnet.com
Website : mailto:crs@olamnet.com

Mr. Stephen J. Driver
President & Global Head of Manufacturing, Innnovation and Technical Services (MATS)
Olam International Limited
New Zealand House, 80 Haymarket, London SW1Y 4TQ, UK
Tel : +44 207 389 6464
Email : mailto:stephen.driver@olamnet.com
Website : http://www.olamgroup.com/sustainability

Broad Community Support is not applicable for this project

Title	Anticipated completion Date
QEHS Management System. In accordance with IFC’s Performance Standard 1 framework and requirements, Olam and its four targeted subsidiaries will update and finalize the implementation of an Integrated Environmental, Occupational Health and Safety and Social Management System. This QEHS will be consistent with ISO 9001, ISO 14001, OHSAS 18001, HACCP/ ISO 22001.	11/30/2015
QEHS Management System. In accordance with IFC’s Performance Standard 1 framework and requirements, Olam and its four targeted subsidiaries will update and finalize the implementation of an Integrated Environmental, Occupational Health and Safety and Social Management System. This QEHS will be consistent with ISO 9001, ISO 14001, OHSAS 18001, HACCP/ ISO 22001.	11/30/2015
QEHS Management System. In accordance with IFC’s Performance Standard 1 framework and requirements, Olam and its four targeted subsidiaries will update and finalize the implementation of an Integrated Environmental, Occupational Health and Safety and Social Management System. This QEHS will be consistent with ISO 9001, ISO 14001, OHSAS 18001, HACCP/ ISO 22001.	06/30/2016
Human Resources Policy. Olam will review and update its corporate and country (India and Nigeria)-based Human Resource Policy and labor contracting specifications, including contracted workers, in compliance with national labor laws and regulations and IFC’s Performance Standard 2 requirements. Specifically, this policy will have explicit references to the right of its employees to freedom of association and collective bargaining, retrenchment provisions, prohibition of child and forced labor among its employees and contractors, contractor management system procedure and verification mechanism to ensure compliance with local labor laws, grievance mechanism for employee and contractors, etc.	11/30/2015
Human Resources Policy. Olam will review and update its corporate and country (India and Nigeria)-based Human Resource Policy and labor contracting specifications, including contracted workers, in compliance with national labor laws and regulations and IFC’s Performance Standard 2 requirements. Specifically, this policy will have explicit references to the right of its employees to freedom of association and collective bargaining, retrenchment provisions, prohibition of child and forced labor among its employees and contractors, contractor management system procedure and verification mechanism to ensure compliance with local labor laws, grievance mechanism for employee and contractors, etc.	09/30/2016
Occupational Health and Safety. Olam will provide, on a yearly basis, the comprehensive OHS training to be delivered to its temporary and seasonal workers at Hemarus, SVI and sesame plant.	10/31/2015
Supply Chain Risk Assessment and Management Procedure. Olam and its applicable subsidiaries will adopt a management system’s supply chain risk assessment and management procedure as part of its overall ESMS to assess and manage PS related supply chain risks associated with sugar cane, spice (red chili) and sesame sourcing.	10/31/2015
Supply Chain Risk Assessment and Management Procedure. Olam and its applicable subsidiaries will adopt a management system’s supply chain risk assessment and management procedure as part of its overall ESMS to assess and manage PS related supply chain risks associated with sugar cane, spice (red chili) and sesame sourcing.	08/31/2016
Supply Chain Risk Assessment and Management Procedure. Olam and its applicable subsidiaries will adopt a management system’s supply chain risk assessment and management procedure as part of its overall ESMS to assess and manage PS related supply chain risks associated with sugar cane, spice (red chili) and sesame sourcing.	09/30/2018