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
PS5: Land Acquisition and Involuntary Resettlement is not applicable since all facilities are existing buildings/facilities, located in urban contexts, acquired and renovated by the company.
PS 6 Biodiversity Conservation and Sustainable Management of Living Natural Resources, PS7: Indigenous Peoples, and PS8: Cultural Heritage are not applicable given the urban setting (modified habitat) of the project with no recognized indigenous people or cultural heritage present.

Because IFC’s proposed investment in Evex will be used to support future but, as yet, undefined projects in addition to the existing facilities, the main Performance Standards to be applied to this investment are those listed above. A condition of IFC’s investment going forward will be that the company shall adopt IFC Performance Standards as part of the applicable requirements in all of its operations, and consider the issues identified in PS1 through PS8 when s assessing any new business opportunities, acquisitions or mergers, or service models.

The project may result in a limited number of potentially adverse E&S impacts, which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines, or design criteria. On this basis, this project is therefore classified as a Category B project according to IFC’s Policy on Environmental and Social Sustainability.

Key E&S issues and risks associated with this investment are: the company’s social, environmental, and occupational health and safety management system, including stakeholder engagement at corporate level; life and fire safety management in accordance with local and international fire safety codes; emergency preparedness and response planning; efficiency of water and energy use in its operations; solid waste management and disposal (particularly for medical/hazardous waste); labor and working conditions; management of contractors (during construction and operational phases).

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 Assessment and Management System: Evex undertakes an assessment for any potential new hospital acquisition including legal, business and technical aspects before finalizing the acquisition. The company’s operational facilities and the ones under renovation included in the project, involved the acquisition and renovation of existing hospitals/facilities for which an environmental impact assessment (EIA) study was not required by local legislation. All regulatory permits and renewal to operate its hospitals are obtained from the relevant authorities and the company complies with the applicable mitigation measures as per the permit conditions.



Healthcare facilities are subject to both periodic and random inspections by the Medical Activities Regulation Agency to ensure their continued compliance with the terms of the relevant license or permit. Facilities that use ionizing/electromagnetic radiation (such as roentgenology diagnostics, Cat Lab, CT, MRI) are subject to control by the Georgian Ministry of Environmental Protection and Natural Resources and are required to hold a specific license. Since almost all of the company’s ambulatory clinics and hospitals use ionizing/electromagnetic radiation as part of their healthcare services offering, they are required to have such licenses in place.



GHG has adopted a quality management program to develop quality standards since 2014 aligned with Joint Commission International (JCI) standards, which is the largest accrediting body for healthcare organizations in the USA. As part of this program, the company is introducing internal regulations, measures and indicators in accordance with JCI standards. Building upon this, Evex is developing its own management system articulating various policies, operational procedures, roles and responsibilities and monitoring, and reporting mechanism. As per ESAP item 1, Evex shall finalize its Environmental and Social Management System (ESMS) and ensure that it is implemented in all healthcare facilities. The ESMS will incorporate reference to IFC Performance Standards PS 1 through 8 and applicable WBG EHS Guidelines, in particular identifying and prioritizing key E&S risks, development of appropriate E&S management plans and operational procedures, provisions for relevant training and implementation of appropriate E&S monitoring programs.



Since January 2014, Tbilisi, Kutaisi and Batumi referral laboratories have ISO 9001:2008 certification for their quality management systems.



Policy and Procedures: GHG has an Environmental and Social Policy disclosed in its website and, based on this policy requirements, Evex is in the process of developing its own policy and procedures. As such, the company is customizing around 200 operational procedures covering more than 20 functional areas such as employee code of conduct (ethics), human resources management, patient and family rights, quality control, infection control, physical security, fire sec
urity, occupational health and safety, radiation safety, laboratory safety and waste management.



Organizational Capacity and Competency: As of February 2016 Evex has a dedicated team of around 20 senior and experienced professionals responsible for various functions and departments at corporate level such as Marketing and Service, Human Resources and Organizational Development, Internal Medicine and Outpatient Services, Business Management and Management, Procurement, Operations, Engineering and Finance. The Operations Department at company’s head quarter is responsible for Environmental Health and Safety (EHS) management but there is no dedicated EHS responsible within the team for managing, controlling, monitoring and reporting functions. Evex shall assign an Environmental, Health and Safety Coordinator at corporate level, with relevant expertise and experience in managing E&S issues of company assets (ESAP #2).



Emergency Preparedness and Response: The company is in the process of developing corporate level emergency preparedness and response policy and plans that includes evacuation, firefighting and first aid procedures for each individual facility. As per the requirement of ESAP item #1, Evex shall develop emergency preparedness and response operational procedures, in accordance with IFC PS4. Emergency preparedness and response operational procedure which shall be developed for each facility shall include necessary training arrangements, evacuation exercises and periodical fire drill programs as per the WBG EHS Guidelines on emergency preparedness and response.



Monitoring and Review: As part of its quality management system, the company is developing a detailed monitoring program and related quality and safety core indicators and databases for mortalities, prenatal care, penalties, medical errors and case reviews. This also includes creating an effective reporting and feedback system. Going forward, as part of ESMS enhancement requirement under ESAP item #1, the company shall include EHS related indicators such as energy and water use, waste generation, liquid effluent quality, occupational health and safety (OHS) injuries (such as needle stick injuries), among other indicators. Monitoring thresholds that will trigger corrective actions will be consistent with those referenced in the tables 2 and 3 of the WBG EHS Guidelines for Health Care Facilities.

Human Resources (HR) Policies and Procedures: GHG has code of conduct and ethics disclosed on its website and Evex is in the process of documenting its HR policy and procedures including that related to recruitment, performance evaluation of managers, company ethics, disciplinary actions and leave and vacation. As per the requirement of ESAP item #1, Evex shall integrate its ESMS, HR policy and procedures in accordance with PS 2 provisions.



Working Conditions and Management of Worker Relationship: The company employs over 9,400 staff of which almost 1,300 are administrative and 5,550 are medical professionals including doctors, nurses and laboratory staff. Nurse support and general support staff are around 2,550. In all of its 45 facilities, there are 697 short term employees. Most of short term employees are locals living close to the workplace and are employed on need basis. The company has a centralized recruitment and payroll system. All employees, including short term staff, are recruited by headquarters, all sign individual contracts and monthly payroll is directly accredited to their bank accounts. Overtime and shifts are determined by hospital managers in consultation with staff. Overtime work is paid 105 percent on hourly basis. Working hours are 40 for administrative and 48 for shift staff. Shifts differ depending on need and service provided; 24 hour services are covered by 4 shifts, 18 and 16 hours by 3 shifts based on the need of the service.



Non-discrimination, Protection of Workforce and Workers’ Organizations: The code of conduct at GHG specifically forbids discrimination, bullying or harassment of any kind. Seventy nine percent of total company’s staff are females. Evex does not employ child or forced labor, and it complies with local labor laws and related PS2 requirements to protect the workforce. All employees are over the age of 20, which is above the minimum required age of 16 and minimum required age for hazardous work which is 18. As per the requirement of ESAP #4, the company’s contractors shall be required to implement the same policy and procedures for their work force while under contract with Evex. Around 500 employees are members of the medical, pharmacy and social workers’ professional and other associated unions but the company is not party to any collective bargaining agreement. GHG framework HR policies and procedures will be adopted by Evex and, in compliance with PS2 provisions, will include specific references to protection of workforce, minimum working age, and freedom of association rights.



Retrenchment: The company re-structures the workforce after acquiring any facility based on the company service and staff model which may results in staff lay-offs. In DKC and Sunstone the number of staff redundant as of January 2016 is 64 and 67 respectively. Redundant workforce is expected to be more during 2016 as the company expands its business but the actual size cannot yet be determined. As per the ESAP i
tem #3, Evex shall develop retrenchment procedures at corporate level in compliance with IFC PS2 requirements and implementation plans for redundant staff at each project where lay-offs are expected.



Grievance Mechanism: GHG whistleblowing policy is disclosed on its website and includes dedicated email address and phone numbers where grievances can be submitted; this also includes anonymous reporting. Evex is in the process of integrating this policy into its HR procedures. As required under ESAP item #1, the company will incorporate an internal grievance mechanism in its HR policy and procedures in compliance with IFC PS2 requirements.



Occupational Health and Safety, Infection Control and Prevention: The company has already initiated several infection control and prevention initiatives in order to protect patients, visitors and personnel from healthcare-associated infections. In 2015, an infection control and prevention manual for nurses, standard operational procedures for infection control and prevention, and hand hygiene assessment toolkit were put in place. Evex conducted relevant training programs, including training of trainers, in 2015 covering 108 healthcare personnel primarily working for intensive care units. Staff are provided with necessary personal protection equipment including gloves, mask, goggles, aprons and radiation detection devices.



In addition, an independent medical case review process is designed to reveal systemic problems and enhance preventive measures in clinical practices. As a pilot program, different case-reviewing processes were put in place for medical errors, including near miss cases, at the head office and the Kutaisi referral hospital. Going forward, the company will implement the experience gained in this pilot program throughout its network hospitals and will undertake relevant staff training programs. As required under ESAP item #1, the company shall integrate an occupational health and safety procedure in its ESMS including risk assessment, incidence recording, reviewing, monitoring and reporting procedures in compliance with IFC PS2 requirements.



Training: Evex has its own Training Center which independently develops and runs a variety of professional development programs. Most of these programs are developed for medical training of physicians and nurses, yet non-medical staff, such as hospital administration and registry employees, are also included in these programs. In 2015, Evex trained 1960 nurses, 1720 physicians and 403 administration employees. In addition, Evex Training Center provides trainings for students of nursing colleges and universities as well.



Workers Engaged by Third Parties/Contractors and Construction Safety: Evex does not outsource any services provided in and for its healthcare facilities. However, for renovation works of newly acquired facilities, the company employs a number of contractors (e.g. civil and mechanical works, electrical works and finishing works, etc
.). Evex undertakes an extensive renovation in its DKC and Sunstone referral hospitals in order to improve the facilities standards. Renovation works and hospital operations often occur at the same time and therefore require thorough planning, coordination and control in order to avoid potential overlaps between these two activities like preventing the contractors’ workforce from any possible adverse impacts on healthcare operations as discussed further under PS4 section.



Construction control of renovation works is undertaken by the engineering department of the company. Evex has a system in place to effectively monitor construction implementations through a construction control engineer’s daily visit. As per the ESAP item #4, Evex will develop contractor management procedures in compliance with national laws and requirements of IFC PS2 which address working conditions of labor force and requirements for occupational health and safety. This should include risk assessment measures to be taken aligned with the identified risk, including working at height and usage of personal protection equipment. In addition, for the civil works on the exterior of the buildings general occupational health and safety measures including barricading, installation of warning signs, lightening of the area (if needed) shall also be covered in this occupational health and safety management procedures. Evex will include these requirements in the contractual specifications at bidding stage in line with newly developed ESMS.

Resource Efficiency, Energy and Material Efficiency Projects: Electricity is provided from the national grid for all facilities. There are standby generators at every facility. The generators have internal fuel systems and no separate stand-alone fuel tanks are installed. Total annual electricity consumption for existing facilities in 2015 is 16,327,471 kWh It is estimated that the total electricity consumption will be higher in 2016 and following years as Evex is planning to expand its hospital network although Evex already has put in place several resource efficiency programs such as improvement of heat insulation, installation of resource-saving equipment and LED lamps. This will be monitored and reported to IFC as per the agreed Annual Monitoring Report.



All existing facilities are heated by boilers that also supply hot water. Total natural gas consumption of all facilities combined is around 1,700,000 m3/year whereas total diesel consumption is around 100 tons/year. Diesel is used for heating only in four facilities located in rural areas where there is no natural gas supply. The company is planning to switch to gas instead of diesel at facilities located in mountain regions by 2016 with an expected annual saving of 60 tons of diesel.



Water, in general, is supplied from the municipal network for domestic use while bottled water is used for drinking at all facilities. Water quality is monitored periodically as per the relevant local regulation. In one of its facilities, the company drilled its own water well in 2015 under its resource efficiency initiative. Additional wells are planned to be drilled by 2016 in other facilities as well. As required under ESAP item 1, Evex will develop water quality monitoring procedure for drinking/domestic water drawn from groundwater wells to ensure quality is in line with national drinking water standards.



Green House Gasses Emissions: As reported in GHG’s 2015 Annual Report, emissions are generated from: (i) combustion of fuels in stationary equipment and in owned transportation vehicles; (ii) electricity, heat, steam and cooling; (iii) standby generators; and (iv) air travel and land transportation. There are no incinerators for waste and equipment sterilization is done by electrical autoclaves. Total GHG emissions is reported at around 15,000 tonne carbon dioxide (CO2) equivalent /year.



Waste Water: All domestic waste water from toilets and showers, together with liquid effluents, which include waste biomedical test liquids (e.g., blood, urea etc.,) and chemicals from laboratories are discharged to municipal waste water collection networks. As per the ESAP item #5a, Evex shall ensure wastewater discharged from its facilities are in compliance with all applicable permits, and apply its best effort to obtain official confirmations from the municipalities that the municipal facilities are capable of handling the type of effluent discharged. However, as municipal waste water treatment of Tbilisi
city has no biological treatment, as per the ESAP item #5b, Evex will assess the volume and the components of wastewater discharged from DKC and Sunstone hospitals to municipal sewage system, propose and implement corrective measures acceptable to IFC to ensure that the effluent levels of wastewater discharged from DKC and Sunstone hospitals are in line with WBG EHS Guideline values, and establish a monitoring mechanism to confirm this. In addition, as per the ESAP item #5c, Evex shall undertake an assessment, for each of the existing facilities, in order to identify where the current effluents are being discharged, their volume and composition and identify best alternatives in order to mitigate impacts that could include but not limited to: septic systems, grease traps and/or separation of special effluents from domestic ones. This assessment will include a time bound implementation plan acceptable to IFC. As required under the ESAP item #1, Evex shall integrate in its ESMS a wastewater management system including monitoring procedures.



The HTMC referral hospital providing radiotherapy, chemotherapy and nuclear therapy have separate waste water collection and settling tanks for potentially radioactive water waste. The waste water collected in these tanks are kept for the duration of elimination of radioactivity as per requirements of local legal regulations and then is collected by licensed company to be discharged.



Solid Waste Management: Evex has waste management programs compliant with the Georgian legislation. As per the related local regulations the company outsources the waste transportation and disposal services to Ecomed, a government licensed specialized company. Ecomed has incinerators licensed and monitored by the relevant government institutions. Medical wastes, domestic wastes and packaging wastes are segregated at each facility. Where waste storing is needed, the facilities have proper storage areas that are locked and, if necessary, cooled. Steam sterilization is used to decontaminate biological and biohazardous waste, including blood. The accredited contractor collects all medical wastes daily for incineration and/or landfilling. Ecomed and its consultant (Gamma Consulting) conduct sampling and monitoring of ash, combustion emissions and wastewater of the incineration facility but the frequency of monitoring is unknown. According to GHG 2015 Annual Report, total medical waste generated in all healthcare facilities is 125 tons in 2014 and 115 tons in 2015. No information was provided regarding X-ray equipment and other radioactive wastes as some facilities of Evex provide nuclear therapy. As required under ESAP item #1, Evex will integrate a waste management plan and procedures in its ESMS including hazardous waste, in accordance with IFC PS 3. This will include specific procedures for the collecting, storage, transport and final disposal of this waste stream.

Community Health and Safety: Medical, analytical and laboratory equipment is checked and monitored in accordance with Georgian laws by the relevant government institutions. Evex initiated procedures for infection prevention and control in order to eliminate risk of community exposure to disease. Local authorities conduct audits to inspect hygiene practices as well.



Construction Management: As discussed under PS2, renovation works are undertaken while at the same time hospital operations are ongoing in other parts of the buildings creating potential physical overlaps between operations. Usage of same entrances and exits by patients and construction workers and for construction materials, as well as partial interruption of hospital operations by the construction activities were observed during the visit to DKC and Sunstone hospitals, both under renovation. As per ESAP item #6, Evex shall develop a site operation and construction management procedure so to limit/eliminate interaction between hospital operation and renovation/construction activities in terms of health, safety and security of patients and staff.



Emergency Preparedness and Response: As required under ESAP item #1, Evex shall develop an emergency response and preparedness plan in accordance with IFC PS4. This will include management procedures for earthquakes, fires and other large scale emergency situations as well as other potential emergencies such as radiation safety, hazardous materials safety, and control of outbreaks and infections.



Evex complies with local regulations regarding life and fire safety design and installations in hospital facilities. For the facilities under renovation or the ones that will be acquired that will undergo substantial renovation works, as per the ESAP item #7 and 8, Evex shall provide a third party certification, from a competent professional acceptable to IFC, to attest material compliance with local as well as internationally accepted life and fire safety standards.



HTMC referral impatient hospital in Tbilisi has clear marking of the exits, smoke detectors, alarm system, fire exits, evacuation plans posting and emergency lights which are compliant with national standards and regulations. As required by Georgian legislation, in outpatient clinic visited in Tbilisi, portable fire extinguishers and fire hydrants were installed but evacuation plans need to be in place on each floor and exits are to be clearly marked. There is no clear record of evacuation exercises and periodical fire drills conducted. As per the ESAP item #9, Evex will commission a third party life and fire safety review for a representative number of existing hospitals in order to identify life and fire safety risks and develop a time bound action plan to eliminate identified risks. In addition, Evex shall implement during the following year the actions proposed for all existing health care facilities in order to eliminate the identified life and fire safety risks (ESAP ite
m #10).



Security Personnel: Unarmed security personnel are employed at all facilities. Security personnel are trained in the use of force for defensive and emergency response purposes.

Evex provide contact information on their web-site (evex.site.itdc.ge/en/contact) for external contact. A call center, open 24 hours, is also available to the public.

However, there is no established mechanism to timely provide information about the company expansion plans and activities to the stakeholders and the public in the vicinity of their operations. Thus as per ESAP item #1, Evex shall develop a Stakeholder Engagement Framework, as part of its management program, outlining general principles and a strategy to identify relevant stakeholders and plan for an engagement process, procedures for disclosure of project information and development of appropriately scaled grievance mechanism.

Contact Person: Irakli Gogia
Company Name: JSC Medical Corporation EVEX
Address: 40 Vazha Pshavela Ave.,
Email: mailto:irakligogia@ghg.com.ge
Phone: +995 599 002 244
Facsimile: N/A

Broad Community Support is not applicable for this project

Title	Anticipated completion Date
1a) Evex shall finalize its corporate level Environmental and Social Management System (ESMS). The ESMS will incorporate reference to IFC Performance Standards PS 1 through 8 and applicable WBG EHS Guidelines, in particular identifying and prioritizing key E&S risks, development of appropriate E&S management plans and operational procedures, provisions for relevant training and implementation of appropriate E&S monitoring programs. Specific E&S policy and operational procedures to be developed by the company include but are not limited to: a) EHS due diligence for all new assets – against national, IFC PSs and WBG EHS Guidelines; b) Stakeholder Engagement Framework- including identification of key stakeholders, procedures for disclosure of project information and development of appropriately scaled grievance mechanisms, as per IFC PS 1; c) HR policy and procedures including an internal grievance mechanism; in accordance with PS 2; d) Waste management including hazardous waste, in accordance with PS 3; e) Wastewater management including monitoring procedures in accordance with PS 3; f) Water quality monitoring procedure for drinking/domestic water drawn from groundwater wells to ensure quality is in line with national drinking water standards, g) Emergency preparedness and response, in accordance with PS4 including L&FS standards.	12/30/2016
1b) Evex shall ensure that corporate level ESMS is implemented at its all health care facilities.	06/30/2018
2) Evex will assign an Environmental, Health and Safety Coordinator at corporate level, with relevant expertise and experience in managing E&S issues of company assets	05/30/2016
3) Evex shall develop retrenchment procedures at corporate level in compliance with IFC PS2 requirements and implementation plans for redundant staff at each project where lay-offs are expected.	08/30/2016
4) Evex shall develop contractor management procedures in compliance with national laws and requirements of IFC PS2 which address working conditions of labor force and requirements for occupational health and safety. Evex will include these requirements in the contractual specifications at bidding stage.	05/30/2016
5a) Evex shall ensure wastewater discharged from its facilities are in compliance with all applicable permits, and apply its best effort to obtain official confirmations from the municipalities that the municipal facilities are capable of handling the type of effluent discharged.	12/30/2016
5b-1) Evex will assess the volume and the components of wastewater discharged from DKC and Sunstone hospitals to municipal sewage system, propose and implement measures acceptable to IFC, and establish a monitoring mechanism to ensure that the effluent levels of wastewater discharged from DKC and Sunstone hospitals are in line with those referenced in the table 2 of the WBG EHS Guidelines for Health Care Facilities.	05/30/2017
5b-2) Evex shall monitor the volume and the components of wastewater discharged from DKC and Sunstone hospitals to municipal sewage system, to ensure that the effluent levels of wastewater discharged from DKC and Sunstone hospitals are in line with those referenced in the table 2 of the WBG EHS Guidelines for Health Care Facilities.	11/30/2017
5c) Evex shall undertake an assessment, for each of the existing facilities, in order to identify where the current effluents are being discharged, their volume and composition and identify best alternatives in order to mitigate impacts that could include but not limited to: septic systems, grease traps and/or separation of special effluents from domestic ones. This assessment will include a time bound implementation plan acceptable to IFC.	05/30/2017
6) Evex shall develop a site operation and construction management procedure so to limit/eliminate interaction between hospital operation and renovation/construction activities in terms of health, safety and security of patients and staff.	05/30/2016
7) For the facilities under renovation or the ones that will be acquired that will undergo substantial renovation works, Evex shall provide a third party design certification, from a competent professional acceptable to IFC, to attest material compliance with local as well as internationally accepted life and fire safety standards.	05/30/2016
8) Evex shall provide a third party construction certification, from a competent professional acceptable to IFC, that the construction of all hospitals being substantially renovated under the project are in material compliance with local as well as internationally accepted life and fire safety standards.	05/30/2017
9) Evex shall commission a third party life and fire safety review for a representative number of existing hospitals in order to identify risks and develop a time bound action plan acceptable to IFC for all existing assets in order to eliminate the identified risks.	05/30/2016
10) Evex shall implement during the following year the actions proposed for all existing health care facilities in order to eliminate the identified life and fire safety risks.	12/30/2017