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 these Performance Standards.
 

The offices are located in existing buildings leased from landlords and there are no indigenous people, biodiversity or cultural heritage affected by the company’s business activities. Accordingly, the findings of the project review indicate that there are no impacts related to Land Acquisition and Involuntary Resettlement (PS5), Biodiversity Conservation and Sustainable Management of Living Natural Resources (PS6), Indigenous Peoples (PS7) or Cultural Heritage (PS8).

 IFC has categorized this equity transaction as a Category B project, according to its Policy on Social and Environmental Sustainability (January 1st, 2012). The rationale underlying this categorization is based on the scope of activities and current operations of the company in Sri Lanka.

Key E&S issues associated with this proposed investment include: (i) performance and management of environmental, social (labor), occupational health and safety; (ii) provision of fair and safe working conditions, and labor standards and human resources (HR) management for permanent and contract workers; (iii) terms and conditions for the freelance drivers; (iv) emergency preparedness and response; and (v) road safety and passenger safety.

 Environmental and Social Policies: PickMe is a relatively new company (launched in 2015) with limited environmental and social (E&S) risks and impacts from its current business operations. At present, it does not have a documented E&S policy or procedures or safety policy to address the risks and impacts. The current legal compliance requirements are met through necessary statutory documentations, filing and license renewals, e.g., fire clearance and government approvals/registrations for leased office space. The company does not have a fully documented Human Resource policy manual (more in PS-2 section below).. Going forward, and as set forth in the Environmental and Social Action Plan (ESAP action #1), PickMe will develop and implement corporate policies and procedures on risk assessment of new product/service, fire safety, emergency response, environment, occupational health and safety, road safety, passenger safety and community grievance mechanism policy.

Environmental and Social Assessment: At present, there is no taxi hailing policy or regulation from the government and hence there is no requirement of a specific license to operate on the company. PickMe complies with national and local applicable regulatory requirements which, to date, are primarily limited to management of staff and contracted workforce. Verification of every freelancer driver is undertaken by the company before the driver is authorized and registered for providing taxi services through company app. As part of verification process key documents related to vehicle registration, taxes, insurance and vehicle fitness are also collected.

Environmental and Social Management Programs: the company does not have a documented E&S management system and a human resource manual. Some of aspects relevant to working conditions and safety are covered through the “Terms and Conditions” which are agreed by every freelancer driver before they can use the mobile application platform of the company, as discussed in detail under PS-2 below. Going forward, the company will formalize a management system to address the following key elements: (i) occupational health and safety at the office premises, (ii) road safety for drivers and other road users, and (iii) safety of passengers. Some of these aspects will become more critical in future as the company’s customer base diversifies and its geography of operations expands. The company will therefore implement necessary procedures to address these risks and impacts as outlined in the ESAP action #1. Further, going forward, as part of ESAP action #1, it will define specific E&S compliance monitoring procedures for each company’s operation and facility, E&S compliance monitoring of registered drivers and contracted workers and E&S due diligence for any future assets it may acquire or own.

Organizational structure and management capacity: The E&S roles and responsibilities have not been assigned in a structured format and are currently discharged through senior managers in the respective operations vertical who ultimately report to the chief operating officer (COO). The registration process of the drivers is handled by a team of 16 employees headed by manager-registrations. All registrations are done centrally at the Colombo head office. Registration process involves a basic vehicle fitness inspection by the company (within the head office building). This is followed by document verification which includes verification of driving license, national ID, address proof, no objection certificate from vehicle owner (if the driver doesn’t own the vehicle), vehicle book (registration), insurance and revenue license (road tax verification). Once the drivers submit the documents, the driver ID is generated. Post registration, the drivers undergo mandatory five-hour training delivered at the company’s training center (within the head office building). Once the driver is active on the network, the service quality level is monitored by a team of 15 employees working under the Manager- Driver care. The team is responsible for monitoring the online hours of the drivers, driver availability through real time GPS network monitoring, complaint handling, and monitoring app comments/feedback on drivers. Human resource function is managed by the Manager- Human Resources and Specialist- Talent Acquisition and Resourcing. Office level compliances including fire safety, and emergency preparedness is handled by Manager- Coordination. Going forward as the E&S policies are drafted, PickMe will nominate a team of senior operations managers (e.g., Manager- Driver care, Manager- Registrations, Manager- Coordination) to ensure that the policies are implemented across the business activities (ESAP action #2). The senior operations managers will provide feedback to the COO. PickMe will subject the implementation of its E&S policies and procedures to internal and external audits, according to an audit program, and will take actions on the recommendations.

Training: Employee training covers aspects related to company vision and mission, service suite, HR policies and on job training based on departmental needs and requirements. At present the company does not have a formal training program on fire safety and emergency evacuation. The company has moved to the current location last year and hence some of these programs have not yet been formalized. Mandatory training is imparted to every freelance driver prior to registration with the company. Once a driver has been registered, s/he undergoes a mandatory induction training on mobile application use, basic safety precautions to be followed, user feedback process, emergency hotline number, potential earnings, incentives and referral bonuses etc. The training modules also cover aspects of road safety such as safe speed limits, lane driving, seat belt etc. The company is planning on hosting the training modules on the company’s mobile app such that it can be made available more widely and is easily accessible. As per ESAP action #3, current training programs will be strengthened by including modules on passenger/customer safety, emergency response, incident reporting, maintenance of hygiene for food delivery (when this service will be provided) and basic fire safety awareness for its offices. Additionally, training program for employees will be strengthened to include fire safety and emergency evacuation. All these will be delivered through regular trainings and awareness building sessions by online and/or face to face modules and will be notified through a trainings calendar.

Monitoring and Reporting: PickMe tracks data on active, online and offline drivers and delinquencies, numbers of trips, driver earnings per month (as a function of its commission) etc. Currently, the company doesn’t acquire or monitor data on accidents and incidents. PickMe will strengthen its monitoring and reporting process by including training statistics and incident reporting from all business verticals and from its own premises, as per ESAP action #4. Over time these reports would be available through a management dashboard. E&S performance, including safety performance of the freelance drivers, will be reported to and reviewed annually by senior management.

Emergency Preparedness and Response: As mentioned above, PickMe ensures that the premises it occupies hold valid fire licenses and basic registration and statutory approvals. All vehicles delivering PickMe services are GPS tracked. Going forward, as per ESAP action #5, for all cars, PickMe will strengthen its emergency preparedness by ensuring trainings, ensuring availability of relevant safety gears and first aid kits, portable fire extinguishers and safety measures in line with national laws, other traffic rules and good international practices on passenger safety, as defined in the relevant procedures to be developed. 

Human Resource Policy: PickMe has around 158 permanent employees including 35 female employees engaged in office, IT, software development and upgrade and other back end work. PickMe also has 36 staff under term contract engaged in call center operations. All HR functions are handled centrally such as recruitment/talent acquisition, HR operations, training, learning & development, HR policy creation etc. Administration and compliance functions are handled at business units and office levels by the senior managers and heads of business verticals. New employees are communicated about the policies during induction. Policy revisions and new policies are approved by the CEO and communicated to the employees verbally. PickMe is in the process of developing and documenting its HR policies and manual in line with the applicable laws and rules of the country and subsequently put them to the board of the company for approval before finally notifying through company intranet. The policies and the manual will be in compliance with the Shops and Office Employee Act, 1954, other applicable labor laws and in line with this Performance Standard. As part of ESAP action #6 this will be completed for implementation in next six months. As set forth in the ESAP action #6, the documented policies will include policies on non-discrimination and equal opportunity, anti-harassment and retrenchment.  With respect to the latter, PickMe will update its retrenchment policy and procedure that will comply with local requirements and IFC Performance Standard 2 to be applied in the event that the company’s business plans lead to retrenchment at any of Company’s current operations.

Working conditions and terms of employment (job description and KPIs) are communicated through appointment letters which are followed by induction training and department posting. Defined working hours, weekly holidays, leaves (including maternity leaves, public holidays and festival leaves), biometric time keeping, voluntary overtime work (with prior approval from line manager), festival bonuses, timely salary payments and statutory deductions are implemented in line with applicable laws. Induction training covers basics of the job, HR policies and administrative procedures, reporting lines and job expectations. In terms of contracting through third party, and in view of the planned expansion, the company will ensure contractor’s compliance with the applicable labor laws and regulations and this Performance Standard (ESAP actions # 1 and 6).

Freelance Drivers: The drivers are not engaged on any employment contract with the company, and are completely associated on voluntary basis and hence are not under any obligation to follow PickMe’s instructions on service delivery (apart from following terms on quality of services as described in the ‘general terms and conditions’) and can stop delivering the service at their will with no financial penalty. However, delinquent accounts (drivers offline for more than 72 hours) get suspended as part of quality control and for the company to be able to maintain good customer experience. Drivers need to purchase a smartphone device (“device”) from the company on one-time down payment or through different payment plans. The company also levies a monthly subscription fee from the drivers for using the company app and this fee is charged on daily basis. On the revenue sharing side, a 5-15% (depending on vehicle types) commission on every hire done through company app is also charged by the company. These charges can be accrued upto a credit limit and a driver crossing the credit limit is flagged for deactivation. However, the reactivation process is very simple and there is no penalty for deactivation/reactivation. The credit limit concept is in place primarily because 85% of payments that the drivers receive is in cash. Moving forward as the payment platform is developed by the company, this is likely to change. The drivers are free to go offline and do a road pick up (“private pick up”) or they can be online on company’s app and pick passengers based on requests on the app. The drivers have liberty to decline a request or let it “time out” in 20 second. However, it is expected that the driver is not repeatedly declining the same passenger request as it has bearing on customer experience. The general terms and conditions that the freelancer drivers sign at the time of registration, include compliance with applicable laws, possession of valid licenses and authorization to drive the vehicle, third party insurance, valid registration and vehicle fitness certificate. The conditions further mention that the drivers shall not contact customers for any other purpose. Similar terms are agreed by the customer using company app.  The conditions also cover aspects such as cleanliness of vehicle and personal hygiene, acceptance and cancellation of rides, etiquettes while dealing with customers, restriction on carrying political posters, restriction on use of customer information, use of devices only for working purpose, and that the company can blacklist a driver or reject the driver from using the app for a certain period (6 hours to 72 hours) based on severity of complaints from customers which are received via email, app feedback or social media. All vehicles are owned by the freelancers and any liability arising out of the ownership is that of the freelancer.

Nondiscrimination and equal opportunity: PickMe will develop and implement a non-discrimination and equal opportunity policy, and anti-harassment policy in line with national regulations and this PS-2.

Protecting the Work force: The company has a multitier grievance redressal process which covers workplace complaints , including harassment of any nature. However, as indicated above, the grievance redressal policy is not documented and this will be addressed as part of ESAP #6. The company has no policy restrictions on freedom of association and employee organizations, but it will document it in the required HR policies. Similarly, the company will document a policy on prohibiting child and forced labor in its operations.

Occupational Health and Safety: PickMe will manage occupational health and safety and fire safety at all premises in line with applicable laws. PickMe follows the applicable labor laws in this regard and the OHS policy will comply with the applicable rules and this Performance Standard. Through its training programs PickMe will keep improving the OHS performance including improvements in ergonomics. As per ESAP action #3, a safety training program will be designed and implemented, with modules designed to cover (i) company’s staff and contracted workers; and (ii) the freelancer drivers.

Air emissions: Sources of air emissions are limited to vehicular emissions.
 

Electricity and Water: Electricity and water use arise from routine office tasks, remain low, and do not represent a significant source of impacts.

Effluents: There are no wet processes at PickMe’s facilities.

Solid Wastes: Very limited volume of solid waste is generated in offices which includes domestic waste, waste paper etc. These are disposed in accordance with local municipal rules. Vehicle fitness testing is not intrusive and very small quantities of waste like oil soaked cotton rags is generated which is disposed in line with regulations. 

 Community Health and Safety: The company operations do not pose serious risks to health and safety of local community. Risks associated with any explosions or failure of infrastructure or equipment do not arise. Potential risks to communities across PickMe’s operations are primarily associated with the risk of road accidents and safety of customers using the ride services. The company is currently providing basic awareness to all drivers on health and safety measures to be followed while driving on road, obeying traffic rules, not taking illegal turns or driving on wrong side, maintaining good condition of smartphones and vehicles and maintaining personal hygiene. The company is currently not monitoring accident/ incidents. Going forward, and as set in ESAP action # 3 and ESAP action # 5, the company will strengthen its training modules and will monitor safety performance, including incidents, and compliance with the policies. 

Security Personnel: PickMe’s business premises are small sized and do not have armed security personnel.

 The stakeholder engagement process of PickMe includes user feedback mechanism available through its mobile application, via email or from social media platform. All such feedbacks are available to the company and are utilized to further improve the services and quality of service provided by the drivers. Individual feedback and rating provided by the customers in relation to a driver is also publicly accessible and helps the next customer. The company can also take action against the driver and restrict them from providing services from PickMe platform. PickMe will keep utilizing the feedback to improve the quality of its service delivery and take actions on any critical feedbacks related to safety incidents etc. PickMe has very elaborate mechanism to address issues around driver misconduct and complaints. Going forward, and as set forth in the ESAP action #1, PickMe will enhance the current mechanism to include a community grievance mechanism to record and take action on any grievances received from general public which is inconvenienced due to the company’s business activities.