Rede D’Or’s hospitals and related facilities are located in consolidated urban areas with established connections to public water, sewage, and electricity utilities. The acquisition or rental of land used for Rede D'Or's facilities has been made on the basis of willing buyer/willing seller transactions with private owners. It was therefore considered that PS5 (Land Acquisition and Involuntary Resettlement), PS6 (Biodiversity Conservation and Sustainable Natural Resource Management), PS7 (Indigenous Peoples), and PS8 (Cultural Heritage) do not apply to this project.

This is a category-B project according to IFC’s Policy on Environmental and Social Sustainability because the proposed business activities are considered to involve potentially limited adverse environmental or social risks and impacts that are few in number, generally site-specific, largely reversible, and readily addressed through mitigation measures.

Based on IFC’s ongoing supervision of previous investments with the company, the project's key environmental and social risks and impacts mainly relate to the following: (a) environmental and social management capacity and systems, (b) more proactive engagement with stakeholders, including the provision of more information about construction projects and the availability of an external grievance mechanism, to address any complaints from construction-related activities, (c) labor and working conditions, including occupational health and safety during construction and operation of company facilities, (d) protection of community health through adequate building infrastructure and measures to guarantee life and fire safety, and (e) emergency preparedness and response, especially life and fire safety.

Environmental and Social Assessment and Management System: Rede D'Or’s environmental and social management system is based on its Integrated Health and Safety System (known as Gestão Integrada de Saúde e Segurança, or GISS). GISS focuses on operationalizing the body of Brazilian occupational risk, health, and safety norms known as the normas regulamentadoras (see description under Performance Standard 2 for more details). As management of regions and the hospitals within them is relatively decentralized, GISS orients but does not direct individual hospitals on E&S performance by collecting data, providing training and technical support, and flagging up issues for management attention at the hospital, regional, and potentially corporate levels. Nonetheless, GISS is important as a driver for integrating newly-acquired hospitals into the chain and ensuring a basic level of compliance with EHS issues, and it is central to accident-reporting and incident response. Certain environmental aspects are managed independently through a sustainability team within the company’s audit and quality functions.

These elements operate alongside of the company’s general quality assurance system, known as Prime, which focuses on three general pillars: financial performance, the quality of hospital care from a technical standpoint, and the patient experience. Composed of myriad indicators under these three pillars, Prime helps drive the company’s efforts to secure third-party quality certifications, such as Joint Commission International (JCI), Organização Nacional de Acreditação (ONA, a Brazilian standard), and occasionally Accreditation Canada. Certain HR-related and environmental indicators (for example, the use of water and electricity and generation of waste) feed into Prime, but for the most part it remains a stand-alone system. Separately, at the regional level there is monthly reporting on accidents/absenteeism, and resource use is reported on a quarterly basis. One hospital, Anália Franco, has automated tracking of its use of water and energy, and facilities managers receive SMS alerts of extreme use of such resources.   

Rede D’Or management systems more generally are undergoing a series of changes. Rede D’Or has launched an initiative called Conecta D’Or to establish a unified Enterprise Resource Planning system. Called Proteus 12, this ERP is focused more on operational and budgetary issues, and once implemented, it will be able to track with greater precision and geographic reach certain aspects of the company’s E&S functioning, such as occupational health for staff, training, use of PPE, and compliance with certain life and fire safety issues. Separately, In short, however, the company lacks a consolidated ESMS that functions on a unified basis across the company’s operations and that allows senior management oversight of key E&S aspects. Under the ESAP, the company will analyze its current approach to managing E&S aspects and develop an action plan with specific timeframes to consolidate its ESMS. This plan will be implemented, reviewed, and adjusted as necessary within the first year of implementation.  

Policy: Under the second IFC investment, Rede D’Or established a comprehensive E&S policy covering all key aspects of its functioning. This policy has been distributed widely, and it is subject to periodic monitoring and review. As part of its review of its ESMS, the company will update and strengthen its E&S policy as necessary.

Identification of Risks and Impacts: Brazilian law does not require Environmental Impact Assessments for new hospital development or expansion of existing units. New facilities must obtain a series of construction and operating licenses applicable to hospitals; in certain municipalities, including where Rede D'Or operates, completion of a Neighborhood Impact Assessment (Estudo de Impacto de Vizinhança) is needed for construction projects. These studies typically involve an analysis of basic environmental considerations, impacts from noise and traffic, and effects on local property valuations.   

All hospitals are also required to have a hospital waste management plan (known by its Portuguese acronym, PGRSS) approved by relevant authorities. Construction of new hospitals wings or greenfield units, much of which is managed intensively by a large in-house team, is underpinned by a strong approach to designing and building structures in ways to minimize risks or impacts and to maximize resource efficiency. Beyond these regulatory requirements, Rede D'Or previously had in place a more robust system and set of processes for identifying risks and impacts of its operations. This included, in particular, its "checklist" system used for diagnosing significant equipment, maintenance, performance, and training gaps for newly-acquired hospitals. This diagnosis then allowed for vigorous follow-up and resolution of these gaps to minimize, eliminate, or otherwise manage key risks. This approach has largely been supplanted by one that focuses on the integration of newly-acquired hospitals into the company’s systems via the functioning of a Project Management Office and the use of a “due diligence” process. This process focuses primarily on medical, financial, and operational issues at the hospital to be acquired, and an action plan and timeframe for the integration of the hospital into the system is aggressively defined. E&S items are not routinely included in this due diligence process; they are attended to later in the integration process.  

As part of the ESAP under the new investment, Rede D’Or will develop a standard operating procedure (SOP) that aims to ensure that after an acquisition, all material E&S aspects, particularly life and fire safety (L&FS) and occupational health and safety (OHS) requirements, are fully analyzed and addressed as part of the integration plan of a newly acquired hospital. As part of the ESAP item on strengthening its ESMS, stipulated above, the company will review what processes and procedures related to E&S risks and impacts it can standardize, train against, and monitor systematically at the corporate level through standardized operational procedures (SOPs or POPs, in Portuguese).   

Management Programs: Due to rapid expansion and turnover of key staff, Rede D’Or’s focus on E&S management programs has diminished over the last 1-2 years. Its previous “checklist” systems of facility and equipment preparedness, audited at individual hospitals by corporate staff, has not continued, and in the area of OHS (see below under PS2), accident rates are a source of concern and should be the focus of a targeted management program. Resource use is tracked, but no concerted effort is made to identify and achieve specific reduction goals. Under the ESAP, the company is therefore required to re-examine what types of E&S management programs are priorities for the coming years, for example, the consolidation of a company-wide ESMS, a resource efficiency initiative, and a program to reduce workplace accidents, and based on this review, the company will launch appropriate efforts. These should be grounded in concrete goal-setting and backed up by periodic audits, progress reports, and follow-up actions.  

Organizational Capacity and Competency: Rede D'Or has both corporate-level teams and hospital-specific staff who are responsible for managing elements of the company's overall ESMS and for implementing or monitoring specific activities. At the corporate level, myriad interrelated groups focus on environmental and social issues on a day-to-day basis. These are (1) functions related to facilities, maintenance, nutrition, and housekeeping, (2) human resources, and (3) occupational health and safety (known by the standard Brazilian name, Serviço Especializado em Engenharia de Segurança e em Medicina do Trabalho, or SESMT), which reports to human resources and then to legal affairs, and (4) diverse functions related to quality control (e.g. management of the Prime system), audit and institutional controls (which tracks some sustainability issues i.e., resource use), and corporate risk management and compliance (which handles the internal complaints mechanism described under PS2).

The senior managers and mid-level staff whom the IFC met in these functions are all well-trained, well-seasoned professionals, often with years of experience in their areas. Hospital-level staff responsible for environmental and social functions, who can vary in number based on the size and complexity of the unit, report to the operational director but also receive visits and support from corporate-level personnel involved in quality control, occupational health and safety and/or facilities management. The major weakness in Rede D’Or’s current management capacity, however, is the lack of senior-level oversight of E&S functions, which are dispersed across different departments. Rede D’Or has, therefore, nominated a senior-level person to report directly to the CEO on E&S issues.    

Emergency Preparedness and Response: Rede D'Or has a well-developed approach to emergency preparedness and response, despite the constraints of a hospital environment (where it is not feasible to perform full-on fire drills during day-to-day operations, for example). Rede D'Or follows all relevant state norms on emergency preparedness and fire safety. The company has a master emergency plan (plano de emergência), which each of its units is also expected to formulate at the local level. These plans are to contain an evacuation plan, a communications plan, training program, drills, fire response plan, and a response plan in the event of a catastrophe or disaster with multiple victims. Specifically, each local emergency plan describes key characteristics of life and fire safety at the site's building(s), ward by ward, floor by floor, and identifies potential risks in each, particularly those stemming from the potential for accidental fires or similar events. The plan describes escape routes for use during any evacuation and provides guidance on procedures for crisis response, including external contacts, such as for the local fire department, and each hospital has clearly designated personnel for a crisis management team. In addition, Rede D'Or has established contingency plans in the event of any critical failure (of drinking water, power supply, or medical gases).

For almost all of its units around the country Rede D'Or has established emergency response teams covering all wards/floors and shifts at a given location, to ensure at least a minimum emergency response capacity at all times. Rede D'Or sends staff appointed to emergency response functions (known in Brazil as brigadistas) to structured trainings offered by state-level fire departments. Given the constraints of hospital operations, the company is not able to conduct fire drills for its ongoing hospital operations on a comprehensive basis, but it does seek to run drills with personnel outside of operational areas. For example, the company took advantage of the recent remodeling of a ward to conduct a sophisticated simulation with a significant number of personnel in a vacant area in one of its hospitals. The company also seeks to develop and maintain a proactive relationship with local fire departments (whose personnel rotates often) so that first responders are familiar with Rede D'Or's buildings, staff, and operational challenges.  

As part of its efforts under the second investment, Rede D’Or reports to IFC on the status, by hospital, for (1) its fire safety certificate (Auto de Vistoria do Corpo de Bombeiros, AVCB, or equivalent), (2) the completeness of the unit's emergency response plans, (3) designation of crisis management and emergency response teams, and (4) the status of yearly trainings (both internal and external) for emergency response staff. The company has been making consistent progress in closing gaps in these arrangements over time. The company will provide yearly updates to IFC on these items to ensure that newly-acquired hospitals are fully integrated into Rede D’Or’s plans for emergency preparedness and response. Under the ESAP, the company will provide a time-bound corrective action plan to apply for the obtainment of AVCBs and to prepare adequate emergency response plans for hospitals identified with these gaps. The corrective plan should aim to address such gaps by December 2017.  

Monitoring and Review: Given the threat of hospital-related infections, quality of care and patient experience are therefore closely related to underlying systems for managing hospital wastes and minimizing or mitigating other risks. Together with financial performance, the quality of medical care and patient experience is the subject of monthly monitoring and review meetings with the management team at each hospital through the Prime system mentioned above. As also noted above, however, Rede D'Or’s system for monitoring and reporting internally on E&S performance could be strengthened so as to ensure that (1) key E&S indicators are incorporated more consistently into senior management decision-making, and (2) targets for performance improvements are set and can be followed at the corporate level. As part of its review of its ESMS, Rede D’Or will therefore also examine ways to improve the quality, timeliness, and level of decision-maker involved in its monitoring and reporting system.

Working Conditions and Management of Worker Relationship: Rede D'Or has established a strong approach to attracting, training, and retaining a well-qualified workforce. In a competitive market for skilled healthcare personnel, the company maintains a sizeable workforce of more than 34,000 employees and two types of contractor personnel. First, Rede D’Or employs personnel who are present at their facilities on a daily basis, engaged in routine roles such as unarmed security personnel, IT support, heavy cleaning or specialized maintenance, and some catering. These so-called “permanent third-party workers” number approximately 14,000. (The exact number is not possible to know since the company contracts these services on an “as-delivered” basis.) In addition, Rede D’Or contracts specialized service providers for specific, discrete tasks. These include approximately 9,900 doctors who use the Rede D’Or facilities for patient care, but who are not full-time employs of the company. Other outsourced services include transportation and disposal of solid waste, including hazardous hospital waste, and transport of radioactive drugs. Finally, Rede D’Or employs a significant number of construction workers via contractors involved in building greenfield or expansion constructions.

In general, Rede D’Or seeks to maintain a positive relationship between management and workers, and IFC has consistently encountered staff who report a conducive work atmosphere and ample opportunities for professional advancement and development. The company did not report any significant cases of investigations or class-action lawsuits by the Public Prosecutor for labor issues, and it is not currently subject to any consent agreements (known in Portuguese as a Termo de Ajuste de Conduta, or TAC) with such authorities to correct deficient labor practices. Female workers constitute approximately 74% of the company's direct-hire workforce, which is distributed across operational activities in Rio de Janeiro, São Paulo, Recife, and Brasilia (Federal District). Rede D'Or invests in feedback, training, and education for its staff, including a formally structured training program for different employee types and categories, specialized courses on specific topics in healthcare, and educational opportunities outside of the company's in-house offerings. The company is currently launching a new training initiative with bases in São Paulo, Rio, and Brasilia in order to redouble its commitment to staff learning, professionalism, and retention.

The company's operations have grown significantly over recent years and are expected to continue to increase given its ongoing acquisition and expansion activities. Rede D’Or’s turnover rate, however, is approximately 30 percent per year. Company officials indicate that this turnover rate stems from a competitive labor market in the Brazilian health sector and reflects Rede D’Or’s policy of paying median salaries by industry standards. Nonetheless, the company is cognizant of the costs associated with this turnover, and it is seeking, particularly through training and career advancement opportunities, to retain and reward its highest-performing employees. In late 2016 and early 2017 it launched an internal effort to examine all sources of relevant information about worker satisfaction – such an surveys, exit interviews, complaints lodged via the worker grievance mechanism – and it has an internal strategy for developing a “bottom-up” action plan for reducing turnover and increasing worker retention. As part of the ESAP, Rede D’Or will formalize and implement a company-wide action plan to increase worker retention.

Human Resources Policies and Procedures: Rede D’Or’s human resources department has documented procedures including hiring, selection, disciplinary measures, transfer of employees, payment of benefits, and the like. Its HR strategy seeks to create a structured approach to human resource management, career development, and professional advancement, including by posting all of its human resources policies and procedures on the company intranet, and the company has developed its own in-house software for HR management. The practical elements of its HR strategy are to focus on onboarding new staff quickly and effectively, to attend to employees' occupational health and safety (see below under "Occupational Health and Safety"), to provide areas for relaxation during breaks, to give regular feedback on employee performance, to recognize superior work publicly, and to offer competitive benefits, including the performance-based bonuses.

Working Conditions and Terms of Employment: Conditions of employment are defined in the contracts that Rede D’Or signs with its employees and in the list of benefits, both of which are communicated to the employees during induction. Collective agreements further define the benefits and conditions of employment. In addition to benefits defined in Brazilian legislation, employees have access to a health care plan, dental services, pharmacy discounts, transportation subsidies, and grants for educational courses offered by Rede D’Or.

Workers’ Organization: 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). Labor relations are highly regulated under the country’s laws and labor practices, including the requirement for all types of workers to belong to a union. The company employs workers associated with close to 40 different occupational and regional unions; a significant portion of the workforce belongs to affiliates of Brazil's main nursing and healthcare worker unions. The company reports positive relations with both the employers’ union to which it belongs and the workers’ unions that its employees belong to.

Non-discrimination and Equal Opportunity: Rede D’Or has well-defined statements regarding non-discrimination and equal opportunity. Fair treatment is observed in the company, including processes of hiring, promotion and termination of employment. Rede D’Or has a well-defined selection process, an annual performance assessment, and leadership programs to promote personnel with defined skills. Approximately three quarters of Rede D’Or’s workforce are women. The company is also endeavoring to comply with Brazilian legal requirements under Law 8213 (1991) to meet targeted quotas for hiring persons with handicaps.

Retrenchment: As the company has experienced steady growth over recent years – even in spite Brazil’s economic downturn – no retrenchment is expected in the near future of this project. Nonetheless, should the need for layoffs arise, the company will comply with stringent Brazilian legal conditions (including union approvals for dismissals) and relevant PS2 requirements.

Grievance Mechanism: The company has a code for workplace conduct applicable to all employees as well as an anti-corruption policy. These documents were updated in early 2016 as part of the overhaul of the company’s in-house grievance, Canal da Ética, and the creation of a new department responsible for corporate risk management and compliance. These documents include statements regarding non-discrimination, equal opportunities, and protection of the workforce as well the company’s zero-tolerance approach to corruption.

Under the revamped workers’ grievance mechanism (previously Canal da Ética, now called Rede Ética), an external third-party manages complaints, which can be raised anonymously through an online option (http://www.redeetica.com.br/) or via a confidentially staffed toll-free number or email address. The system has controls to ensure no conflicts of interest arise, set timeframes within which internal investigations are to be carried out, and target dates for when initial responses or solutions are to be provided. If needed, external investigations are possible, and functioning of the system as a whole will be audited by an outside accounting firm. The new system was launched in the first half of 2016, and Rede D’Or reports that complaints are being submitted from all parts of the organization. Response times have been reduced in light of a generally positive reaction to the new system. First rolled out with the company’s direct-hire staff, the mechanism’s coverage has been expanded to third-party workers.

Protecting the Work Force: Rede D'Or systematically applies all Brazilian legislation and regulations on labor standards, including respect for labor rights, minimum age requirements, and prohibitions against forced labor. Contracts with companies who engage third-party workers include prohibitions against any underage or forced labor. Rede D’Or does occasionally employ young workers as part of the Jovem Aprendiz program, but it does so within the rules and norms of this government-sanctioned program, including protecting participants against handling hazardous materials or engaging in any hazardous work activities. For all other workers the minimum age for employment is 18 years, which is verified at the time of job interviews and contracting for new employees.

Occupational Health and Safety: Rede D’Or manages OHS risks by seeking compliance with Brazil's national and local regulations, which constitute a comprehensive and well-defined system of norms and procedures. The company meets Brazilian requirements for its hospitals, for example, by implementing a generic mandatory Risk Prevention Plan (known by its Portuguese acronym, PPRA) and Health Monitoring Program (PCMSO), providing training and personal protective equipment for its employees, and applying a specially-defined Brazilian regulatory norm (norma regulamentadora) for the health sector: Safety and Occupational Health in the Health Services (known as NR-32).

The company previously had a corporate OHS group based in its headquarters, first as part of its shared services department and then under Human Resources. It was staffed by two safety professionals. In September 2016, this team was restructured, and the corporate OHS functions became part of the management unit responsible for labor relations, directly linked to the Human Resources Department. The team is now composed of three professionals: a work safety engineer, a physician trained in occupational health, and an analyst focused on tracking health and safety indicators in the workplace. Throughout all of its hospitals Rede D'Or has more than 200 OHS staff, including safety engineers, safety technicians, and physicians and nurses specialized in occupational health, who answer to hospital directors at the local level. The OHS team at the corporate level is responsible for communicating with all of Rede D'Or's hospitals and monitoring compliance with Brazilian occupational health and safety requirements, especially the compulsory use of appropriate personal protection equipment given different work-related risks. Requirements also include setting up internal committees for accident prevention (CIPA), which are responsible for investigating and analyzing occupational accidents, incidents, and health issues, as well as the above-mentioned processes of identifying and preventing workplace environmental risks (PPRA), monitoring occupational health (PCMSO), and complying with the regulatory norm on Safety and Occupational Health in the Health Services (NR-32). 

Rede D’Or records and investigates all lost-time accidents, with records readily retrievable from its databases, and it can demonstrate follow-up after accidents and recommendations of measures to prevent recurrence of such incidents. Due to the company’s highly-decentralized management structure, however, workplace accidents have remained persistent, and their frequency has risen in the last year. According to data for 2015 provided by the company, Rede D’Or has an overall lost-time accident frequency rate (LTIFR) of 120 accidents per million hours worked, which is extremely high compared to benchmarks, including two of Brazil’s best non-profit hospitals. This represents a significant increase since 2014, when the appraisal for the second investment was conducted. This situation might be exacerbated by an internal division through which OHS functions report through HR/Operations and medical professionals are supervised by a Medical Practice Group. Therefore, under the ESAP, Rede D’Or will review the root-cause analyses performed for accidents in 2014-16 in an effort to identify trends, constraints, and shortcomings in the company’s management of OHS and thereby identify ways in which to reduce the LTIFR. As noted above under PS1, a management program to address this issue should be considered; at a minimum an action plan will be developed. To do so, it could bring its demonstrated commitment to defining its patient care protocols (through its CPPM or Committee for the Standardization of Materials, Medications, and Equipment) to the challenge of standardizing, training against, and monitoring OHS practices rigorously.

As part of its expansion plans, Rede D'Or anticipates increase its capacity through a series of acquisitions and brownfield and greenfield projects. While a c. 100-person in-house team manages the design, permitting, and construction of additional hospital wings or brand-new hospitals, the company does outsource the actual construction of such structures to qualified companies. In addition, Rede D'Or frequently has smaller-scale remodeling, repair, or maintenance work (e.g. external window-cleaning) underway where there may be significant occupational health or safety risks. A Brazilian regulatory norm governs civil construction (this norm, referred to as NR-18, is also known by its Portuguese acronym, PCMAT for "Programa de Condições e Meio Ambiente de Trabalho na Indústria da Construção Civil"). As part of the second investment, Rede D'Or instituted its own in-house guide for managing and overseeing OHS vis-à-vis third-parties, applying a checklist approach that will serve as the basis for identifying and discussing any performance gaps with contractors. Through its supervision activities IFC has been able to verify that Rede D'Or monitors OHS of third-party construction workers through checks on contractors' application of NR-18 at its worksites.

Workers Engaged by Third Parties: Companies that provide all types of third-party workers are screened by the Supplies Department for compliance with Brazilian labor and OHS norms, social security payments, and the like. Standard provisions are included in contracts, and Rede D’Or releases payments to them only on the basis of proof of compliance with such provisions. As noted immediately above, Rede D'Or's ongoing operations and expansion projects encompass some high-risk work activities executed by third-parties for which the company monitors contractor OHS performance through an internal guide and monitoring system required under the ESAP of the second investment. Since its inception the workers’ complaints mechanism (originally known as the Canal da Ética, but newly revamped and now called Rede Ética) has been open to third-party workers as well through an online option or via a secure email or toll-free number managed by a third-party provider. Included in contracts with service providers is information about the complaints mechanism. Under the ESAP, the company will communicate information about access to and functioning of the Canal da Ética (now known as Rede Ética) to third-party workers employed by the company itself or by construction companies working on greenfield or expansion projects. To this end, the company will develop and implement an appropriate communications plan to cover third-party workers.

Supply Chain: There are no risks or impacts stemming from Rede D'Or’s supply chain relevant to this investment.

Resource Efficiency and Energy and Material Efficiency Projects: Rede D’Or is strongly oriented toward optimizing the use of resources including electricity and water. In about a half-dozen existing and new hospitals, the company has undertaken various measures such as the replacement of lighting with LED bulbs, installation of chiller systems, use of more efficient gas-fired water heaters, introduction of automated systems for maintaining optimal temperatures from an eco-efficiency standpoint, etc. New building designs have used more efficient window glass and ventilated facades to reduce air conditioning needs. The company will continue to identify opportunities to conserve resources in its operations, including in the construction of new facilities. Nonetheless, due to growth in the number of hospitals, the group's energy use increased in 2015 by 9% to more than 121.5 million kWh. Using 4,600 functioning beds as the basis for the per-bed calculation, the company consumed 26,418 kWh/bed, which is slightly higher than the 24,750 kWh/bed average reported in 2014 (at the time of IFC’s last investment). This nonetheless compares favorably with the global benchmark for hospitals (30,000 kWh/bed). In addition, it should be noted that the company is actively considering participation in IFC’s Greenbuilding program.

All units have auxiliary power from backup diesel generators for 30-60 minutes, depending on the hospital. It is also a group policy to have at least two diesel generators on stand-by at each unit to maintain the power supply for at least 6 hours in case of emergencies. There are contingency plans for receiving extra fuel quickly in the event of longer periods of energy shortage. In order to save on costs of energy sourced from the main power grid, some facilities use their generators on a daily basis during peak consumption periods (in the early evening).

Water: The water used in hospital facilities is always provided by the local municipal or state water companies through public networks. All facilities are further equipped with dechlorination and activated carbon filtration systems to further treat municipal water prior to internal consumption and use in medical or other activities. Water quality monitoring is performed by an external service provider on a monthly basis.

GHG Emissions: The company’s direct and indirect emissions of greenhouse gases (GHGs) from fuel consumption by diesel-powered auxiliary generators and from its general electricity consumption come to approximately 11,000 tons of CO2 equivalent/year. The company is therefore not considered to be a significant emitter of GHGs.

Ambient Air Quality: The company contracts service providers to perform periodic testing and cleaning of internal air ducts to safeguard the health of employees and patients and prevent transmission of infectious agents through the internal ventilation system.

Wastewater Treatment: Liquid effluents, mainly those from sanitation and food services, are in most cases discharged into the municipal sewage systems. All the units connected to the municipal sewage network are equipped with a “filter sink” consisting of decantation, filtering, and chlorination, which provides an initial pre-treatment of hospital effluents prior to the discharge into the public sewer collection and treatment network. Rede D’Or complies with the conditions defined in its operating licenses, including the collection and disposal of sludge by authorized companies. Local standards are set by the Brazilian government’s National Environmental Council under CONAMA Resolution Nos. 357 (2005), 430 (2011), and 377 (2006).

Solid Waste Management (including Hazardous Materials): Rede D’Or has a corporate hospital waste management plan (known by its Portuguese acronym, PGRSS) in accordance with the Brazilian regulation No. 306 of ANVISA (National Agency for Sanitary Vigilance), issued in 2004, and CONAMA Resolution No. 358 (2005). All waste generated in the company's hospitals is collected, stored, and disposed of following this corporate hospital waste management plan, which is adapted at the facility level depending on the types of waste streams generated at each location. The plan includes procedures for the segregation and management of waste flows inside the units and for their proper handling, collection, temporary storage, and transport and disposal.

The hospital chain generates three broad types of liquid and solid wastes consisting of (i) common household waste from the patient care areas, kitchens, coffee shops, and toilets; (ii) infectious waste, which is specially collected and stored in a segregated manner; and (iii) chemical waste, which is also specially collected and stored in a segregated manner. All wastes are accumulated in temporary storage areas, where they are collected by external service providers licensed by relevant environmental authorities for transport, treatment, and disposal. Common and organic wastes are disposed of at a sanitary landfill, while chemical, infectious, and skin-piercing wastes are incinerated by a licensed company. All such service companies are audited by representatives of the hospitals' infection control committees. Hazardous substances from the hospital group's biological laboratories are treated separately and collected by a certified company due to the pathological risks of discharge via laboratory effluents.

The sites for temporary storage of waste – whether domestic waste, chemical waste, or hazardous waste – were observed by the IFC to be clean, well-organized and with appropriate access restrictions, thereby preventing contact with or handling by unauthorized people. The company's PGRSS requires the tracking and monitoring hazardous wastes in spreadsheets, which are forwarded to the audit and compliance department in headquarters on a monthly basis.

Community Health and Safety: Company facilities are regulated by ANVISA (the National Agency for Sanitary Vigilance), which reviews and approves hospital engineering designs, issues operating licenses, and regularly inspects all of the group's hospitals for compliance with patient health and safety requirements. Both the company and this public agency monitor patient morbidity and mortality statistics as indicators of company performance and quality of care. In addition, the company itself monitors readmission rates to determine whether its healthcare services have been fully successful; it otherwise analyzes cases of readmission to identify shortcoming in its care and management systems.

The company takes active steps to manage and reduce the risk of hospital-related infections. In all of its hospitals it currently implements clinical and non-clinical risk management committees to prevent hospital infections (known by its Portuguese acronym, CCIH). These committees analyze infection risks and monitor the effectiveness of prevention and control measures, including waste collection, access control, and facility cleaning, and they are also involved in investigating cases of hospital-related infections to understand and address their causes. As noted above, the company has secured or is currently in the process of securing quality accreditation for all of its hospitals under one or more of the following schemes: the Brazilian National Accreditation Organization (ONA), QMentum/Accreditation Canada, and Joint Commission International (JCI). Assuring high-quality patient health and safety management are key standards under these schemes.

Infrastructure and Equipment Design and Safety: Under the ESAP for the second investment, IFC required Rede D’Or to introduce life and fire safety (L&FS) features into expansion and greenfield designs according to international standards that go beyond Brazilian regulatory requirements. This process involved retrofitting some hospitals constructed or expanded during the first investment, but without due regard for L&FS requirements. The company also developed a design guide for incorporating international L&FS standards into its new constructions. Under the new investment, Rede D’Or will continue to apply its L&FS design guide to new constructions. As per the ESAP, for new hospital construction initiated in a given year – whether greenfield or large brownfield – the company will engage the professional services of a Life and Fire Safety Engineer specialized in international norms to carry out post-construction inspections and certify that the as-built status conforms to the company’s internal L&FS design guide.

Hazardous Materials Management and Safety: As required by Brazilian legislation and the hospital group's operating licenses, Rede D'Or manages hazardous wastes in accordance with relevant norms and regulations. Please see above under PS3 (Resource Efficiency and Pollution Prevention) for more details on these measures.

Community Exposure to Disease: As required by Brazilian legislation and the hospital group's operating licenses, Rede D'Or manages community exposure to communicable diseases accordance with relevant norms and regulations. Please see above under PS3 (Resource Efficiency and Pollution Prevention) for more details on these measures.

Emergency Preparedness and Response: The company has a management program to ensure compliance with local life and fire safety (L&FS) requirements across all of its operations. In addition, Rede D'Or seeks to adopt a proactive approach to prevent incidents that could cause a fire or any other emergency that would require moving or evacuating patients, for example, regular inspections to ensure that CO2-based kitchen fire suppression systems and any equipment operating under pressure are functioning properly. As noted above under PS1, IFC is continuing to monitor progress in Rede D’Or’s compliance with four key aspects of emergency preparedness at its facilities (up-to-date fire safety certificate, an established emergency response plan, a designated emergency response team at each facility, and regular trainings for such), as per the ESAP of the second IFC investment. This monitoring will continue in the new investment.

Stakeholder Mapping/Analysis and Stakeholder Engagement Plan: Rede D'Or has multiple mechanisms for patients/clients and for its own staff to raise issues with the company's management regarding quality of service or workplace concerns, but the company does not currently have specific measures in place to engage with stakeholders and neighbors – whether commercial or residential – regarding construction projects and the disruptions from noise, dust, and traffic that might accompany them. Under the second investment, Rede D’Or was to carry out Neighborhood Impact Assessments (estudos de impacto de vizinhança, or EIV) to analyze and manage disruptions that could arise from larger-scale construction projects. This did not take place on a systematic basis, and as a result the ESAP for the new investment requires the company to commission such a study for all construction or major renovation projects before the issuance of the municipal construction permit (alvará de construção or equivalent).

Information Disclosure and Ongoing Reporting to Affected Communities: Further to IFC’s second investment, Rede D’Or has begun publishing yearly reports on its E&S performance, based on the GRI methodology. Under the ESAP for that investment, Rede D’Or was also required to conduct and publicize on its website Neighborhood Impact Studies for its major construction projects. It has since published such studies for the São Caetano, viValle, Copa Star, Niterói D’Or, and Real D’Or hospitals. Under the ESAP for the new investment, Rede D’Or will continue to ensure that Neighborhood Impact Studies are completed and publicized for any significant construction project under the third investment.  

External Communications and Grievance Mechanisms: In 2014-15, further to an ESAP item in the second investment, Rede D'Or restructured its external complaint mechanism (ouvidoria) and  expanded its scope to include issues, questions, and grievances unrelated to quality of medical services or patient care. The company reports that under its revamped mechanism it has received some external complaints, which it seeks to address as they arise.

Contact Person: José Vasconcelos

Company Name: Rede D’Or São Luiz

Address: Rua Voluntários da Patria, 138, CEP 22270-010, Rio de Janeiro, RJ Brazil

Email: jose.vasconcellos@rededor.com.br

Phone: +55-21-3239-4746