PS5, Land Acquisition and Involuntary Resettlement is not applicable as the land for the new facilities (PABL-Rajshahi and PABL-Natore) has been purchased by PRAN in willing buyer-willing seller transactions from individual owners with legal titles. No squatters were established in the land, nor the land was leased to people. Also, for PAL and NAL, modernization/expansion will take place within the same premises. No physical or economic displacement is expected due to the project. PS6: Biodiversity Conservation and Sustainable Natural Resource Management is not applicable because PRAN facilities are situated in rural areas qualified as modified habitat. In these locations, there are no impacts on biodiversity, and also, as per the supply chain desktop assessment, no natural habitats are converted for plantations. PS7: Indigenous Peoples and PS8: Cultural Heritage are not applicable for the project because neither indigenous peoples nor culturally sensitive sites are present.

This is a Category B project according to IFC’s Policy on Environmental and Social Sustainability because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. 

Environmental & Social (E&S) Assessment: As required under the Environment Conservation Rules 1997, PABL has received location clearance for both PABL-Rajshahi and PABL-Natore facilities. The company will hire a third-party consultant to prepare an initial environment examination (IEE) and Environment Management Plans (EMP) for both facilities. In line with the applicable requirements, these documents are required to obtain the environmental clearance certificate (ECC). PRAN will ensure that these assessments cover all relevant E&S risks and impacts as stated in IFC PSs. For PAL/NAL, the expansion/modernization does not require any E&S impact assessment (ESIA). All new activities will be covered in PRAN’s risk assessment procedures.

E&S Policy, Management Systems, Identification of Risks and Impacts: PRAN has a corporate environment, health and safety (EHS) policy, which is adopted by all its companies and implemented at all facilities. This EHS policy is covers all E&S risks and impacts of Pran’s operations and is communicated to all workers, and other relevant stakeholders through displays. As a part of its commitment under the previous IFC investments, PRAN has implemented an integrated management system (IMS) covering quality, environment and occupational, health and safety (OHS) aspects as per ISO 9001, ISO 14001 and OHSAS 18001 standards, at PAL and NAL facilities. Both companies (PAL and NAL) have hazard analysis and critical control point (HACCP) certification for food safety for a number of products manufactured at all its facilities.

In 2014, the company hired an external consultant to undertake an EHS management system implementation assessment, which identified a number of areas for improvement. The company has implemented many of the corrective measures. As part of the appraisal for this proposed investment, IFC commissioned a follow-up EHS management system assessment (EHSMA) to evaluate the progress on the ESMS implementation. The EHSMA results confirm that the company has improved its EHS management systems implementation, and identifies some areas for improvements. Aspects to be strengthened include: (i) risk assessment procedures, (ii) description of EHS roles and responsibilities, (iii) resource efficiency objectives and targets, and (iv) stakeholder engagement. Improvement areas are discussed in detail and mitigation measures presented in the following subsections. As part of the ESAP(#1), PRAN will review the EHSMA findings and prepare a corrective action plan (CAP) including timelines and assigning resources, including budget, to ensure its implementation.

Also, as part of a client support project from IFC, PRAN had also drafted a corporate E&S management framework (in 2016). The third-party consultant who has undertaken the EHSMA will also finalize the corporate E&S management framework by including new procedures developed since 2016. As per ESAP (#2), PABL, PAL and NAL will formally adopt the finalized corporate E&S management framework and align their management systems in line with the same.

The new PABL’s facilities will implement EHS management systems aligned with this PS and including the improvement suggested in the EHSMA (as per ESAP#2).

Organizational Capacity and Competency: PRAN has an EHS General Manager at corporate level, who is the overall responsible for E&S management at all facilities including PABL, PAL and NAL. At the facilities level, there are EHS coordinators, who are responsible for the day-to-day implementation of the EHS management system. EHS resources are considered to be adequate to ensure effective management of E&S risks and impacts at the PAL/NAL facilities. Facility EHS management representatives report to the Facility Head and EHS General Manager. In addition, a facility level EHS committee has been formed at PAL and NAL which discusses EHS issues on a monthly basis. Departmental level EHS committees have been formed and are responsible to ensure implementation of corrective measures discussed in the facility level meetings.

At PABL-Rajshahi and Natore, since operations have not started, quality and administration personnel have been given EHS management responsibilities. As set forth in the ESAP(#3), the company will ensure availability of adequate full-time EHS management personnel at both PABL-Rajshahi and Natore and also create similar facility and department level EHS committees. Also, as per the EHSMA, the roles and responsibilities of the EHS coordinators need to be described and communicated, which will be completed as part of implementation of the CAP being prepared under ESAP#1.

Emergency Preparedness and Response: An emergency response plan (ERP) has been prepared for both PAL and NAL. During the site visit, it was noted that required emergency response infrastructure has been implemented including identified emergency routes, exit markings, displayed evacuation plans, marked assembly points, fire alarms (visual ones for high noise areas), smoke detectors (in unmanned areas) and firefighting systems. Annual mock drills are conducted at all facilities, and emergency wardens have been trained to support implementation of the ERP. As the company uses Ethylene Oxide (ETO) for sterilization of spices, the company is in the process of installing a smoke detector and ETO sensor in the ETO storage areas. PAL and NAL will implement identified improvements as per the EHSMA, including: (i) conducting mock drills for all potential emergencies, (ii) installing additional smoke detectors and fire extinguishers in the identified areas, and (iii) training of workers (under ESAP#1). Similar emergency response infrastructure will be provided and plans implemented at the new facilities. The implementation will be reviewed as part of regular supervision visits by IFC.

Monitoring and Review: PAL and NAL have a monitoring and reporting program. Ambient air quality, stack emissions, effluent quality and work area noise, temperature and humidity are regularly monitored at the facilities in accordance with both host country requirements and WBG EHS guidelines. Additional EHS indicators related to resource consumption, waste generation and training are also monitored. All accidents/incidents are monitored, investigated, and corrective actions implemented, if necessary. The EHS coordinator conducts facility inspections and reports unsafe acts and conditions as well as other EHS issues to the facility management and GM-EHS. The GM-EHS also conducts regular facility visits, reviews implementation of the ESMS and follows up on the implementation of corrective actions. Based on these monitoring activities, a monthly EHS report is sent to the GM-EHS, who then prepares a monthly corporate level report (covering all group facilities) and shares it with the group’s senior management. These reports include EHS indicators which are reviewed by management annually as part of the management review. The EHSMA suggests specific improvements in the monitoring and review procedures, which will be implemented as part of the CAP (under ESAP#1) and included in the finalized corporate E&S framework.                                                   

PAL and NAL have a total workforce of approximately 5000 workers including ~1000 trainees and apprentices (workers who are in their probation period of six months). About 60% of the workforce is women engaged in variety of production activities. About 500 contract workers are employed at these facilities, whose number varies seasonally. PABL-Rajshahi and PABL-Natore are expected to employ 720 and 1400 people during operation, respectively. During construction, PABL will engage 300 workers hired through contractors.

Human Resource Policy, Working Conditions and Terms of Employment: PRAN has HR policies which have been documented in a HR handbook. The handbook includes specific policies on non-discrimination, freedom of association, harassment and abuse, prevention of child labor and forced labor and a worker grievance mechanism. The handbook also includes OHS guidelines on first-aid, emergency response, usage of personal protective equipment (PPE) and cleanliness. The HR department at each facility is responsible for implementing the HR policy.

Terms of employment, such as wages, working hours, overtime, social security, medical insurance, pension and other benefits were noted to be in line with the country legal and PS2 requirements. These are described in detail in all workers’ contracts and provided to workers at hiring stage. HR policy and procedures are communicated to all workers during induction and through their appointment letters. However, it was noted that the HR handbook is not being regularly distributed and therefore, as set forth in the ESAP(#4), PAL/NAL will distribute handbooks to all workers and ensure its continual distribution at the time hiring. Similar handbooks shall be prepared and distributed at the new facilities.

Freedom of association and Grievance mechanism: A documented policy on freedom of association has been included in the HR handbook and it does not restrict workers to organize or bargain collectively. Currently, the company does not have a union at any of its facilities. Worker committees have been formed at PAL and NAL facilities that have equal representation of nominated workers and management and are tasked to discuss and resolve workplace issues.

 The company has a documented grievance mechanism that utilizes multiple forums to receive grievances based on the type of grievance including suggestion and complaint boxes through which workers can submit grievances anonymously. The grievance mechanism includes clear procedures to receive, register, and address grievances. Written grievances are reviewed by Welfare department and escalated in case resolution is not achieved at the level of HR. The mechanism is extensively communicated throughout the company through induction and displays. Necessary actions are taken to address gaps within reasonable timelines

PAL and NAL have an anti-harassment policy (including sexual harassment) and have conducted training programs for all workers on this policy. However, the policy does not clearly specify the methods of investigation and resolution of such complaints. As set forth in the ESAP(#4), the company will strengthen the policy implementation by specifying clear procedures of investigation and resolution of such complaints including specific provisions of anonymity for the complainant/victim and preventing any retribution against them. Adequate resources will be assigned to manage these type of cases.

Non-discrimination: The company is an equal opportunity employer and has a specific policy on non-discrimination included in the handbook.

Prevention of child and forced labor: The company has a specific policy on prevention of child and forced labor. Age proofs are collected for employees and contract workers. No instances of child labor or forced labor were reported by the facilities during the recent as well as previous supervision visits.

Occupational, health and safety: PAL and NAL have completed an OHS risk assessment for their operations in accordance with OHSAS requirements. The company has rolled out OHS programs including work permit system, lock-out-tag-out and accident/incident investigations. The company has safety committees comprised of both worker and management representatives, which meet on a regularly basis to develop and implement OHS corrective action plans.  Personal Protective Equipment (PPE) was deployed at locations visited and equipment noted to be adequate to the risk. In terms of housekeeping, work areas are clearly demarcated and safety signage displayed throughout the plants. All accidents and incidents are investigated to identify root causes and define corrective and preventive actions.

The EHSMA has identified improvement areas with regards to OHS risk assessment, machine guarding and few other OHS areas at specific locations. Corrective actions to address these gaps will be implemented as described in the ESAP (ESAP#1) and included in the finalized corporate E&S framework.  

Third party: PRAN has several contractors providing services for its operations. All companies are legitimate enterprises and as part of the contracts, PRAN includes EHS requirements, including compliance with national legislation. Workers engaged by third parties have service contracts with a duration ranging from daily to yearly. Their terms of employment are aligned with this PS and compliance is actively monitored on site. PAL and NAL HR department ensure payment of wages in presence of an HR representative. HR department representatives review required documentation to ensure that third-party workers are provided all legal benefits. As part of its management system, facility level EHS coordinators monitor the EHS performance of its third-party workers. However, the EHSMA suggested specific improvements in communication of EHS requirements to contract workers, which will be implemented as part of the CAP (under ESAP#1) and included in the finalized corporate E&S framework.

The construction of the proposed new facilities and any ongoing expansion at PAL and NAL is undertaken by Property Developments Limited (PDL), a group company. PDL has a documented safety manual which is being updated to integrate IFC PSs and WBG EHS Guidelines requirements. As set forth in the ESAP(#5), PAL/NAL and PABL will ensure that the manual is revised to include:

(i)   clear EHS and working conditions requirements (in line with IFC PSs and legal requirements) to be implemented at the site;

(ii)   clear roles and responsibilities of company and contractors’ personnel for implementation and monitoring on-site aligned with the EMP of the new facilities; 

(iii)   consequences of non-compliance for the contractors and their method of implementation; 

(iv)    requirements on labor law compliance including prevention of child labor;

(v)    labor camp guidelines in line with the IFC guidance note on workers’ accommodation;

(vi)    construction management practices to minimize the impact on neighboring communities; and

(vii)   specific processes on dust control and waste management.

(viii)   Grievance mechanism?

PABL/PAL/NAL will ensure implementation of the manual on-site through PDL.

During the site visit, 30-40 construction workers were noted to be working at the PABL-Rajshahi which are expected to increase to 100-120 at the peak of construction. Basic PPE usage (shoes, helmets) at the construction areas was noted to be adequate. Also, a safety induction is conducted for all construction workers.

Workers’ Accommodation: The workers accommodation (for construction workers as well as security guards) was noted to have improved, with reasonable size of rooms, basic sanitation facilities, fire extinguishers, drinking water, and access to other basic services.

Supply Chain for Agribusiness Operations: The key agricultural commodities purchased by PRAN include mangoes, tomatoes, garlic, peppers, turmeric, peanut and moong beans. The company deals with about 15000 contract farmers through about 150 lead farmers, who sign agreements with PRAN and act as aggregators. Purchases through lead farmers amount to approximately 30% of commodity purchases. In addition, PRAN procures 70% these commodities through traders/dealers who in turn have links with 55000 farmers.

As required under the ESAP of previous investment, PRAN’s sourcing team has completed a supply chain risk assessment with respect to IFC PSs requirement i.e. no child labor, no forced labor, no significant safety hazards and no conversion of natural habitat for plantation. As per the desktop assessment, no major risks have been identified except use of PPE in pesticides application, storage and management.

The company has a supplier code of conduct, which describes the specific EHS requirements suppliers need to meet. Currently, requirements include, no child labor, no forced labor, no significant safety hazard, and no conversion of natural or critical habitat. This code of conduct is being included into the purchasing documentation. The sourcing team has an outreach plan which includes visits to lead farmers at various stages (e.g. field preparation, fertilizer application, harvesting) to review compliance against abovementioned requirements. The overall action plan also includes communication of EHS requirements and training to farmers.  

PRAN will strengthen its supply chain management and develop good agricultural practices standards for their contract farmers. The standards developed will also include the above-mentioned requirements of IFC PSs for supply chain.                                                   

Resource Efficiency: Water and energy consumption are monitored at PAL and NAL and reported in the monthly EHS reports. Initiatives have been implemented at PAL/NAL for reducing water and energy consumption. However, as identified during IFC appraisal as well as in the EHSMA, there are areas of improvements on resource efficiency – water reuse and recycling, energy conservation. As set forth in the ESAP(#7), PAL and NAL will set resource efficiency targets, implement improvement plans identified and assign adequate resources for implementation.

Power Supply and Air Quality: Electricity is sourced from the grid for PRAL/NAL and for the new facilities. Diesel generator sets provide backup power where required. Diesel fuel is stored in secured tanks with adequate secondary containment.

PAL and NAL have a Coal based steam boiler with a capacity of 10 tonnes per hour (tph). Two new boilers of 20 tph capacity each are being installed – one of which will be dual fuel using Coal and Mango seeds. The existing boiler as well as the proposed boilers have wet scrubber systems for pollution control.

Ambient air quality and stack emission monitoring are conducted and the available results reviewed during appraisal indicated compliance with national standards and WBG EHS guidelines except for particulate matter (PM). As set forth in ESAP(#6), PRAN will conduct an environmental assessment to model incremental impact of current and expected PM of new boilers on nearby sensitive receptors and airshed of the facilities (PAL/NAL) and in case required (based on the result of the assessment), submit an improvement plan to meet the stack emissions guidelines of 50 mg/Nm3 of PM for the new facilities. PRAN will work with the vendors to ensure that the boilers’ designs are compliant with WBG EHS guidelines. The stack emissions and ambient air quality (both at the facility and nearby sensitive receptors) will be monitored regularly and the monitoring results will be shared as part of the annual monitoring reports sent to IFC.

Water Supply and Effluent management: PAL/NAL source water from its own ground water wells and the same is expected at the new facilities. Groundwater extraction is monitored on a daily basis. The water is treated in-house for various uses through filtration and softening. The average water consumption at PAL/NAL facilities is around 3000 m3/day whereas the estimated consumption for new facilities is estimated to be XXXX

Domestic sewage is disposed in septic tanks and soak pits. Effluent treatment plants (ETPs) are available at PAL/NAL with secondary treatment (activated sludge process) for treatment of industrial effluent. The effluent quality is tested regularly and results showed compliance with national standards and WBG EHS guidelines except for total suspended solids (TSS) which exceed WBG EHS guideline levels. As per the ESAP(#6), the company will undertake required corrective actions to ensure compliance on TSS. ETPs have been designed for the new facilities and are under construction. PRAN will ensure that the performance of the new ETPs is optimized to meet national standards and WBG EHS guidelines. 

Solid and Hazardous Waste: The main waste streams generated from the PAL/NAL operations (and expected to be similar at new facilities) are empty plastic containers, paper/plastic packaging waste, metalized foils, and pulping waste (from various fruits). Waste from PAL/NAL is also stored in a scrap yard constructed in the PABL-Natore facility. Containers are washed and reused whereas paper/plastic and metallized foils are segregated and sold to recyclers.  

The most significant quantity of pulping waste comes from Mango and PRAN plans to implement composting to treat this waste (along with the other pulping waste generated through the year). Mango seeds and skin will be separated through mechanical separators and seeds will be used as fuel for the boilers. Skin will be composted and the compost will be sold. Compost sheds and yards for this process are under construction at PABL-Rajshahi and Natore (to be used for NAL waste) and are expected to be completed before the next Mango pulping season i.e. end of May 2018.   

All hazardous waste (used batteries and used oil) are disposed through authorized entities. The ETP sludge is stored in a concrete pit as there are no centralized waste disposal facilities. Improvements suggested in the EHSMA on storage of ETP sludge and display of hazardous waste signages will be implemented as part of the CAP (under ESAP#1).

Hazardous materials management: Fuel (diesel) and hazardous chemicals are stored with adequate secondary containment at PAL/NAL. As mentioned above, ETO is used for sterilization of spices and the company has installed smoke detectors and ETO sensors in the storage areas. As ETO is also expected to be used at the new spices facility at PABL-Natore, similar fire safety and emergency response infrastructure will be implemented.

Greenhouse Gas (GHG) Emissions: Expected GHG emissions from the project are anticipated to be approximately 70,000tonnes of CO2 equivalent (tCO2) (53,000 tonnes direct and 17,000 tonnes indirect).

Integrated Pest Management: PRAN has prepared a list of approved pesticides and has also conducted a preliminary analysis to ensure that no World Health Organization (WHO) hazard class Ia, Ib or II are used in its contract farming operations. In relation to its suppliers, PRAN will include awareness raising programs and further verify this as part of its supply chain assessments reduce reliance on these chemicals.                                                   

The nature of the PAL/NAL/PABL operations does not present significant safety and security risks to nearby communities. However, there can be impacts due to the movement of vehicles on the access road to the facilities. Transport is used for receipt of raw materials or delivery of finished product. As per the ESAP(#8), the company will prepare a traffic management plan which will include regular training of drivers on road safety.

The company does not employ armed security guards at its facilities. Security guards are appropriately trained to interact with the neighboring communities and workers.                                                                                                      

Apart from being the biggest employer for the neighboring communities in Natore area and a significant buyer of agricultural commodities, PRAN undertakes several initiatives to help nearby communities. Focus areas of these initiatives include education and health support.

As highlighted in the EHSMA and as included in the ESAP(#9), PAL/NAL/PABL will develop a community grievance mechanism which will include clear procedures of receiving, processing and responding to community complaints and providing feedback to the complainant.                                                   

The company will disclose this ESRS and ESAP locally at the following addresses

1. PRAN Agro Business Limited

Chandpur, Pirgonj, Natore Sadar

Natore, Bangladesh.

2. PRAN Agro Business Limited

Village Amanotpur, P/O: Pirijpur (6290)

6 Matikata Union Porishad (Ward No. 3)

P/S: Godagari, District Rajshahi, Bangladesh.

 3. PRAN Agro Limited and Natore Agro Limited

Ekdala, Natore

Bangladesh.

All inquiries and comments on the project may be directed to:

Mr. Nirupam Dutta/Mr. Kazi Wahidur Rehman

PRAN-RFL Center

105 Middle Badda

Dhaka-1212, Bangladesh.

Telephone: +88-2-9881792

Fax: +88-2-8837464