PS5: Land Acquisition and Involuntary Resettlement does not currently apply. At this stage, the risk is considered further under IFC PS1. All activities in relation to the Sable Farming capacity expansion will take place within the existing land areas of Ngapani and Mapanga estates. No new land will be acquired. Gold Crown is looking at relocating and consolidating its existing facilities to a four ha site within Mombasa, Kenya. Although two location options have been identified, the choice of site has yet to be decided.

PS6: Biodiversity Conservation and Sustainable Natural Resources Management does not apply. Whilst, Mapanga estate is in a peri-urban area with a highly modified and degraded habitat; Ngapani estate is located in a rural, remote area between the south-eastern end of Lake Malawi and the Mozambique border. Based on an Integrated Biodiversity Assessment Test (IBAT) report generated for Ngapani the eco-region of the area is Zambezian and Mopane woodlands and the estate is close to the Namizimu Forest Reserve. The estate boundaries have been established since the 1970's. Sable Farming manages biodiversity through a Policy for Ecosystems Conservation and Wildlife Protection and associated management plans for Water and Wildlife Management. In 2016, Sable Farming commissioned a fauna survey covering Mapanga (Mapanga and Chipale Divisions) and Ngapani. An inventory of fauna was produced. In addition, a conservation area inventory sheet has been developed based on presence of biodiversity and earmarked on maps so as to avoid plantation activities in these areas. Furthermore, as per the requirements of Rainforest Alliance Certification, a buffer zone is strictly observed along these dambos and watercourse so as to maintain their integrity. The macadamia nut expansion activity will take place in areas that are currently planted with fuelwood (mainly eucalyptus and blue gum) within the existing estate boundaries.

There are no Indigenous Peoples or known cultural artefacts in the area, therefore PS7: Indigenous Peoples and PS8: Cultural Heritage are also not applicable.

The following IFC/WBG Environment, Health and Safety (EHS) Guidelines are applicable for this investment:

• General EHS Guidelines (2007);
• Dairy Processing (2007);
• Food and Beverage Processing (2007); and
• Perennial Crop Processing (2016).

This proposed investment is expected to have limited environmental and social impacts which are expected to be site-specific, temporary and none are expected to be 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. This categorization is in accordance with other similar type of projects within the sector. The project is designed to avoid, minimize and manage environmental and social risks and impacts of the company's operations in compliance with applicable IFC's Performance Standards and the WBG General and relevant sector-specific EHS Guidelines.

Key E&S issues applicable for this investment are: i) the company's E&S management system - specifically organizational structure, capacity, policies and procedures to manage E&S risks; ii) adherence to Kenya and Malawian Labor Laws, working conditions, and occupational health and safety risk prevention and management, including the company's employees, contractors and nearby communities; iii) wastewater, solid waste and hazardous material generation, disposal and management; iv) resource (water and energy) usage/efficiency and improvement measures; v) potential impacts of company activities on the health and safety of surrounding local communities including food safety, transportation risk and security risks; vi) stakeholder engagement including operation of a robust grievance management system; and vii) the company's management of third-party contractors if relevant.

Environment and Social Management System. Sable Farming has a well-structured Environment and Social Management System (ESMS) consisting of a comprehensive set of policies, procedures and plans related to environment and social management, applicable across all of its estates. Sable Farming has been audited and is currently Rainforest Alliance Sustainable Agriculture Standard certified (valid to 25th January 2019), CAFÉ Practices certified (valid to 30th September 2020 and FSSC 22000 certified (valid to 3rd January 2021). Gold Crown has a Quality Management System (QMS) consisting of a set of policies, procedures and plans that also cover Environment, Health and Safety (EHS).  The EPZ facility has been audited and is currently British Retail Consortium (BRC) Global Standard for Food Safety Certified, Ethical Tea Partnership (ETP) Certified, and ISO 9001:2008 Certified. Other certifications include Rain Forest Alliance, Fairtrade, UTZ, KOSHER, Organic Certificate, Halal and FDA.

Going forward, as part of ESAP action # 1, Global Tea shall review both management systems with the aim to harmonize and align them with IFC PS1, where required. The updated management systems will be implemented across all Sable Farming operations and Gold Crown (EPZ) and Gold Crown (Kenya). The specific elements of the two management systems are described in further detail in each of the sections below.

Policy: In summary, both Sable Farming and Gold Crown demonstrate their commitment to managing environmental and social risks and impacts of their existing operations in a number of policy or policy statements related to the environment, health and safety, labor and working conditions and food safety and quality. Both these sets of policies are aligned with respective national legislation and voluntary certification standards. Going forward, Global Tea shall prepare an overarching E&S Policy signed by Global Tea management, applicable to all subsidiaries and communicated to all employees and external parties and preferably published or referenced in all company documents, staff contracts and other communication channels, as applicable (as per ESAP action # 1).

Identification of Risks and Impacts.  With respect to Sable Farming, the activities to expand the capacity of the operations under this proposed investment do not require an Environment and Social Impact Assessment (ESIA) to be undertaken as per Malawian environmental legislation. Instead, risk identification and assessment follow a procedure outlined in the ESMS resulting in a Register of Environmental Aspects and Risks. This is required to be reviewed annually and the Register updated with the findings. Sable Farming has not undertaken such a review since 2016. Going forward, Global Tea shall review the EHS aspects of all Sable Farming operations and activities and update the Register of Environmental Aspects and Risks (as per ESAP action # 1) delineating the issues to be addressed, the required mitigating actions, the individual responsible for carrying out the task and the required completion, as required.

Gold Crown is looking at relocating and consolidating its existing facilities to a larger four (4) ha site within Mombasa, Kenya. Although two location options have been identified, the choice of site has yet to be decided. Going forward, Gold Crown shall undertake an ESIA for the new consolidated facility in Mombasa and obtain the requisite licenses prior to the start of any construction activities (as per ESAP action # 1). The terms of reference for carrying out the ESIA and the draft ESIA when available, shall be submitted to the IFC for review and approval, prior to submission to the National Environmental Management Authority (NEMA) in Kenya.  Global Tea shall also develop a land acquisition screening procedure to check for involuntary resettlement risk including non-compliance with requirements of PS5 for any area that it selects to lease/ acquire for the new site (as per ESAP action # 1). 

Furthermore, Rainforest Alliance, CAFÉ Practices and ETP certification requirements cover a range of environment and social criteria including water conservation, wastewater management, soil preservation and waste disposal, fair treatment and good conditions for workers, child labor, health and safety, training, traceability, and other considerations.  These aspects need to be complied with by Sable Farming and Gold Crown (EPZ). All these certification entities also undertake periodic audits as part of maintaining the certification. This is considered to be a comprehensive assessment of the prevalent risks of the sector.

Management Programs.  Both Sable Farming and Gold Crown have a comprehensive set of Standard Operating Procedures (SOPs) and where relevant implementation plans, as part of their respective management systems to address risks and impacts. Global Tea shall also ensure that the Environment and Social Management Plan (ESMP) associated with the ESIA for the new Gold Crown facility is incorporated into the QMS risk management process so to ensure that all identified mitigation measures are implemented (as per ESAP action #1).

Organizational Capacity and Competency. Global Tea is committed to ensuring that both Sable Farming and Gold Crown have adequate organization capacity to fulfill the sustainability requirements. Currently, at Sable Farming, the overall responsibility of the ESMS and its implementation across all the estates is vested with the Farm Manager and supported at the estate level, on a day to day basis, by the respective Deputy Farm Managers. The E&S responsibilities are executed by these senior management staff as part of their wider set of responsibilities.  Sable Farming has a Certification Officer who has the responsibility of maintaining the certification requirements. The E&S functions are also supported by the Human Resources (HR) Manager and the Personnel Officer. Therefore, responsibilities for E&S management are spread across the Sable Farming organizational structure with no dedicated and experienced E&S resource overseeing the implementation of the ESMS across both estates. Going forward, as part of ESAP action # 2 so as to strengthen the E&S capacity of Sable Farming, Global Tea shall recruit a dedicated and experienced E&S resource person whose key responsibilities will encompass the review, update, maintenance and implementation of the ESMS across all operations. Amongst other roles, this resource will maintain the certifications acquired by Sable Farming, develop and implement continuous training of staff on E&S aspects, support the coordination of the various health and safety committees and ensure the monitoring and reporting on E&S performance.

E&S management at Gold Crown comes under the responsibility of the Operations Manager, supported by the Quality Assurance Manager and the Production Manager. However, this is not clear defined in their job functions. Going forward, Global Tea shall formally assign a senior Gold Crown manager to oversee the E&S management and explicitly define E&S roles, responsibilities and authorities within job functions across the company, as required (as per ESAP action # 2).

In addition, Global Tea shall allocate a senior resource at the Corporate level to oversee the implementation of the ESAP across Sable Farming and Gold Crown and coordinate information management requirements with respect to the IFC (as per ESAP action # 2).

Training. At Sable Farming, the Deputy Farm Manager at Mapanga, supported by the Personnel Officer at Ngapani develops an annual training plan at the start of each year, based on operational needs. For 2018, this program includes training on Occupational Health and Safety (OHS), pesticides application, machine operators, etc. Training is either developed and implemented in-house or sometimes external trainers are brought in. All attendance records are kept. At Gold Crown, an annual training program is developed based on quality assurance needs and implemented by the Quality Assurance Manager in line with the QMS Training Procedure.

Emergency Preparedness and Response. Sable Farming has developed and maintains, as part of its ESMS, an Emergency Preparedness and Response Procedure that covers a range of unplanned events such wildfires, agrochemical spills and lightening and a Procedure for Fire and Emergency Evacuation. Each estate (or division/ facility) has a Fire Fighting Committee and a First Aid Committee. All facilities visited during the appraisal were equipped with serviced fire extinguishers and clear signage to indicate emergency exits in case of an evacuation. At the macadamia nut processing facility, a list of committee members was also posted on walls for the benefit of the staff. With respect to Gold Crown, there is a Fire Safety Policy in place and both the facilities have Medical Emergency Procedures and Evacuation Plans displayed at various points including telephone contact numbers for emergency responders. First aid boxes are available with trained first aiders listed. Emergency exits are suitably provided, marked, accessible and properly maintained. Suitable and adequate fire-fighting appliances have been installed at strategic points in both facilities.

Monitoring and Reporting. As part of their respective certification requirements, both Sable Farming and Gold Crown (EPZ) report on a number of E&S measures including personnel, resource use (energy and water), OHS incidents, etc. In addition, periodic external audits are undertaken by the certification entities to maintain or renew the certifications. In the case of Gold Crown facilities, there are also annual requirements for statutory audits in relation to environment, OHS and fire safety. Although the Sable Farming ESMS has an Internal Audit Procedure that requires an audit to be done monthly, this frequency has not been maintained. Sable Farming and Gold Crown will be required to undertake internal audits of the management systems as per the frequency defined in the respective audit procedures.  Going forward, Global Tea shall define and agree with the IFC a comprehensive set of Key Performance Indicators (KPIs) for both Sable Farming and Gold Crown to monitor on a monthly/annual basis (as per ESAP action # 1). Global Tea will report these KPIs annually in an Annual Monitoring Report (AMR) whose contents and format of which will agreed with the IFC.

Community Grievance Mechanism.  Currently the Communications Procedure at Sable Farming does not allow for receiving and addressing community grievances resulting from the actions of Sable Farming operations and activities. Going forwards, as part of ESAP action # 3, Global Tea shall develop a formal Community Grievance Mechanism to receive, analyze, respond and monitor potential complaints (including anonymous ones) from the surrounding communities including those in relation to actions of security personnel and security provision at the estates (see ESAP action # 12). All relevant stakeholder groups (including communities) will be informed about the establishment of the Community Grievance Mechanism and its function.

Currently the two facilities of Gold Crown are in an industrial area. Most external engagement undertaken by Gold Crown is in relation to customer feedback and complaints and not communities. Once the site for the new facility has been confirmed, Gold Crown will liaise with the IFC to determine whether or not a suitable Stakeholder Engagement Plan will be required.

     As of February 2018, Sable Farming employed 1,409 permanent staff of which 29% were women.   In addition to the permanent staff, Sable Farming also employed a total of 909 casual staff of which nearly 56% where women.  The number of casual staff varies by season and are employed for activities such as planting, harvesting of coffee berries and harvesting macadamia nuts, loading, etc. As of February 2018, Gold Crown employed 214 permanent staff of which 31% were women; a further 552 staff were employed either as casual workers or those employed via third parties, of which 39% were women. Workers are directly recruited without the use of labor intermediaries. Both Sable Farming and Gold Crown each have a HR Manager.

Human Resources Policies and Procedures. Sable Farming and Gold Crown, each maintain a set of HR policies and/or policy statements that cover Non-discrimination, Child Labour, Forced Labour, Labour Grievances and Sexual Harassment. These are displayed at strategic areas in both Gold Crown facilities and at the Sable Farming estates, for workers to refer to. While freedom of association is a current practice at Sable Farming, there is no policy or policy statement that clearly specifies adherence to this principle. Sable Farming does not have a HR Procedures Manual, whereas Gold Crown is in the process of drafting one. HR policies, procedures and the terms and conditions of employment at both companies are governed by the respective countries labour legislation and certification requirements.

Going forward, as part of ESAP action # 4, Global Tea shall develop a set of corporate HR policies that cover Non-discrimination and Equal Opportunity, Child Labour, Forced Labour, Freedom of Association, Labour Grievances, and Sexual Harassment that are cascaded down to all subsidiaries.  Furthermore, both Sable Farming and Gold Crown shall update or develop a HR Manual to account for the corporate HR policies and include the following: recruitment procedures; induction procedures; terms and conditions of employment (aligned to national legislation requirements); reference to the Corporate E&S policies; OHS requirements; performance management; procedures for workers representation or committees; disciplinary procedures including explicit provisions for sexual harassment, the labour grievance mechanism; and termination of contract and dismissal.  The HR policies and procedures will apply to all categories of employment (permanent, temporary and seasonal/ daily) across all of Sable Farming and Gold Crown operations. These will be made accessible and clearly communicated to all staff (in English and local language as necessary).

Furthermore, as part of ESAP action # 5, taking into account the large female workforce and a higher proportion of women in casual employment, IFC would like to support an assessment of Sable Farming and Gold Crown operations including its policies, procedures and plans, with a view towards enhancing women’s employment opportunities and terms of employment and enabling a platform to receive and addressing grievances (both community and labour related) that are gender sensitive.

Working Conditions and Terms of Employment.  All staff at both Sable Farming and Gold Crown, whether they are permanent or casual, have written contracts or employment agreements. These contracts/ agreements specify the employment duration, job grade or function, salary and in the case of permanent employees, other benefits and annual leave entitlements. Sable Farming contracts/ agreements also refer to either a set of terms and conditions of service (for permanent staff) or conditions of employment for daily staff (or causal labour), intended to comply with the Employment Act No 6 of 2000 of Malawi. These cover references to wages and benefits; hours of work; rest days; overtime arrangements and overtime compensation; breaks; and leave for illness, maternity, and holiday, etc. The terms and conditions are displayed at various locations in both estates. At Gold Crown, there is no specific document covering the terms and condition of employment, instead this is governed by the Labour Act 2017, a copy of which is posted on notice boards. Going forward, Global Tea shall include a statement in the employment contract or agreement, to acknowledge that the employee has received, reviewed and understood the HR policies and procedures and the terms of employment (as per ESAP action # 4).

All staff at both Sable Farming and Gold Crown were paid more than the statutory minimum daily wage in the respective countries, with overtime paid on the basis of national legislation. In case of certain functions such as slashing, macadamia harvesting, sorting of coffee green beans and coffee harvesting at Sable Farming, where work is piece rated, pro rata wages are given according to the time worked up a maximum of 8 hours in a day (normal working hours). Sable Farming has introduced time sheets for the workers who are employed on a task basis to monitor their working hours.

Sable Farming also provides a range of benefits to staff including pension (for permanent staff), staff accommodation (where this is needed e.g. in remote locations such as Ngapani), access to a medical clinic and school (in the case of Ngapani) and lunch and drinking water. For those eligible staff not receiving housing, Sable Farming pays an allowance for rental. Both Sable Farming and Gold Crown provide cover for workplace injuries and compensation.

IFC visited the staff housing in Ngapani estate and noted that most of the houses were in adequate condition with basic facilities such as common water points, common sanitation facilities and waste disposal areas provided and accessible to residents. The quality of water was periodically checked as per the Water and Wastewater Analysis Procedure. Houses consisted of different types and allocation depended on household size and employment grade. In addition to individual houses, Sable Farming also provides and maintains dormitory housing at the Mapanga estate. IFC was not able to visit all the housing facilities at the time of the appraisal. Going forward, as part of ESAP action # 6, Global Tea shall review the provision of staff accommodation at the estates relative to IFC PS 4 including the IFC Guidance Note on Worker Accommodation so as to ensure alignment. Based on the review findings, Sable Farming will develop and implement a plan of improvements.

Protecting the Work Force. Both Sable Farming and Gold Crown have policies in place that prohibits employment of any person below the age of 18 years and the use of forced or bonded labor. In a recent analyses of staff ages at Ngapani estate, Sable Farming identified five workers who were between the ages of 16 to 18 years. Although this goes against their stated minimum age policy, under Malawi Labour Law – Employment Act 2000 No 6 of 2000, children between the age of 14 to 18 are permitted to work provided a consent letter from the parents is obtained to allow them to work in basic agriculture operations which are not harmful to the persons safety, health, education, moral or development of such person. Sable Farming has subsequently obtained such a consent for the five persons identified; furthermore, in order to strengthen the age verification process in the absence of identity cards, Sable Farming will require job applicants to either present an identity card showing proof of age or a letter from parents or chief confirming their age.

Workers’ Organizations.  At the time of appraisal there were no employees at either Sable Farming or at Gold Crown, who were members of a union. Both companies allow the freedom of association as required by their respective country’s legislation. Sable Farming has facilitated the setup of a Joint Consultative Committee (JCC). IFC met representatives of the Ngapani JCC during the appraisal visit. Staff elect their own representative delegates on a three-year basis among the workers from the estate.  The JCC represents permanent workers (who have been employed for at least a year) to take up issues/ grievances to Sable Farming management to be heard and discussed.  Meetings between management and the JCC are held at least twice a year at a minimum and recorded to ensure follow up.  Casual labour employed for less than a year are not represented and not all estates/ divisions have a functional JCC. Gold Crown facilities have a workers committee that plays a similar role to that of the JCC. According to staff there is a good working relationship with Gold Crown management.

Labour Grievance Mechanism. Whilst Sable Farming has a Labour Grievance Policy, a formal written procedure or mechanism which is understood by and accessible to all workers including casual labour do not yet exist. Gold Crown has in place a structured grievance procedure. Going forward, as per ESAP action # 7, Global Tea shall develop or update (as relevant) and implement a labour grievance mechanism that is accessible to all workers of Sable Farming and Gold Crown, regardless of their types of contracts and allow for anonymous grievances and have the appropriate channels to address sexual harassment complaints (see ESAP action # 5). Each company will inform its workers about the objectives and procedures for the Labour Grievance Mechanism and the results of grievance evaluation and actions taken to resolve reported grievances.

Occupational Health and Safety.  At Sable Farming, the farm managers at each estate, supported by the HR Manager (or the Personnel Officer in the case of Ngapani) have an oversight role over workers’ occupational health and safety, and overall welfare. As part of its ESMS, Sable Farming maintains an OHS Policy supported by comprehensive set of SOPs reflecting all the major risks in relation to the nature of operations. These include SOPs on personal protection equipment, noise and air emissions, electrical hazards, hazardous material, mechanical safety, handling of pesticides and exposure, etc. All divisions have an OHS Committee (with both management and staff representatives). The main role of the OHS Committee is to review and improve the OHS performance at all estates. Divisions also have a First Aid Committee and a Fire Fighting Committee. Workers engaged in hazardous tasks at the plantations are issued appropriate PPE. Gold Crown has established policies and procedures on health and safety which have been communicated to workers through training and displaying them on the noticeboards. The Quality Assurance Manager, in conjunction with the Operations Manager, is responsible for the implementation of these health and safety policies. In addition, both facilities have Health and Safety Committees. In 2017, Gold Crown facilities underwent an OHS audit as per the statutory requirements. A few recommendations for minor improvements have been made which Gold Crown is implementing over the course of the year. Periodical training is provided to staff at both Sable Farming and Gold Crown as per a training schedule developed at the start of the year and training records maintained.

A log of injuries is maintained for both Sable Farming and Gold Crown. All accidents are recorded together with the date, name, a short description of the injury and actions undertaken. Most accidents recorded in 2017 at both companies were minor, related to falls, cuts and bruises.

Workers engaged by third-parties. Currently, Sable Farming does not have any contractors undertaking any work at the estates. It is likely that the construction of the new Gold Crown facility will be contracted out to a construction contractor. Going forward, as per ESAP item # 8, Global Tea shall require all its contractors to observe its HR, E&S and OHS Policies, as well as any national OHS and labor regulations. All the above-mentioned will be introduced as binding conditions in the contracts made with the contractors. Global Tea will establish regular inspection mechanisms to ensure compliance of the contractor with the contractual requirements including the use of external consultants to undertake periodic audits, as required. Global Tea shall also ensure that the contractor either has in place its own employee grievance procedure or facilitate access to the company’s grievance procedure for contractor’s employees working on site.

Supply Chain. Sable Farming is supporting 3000 smallholder farmers to grow macadamia in Thyolo and Mzimba District.  The role of Sable Farming is to develop a nursery to supply 300,000 macadamia plants and train extension workers from an NGO who will in turn train the smallholder farmers.  Sable Farming will purchase the harvested nuts from collection centers and may build a facility to process these nuts. The smallholder component started in 2016. A similar smallholder scheme for coffee is also envisaged for together with support from IFC and GAFSP. Sable Farming will support the smallholder farmers to achieve certification. Going forward, as per ESAP action # 9, Global Tea shall develop a supply chain management procedure for sourcing (macadamia nuts and coffee) from smallholder farmers that are adhering to good agricultural practices (including avoidance of child/forced labor and adherence to good OHS practices), and, over time, that have received certification.          

     Energy and Resource Efficiency.  Sable Farming operations at Mapanga, Chipale, Chipande and Mikonga, (including the coffee and macadamia nut processing facilities) are all connected to the national power grid. Furthermore, the operations at Mapanga (offices & dairy) and the coffee and macadamia facilities at Chipande and Mikonga respectively, are also backed up by three diesel generators (150, 125 and 350 KVa), which are primarily used during power outages. Currently, Ngapani Estate is not connected to the national power grid. Electricity at Ngapani Estate is provided by three diesel generators (33, 250 and 77 KV). The main users of electricity across all Sable Farming operations include lights / appliances at the facilities, administrative buildings and staff housing, irrigation pumps, and the operation of machinery at the pulpery and coffee and macadamia nut processing facilities. IFC’s Energy and Water Advisory unit, estimated total current energy consumption across all of Sable Farming operations at 4,166,261 kWh/year.  In addition to the above, there are two boilers (one of which is used as a back-up) at the macadamia nut processing facility (with a capacity of 3000 kg/hr and 2000 kg/hr respectively) that generates steam used in the nut drying operations and another smaller boiler at the dairy facility (with a capacity of 500 kg/hr). All the boilers use macadamia husks and shells as fuel and the resulting ash is used for composting kW per kg of production). In addition, 12,770 liters of diesel was used to fuel the generators.

In order to have more energy efficient operations, secure a more stable supply of electricity and also to manage operational costs, Global Tea is looking to implement energy efficiency and renewable energy solutions such as solar power at Sable Farming in Malawi. As such Global Tea, with the assistance of IFC’s Energy and Water Advisory Unit is undertaking an in-depth analysis of Sable Farming operations to inform decisions on implementing specific energy efficiency and renewable energy projects. Global Tea will also incorporate energy efficiency and renewable energy solutions into the design of the new Gold Crown blending and packing facility that will be constructed under this IFC investment. 

Air Emissions.  The main sources of air emissions of Sable Farming and Gold Crown operations are from the boilers and the diesel generators, all of which are less 3MWh in capacity and from vehicles. As a result, air emissions are considered not significant and below the WBG EHS guidelines threshold. 

Water Consumption.  Both coffee and macadamia farming and processing operations at Sable Farming consume a significant amount of water. Water for irrigation is primarily sourced from the purpose built Mikonga (for the Mapanga and Chipande plantations), Chipale (for the Chipale plantation) and Mkeni Dams (for the Ngapani plantation) and from a number of rivers at each estate.  The respective dams also provide water for the coffee pulperies at Chipale and Ngapani and the nursey at Mapanga. Water for the macadamia nut processing facility at Mikonga comes from the Blantyre Water Board, whereas water for the coffee processing facility at Chipande comes from a borehole. Boreholes also supply water for the administration offices and dairy at Mapanga, staff housing at Chipale and Ngapani and the plantation nursery at Ngapani. Sable Farming maintains the appropriate water abstraction and use licenses obtained from the National Water Resources Authority (Malawi). All plantations are under manually scheduled drip irrigation (coffee) or micro-irrigation (macadamia nuts), the most efficient water delivery systems. In addition to this, other water conservation/ efficiency measures include the use of mulching to reduce evapotranspiration losses, re-use of water for pulping of coffee prior to fermentation and a continuous use of a mix of fresh and recycled water for coffee washing after the fermentation process. Currently, around 5 liters of water are needed to process one kg of coffee in the existing pulper, which is old and inefficient. The capex plan as part of the proposed investment includes the installation of a new pulper that will result in 33% less water requirements. Sable Farming has a Water Conservation Policy and a Water Management Plan focused around water usage and conservation measures and a Water and Wastewater Analysis Procedure that is intended to define testing for potable water supplied to the estates (including housing) and wastewater released from pulping of coffee at Chipale and Ngapani estates.

Water at the Gold Crown facilities is mainly used for ablution facilities and other domestic use. Some water is also used for processing. All process water is potable water quality standard and periodically tested by an external laboratory. In 2017, water usage across both facilities was 120 m3 from municipal sources (brought in by water tankers) and another 638 m3 from a borehole at each site. The company has a permit from the Water Resources Management Authority (Kenya) for abstract of water from the borehole.

Wastewater Treatment. The coffee pulping operations at the Chipale and Ngapani divisions generate significant volumes of process effluent. Overall, this water is acidic, deoxygenated, and laden with suspended solids and organic material from the pulp and mucilage. Sable Farming has installed a wastewater treatment system, whereby the process effluent is released into settling ponds, where the solids settle at the bottom; the wastewater is then transported via a waterway to a series of interconnected effluent aerobic treatment ponds that follow the natural slope of the facilities. Lime is applied at the top ponds to balance acidity. Samples of wastewater from the first pond and final pond are taken during each processing season to be tested for water quality against Malawi standards. Other effluent sources include the dairy operations and macadamia nut processing operations (such as that from sanitizing and washing macadamia shells with peracetic acid and chlorine respectively and chlorine is used for separating shell pieces from < 9mm macadamia kernel pieces). Effluent from these activities is diverted into a soaking/ effluent pit for natural absorption into the soil. A smaller volume of domestic wastewater is also generated from the administrative offices and the staff housing facilities which is disposed of into septic tanks. These are emptied as necessary by an external contractor.

With respect to the two Gold Crown facilities, the main source of effluent is domestic wastewater which is disposed of into septic tanks. These are emptied as necessary by an external contractor

Solid Waste Management.  Sable Farming has a Waste Management Policy in place which states the company’s commitment to reduce the impact of its operations on the environment through proper disposal of its waste streams. Due to diverse nature of activities at Sable Farming, a wide variety of waste is generated including macadamia waste, coffee waste and other biodegradable materials as well as plastic, glass and metals. Macadamia nut waste (such as husks and shells) is used as fuel for the boilers. Reject nuts are sent for oil extraction, and the cracker dust may be used for poultry feed. Waste from the pulping of coffee is composted with the addition of cow dung and used for macadamia planting. All inorganic waste (such as plastic, glass and metal) is sorted and in marked open pits located outside various facilities. All empty agrochemical containers are removed in accordance to the Procedure for Handling Pesticides, Pesticide Spills and Over Exposure and sacks and bags are recycled.

The Gold Crown has documented waste management procedures. All the solid waste is collected in bins and disposal done through a company that is licensed by NEMA. During the site visit, it was observed that the waste generated is segregated at source and kept in bins.

Hazardous Materials Management. Sable Farming has a Hazardous Materials Handling Procedure in place to prevent accidental spills and unsafe handling of hazardous materials and a Procedure for Handling Pesticides, Pesticide Spills and Over Exposure. A record of all agrochemicals used applied is also kept. All agrochemicals were stored in a locked place with controlled access and separate from food products and living and social areas. The storage areas were well ventilated and designed to retain spills. Sable Farming keeps purchase records of pesticides, specifying date, product, product formulation, quantity, supplier, and price of purchase for each pesticide. Material Safety Data Sheets (MSDS) are available but these are not kept with the respective agrochemicals in the storage area. Furthermore, there were no spill response kits or first aid kits in vicinity. Agrochemicals are mixed and spraying equipment loaded outside in ventilated areas. If products are mixed in the field, because of distance from storage, precautions are taken and plans are in place to handle accidents, spills or contamination. All persons handling agrochemicals are provided periodic training of their safe handling and shifts where agrochemicals applied are limited to six hours per day to prevent over exposure. Application of agrochemicals is managed according to specifications and operational requirements. IFC also visited the generators and diesel storage tanks at Ngapani estate during the appraisal. The storage tanks and the generators did not have retaining walls to contains spills and leaks. As such at all three sites, large spills of diesel fuel on the bare earth were noted. As per ESAP action # 10 Global Tea shall undertake an audit of all fuel, hazardous material or chemical storage and use areas at Sable Farming to check for compliance against IFC PS 3 requirements and the WBG EHS General Guidelines and implement any required remedial actions.

Gold Crown has a Chemical Control Procedure in place to manage the purchase, use, storage and handling of chemicals. A dedicated and locked chemical store was available. All chemical products were properly labelled and appropriate MSDSs available at the storage area. Chemical products for cleaning purposes were kept in another dedicated and locked store. A list of substances hazardous to health (COSHH) is available.

Integrated Pest Management. Sable farming has in place an Integrated Pest Management Plan that defines the methods and means to identify and control pest infestations and diseases, with an emphasis on the use of non-chemical control methodologies as first priority.

Pest and disease outbreaks are identified by visual observation undertaken on a routine basis by trained scouts; observations are recorded on a sheet which is checked by the field supervisors. Physical action to control sources of infestation such as pruning, seed selection, hand picking of insects, etc. are used first; application of pesticides is only undertaken when other methods have failed. Records of pesticide application specifying the date, product, product formulation, quantity, and location or area of the farm for each pesticide application are maintained. Pest management is currently undertaken by the estate managers. Sable Farming does not use any pesticides listed by the World Health Organization as Class 1A (Extremely Hazardous) or that are banned according to national, regional, or local laws; however, Sable Farming is currently using Beta Cyfluthrin (classified as Class 1B – Highly Hazardous) for pest outbreaks. Going forward, as per ESAP action # 11, Global Tea shall cease to use any pesticides listed by the World Health Organization as Class 1A (Extremely Hazardous) or Class 1B (Highly Hazardous).        

Food Safety Impacts and Management.  As stated above, Sable Farming’s macadamia nut processing facility is certified as compliant with the requirements of FSSC 22000. This means that that facility has a Food Safety Management System (FSMS) in place and all activities (such as de-husking, washing, drying, sorting and vacuum packing in foil pouches) are performed in accordance with the principles of Hazard Analysis Critical Control Points (HACCP), thereby minimizing or eliminating food safety hazards in the end product. Crown Food (EPZ) facility is certified to BRC Global Standard for Food Safety. Staff at the both the macadamia processing facility and the Crown Food EPZ facility have been issued with and were observed to be wearing all the necessary work clothes including coveralls, gloves, and hair coverage. Both the FSMS (for the macadamia nut processing facility at Sable Farming) and the QMS (for the Crown Food EPZ facility) have in place a product recall, customer complaints and traceability procedure. Sable Farming also has a procedure in place with supporting documentation that allows the tracking of coffee beans from estate to processing facility up to dispatch.

Community Health and Safety. As noted before, Sable Farming estates are mostly unfenced and communities often use the internal access road, especially in the case of Mapanga estate. Whilst agrochemical spraying operations are in progress, sign boards and red flags are positioned around the affected area to inform the communities of restrictions on entry into such zones

Transportation Safety. Vehicle traffic peaks during the macadamia nut and coffee seasons at Sable Farming. This mostly consists of the “internal” movement of vehicles and trucks within and between the various estates and the coffee and macadamia nut processing facilities at Chipande and Mikonga, respectively; and the “external” transport by road of containers (estimated to be up to 30 containers of coffee and 40 of macadamia nuts in the 2017 season) of finished products to Nacala and Beira ports in Mozambique, where they will be shipped to their final destinations. All internal transport is undertaken using Sable Farming’s own fleet of vehicles whereas, external transport is contracted out to haulage companies. Although traffic within all the estates is relatively light, Ngapani has several villages housing workers and their families, who also use the internal roads to get to and from places of work, school, etc. In addition, as the estates are not fenced off, neighboring communities (mostly in the case of Mapanga estate) also use the internal roads for access. The company currently does not have a specific policy or procedure in place for ensuring the safe operation of vehicles, both its own or those operated by contractors or for documenting incidents and accidents involving road traffic.  Going forward, as per ESAP action # 12, Global Tea shall develop a Transport Management Plan as well as procedures for the safe operation of vehicles (such as appropriate speed limits and safe driving practices), applicable for both Sable Farming and Gold Crown. Global Tea will also apply such procedures to third-party transport companies so as to minimizes community health and safety risks in relation to transportation safety.

Security.  The boundaries of the all the plantations are currently mostly unfenced; however, the macadamia nut processing facility site is surrounded by a perimeter fence and access is controlled by manned gates. Neighboring communities often use internal plantation roads for access. The provision of security is mostly in-house (with the use of both permanent and seasonal guards) and unarmed (although the guards may carry sticks/ batons). There have been a few cases of theft of macadamia nuts and the occasional burning or cutting down of trees (apparently in retaliation to the apprehension of the perpetrators), mostly at the Mapanga estate (which is in a peri-urban area and surrounded by communities). Sable Farming has worked with local leaders to sensitize communities about such issues. At the same time, to enhance the security presence and patrols at the estate, Sable Farming sometimes uses the services of the local police force, who maybe armed. Sable Farming currently does not have a security procedure for the estates to manage potential security issues, especially with communities, and minimize potential conflicts. Going forward, as per ESAP action # 13 Global Tea shall establish clear security protocols, including the interface with the police force, and train its security guards accordingly. Furthermore, the approach will include the ability by the communities to raise complaints (including anonymous ones) regarding security personnel and security provision as part of the Community Grievance Mechanism referred to in ESAP action # 4. The security protocols and the Community Grievance Mechanism, will be communicated to the surrounding communities to ensure common understanding regarding security and to minimize potential conflicts.

With respect to Gold Crown, there is in place a Procedure for Site Security and Food Defense. Both facilities have a perimeter wall and unarmed site security provided by a private security company, is maintained on a 24-hour basis.

Stakeholder Engagement. Whilst Ngapani estate is remote and in a sparsely populated area, Mapanga estate is in a peri-urban area and is surrounded by a number of communities. Both estates are mostly unfenced with neighboring communities often using the estates internal roads for access. Sable Farming maintains a good relationship with its neighboring communities with casual staff employed coming from these communities. Sable Farming also supports a number of Corporate Social Responsibility related activities. As part of its ESMS, Sable Farming has a Community Relations Policy, a Communications Procedure and a Communications Register. Going forward, Global Tea will update the Communications Procedure into a Stakeholder Engagement Plan to facilitate a structured engagement with surrounding communities (as per ESAP action # 1).

Contact Person:Michael McBrien

Company Name: Global Tea & Commodities Limited

Address: 78 Whitfleld Street, London W1T 4EZ

Email : michael.mcbrien@globaltea.com

Phone : 0207 500 7610