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 E&S risks and issues associated with this project include: development and implementation of E&S management systems at the proposed hotel; 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 during construction and operation; adequate pollution prevention measures; life and fire safety management for proposed hotel in accordance with World Bank Group (WBG) EHS guidelines; resource efficiency and impacts of construction and transport on nearby communities.

Land for the hotel was earlier being used as a parking lot. It has been purchased by NHGPL in 2012 through willing buyer-seller transaction and no person or economic activity was displaced as a result of this transaction and therefore Performance Standard (PS) 5 (Land Acquisition and Involuntary Resettlement) is not applicable. The proposed hotel is located in an urban area and the type of risks and impacts envisaged in PS6 (Biodiversity Conservation and Sustainable Natural Resource Management), PS7 (Indigenous Peoples) and PS8 (Cultural Heritage) do not seem to apply.

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 Impact Assessment (ESIA): Initially the hotel was proposed to have 99 rooms and as per applicable legal requirements, the company completed an Initial Environmental Examination (IEE) which was approved by the Ministry of Culture, Tourism and Civil Aviation. However, subsequent to start of construction, the hotel design was changed to have 110 rooms. Therefore, the company has initiated an environment impact assessment (EIA). The terms of reference (ToR) for the EIA have been submitted to Ministry of Science, Technology and Environment. The company will construct the additional rooms (11 nos.) only after receiving the approval of the ministry. Based on the EIA and approval of the ministry, the company will implement all required mitigation and monitoring measures. The company will also obtain permits from other authorities, as required before operation of the hotel.



Policy, Management Systems and Programs: Currently NHGPL does not have any E&S policy or management systems. However, to meet the requirements of PS1, as per the ESAP, the company will develop an EHS/Sustainability policy. The policy will include company’s E&S objectives, articulate company’s commitment to comply with the applicable laws and regulations as well as compliance with IFC Performance Standards.



The hotel will be designed and operated in compliance with Marriott’s environmental principles, human rights, global employment and supply chain principles which are consistent with IFC PSs requirements. Marriott’s procedures and programs under the above mentioned principles are therefore expected to ensure development and operation of the hotel with respect to applicable legal requirements and IFC PSs.



Organization: NHGPL has a project team which is responsible for management of construction activities and monitoring of construction contractors. During operation stage, hotel operations will be monitored by Marriott’s team in full compliance with Marriott’s highly regarded social and environmental requirements.



Monitoring and Reporting: Typically, the E&S performance of the hotel is monitored and reported by Marriott to assess progress against its E&S commitments. The results are incorporated in its annual sustainability report. In addition, as per the ESAP, the company will develop an EHS monitoring procedure which will specify minimum KPIs/parameters to be monitored, monitoring frequencies and type and the definition of thresholds that signal the need for corrective actions. The EHS monitoring procedure shall be aligned with the requirements of the approved EIA, applicable legal requirements and World Bank Group (WBG) EHS guidelines. The monitoring results will be reported to IFC as part of the Annual Monitoring Report (AMR).



Emergency Preparedness and Response: The L&FS systems of the hotel are discussed under PS4. Marriott has requirements to document crisis management/emergency response plans for the hotel and training of the hotel staf
f on these plans and thus will be ensured during operation of the hotel.

When operational, the hotel will employ 70 to 80 employees. As the hotel will be operated by Marriott, the employees will be covered under Marriott’s HR policies and procedures. As per public data available, Marriott has adopted Global Employment Policies, which align with its Statement on Human Rights, which acknowledges and respects the principles contained in the United Nations Universal Declaration of Human Rights. The policies therefore cover compliance with applicable laws, prevention of child labor, elimination of forced and bonded labor, non-discrimination, freedom of association, legal compliance and providing a safe and healthy work environment. Therefore, HR policies at the hotel are expected to meet the PS2 requirements.



Specifically on Freedom of Association, typically in Nepal, workers in hotels are part of one of the registered unions [e.g. Nepal Independent Hotel, Casino and Restaurant Workers Union, All Nepal Revolutionary Hotel and Restaurant Workers Union]. The union then negotiates and signs a collective bargaining agreement. Similar practice is expected to be followed at the hotel, once it is operational.



Third Party Workers: The hotel is expected to hire third party service providers mainly for housekeeping and security. Marriott has publicly disclosed its Supplier Conduct Principles. As per these principles, Marriott expects and encourages its suppliers (among other requirements) to comply with applicable legal requirements, providing inclusive environment, supporting elimination of forced and bonded labor as well as child labor and operate in an environmentally sustainable manner. Therefore, during operation, the third party workforce management to be in line with PS2 requirements.



Occupational Health and Safety (OHS): NHGPL has its own project team which responsible for management of various contractors on-site. The company has included basic safety requirements in the agreement signed with existing contractor (mainly civil work till appraisal). During the appraisal, the safety practices were noted to have a significant scope of improvement in the areas of use of personal protective equipment (PPE) and work at height. Currently the monitoring of EHS performance on-site by the company is not documented and is mainly informal. Also, on-site facilities of drinking water and rest area for workers were noted to have scope for improvement. Considering that the number of contractors will increase as the construction progresses, as per the ESAP and as a priority, the company will develop a documented EHS manual for construction activities as well as a monitoring procedure and check-list to ensure contractors’ compliance with EHS requirements and legal requirements on working conditions, labor camp facilities, and labor law. The procedures will include monitoring and documentation of EHS performance on-site by the company.

Resource Efficiency: As per Marriott requirements, the hotel is expected to obtain LEED Silver certificate. Therefore, the hotel has been designed with the following key resource efficiency features.



On water and wastewater management: efficient dual flush water closets (3 liter/6 liter) in both guest rooms as well as in public wash rooms; urinals with sensors and auto shut-off/aerators in taps in the public wash rooms; and aerators for taps in guest rooms. The dishwashers used in the kitchen will be water efficient with waste air heat recovery system and an auxiliary rinse zone and pre-rinse valve for rinsing operation. In the laundry machine, water efficient front loading machine and ozone laundry system will be used. The hotel will have a rainwater harvesting system and reuse treated wastewater from grey water treatment plant and STP for flushing, gardening and laundry.



On heating and ventilation: Central air conditioning systems with chillers will be used.



On lighting: Guest rooms, restaurants, corridors, outdoors and toilets will be provided with LED lighting. Back-of the house areas will have T5 fluorescent lighting. The lights in the corridors will be controlled with time controls/movement sensors and will switch off every second light. The bathrooms will have occupancy sensors for controlling lighting.



On Materials: The hotel will use low E double glazed glass panels and heat insulation for building exteriors and roof.



The wall to glass ratio for the hotel will be about 27% of the wall area.



Additionally the hotel will have an integrated building management system (BMS) for monitoring various key parameters of electrical, plumbing, air conditioning, and fire fighting systems. On an average, the hotel is expected to have an electricity consumption of about 1,752,000 kWh per year.



During the operation stage, the hotel will monitor key parameters on energy and water efficiency as mandated by the Marriott’s requirements. It was noted (though public data) that Marriott has a sustainability program which include goals on energy and water efficiency – 20% reduction in energy (in kwh/conditioned/m2) and water consumption (in m3 per occupied room) by 2020 over the baseline of 2007. The Company will also monitor and compile data on energy and water consumption as part of the monitoring framework discussed under PS1.



Water and energy supply: Water for the hotel will be sourced on-site borewell. The raw water will be further treated and the treated water quality will be monitored to confirm that it meets the national potable water quality and Marriott standards for various uses.



The electricity will be sourced from the grid. However, considering the power situation in Kathmandu, two diesel generators (DG) (of 500 KVA capacity each) will be provided as back-up for the grid power cuts and are expected to run for 12 hours a day on an average. The diesel generators will be provided with acoustic enclosure and stack of ade
quate height.



Pollution Prevention: The hotel will have a sewage treatment plant (STP) on-site to ensure treatment of the wastewater as per local standards. As mentioned above, the treated wastewater will be used for toilet flushing and gardening and remaining will be discharged in the municipal sewerage system.



As regards waste management, the hotel will manage waste in compliance with the applicable legal requirements. The non-recyclable waste will be disposed of at the landfill site of the Kathmandu Metropolitan city. The other recyclable solid waste (paper waste, packaging materials, plastics etc.) will be sorted and sold to local agencies that in turn recycle these waste. Food waste will be disposed of either through municipal waste disposal system or provided as animal feed to local pig farms. Used oil (from the back-up diesel generator maintenance) and batteries will be disposed of through authorized recyclers.



Emissions are primarily from backup diesel generators (DG) as kitchens (wherever provided) will use LPG as fuel. The DG set emissions (and treated effluent quality) will be monitored and managed in accordance with environmental permit conditions and as part of the monitoring framework discussed under PS1.



GHG emissions: Based on the available information on fuel and electricity consumption, the GHG emissions for the Project are estimated to be 1,400 tonnes CO2 equivalent/year.

Regarding Life and Fire Safety (L&FS), the hotel’s systems are designed with respect to Nepal building code (NBC) requirements and Marriott’s Fire Protection and Life Safety Design standards which are based on Unites States’ National Fire Protection Association (NFPA) standards. Like all international operators, Marriott’s L&FS team reviews the designs of the hotels with respect to these standards as well as verifies their implementation on-site before initiating operation of these hotels. Therefore, the hotel’s L&FS systems are expected to meet the WBG EHS guideline requirements of compliance with an internationally accepted L&FS code (NFPA in this case). The company will keep required documentation confirming this review by Marriott at design and post-construction stages for the hotel.



The hotel’s kitchens will be operated to meet international food safety standards e.g. Hazard Analysis and Critical Control Point (HACCP) as it is typically mandated by the Marriott requirements. Potable water for all domestic needs such as drinking, food preparation and personal hygiene (washing or bathing) will be supplied through onsite water treatment plant which will treat the raw water to meet the local potable water quality standards as well as operator requirements. Domestic hot water will be maintained at sufficiently high temperature to prevent growth of legionella bacteria, and the hotel operation team will test to confirm the effectiveness.



The hotel will have 20 parking spaces and the parking is expected to be adequate. However, the access to the hotel is through a narrow street and to ensure there are no impacts on the neighboring community due to traffic, as per the ESAP, the company will be required to develop and implement a traffic management plan for both remaining part of the construction phase and operation phase of the hotel.



During the operation of the hotel, unarmed private security guard will be hired through external agency.

As per the applicable legal requirements, as part of the scoping process for the EIA for additional rooms, NHGPL had published a notice in the local newspaper inviting suggestions from public on scope of this EIA within a period of 15 days. Copies of the public notice were placed in the nearby public institutions for seeking public opinions. No material suggestions/comments were received based on the process. Going forward, once the EIA is completed and prior to approval, the relevant Ministry will conduct a public hearing where public can provide their comments, suggestions and raise any grievances. Further, as per the ESAP, NHGPL will develop a community engagement and grievance mechanism including a process to engage with the neighboring communities, receiving and responding to their grievances.

As part of the corporate social responsibility (CSR) activities, the Director of the company is involved in running a charity school and teaching in the same. The company has also maintained the public sewer in vicinity of the project site, rehabilitated cows from the roads to designated cow shed and upgradation of cremation grounds. Additionally, typically as part of the sustainability programs, Marriott will also design and undertake community outreach and CSR activities around the hotel (financed by the hotel budget provided by NHG).

NHGPL will disclose this ESRS and ESAP at the following address.

Tridevi Marg
Kathmandu Metropolitian City – 29
Thamel, Kathmandu
Nepal.
Tel: +977 1 4417925, 4417927

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

Mr. Suvanwait Gurung
Nepal Hospitality Group Private Limited
3rd Floor, Sunrise Business Park Building
Dilli Bazar, Kathmandu
Nepal.
Tel: +977 1 4417925, 4417927

Broad Community Support is not applicable for this project

Title	Anticipated completion Date
Share copy of the approval of the Environment Impact Assessment (EIA) from the relevant Ministry.	04/30/2015
Develop and implement a Sustainability Policy defining company’s objectives and principles that will guide the company in achieving E&S performance in compliance with the applicable legal requirements and IFC PSs.	06/30/2015
Develop an environment, health and safety (EHS) monitoring procedure specifying key performance indicators (KPIs)/parameters on EHS to be monitored, monitoring frequencies and type and the definition of thresholds that signal the need for corrective actions. The EHS monitoring procedure shall be aligned with the requirements of the approved EIA, legal requirements and World Bank Group (WBG) EHS guidelines.	11/30/2015
Develop a EHS manual for construction activities as well as a monitoring procedure and check-list to ensure contractors’ compliance with EHS requirements and legal requirements on working conditions, labor camp facilities, and labor law.	04/30/2015
Develop and implement a traffic management plan for both remaining part of the construction phase and operation phase of the hotel.	04/30/2015
Develop and implement a community engagement and grievance mechanism including a process to engage with the neighboring communities, receiving and responding to their grievances.	06/30/2015