While all Performance Standards are applicable to this investment, IFCs environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards. If IFCs investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

PS 1 – Assessment and Management of Environmental and Social Risks and Impacts
PS 2 - Labor and working conditions
PS 3 - Resource Efficiency and Pollution Prevention
PS 4 – Community Health, Safety and Security
PS 6 – Biodiversity Conservation and Sustainable Management of Living Natural Resources
If IFC’s investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards
PS5 Land Acquisition and Involuntary Resettlement, PS7 Indigenous People and PS8 Cultural Heritage are not expected to apply to this project for the following reasons: although the company leases land for sugar cane plantations and owns the land on which its existing industrial plants are located, no involuntary resettlement was identified during appraisal and all of future land leasing for sugarcane plantations will be market based transactions on existing agriculture or pastureland areas. The company will likely have flexibility over the location of such plantations, and therefore no involuntary resettlement is expected to take place. No Indigenous People areas or cultural heritage was encountered during the course of appraisal and assessment of this project as most of their facilities and plantations are located on consolidated areas of agriculture.

This Project has been classified as Category B according to IFC’s E&S Sustainability Policy. The Project’s principal E&S risks and impacts will be associated with existing ethanol and energy production activities in Brazil. Key E&S risks and impacts from this project are: biodiversity loss and offset (compliance with Brazilian Legal Reservation and Permanent Protected Areas requirements); child labor, forced labor and labor issues regarding workers in the sugar cane plantations (within the company’s own operations and those of its suppliers); wastewater (vinasse) treatment and discharge; air emissions from boilers; health (employees and communities) issues related to agrichemical exposure; OHS risk prevention and management; life and fire safety; and neighboring and community engagement. These risks and impacts can be readily addressed through well-established mitigation measures

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. CerradinhoBio has agreed to take some actions to enhance the existing management function aimed to mitigate environmental and social risks, which includes the following: conducting external EHS audits to evaluate the performance of existing Integrated Management System; running a pollution dispersion model from air emission and adopting additional control measures if necessary, phasing out from its list of pesticides the products under WHO categories Ia and Ib; implement procedures to avoid the risks and impacts to health and other crops associated with aerial spraying of chemicals; and CerradinhoBio will manage plantations in a sustainable manner following agribusiness/food industry good management practices as defined in the Bonsucro standard for sugarcane production

CerradinhoBio manages the E&S risks and impacts of its operations through application and implementation of its corporate ESMS framework based on its Balance Score Cards framework. Under this approach Cerradinho has developed 10 different business policies (HR, Operational, Commercial, Investment, Financial, Corporate Responsibility, Comunications, Information Technology, Environmental health & Safety, and Supply Chain). All basic elements of an Integrated Management System are line with IFC PS1 requirements for an E&S management system.



CerradinhoBio’s E&S policy is based on 6 principles that include the protection of the integrity of workers and company’s assets; the prevention of risks to workers and environmental pollution; environmental, quality, health and safety awareness; meeting clients and legal requirements as well as CerradinhoBio’s corporate policies; reducing the consumption of natural resources and environmental footprint from ethanol production; and continuous improvement of risk control measures across the value chain of inputs.



Environmental and Social Assessment: CerradinhoBio identifies most relevant impacts and risks from its operations, including air emissions, effluents, solids waste and main OHS risks under a Risk Prevention Plan (Plano de Prevenção de Riscos Ambientais – PPRA) required under Brazilian regulations. CerradinhoBio had to complete a full ESIA process according to Brazilian environmental licensing requirements, which covered three different phases of the project: initial development of ethanol and energy cogeneration; and two subsequent scenarios of expansion of sugarcane crushing, ethanol and power production and finally sugar production. The current license of the expansion of cogeneration capacity refers to the second phase of expansion described in the ESIA.



However, regardless of licensing requirements, CerradinhoBio has conducted a Risks/Hazards and Aspects/Impacts assessments from its operations following internal management system procedures (PS 00.01 and PA 00.01, respectively). Going forward, as set forth in ESAP, CerradinhoBio will hire a qualified consulting firm to conduct a legal gap analysis of Brazilian EHS regulations and provide a corrective action plan to address any outstanding/unmet local regulatory requirements.





Management Programs: In Brazil, Environmental and Social Management Programs are first designed during the licensing phase, and all ESIAs must have an attached set of management programs to avoid, control and mitigate identified impacts from the projects (called PBA, Plano Básico de Ação, in Portuguese). These plans most often include an E&S management plan for the construction phase (when applicable), monitoring and management programs for waste streams; air quality monitoring, surface water quality monitoring, vinasse application program, fauna and flora monitoring, traffic safety and control, environmental monitoring of field/agricultural activities; monitoring
of erosion process, among others.



The company has adopted several policies and procedures to manage human resources and OHS matters related to its own activities and contracted works while in the plant including, among others, OHS programs required under Brazilian law, such as a Risk Prevention Plan (Plano de Prevenção de Riscos Ambientais – PPRA), an Occupational Health Monitoring Plan (Programa de Controle Médico da Saúde Ocupacional – PCMSO) and a Hearing Protection Program (Programa de Conservação Auditiva). CerradinhoBio also has specific procedures for hazardous work (working at heights, hot work, working with electrical systems, working in confined spaces, working in explosive settings, etc.), which must follow the company''s mandated procedure for approving hazardous work activities.



CerradinhoBio has respective EHS manuals for industrial and field operations providing relevant guidance on the right and safe way to conduct the job.



Organizational Capacity and Competency: CerradinhoBio has an EHS manager reporting directly to the Operational Director. Reporting to EHS manager there is a dedicated environmental engineer and a team of OHS professionals (OHS engineers, OHS technicians, doctors and nurses). Operational staff, task leaders, division managers and site managers share EHS performance responsibilities with the local EHS team and the individual job performance of these senior managers is tied to, and evaluated on, the basis of the EHS performance.



Training: CerradinhoBio has structured training programs that include an EHS induction for new employees (and contractors) as well as job-specific training such as working at heights, working in confined spaces, work as machine or boiler operators, handling and use of pesticides, operating vinasse irrigation equipment, etc.



Monitoring and Reporting: CerradinhoBio monitors main aspects and impacts from its operations included in mandatory monitoring programs defined during licensing process (surface water quality, fauna and flora, traffic mortality of fauna, air emissions, aquatic ecosystem, social development, solid wastes generation and disposal, etc.) as well as some internal indicators EHS performance such as work-related injuries, water consumption and pesticide consumption. As required by law, CerradinhoBio mill reports specific indicators to the Environmental Agency of State of Goiás and IBAMA (Instituto Brasileiro de Meio Ambiente) on an annual basis.





Under the mandatory PPRA (Programa de Prevensão de Riscos Ambientais), OHS exposure to hazardous agents such as noise, dust and heat is also monitored every year. CerradinhoBio also has mandatory occupational health monitoring programs in place (PCMSO, or Plano Médico de Controle da Saúde Ocupacional), which include periodic clinical assessments as well as regular testing (such as audiometry, eye testing, blood pressure, diabetes and urine and blood testing) to detect potentially noxious exposure to workplace
contaminants or other risks.



Going forward, as set forth in ESAP, Cerradinho will conduct external EHS audits twice a year to evaluate the performance of existing Integrated Management System.



Finally, CerradinhoBio will consolidate relevant indicators of EHS performance on an internal managerial report to be circulated to all sector managers and operational director, and discussed during operational management meetings.

Working Conditions and Management of Worker Relationship: CerradinhoBio’s workforce comprises approximately 1,900 permanent workers. With total mechanization of the planting and harvesting process, cane cutters and other workers involved in heavy manual labor are no longer needed in significant numbers.



Through its human resources policies and practices, which are clearly articulated and readily available to workers, CerradinhoBio seeks to abide by all Brazilian legal requirements regarding working conditions and management of the employer-worker relationship, to promote a positive work environment, and to retain and motivate its workforce. Employees are hired on the basis of clearly communicated contracts, they undergo an induction and training process, and end-of-employment formalities are carried out in a transparent and orderly fashion. Time clocks are electronic and readily accessible to the workforce, and overtime is calculated and paid. CerradinhoBio pays all employer social security taxes and legally mandated benefits.



In addition, the company provides a series of benefits that go beyond Brazilian legal requirements including additional health insurance, transportation arrangements or vouchers. Complementary pension fund and meals are provided for all workers during working periods. CerradinhoBio has a system for performance-based pay; this extends from corporate-level executives and senior managers at the regional and mill to operational levels.



Labor rights in Brazil are enshrined in the constitution and the consolidated labor laws (known as Consolidação das Leis do Trabalho, or CLT, in Portuguese), and labor relations are highly regulated under the country''s laws and labor practices, including the requirement for most categories of workers to belong to a union. In CerradinhoBio’s case the workforce belongs to 2 different regional unions (Union of Chemical Industry Workers and Union of Rural Workers).



CerradinhoBio’s worker grievance system is grounded in its overarching HR policy, particularly the company''s Code of Conduct, which applies to all employees. There are three channels for workers to raise complaints: with their line managers, directly through HR personnel, or through email and phone number in case there is the need of anonymous complaints. Complaints raised through this latter channel pass through a fully confidential process with recourse to an Internal Ethics Committee that meets on an as-needed basis and has considerable internal authority to take corrective actions.



Protecting the Workforce: CerradinhoBio follows Brazil''s legislation on minimum age. The company checks the worker''s age at time of application, recruitment, and contracting. For example, the company''s HR system automatically blocks any attempt to register a new employee below the legal working age. The company does engage trainees of 16-17 years of age under the Brazilian government''s Jovem Aprendiz training program, but it follows al
l requirements of the program, including limited work hours to allow for participants'' schooling and prohibitions against exposing trainees to any forms of hazardous labor.



Occupational Health and Safety: CerradinhoBio has a well-structured team managing OHS hazards and risks facing the workforce, in line with Brazilian labor requirements. As mentioned above in PS1 section, CerradinhoBio has mandatory OHS programs in place, such as risk prevention plans, health monitoring plans, an accident prevention committees, and emergency response plans. There are appropriate collective prevention measures, and where necessary, CerradinhoBio also provides appropriate Personal Protective Equipment (PPE). The injury frequency rate during the last season (2013-14) was 7,98 accidents per million hours worked, which is considered acceptable and aligned with international reference values (7 accidents for sugar manufacturing in the U.S. and 8 accidents for crop production), however it is expected that this performance will improve overtime with the adoption of proposed corrective actions in ESAP. CerradinhoBio has a program in place to work on employee’s behavior and improve safety awareness.



CerradinhoBio has invested heavily in automation of industrial processes which resulted in the need for only a small number of workers inside the operational area, significantly reducing the exposure of workers to inherent risks found in an ethanol mill. CerradinhoBio has an EHS manual for industrial operations covering main hazards and risks and providing guidance on the right and safe way to do the job. CerradinhoBio has identified all confined spaces, which are identified with warning signs and workers must follow safety rules for working inside them consistent with Brazilian safety requirements (NR33) and WBG’s EHS general guidelines. CerradinhoBio has an inventory of all pressure vessels, and holds maintenance books for individual vessels and boilers, including documentation of their technical/operational specifications, periodic safety inspections and maintenance data log, under a program in accordance with the relevant Brazilian safety standard (NR13). CerradinhoBio has completed a safety assessment of its electrical circuits, panels and substations and all electrical work must be done by a trained employee and following specific safety requirements defined in the EHS manual. All work considered to be hazardous work (working at heights, working in confined spaces, working with electrical circuits, welding/hot work) must be inspected by OHS team which must provide a clearance for the work once meeting all safety requirements.



As described above in PS1 section, CerradinhoBio will conduct an assessment to identify gaps with Brazilian safety standards such as Safety of Electrical Systems (NR10), Machinery Protection (NR12), Buildings (NR8), Transport, Moving, Storage and Handling of Materials (NR11) and so forth. Once completed, the company will present to IFC
a corrective action plan to bring the unit into compliance with Brazilian national OHS safety standards (NRs). This corrective action plan must specify actions and dates for completion, indicate what additional resources are necessary, allocate budget and define responsibilities accordingly. The schedule for completing actions should be prioritized on the basis of identified risks to workers, communities and assets.



CerradinhoBio conducts pre-hiring, periodic and contract termination health assessments of all employees that include basic clinical assessment and additional tests, such as audiometry, diabetes, high blood pressure, and blood tests cholinesterase and leucocytes counting, depending the job function and identified risks.



CerradinhoBio monitors workers exposure to hazards at workplace under mandatory workplace risk prevention program (PPRA Programa de Prevenção de Riscos Ambientais) and has conducted a formal hazard/risk assessment of its operations.



CerradinhoBio completed mandatory respiratory protection plan and ergonomic assessment of workplace, according to the requirements of Brazil''s NR 17 worker safety standard, and implemented required corrective actions and a management program to prevent such injuries.



Basic infrastructure is provided for workers in the fields including safe transportation, trailers with toilets, appropriate space for meals and break rests, fresh water supply and electronic time clocks in accordance with Brazilian labor standard NR31. CerradinhoBio has also adapted a trailer on a truck for field trainings on EHS, which are provided when the work has to be stopped due to weather conditions. Since all field activities have been mechanized, field jobs are now mainly filled with qualified machine operators. There is a team of OHS specialists responsible for the supply and use control of PPEs. Harvesting operations are run 24hs in three shifts of 8hs periods. There is one hour of mandatory breaks for meals and two other mandatory breaks for personal needs in between.



Workers Engaged by Third Parties: CerradinhoBio hires external companies for transport, housekeeping, maintenance, some specialized agricultural functions (e.g. applying pesticides) and guard services.



For its contractors, CerradinhoBio has a highly detailed procedure and checklist system to ensure that they are fully observing legal requirements with regard to their own workforces. Procurement, which manages contracting, EHS (the safety, health, and environment team), and HR are all involved in applying the checklist, requesting necessary documentation, and checking compliance before payments are authorized. Third-party workers undergo an EHS induction process upon their arrival to the site, and permission is granted for third-party workers engaged in hazardous work activities through the same procedures used standardly by CerradinhoBio for its own workforce.



Supply Chain: CerradinhoBio reports having a small number of
leased farms (approximately 70) and sugarcane suppliers (approximately 8), who are contractually required to follow company’s manual of field sustainability. Main aspects covered under this manual include labor laws and regulations, OHS requirements, Environmental licensing and CAR (Rural-Environmental Cadaster), mandatory biodiversity set asides requirements, hazardous wastes and empty containers of pesticides. No indication of forced or child labor in supply chain was found during IFC appraisal visit.

Air emissions: The biomass boiler has about 320 MWh power capacity and is the single largest source of air emissions from CerradinhoBio’s operations. CerradinhoBio monitors emissions on an annual basis, achieving compliance with Brazilian requirements under CONAMA Res. 382/06 and, which is less stringent than World Bank/IFC EHS guidelines (PM 200mg/NM3 and NOX 350 mg/Nm3). CerradinhoBio is investing in a second boiler (400 MWh) as part of an energy cogeneration program to sell energy to the national grid. The boiler that has been acquired prior to IFC investment was also designed to meet CONAMA’s emissions requirements. Since the company is located 10Km far from nearest town in a not saturated air shed, it is expected that air emissions will not contribute more than 25% of the applicable ambient air quality standards as defined in WBG/IFC EHS guideline requirements. However, as set forth in ESAP, Cerradinho will run a pollution dispersion model from air emission (considering combined emissions from two boilers and based on Chapadão do Sul’s meteorological station data). If the dispersion model shows CerradinhoBio’s negative contribution to air quality is exceeding the 25% of national air quality standards (as defined by Res. CONAMA 003/1990 - Padrões Primários), CerradinhoBio will explore technically and economically sound alternatives of air emissions control to limit its contribution to 25%.



Effluents: Wastewater from ethanol mills include: (i) process wastewater from ethanol production (vinasse), (ii) wet scrubber blow down from stack gas scrubbing, and (iii) miscellaneous wastewaters. CerradinhoBio does not discharge wastewater into rivers or surface water bodies, and all such wastewater is mixed together and used as a fertilizer in the sugarcane plantations under a ferti-irrigation management program. CerradinhoBio has plans for vinasse application in the fields consistent with São Paulo State agency (CETESB) standard for wastewater used in sugarcane plantations. Vinasse is pumped to the fields through pipelines, intermediary storage ponds are lined with high density polyethylene cover to prevent groundwater contamination, and the amount of wastewater applied in the plantations is determined by the soil characteristics and the nutrient needs of the crop.



Resource efficiency:

Water: Sugarcane cultivation in CerradinhoBio operation relies exclusively on natural rainfall and vinasse application. Water is extracted from surface sources for process operations in the mill, and CerradinhoBio has obtained all required permits from state governments to extract water. With the mechanization of harvesting it was possible to eliminate sugarcane washing at the mills, which has resulted in a significant reduction of water consumption. Water usage averages 1.0 m3/ton-cane, which is consistent with sector benchmarks and the reference values in the WBG’s EHS Guidelines for sugar production.



Energy: CerradinhoBio self-generates all energy for th
eir needs from sustainable resources through co-generation of electricity from thermal power plants fed with sugarcane bagasse. CerradinhoBio has implemented several measures to optimize internal energy consumption such as, electrical engines running the mill (more efficient than steam power engines), online management of fleet control in the field (with GPS) to optimize diesel consumption, modern and more efficient mill with crushing units reaching almost 95% of extraction efficiency, and finally exploring all possibilities of heat recovery in the industrial area.



Greenhouse Gas Emissions: Estimated CO2 emissions from CerradinhoBio mill far exceed 25,000 tons annually, but considering that this is renewable energy from sugarcane plantations, most of the mills'' GHG CO2 emissions are naturally offset as they are captured from the atmosphere by growing sugarcane plants. In addition, the ethanol that CerradinhoBio produces is used as a renewable fuel in the national vehicle fleet. Therefore, although CerradinhoBio generates high volumes of gross GHG emissions, net emissions from the company''s operations can be considered negative (as they are sequestrated in the sugar cane plantations and off-set in the ethanol that replaces use of fossil fuels). In addition, IFC investment will support the expansion of co-generation facility that will export to the grid energy from renewable sources reducing national energy GHG footprint.



Integrated Pest Management: Integrated Pest Management is employed at all plantations. CerradinhoBio uses biological control techniques to control the sugarcane borer population with the Cotesia flavipes parasite, and Drury larvae are controlled with Metharizium bacteria. Only approved chemicals and fertilizers are used, and application rates and methods are adapted to minimize consumption. After the review of the list of pesticides provided by CerradinhoBio, only one product was identified falling into WHO hazard Class 1b (Methomyl). As set forth in the ESAP, CerradinhoBio will explore alternative means of pest control and will phase out from its lists of products the Pesticides Considered highly hazardous (Cat 1a and 1b) under WHO classification system. CerradinhoBio just uses tractors with cabinets for spraying operations, and handling, storage and use of agricultural chemicals follow national regulations and can be considered best practices.



Hazardous Materials: CerradinhoBio uses and stores significant amount of chemicals such as soda, sulfur acid, chlorine, cyclohexan, pesticides and, of course, ethanol. A variety of storage arrangements can be found at different areas, but all of them have secondary contention, risk identification, warning signs, access control and emergency kits and showers.



CerradinhoBio has one centralized warehouse for pesticide storage. In this facility products are segregated by hazard class, the floor is sealed, the area is contained, and there is proper ventilation. Going forward, as
set forth in ESAP, CerradinhoBio will deploy smoke detectors inside warehouse to early identify potential fires in the absence of people.



Solid Wastes: Sugar mills produce significant amount of organic wastes (filter cake and ashes from boilers). These are taken to a composting area, where they are piled up and mixed together to enable the composting process. This mixture is allowed to rest for 30 days and then applied to the fields. Metal scrap is segregated, stored outdoors and sold for recycling. The solid waste from administrative areas and dining halls is collected and disposed of through the local public waste system. CerradinhoBio collects all empty pesticide containers and sends them to certified recycling companies.

CerradinhoBio’s mill is located in a rural area, 10km far from the nearest urban area, which significantly reduces the risks to community health and safety. Potential impacts to communities from CerradinhoBio’s operations could arise primarily from the explosions of ethanol tanks (however, given the distance it is unlikely community could be affected), air emissions from boilers, fugitive air emissions from trucks (dust) and drifts from aerial application of herbicides (to speed the sugarcane maturation process).



CerradinhoBio conducts aerial spraying of crops by contracted companies using crop-spraying airplanes. As set forth in the ESAP, CerradinhoBio will approve and enforce specific procedures to avoid the risks and impacts to health and other crops associated with aerial spraying of chemicals. This entails monitoring weather conditions during aerial spraying, prior communication with neighbors to advise them of spraying schedules and safety exclusion buffer zones to protect towns, small villages or households.



CerradinhoBio mill has a GIS (Geographical Information System) based system to manage sugarcane transport, which automatically defines better routes taking into account the distance, quality of the roads as well as existing traffic restriction on trucks flow around the cities. CerradinhoBio has a specific procedure for sugarcane transport including relevant safety aspects of the operation such as overall safety of the trucks, warning signs, emergency equipment and drivers training. In addition, vehicles are equipped with GPS trackers to ensure that maximum speeds are not exceeded, and ignition systems relying on individualized activation keys show which drivers are using which vehicles, thereby enabling immediate identification of unsafe drivers.



Going forward, CerradinhoBio will map out small rural villages and settlements across existing access roads used for sugarcane transportation and define applicable control and mitigation measures to reduce the risks and impacts to these communities.



Life and Fire Safety: CerradinhoBio has obtained the L&F safety certification from State of Goiás authority. CerradinhoBio has first submitted for approval an L&F safety project design, based on national engineering standards, and including fire safety equipment such as fire detectors, alarm systems, hydrants, foam chambers, portable extinguishers, dedicated emergency water tanks, emergency (diesel) pumps, means of egress and proper emergency signalization. After final construction the L&F safety authority conducted onsite inspections before issuing the certificate. There is a full time professional fireman in the site and a well-equipped set of emergency gear.



In addition, under Brazilian safety standard NR10, industrial sites are classified according to their risk of explosion, and in those areas considered to be of high risk (e.g. distillery), CerradinhoBio has access control systems, and only uses intrinsically safe electrical
equipment.



Emergency Preparedness and Response: CerradinhoBio has the mandatory emergency response plan covering all emergency scenarios such as fires, explosions and environmental leaks as well as fire brigade, evacuation and communication plans.



Security Personnel: CerradinhoBio has no armed guards at any area of its facilities. The company relies on a combination of preventive actions, GPS tracking of vehicles, use of surveillance cameras, and unarmed personnel to provide security for its facilities, equipment, and personnel. Security guards are trained extensively in avoidance of the use of force for resolving problems, and any suspected cases of criminal activity are turned over to the police for investigation. There have been no reported cases of abuses by security personnel.

Protection and Conservation of Habitats: Sugarcane plantations are located exclusively on areas traditionally used for agriculture, and no direct conversion of natural habitats to croplands or significant loss of biodiversity is expected from this Project.



Depending on the region of the country (determined by biome), Brazilian farmers are required to set aside 20% to 80% of their lands as biodiversity conservation areas and to protect buffer zones along rivers and around water bodies. If deficient, riparian buffer zones should be reconstituted, and biodiversity conversation areas can be offset through the protection of intact areas in the same region.



CerradinhoBio uses leased land for sugarcane fields, but before the establishment of new plantations CerradinhoBio conducts an environmental assessment of the area and excludes the mandatory riparian areas and legal biodiversity offsets from the sugarcane areas. Farmers have also to show either the existence of mandatory biodiversity offsets or adherence to the environmental and rural cadaster (CAR) to implement the regulatory requirements (offsets can be established on the farm or compensated in another area).



Sustainable Management of Living Natural Resources: As mentioned above, sugarcane plantations are located on already-converted land and consolidated areas of crop plantations in Goiás and on smaller portion in Mato Grosso States. Soil conservation techniques are applied in the fields including contour planting, terracing and planting design to avoid run-off. Sugarcane leaves and straw are left on the ground to protect the soil from erosion.



CerradinhoBio takes advantage of all possibilities to use organic wastes from ethanol production, including vinasse mixed together with other suitable wastes, in the plantation fields to reduce the need for chemical fertilizers. When such chemical fertilizers are applied, the prescription is based on soil fertility analysis and plantation extraction needs. As mentioned above, CerradinhoBio monitors pests, which it seeks first to control through biological agents. When used, agrochemical products are prescribed by qualified agronomists based on pest infestation and economical level of control. Throughout harvesting mechanization, there is no need of pre-harvesting burns of sugarcane fields, and the straw is left on the fields to better protect the soil from erosion effects.



As set forth in the ESAP, CerradinhoBio will manage plantations in a sustainable manner following agribusiness/food industry good management practices as defined in the Bonsucro standard for sugarcane production.



Supply Chain: No significant conversion of natural or critical habitats is expected from CerradinhoBio’s suppliers in this Project.

External Communications and Grievance Mechanisms: During initial licensing phase, CerradinhoBio’s project was disclosed to the public under the format of an executive summary of the EIA, called RIMA (Relatório de Impacto Ambiental), meantime the full ESIA was made available for public local access. Public hearings were also conducted when the company had to present to the audience all the relevant conclusions from the ESIA as well as all the measures that would have to be implemented to mitigate and control the impacts associated to the project. The public hearings are mediated by a representative of the Environmental Agency, and the mayor and the local public attorney also have a seat. Finally, the Mayor has to sign a letter of endorsement before the Environmental Agency issue the Previous Environmental License, which is the first of a series of three environmental licenses.

Grievance mechanism - CerradinhoBio has available for the general public some channels of communication with the company disclosed at their website, including email address, phone numbers and mail information:

http://www.cerradinhobio.com.br/conteudo_pti.asp?idioma=0&conta=45&tipo=53225

Going forward, CerradinhoBio will develop and implement a system to proper receive, record, forward, treat and provide feedback and complaints from the public and consistent with IFC PS1 requirements.

On-going Reporting to Affected Communities: CerradinhoBio mill is located 10km from nearest town and impacts from plantations are considered diffuse. During the visit it was not possible to identify any community that could be significantly affected by CerradinhoBio’s operations, but nonetheless, it is expected that some rural villages or nearby farmers could be possibly affected by noise and dust emissions from trucks crossing unpaved roads or unintentional agrichemical spraying drifts, especially from air spraying. As described in PS4 section, Cerradinho is going to map villages and potentially impacted communities, and ensure they are informed about aerial spraying and truck traffic schedules and all mitigation measures. Queries and complains will be managed through revamped CerradinhoBio’s grievance mechanism.

HeadquartersCatanduva - SPRua Bahia, 630 - CentroCEP: 15801-290Telefone: +55 17 3311-2900

MillChapadão do Céu - GOFazenda Âncora,Rodovia GO 050, km 12 Zona RuralCEP: 75828-000

Broad Community Support is not applicable for this project

Cerradinho Bio(35523) Supervision Disclosure Snapshot – Version 2
Description	Anticipated Completion Date	Status	Comments	Completion Date
ESMS Risk Assessment Cerradinho will hire a qualified consulting firm to conduct a legal gap analysis of Brazilian EHS regulations and provide a corrective action plan to meet local regulatory requirements	30-Mar-2017	Completed	Completed	3/30/2017
Monitoring and Reporting Cerradinho will conduct external EHS audits twice an year to evaluate the performance of existing Integrated Management System	30-Oct-2016	Completed	Completed	10/30/2017
Cerradinho will consolidate relevant indicators of EHS performance on an internal managerial report to be circulated to all sector managers and operational director, and discussed during operational management meetings	30-Oct-2016	Completed	Completed	10/30/2017
Air Emissions Cerradinho will run a pollution dispersion model from air emission (considering combined emissions from two boilers and based on Chapadão do Sul’s meteorological station data). If the dispersion model shows Cerradinho negative contribution to air quality is exceeding the 25% of national air quality standards (as defined by Res. CONAMA 003/1990 - Padrões Primários), Cerradinho will explore technically and economically sound alternatives of air emissions control to limit its contribution to 25%.	30-Mar-2019	In progress	In progress
Pesticides Cerradinho will explore alternative means of pest control and will phase out from its lists of products the pesticides considered highly hazardous (Cat 1a and 1b) under WHO classification system.	30-Oct-2017	Completed	Completed	10/30/2017
Hazardous Materials Cerradinho will deploy smoke detectors inside pesticide's warehouse to early identify potential fires in the absence of people	30-Mar-2017	Completed	Completed	3/30/2017
Community Health and Safety Cerradinho will approve and enforce specific procedures to avoid the risks and impacts to health and other crops associated with aerial spraying of chemicals. This entails monitoring weather conditions during aerial spraying, prior communication with neighbors to advise them of spraying schedules and safety exclusion buffer zones to protect towns, small villages or households.	30-Jan-2017	Completed	Completed	1/30/2017
Cerradinho will map out small rural villages and settlements across existing access roads used for sugarcane transportation and define applicable control and mitigation measures to reduce the risks and impacts to these communities	30-Jan-2017	Completed	Completed	1/30/2017
Sustainable Management of Living Natural Resources Prepare a gap analysis and deliver an Action Plan detailing the actions and due dates for closing the identified gaps to Bonsucro Standards and maintaining Cerradinho´s practices ready-to-be certified after initial external verification.	30-Mar-2017	Completed	Completed	3/30/2017
Stakeholder Engagement Cerradinho will develop and implement a system to properly receive, record, forward, treat and provide feedback to complaints from the public and consistent with IFC PS1 requirements.	30-Mar-2017	Completed	Completed	3/30/2017