While all Performance Standards are applicable to this investment, IFC’s 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:

PS1: Social and Environmental Assessment and Management Systems;
PS2: Labor and Working Conditions;
PS3: Pollution Prevention and Abatement;
PS4: Community Health, Safety and Security;
The proposed project interventions are to be carried out within existing malls in established commercial areas and existing fuel stations. The project doesn’t envisage any physical expansion requiring new construction or land acquisition therefore, PS5: Land Acquisition and Involuntary Resettlement is not applicable. PS6: Biodiversity Conservation and Sustainable Management of Living Resources does not apply because the company operations are located on modified habitats with no significant biodiversity value. PS7: Indigenous Peoples and PS8: Cultural Heritage do not apply because the project will not cause any impacts on indigenous people and there is no planned expansion in known cultural heritage areas.

The key environmental, social, health and safety issues in this project are pharmaceutical safety; fair, safe and healthy working conditions for employees and contract workers; life and fire safety at the outlets and the distribution warehouse; management of hazardous waste and use of private security guards. There are no major adverse environmental or social impacts expected to result from the project and it is possible to avoid or mitigate any limited adverse impacts that may result. Hence, the project has been classified as Category B according to IFC’s Policy on Environmental and Social Sustainability.

IFC’s appraisal considered the environmental and social management planning process and documentation for the project and gaps, if any, between these and IFC’s requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable period of time, are summarized in the paragraphs that follow and (if applicable) in an agreed Environmental and Social Action Plan (ESAP). Through the implementation of these measures, the project is expected to be designed and operated in accordance with Performance Standards objectives.

Environmental and Social Assessment, Policy and Management System
Goodlife developed an Environmental, Health and Safety (EHS) Policy in 2015 which articulates the company’s commitment to: (i) conduct its business in an ethical, socially responsible and environmentally sustainable manner; (ii) conduct its business with the utmost concern for the health and safety of its employees, customers, suppliers and the general public; (iii) comply fully with all applicable laws and regulations relating to workplace health and safety and environmental protection for the benefit of employees, customers and other members of the general public; and (iv) require suppliers to comply with Goodlife’s labour and welfare conditions, health and safety and environmental management standards. The company has developed some EHS procedures to support the operations. However, according to ESAP 1, Goodlife will implement a formal Environmental and Social Management System (ESMS) that covers all company operations in compliance with IFC Performance Standard (PS) requirements.
Identification of Risks and Impacts
Goodlife has developed a risk assessment form for stores and addresses risks such as slips and trips; manual lifting; working at heights and handling hazardous substances. The risk assessment will be done annually for the stores. The company has also developed a retail location screening report form for analyzing environmental and social risks of new locations prior to acquisition or lease. There is need to enhance the risk assessment requirements for environmental and social aspects of retail location screening to include requests for mall or petrol outlet EHS assessment and annual EHS audit documents for review prior to leasing or acquisition.
Management Programs
Goodlife has developed a set of procedures and guidelines to assist in operationalizing the EHS policy. These include; the retail screening report form; health and safety committee guidelines; accident report form; annual risk assessment form for stores; supplier terms and conditions; life, fire safety and emergency response procedures; standard health and safety aids and signs for stores and a health and safety inspection checklist for the retail outlets.
According to the national Occupational Health and Safety (OHS) legislation in Kenya and the Factories and other places of Work Act in Uganda, all workplaces need to be registered with the respective Directorates of Occupational Health and Safety Services (DOHSS). Registration involves carrying out a risk assessment for each outlet or premises. As part of ESAP 1, the company will develop a procedure with defined roles and responsibilities and timetable for routine or annual inspections and risk assessment of the stores and warehouse, and action plans for addressing any non-compliances when detected. For an effective management system, the EHS audit issues raised need to be discussed routinely by senior management team.
Organizational Capacity and Competency
In 2016, Goodlife in compliance with the national legislative requirements established an OHS committee headed by the Chief Pharmacist (Chair of the committee) and comprising 11 members drawn from the three Regional Development Managers (RDMs), HR Manager, Finance Manager, Marketing Manager, warehouse representative, Implementation Manager, Head of mall stores and Head of convenience stores. The OHS committee has guidelines that prescribe the issues to be discussed at every meeting and these include accidents, incidents and near misses; results of safety inspections and training. The meetings are scheduled on the first Thursday of the first week of each quarter. There is however, no formally designated EHS Manager at corporate level to ensure execution and conformance with the company’s EHS policy across the business operations in Kenya and Uganda. As part of ESAP 1, the company will designate staff in senior management who ensures conformance with the policy and is responsible for its execution. Training on the company’s environmental and social policies and procedures is undertaken for all new staff as part of the employee induction process. In house training and external training (through a company called Spire) is carried out routinely to strengthen employee customer service, communication, productivity and performance management. There was however, no documentation for EHS trainings for staff such as First Aid, fire marshals training, fire safety, ergonomics and mandatory DOHSS OHS Committee Training among others. It was reported that there is a planned external OHS training for staff by 30 June 2017. In line with ESAP 1 requirements, there is need for HR to establish the required statutory training requirements on EHS and develop a plan for implementation across the business operations.
Emergency Preparedness and Response
Goodlife has standard health and safety aids and signs for stores and has installed the signs and fire extinguishers at the outlets and the central warehouse. The inspection of the fire suppression equipment is done twice annually by an approved fire safety auditor in compliance with local fire safety regulations. The emergency response plan and fire safety audits for the central warehouse are conducted by the landlord (Waki). According to the company EHS procedures, there should be trained First Aid Staff and Fire Marshalls to handle emergencies but the details and locations for these staff are not provided, however, this will be addressed by ESAP 1.
The company has developed an Emergency Preparedness and Response Procedure as part of the EHS procedures which generally commits the company to addressing accidents and incidents, ensuring protection of staff and property and general response to emergency. The general emergency procedures do not identify the events that would trigger an emergency situation at the two types of outlet stores, corporate offices or the warehouse, the minimum provisions for emergency detection and suppression equipment and types for the outlets; emergency escape routes, emergency assembly points, responsibilities of the emergency teams, emergency telephone numbers for internal and external emergency responders for the various business locations and the need for statutory annual emergency mock drills across the business operations. More detailed guidance on fire safety is provided in the Store Employee Induction Program including the causes of fire, prevention of fire, escape routes and alarms, types of fire extinguishers to use in case of a fire and procedures to follow upon discovering a fire. In view of the expansion into petrol station outlets which have significant safety hazards, the company will consolidate the procedures and update the Emergency Preparedness and Response Procedure in compliance with IFC PS requirements (ESAP 2), including demarcation, control of combustibles and availability of exits; as applicable, the emergency plans should be aligned with those of the petrol station or malls where stores are located.
Monitoring and Review
There is no formal system for internal monitoring on implementation of the EHS management system or tracking of the E&S performance indicators. Internal inspections and audit procedures are under development (ESAP 1). External monitoring is done by relevant regulatory authorities such as DOHSS and the Pharmacy and Poisons Board (PPB). Goodlife will document the monitoring results and implement the necessary corrective and preventive actions and follow up on these actions in upcoming monitoring cycles to ensure their effectiveness. The monitoring results shall be included in the Annual Monitoring Report (AMR) to IFC.

Human Resources Policies and Procedures
Goodlife has documented policies and procedures for recruitment, selection, staff conduct and termination. The policies and procedures are provided to staff upon recruitment via a copy of the staff handbook and are in compliance with the national employment legislation for the respective countries of operation.
Working Conditions and Terms of Employment
The staff handbook, the employment contract and the employee induction pack inform employees about their rights and responsibilities, including duration of employment, work schedules, job description, remuneration, statutory deductions on wage, hours of work and overtime arrangements, time-off, leave (annual, sick, maternity/ paternity), training, health & safety, confidentiality of information, conflict of interest, harassment, disciplinary and grievance procedures and termination. Employees are informed of their rights and responsibilities at the time of hiring and when any changes take place.
Non-discrimination and Equal Opportunity
As at appraisal in May 2017, Goodlife had 202 staff and 12 contractors. Of these, female staff comprised 54% and male staff 46%. 25% of staff (approximately 54 staff) hold management positions. The managerial positions have almost equal representation of women (49%) and men (51%). The company also has six part-time pharmaceutical technologists with written daily contracts who are called upon on needs-basis to support company operations. The staff procedures and handbook states that "Goodlife respects employees' right to freedom of association".
Recruitment and appraisal of employees are carried out based on equal opportunity practices. Vacancies are advertised internally and externally via print media on national newspapers and staff are also encouraged to recommend suitable and eligible candidates. Interviews for advertised positions are done by the company and successful candidates awarded appointment letters which include their job descriptions.
Retrenchment
The staff handbook provides procedures to follow when redundancy is anticipated, the notice period and compensation or severance pay. There are no plans for retrenchment by the company in fact, a few employment opportunities are likely to be created under the expansion program. However, in the event that the project requires staff optimization (e.g. due to acquisition strategy), Goodlife will assess alternatives to retrenchment prior to implementing any collective dismissals. If collective dismissals are unavoidable, the company will develop and implement a retrenchment plan consistent with PS 2 to reduce adverse impacts on employees.
Grievance Mechanism
Goodlife has documented an employee grievance procedure in the staff handbook. Any staff with a grievance writes to the HR Manager who discusses the complaint with the staff and offers conflict resolution guidance. The company also has a whistleblowing policy and has employed the services of an independent consultant to manage whistleblowing and grievance. The contacts (name, physical address, email address and phone number) of the consultant are provided in the staff handbook.
Protecting the Work Force
In accordance with the local laws, the company does not employ young persons under the age of 18 years. The Employment Act also prohibits forced labor. Depending on the role of the staff, some newly recruited staff undergo preemployment medical examination and all staff undertake Induction Training prior to assignment of duties.
Occupational Health and Safety
As already enumerated under PS 1 Goodlife has developed a risk assessment form for stores; a health and safety inspection checklist for the retail outlets; and a retail location screening report form for analyzing environmental and social risks of new locations prior to acquisition or lease. These documents have been developed recently and the company is in the process of implementation. As part of ESAP 1, the company will develop procedures and documentation for monitoring and reporting of occupational accidents, diseases and incidents for staff and contracted workers that regularly provide services to the company. This will include work-related lost time injuries and illnesses. The data collected shall be reported in the AMR to be presented to IFC.
Workers Engaged by Third Parties
Regular services contracted to third parties are private security guards at selected busy stores, three different firms contracted for logistics and deliveries to retail outlets in different locations and an architectural firm contracted to manage the contracts for pre-fabricated retail outlets in some of the petrol stations. The company will review the contracts with third parties to include requirements for compliance with the EHS policies and the labor laws.
Supply Chain
Goodlife has a wide range of suppliers and sources drugs directly from manufacturers or authorized wholesalers. The risk of child or forced labor in the supply chain is minimal; nevertheless, the company has developed Supplier Terms and Conditions and these include the company’s EHS policy statements. Goodlife’s EHS statement to suppliers specifically states the following "It is GPL's intention to source from suppliers who can satisfy our standards with regards to labor and welfare conditions, health and safety and environmental management or who have given a commitment to achieve these standards within an agreed time-frame"

Resource Efficiency
Goodlife stores occupy relatively small spaces (23-155 m2). Most of the stores are fitted with energy efficient LED lighting and modern air conditioning units. Although electricity consumption is not monitored, the impact of the stores on energy consumption is considered minimal. Fuel consumption for logistical operations (delivery of products to stores) is also considered minimal. Deliveries are done by third party contractors on a need basis on planned schedules.
Solid Waste Management
Goodlife does not have a formal waste management plan. General waste generated by the retail outlets is not very significant and are disposed of at either the malls’ central disposal facilities or the petrol stations central disposal bins. The waste is then handled by the landlords’ waste contractors. The waste generated at the warehouse is disposed of by the landlord through approved recycling companies.
Hazardous Materials
Goodlife’s drug disposal policies and procedures provide for routine inspection of stock to detect any discontinued, outdated, defective, or deteriorated drugs and/or containers worn, illegible, missing or defective seals. Any such drugs are segregated into either of these categories: dangerous drugs, over the counter medicines or non-pharma products. A chain of custody procedure of approvals and transfer is then generated and the expired or damaged products transferred to the central warehouse where final documentation is generated prior to disposal through approved waste handlers. All records of disposed products including certificates of destruction are maintained by the company. Instead of storage of the expired and damaged products on the floor, the company will designate a safe, labelled, storage area within the central warehouse to store the expired, damaged drugs and products.

Goodlife has established the Social & Ethics Committee to assist the Board in its oversight of the Company’s policies and procedures relating to good corporate citizenship; social and economic development; environment, health, public safety and labor. With regards to pharmaceutical safety, the company is aware of the presence of counterfeit drugs in the countries of operation and only source drugs from the manufacturers and authorized wholesalers only.
Infrastructure Design and Safety/ Life and Fire Safety (LFS)
Goodlife has developed a health and safety inspection checklist that includes LFS requirements to be used by the Health and Safety Committee during routine inspections of the retail outlets. All retail outlets and the central warehouse have fire detection systems, evacuation signage, fire extinguishers and one-way exit points from the outlets. New outlets are to be built or leased considering full compliance with the local building codes, local fire department regulations, and ensuring proper mechanisms for fire prevention, detection and control as well as safe evacuation of occupants. Through the AMR to IFC, the company will ensure that the annual statutory OHS and fire audits are done for all the retail outlets the corporate offices and the central warehouse, corrective actions identified, resolved and annual fire and OHS permits maintained. Emergency response plans, including control of combustible load, are in place as described previously in this ESRS.
Security Personnel
Security services are provided by a specialized well recognized company. Security is provided at a few selected retail outlets. The security agency has standard operating procedures and provides basic training for the guards and supervisors. The training includes topics such as customer care relations, communication, health and safety, firefighting, first aid, search (frisking) and progressive use of force. There has been no complaints or reports regarding nonappropriate conduct or abusive behavior of security personnel at the outlets.

Goodlife stakeholders can contact the company through the numbers provided in their webpages or through the Contacts Section of the website which provides a comments section. The company also has flyers in the stores and some of these also provide the company contacts for customers and stakeholders. Should there be any complaints raised, these are handled by the Head of Retail. The company has an open line of communication with suppliers and contractors. The ESRS from the previous transaction with IFC has been publicly disclosed.

Chris Kieu
Chief Finance Officer
Africa Chemist and Beauty Care
Office Tel: 254 20 3744504/5
Mobile Tel: 254 722 607111
Email: ckieu@africhemist.com

Broad Community Support is not applicable for this project

Title	Anticipated Completion Date
PS1: Implement a formal ESMS to include: (i) designated staff in senior management who ensures conformance with the policy and is responsible for its execution. (ii) enhance the risk assessment requirements for environmental and social aspects of retail location screening to include requests for mall or petrol outlet EHS assessment or annual audit documents for review prior to leasing or acquisition; (iii) develop a procedure with defined roles and responsibilities and timetable for routine or annual inspections and risk assessment of the stores and warehouse, and action plans for addressing any non-compliances when detected; (iv) establish the required statutory training requirements on EHS and develop a plan for implementation across the business operations	03/31/2018
PS1: Consolidate and update the Emergency Preparedness and Response Procedure for all company operations in compliance with IFC PS requirements.	06/30/2018