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
PS 5: Land Acquisition and Involuntary Resettlement does not apply to the current investment as the project will be implemented within the existing footprint of the company operations, and no new land is required. There was no involuntary physical or economic displacement associated with the land already acquired by the company.

PS6: Biodiversity Conservation and Sustainable Natural Resources Management does not apply because the company’s operations are located within existing consolidated agricultural or commercial/industrial zoned areas and no conversion of natural/ critical habitats will take place. There is no presence of Indigenous People – PS7 - (as defined in the IFC Performance Standards) and no Cultural Heritage – PS8 – issues have been identified from the documents reviewed and site visits.

Based on the information reviewed by IFC, this proposed investment is expected to have limited E&S impacts which are likely to be site-specific and not significant. Those impacts can be avoided or mitigated by adhering to recognized performance standards, procedures, guidelines and design criteria, as described in the following sections. Thus, this is a Category B project in accordance with IFC’s Environmental and Social Sustainability Policy.

Key E&S issues and risks associated with this project are: Bel Ga Vietnam’s social, EHS and food safety management system and performance; assurance of fair and safe working conditions for company’s employees and contractors; animal welfare and biosecurity management; utilization of equipment and operational practices that maximize conservation of energy, water and process materials, including recycling and reuse initiatives; management of emissions and wastes and their impacts on ambient environment and nearby communities; impacts of transport and warehousing infrastructure and biosecurity issues on the nearby communities.

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:



The company is operating modern breeding farms and hatchery built with state-of-the-art equipment to ensure optimal resource efficiency (energy) vis-à-vis industry benchmarks. These facilities are managed by professional management supported by trained and experienced technical teams at each of the facilities at operations level.



For day to day operations, Bel Ga Vietnam has developed and implemented policies and standard operating procedures (SOPs) to ensure that construction and operation of its facilities meet local EHS regulatory requirements and good international industry practices for bio-security, disease prevention, product quality and production efficiency.



Bel Ga Vietnam is in the process of formalizing its existing commitment towards EHS requirements through the development and adoption of an EHS/sustainability policy to supplement the existing policies; while making a direct reference to comply with IFC Performance Standards and WBG general and poultry production EHS Guidelines at existing and planned operations.



- Environmental and Social Assessment:



In accordance with local regulatory requirements, Bel Ga Vietnam has undertaken an Environmental Impact Assessment (EIA) Study for its existing farms, and an Environmental Commitment (or Initial Environmental Examination - IEE) for the hatchery which were approved by the provincial environmental authority in Da Lat in 2013. These EIA reports already cover the proposed expansion plans. The company has confirmed that it is in the process of obtaining all required environmental, labor, fire safety and operational permits/licenses for the construction and/or operation for its breeding farms and hatchery as per the local regulatory requirements. Copy of EIA Studies and environmental licenses for the operational farms has been provided to IFC during appraisal visits and the sample EIA reports (in Vietnamese language) for Loc Lam and Loc Quang breeding farms are disclosed together with this ESRS.



- Assessment of Labor and Biodiversity Risks in Supply Chain:



The supply chain of Bel Ga Vietnam comprises of highly specialized items, with limited labor or biodiversity risks as contemplated by the supply chain requirements of the Performance Standards. Also the quantities procured by Bel Ga Vietnam are rather small and hence it has limited leverage with suppliers.



The main input for the company’s operations is poultry feed for its breeder farms (about 5,000 tons/year), procured locally from De Heus Vietnam, a subsidiary of one of the sponsors. De Heus Vietnam has its proprietary recipe for the poultry feed, which typically comprises of corn, soybean meal and nutrients.



Other key items in the company’s supply chain include rice husk (about 130 tons/year) procured from local suppliers, vaccines (about 550,000 vials) and parent stock (about 125,000 DOCs) purchased from specialized international suppliers.



- Management Systems and
Programs:



Bel Ga Vietnam has developed a comprehensive set of SOPs for all its operations that address the risks and impacts associated with operations. These procedures cover, among others: bio-security protocols, disease prevention and vaccine plans, nutrition management plan, occupational health and safety for workers, water and waste management plans, including hazardous waste, fire safety, etc. Strict implementation of these at all operations is required and monitored, considering the significant bio-security and disease risks at farms. IFC confirmed effective implementation of the above at all the Bel Ga Vietnam facilities visited during the appraisal.



The company is currently in the process of implementing a documented Hazard and Critical Control Point (HACCP) based Food Safety Management System (FSMS) with focus on good manufacturing practices, sanitation and safety operations procedures (SSOP), bio-security, etc., and is targeting for third-party audit and certification for all the 3 facilities by December 2016.



- Organization:



Bel Ga Vietnam has established a corporate and facility-level structure for the effective implementation of its EHS policies and management procedures. The company’s expatriate General Director, supported by a Sustainability Coordinator/Management Representative for HACCP FSMS, has the oversight on EHS and food safety issues at corporate level. At each facility, a Production Manager is responsible for day-to-day operational management of EHS and food safety related issues, with support from a qualified and experienced team of supervisors and technicians. Key technical staff has received extensive training at the sponsor’s existing operations in Europe.



- Monitoring and Reporting:



Commensurate with limited and site-specific EHS and social impacts from its operations, Bel Ga Vietnam has established corporate and plant-level EHS monitoring and reporting systems and procedures, which are aligned with the local regulatory reporting requirements.



Accordingly, the company monitors several parameters such as: air quality (Dust, SO2, CO, NO2, H2S and NH3), potable water quality, and waste water (pH, suspended solids, BOD, COD, ammonia, phosphate, coliforms). This is in addition to several operational parameters (including those related to animal welfare) in the breeder farms and hatchery, such as: temperature, humidity, CO2 levels, ventilation, lighting etc.



All these monitoring reports are regularly reviewed by the company’s senior management. Moreover, the local environmental protection agency, responsible for issuing environmental licenses, receives bi-annual updates on the company’s EHS performance and conducts inspection visits for the purpose of determining whether operational licenses can be renewed. Based on information provided during appraisal, Bel Ga Vietnam has not incurred any material regulatory penalties, fines or sanctions for contraventions or non-compliance with statutory o
bligations.



- Emergency Preparedness and Response:



Potential incidents that could result in emergencies in the company’s breeding and hatchery operations include disease outbreak at breeding farms and fire. These are addressed in existing SOPs developed by the company. Farm heads, with the assistance of a specifically assigned staff, undertake regular inspection and scheduled training and drills. In addition, local safety regulatory body annually inspects the company’s fire prevention systems.

Bel Ga Vietnam currently has a total workforce of 82 including 30 women employees. After the expansion, the company expects to have a total of 160 employees. These employees are regular employees with full time contracts.



In addition, the company employs about 8 temporary workers in the hatchery and 10 in the breeding farms during peak workload. For the hatchery, it is about 2-3 times a week when the eggs are hatched and DOCs produced; and on breeding farms it is when new parent stock DOCs arrive (about 6 times/year and 2 weeks per time). Bel Ga Vietnam signs a 3 months contract with these workers who are on call, as and when needed.



The company has dormitories for the staff working at breeding farms, which provide for adequate living and recreational facilities consistent with those articulated in the “Workers’ accommodation: processes and standards - A guidance note by IFC and the EBRD”. Since the dormitory, kitchen, washrooms etc. are all adjacent to the controlled quarantine area of the poultry farms, these are also covered under the company’s SOPs for OHS, biosecurity and hygiene and maintained with high hygienic standards.



- Human Resource Policy and Management:



Bel Ga Vietnam has articulated its HR policies and procedures, which cover the following: HR planning, recruitment, terms of employment (compensation, benefits), training, labor relations management, occupational health and safety, and matters related to biosecurity etc.



In addition to the written contract, all the new employees receive HR induction upon taking up the job, and are given detailed information about the terms of employment and HR policies and procedures.



Bel Ga’s HR department currently has 4 full-time staff which makes weekly visits to each facility to ensure compliance with the HR practices across all the facilities, and resolve any issues.



Training:



Bel Ga Vietnam has developed a comprehensive documented training procedure to ensure continuous training at all levels in the company’s farms and hatchery in order to maintain strict enforcement of food safety, biosecurity and EHS procedures. The HR department is accountable for developing and implementing the annual training plan. Every year, based on the analysis of training needs, the HR department in conjunction with the production department develops the training plan for the next year for the approval of Board of Directors. Moreover, during the year, this plan is adjusted in consultation with operations departments, if any specific training needs are identified during the course of the year.



- Freedom of Association



Bel Ga Vietnam respects the staff’s freedom of association and, hence does not prevent formation of employee unions. Currently all the Bel Ga facilities have active staff unions/worker committees in accordance with Vietnamese labor law.



- Grievance Mechanism

As per the documented procedure in the HR manual, employees can raise their grievances through regula
r face-to-face meetings with their supervisors or by talking to HR department, or through the labor union. In addition, they can share their grievances, by using a mail box (also called Idea Box) kept at each facility. All new employees are informed about these grievance redressal channels during their induction training. Further, the company will include this information in the staff handbook provided to all the new staff upon joining.



- Child Labor



The company does not employ child or forced labour. This is ensured at the time of recruitment by the HR Department through verification of necessary certificates for all employees. No evidence of child labor practices was found during the appraisal site visits.



- Animal Welfare, Biosecurity and Occupational Health and Safety:



Key issues for Bel Ga Vietnam’s business are animal welfare, biosecurity and related food safety, which also has a direct bearing on employees’ health and safety. As part of the company operational manual, detailed biosecurity and health and safety management protocols have been articulated, including farm layout and design, access controls, quarantine procedures, monitoring and day to day operational SOPs. During the appraisal site visit, these were observed to be strictly implemented.

- Resource Efficiency:



The operations of Bel Ga Vietnam are not resource intensive; the main resource inputs are water and electricity. Still, in line with the corporate philosophy of its European sponsors, the company has focused on resource efficiency as a priority and has consistently applied new techniques and practices throughout its operations for enhanced resource efficiency.



These include, for instance, regular monitoring of water and electricity and their subsequent benchmarking (e.g. electricity consumption per flock of DOCs), regular preventive maintenance of equipment, good operational practices to encourage conservation of electricity and water (e.g. closing storage room door before using heater in fumigation room; opening the setter room for 30 - 60 minutes to raise air temperature from 20 to 22 deg C to save energy consumption from the running, controlling automatic set points for the equipment to avoid overheating or cooling; and, computerized control of lighting in poultry houses etc. Similarly, design and construction of all the facilities include measures to maximize the natural light and ventilation.



- Energy & Air Emissions:



Electricity is sourced from the grid, while diesel generators are provided for backup power. Air emissions are monitored every 6 months as per the environmental permit conditions.



- Water, Wastewater



Water required for its operations, including the daily use for the staff working and living on-site, is sourced from the groundwater wells within the company premises. On an average, each breeder farm consumes about 30 cum/day of fresh water; while the hatchery consumes about half of that.



At the hatchery, a wastewater treatment system is already in place in accordance with the environmental permit conditions. The treated effluent is discharged in the stream as approved by local authorities after chlorination (for disinfection).



At the breeder farms, waste water from daily activities such as cooking, bathrooms, toilet, laundry, and general cleaning go to the septic tank, while the waste water from production activities goes to septic tanks located in respective zones. The treated wastewater from septic tank is currently used for spraying the manure generated from the poultry sheds, which improves the composting process and thus the quality of the manure sold. Company has made plans to build a wastewater treatment plant at each breeder farm. The treated effluent from the wastewater plant will continue to be used for spraying the manure for composting, prior to selling it to nearby farmers.



As such, the company does not discharge any of its wastewater from any facility to natural water bodies and hence wastewater discharge limits articulated in WBG EHS Guidelines are not applicable. None-the-less, a review of bi-annual wastewater monitoring data confirms that the treated effluent from septic tanks at breeder farms, or wastewater treatment plant at hatchery is well within the l
ocal regulatory limits as well as those in Table 1 of the WBG EHS Guidelines for Poultry Production.



- Waste Management



Poultry operations generate significant quantities of animal waste, mainly manure, but also including other materials such as bedding. Other solid waste generated includes: waste feed, carcasses, and sediments and sludge from on-site wastewater treatment facilities, packaging (e.g. for feed), used ventilation filters, unused/ spoilt medications, used vaccination vials and syringes and used cleaning materials.



Waste management at breeding farms is done as per the company’s SOPs and applicable local regulatory requirements. Manure is composted for 3 weeks to avoid any bacteria in manure (and sprayed with treated wastewater during this time) and then it is sold in bags to farmers for land application as fertilizer. Other waste is sent to municipal collection point as per the environmental permit conditions.



The waste from hatchery including egg shells is sent to a licensed contractor. Similarly, hazardous waste is separately collected and categorized (e.g. vaccination bottles, syringe needles), disinfected as needed and sent to the licensed contractors after necessary labeling as per the environmental permit condition.



- Carbon Footprint:



GHG emissions resulting from the proposed project are estimated based on electricity consumption at the company’s facilities, as well as those from the parent stock. The Project’s GHG footprint is thus estimated at about 700 tones CO2eq / year using IFC’s Carbon Emission Estimator Tool (CEET), which comprises of both Scope 1 and Scope 2 GHG emissions. Actual records will be used to review amounts of tons CO2 equivalent per year in the future.

The main potential risks related to the community from the company’s operations include food safety issues, the spread of animal diseases at hatchery and breeder farms, and impacts from liquid effluents and air emissions.



As Bel Ga Vietnam’s facilities are isolated from human settlements for bio-security measures, traffic or other issues do not represent a significant risk for the local population.



- Security Personnel:



Security personal at the company facilities are company employees. They are not armed and are trained on matters related to life and fire safety, including active involvement in regular fire drills, emergency preparedness and response, first aid, and most importantly, biosafety and quarantine management for all the staff and visitors.

As mentioned earlier, the company’s breeding farms are in agriculture areas far away from any community or households, while the hatchery is located in an industrial area. As such, there no affected communities related to Bel Ga Vietnam’s operations.

However, the company is actively engaging with the local communities in the district through corporate social responsibility activities such as making donations and supporting the local schools, orphanages or the nearby communes.

Environmental:
Contact Person: Nguyen Thi Thien Kieu (Ms.Rosy)
Company Name: Bel Ga JSC
Address: Loc Son Industrial Zone, Bao Loc city, Lam Dong province, Viet Nam
Email: mailto:rosy.kieu@belga.com.vn
Phone: +84 912504537
Facsimile: +84 633710097

Health & Safety:
Contact Person: Nguyen Ngoc Luu Ly (Ms.Sunny)
Company Name: Bel Ga JSC
Address: Loc Son Industrial Zone, Bao Loc city, Lam Dong province, Viet Nam
Email: mailto:sunny.ly@belga.com.vn
Phone: +84 985565463
Facsimile: +84 633710097

Broad Community Support is not applicable for this project