This is a Category B project according to IFC's 2012 Policy on Environment and Social Sustainability. The project will have limited adverse E&S impacts that are few, site specific, largely reversible and readily addressed through existing mitigation measures described in the attached ESAP and good international industry practices (GIIPs). Key E&S risks and issues associated with the proposed project include: (a) company’s capacity and E&S management systems for the expansion and operations of the hatchery in line with IFC Performance Standards (PSs), including adequate E&S risk assessment; (b) assurance of fair, safe and healthy working conditions in compliance with legal requirements and IFC PS2 for employees and contract workers; (c) management of air emissions, wastewater and solid/hazardous waste in line with WBG EHS Guidelines; (d) life and fire safety, emergency preparedness and response; (e) community impacts due to traffic and security and grievance mechanism; (f) adoption of animal welfare practices at the hatchery and the broiler farms; and (g) compliance with IFC PS2/PS6 supply chain requirements for outgrowers.  

PS1: Assessment and Management of Environmental and Social Risks and Impacts

Environmental & Social Policies. Higest’s E&S policies outline its commitments to environmental protection, pollution prevention, occupational health and safety (OHS), observance of human rights and corporate social responsibility (CSR). The company will review and update its E&S policies and develop an overarching E&S Policy and Supplier Code of Conduct aligned to local law and IFC PSs principles and objectives. At a minimum, the updated commitments will be expanded to cover the key principles in IFC PS requirements, including among others, on labour risk management, management of wastewater and hazardous materials, animal welfare practices aligned with Global G.A.P standards, elimination of land conversion risks in its supply chain and community engagement (ESAP#1). Upon the approval of the E&S Policy and the Supplier Code by Higest’s management, Higest will socialize these with its workforce, contractor, service providers and out growers.

Identification of E&S Risks and Impacts. Higest has an E&S risk assessment procedure for the identification and management of E&S risks and impacts of its operations. The procedure is informed by the development of regulatory ESIA study for local environmental permitting, including E&S Management Plan (ESMP). As part of ESAP#1, the company will review and upgrade this procedure and its risk screening tools to cover (i) the scope of IFC PS requirements and WBG EHS Guidelines (General, Poultry Production and Poultry Processing); (ii) use of the procedure as an early decision-making tool on project siting and the definition of technical specification, (iii) the scope and level of E&S risk assessment. The company undertook E&S assessments for its facilities, including the hatchery within the main factory premises in Matola. Higest will update the 2022 Hatchery ESIA to incorporate IFC PS requirements and applicable and relevant sections of the WBG EHS Guidelines, including the proposed expansion financed by IFC, and develop a PS-compliant ESIA report and its Construction Phase Environment Health and Safety Plan (CEHSP) for submission to IFC. The scope of the ESIA will also cover the risk assessment for the outgrowers. (ESAP#2).

E&S Management System & Programs. The management of E&S risks is currently undertaken through the company QHSE Standard Operating Procedures (SOPs). These cover E&S risk assessment, hazard identification and risk assessment, process and activity level environmental monitoring plans, solid and wastewater management procedures, hazardous chemicals management protocols, incident and accident reporting, animal welfare, animal health & biosafety protocols, and supplier audits. Higest is also applying the Kaizen methodology of continuous improvement to promote daily monitoring and improvement tracking in production and related support processes. The company has implemented a food safety management system for its slaughterhouse, certified by FSSC 22000. Higest is in the process of developing an E&S Management System (ESMS) for its feed mill, hatchery, poultry production farms and processing operations, as informed by local laws and regulations, food safety requirements, quality management and EHS procedures. The company will amend the performance-based requirements of its ESMS to incorporate the IFC PS, WBG General, Poultry Production and Poultry Processing EHS Guidelines and the Global Smart Livestock Practices (https://globalslp.org/). Procedures and management plans will be documented to, as a minimum, cover OHS, contractor management, resource efficiency, greenhouse gas emissions, air emissions (dust and odors), noise emissions, solid (including hazardous) waste management, wastewater management, hazardous material (fuel) storage, fumigation, road safety, security, animal welfare, supplier management, and community engagement. Cross-reference of these EHS SOPs will be made to Food Safety MS procedures, including food safety, disease control and pesticide use. (ESAP#1).

E&S Organizational Capacity and Competency. Higest Quality and EHS (QEHS) team is headed by the Quality Manager with support from environmental officers and veterinaries. The Quality Manager oversees all Higest poultry production units and reports to the CEO. The QEHS team also provides EHS oversight to the outgrowers management team. The poultry production team also includes animal welfare officers who is charged with animal safety, welfare and biosafety protocols. HR roles and responsibilities are distributed among line managers and the payroll office under the Administration Department. In view of the company workforce, Higest has a qualified HR Officer.

E&S Training. New staff undergo induction training whose scope includes sensitization of the company QHSE policies and systems, including EHS issues such as firefighting, waste management and first aid. Refresher and annual HSE training focusses on occupational health and safety in the workplace, as an integral component for ensuring workers safety and to support the company’s food safety requirements. As part of ESAP#1, Higest will develop an EHS training procedure that will incorporate the mechanism for a training needs assessments for individuals in high-risk areas and for general staff. The training plan will also incorporate sensitization on the ESMS to be developed under the project ESAP. Specific training on E&S plans and procedure implementation will be expanded to cover the animal welfare officers at the hatcheries, line managers, and the EHS point persons at the outgrower farms.

Emergency Preparedness and Response Plan. Higest has a corporate level emergency preparedness and response procedure (EPRP) covering fire, explosions, chemical, water and sewage spills, workplace and road accidents, potable water shortage, bioterrorism/bomb threats, natural disasters including flooding and earthquakes, animal and human disease outbreaks and failure of critical production systems such as potable water, power and refrigeration systems. All facilities are equipped with fire evacuation plans and firefighting equipment. Higest will, as part of ESAP#1, develop site specific EPRPs as informed by site specific hazard risk assessments.

HSE Monitoring & Reporting. EHS monitoring and reporting is informed by an annual internal audit plan. The scope of the monitoring covers the Environmental Licenses’ Terms and Conditions (ref. ESMPs) for existing projects. External auditors are retained for annual and bi-annual regulatory ESMP audits of the production facilities and the wastewater treatment plant at the abattoir in Matola. Audit findings and corrective action plans (CAPs) are shared with Higest management for review and budgetary allocation for improvement measures against agreed upon company’s KPIs. As part of ESAP#1, Higest will document and enhance its monitoring practices to incorporate PS requirements, WBG EHS Guidelines and Global Smart Livestock Practices. The improvement measures will cover all Higest operations, including the hatchery and outgrower facilities, and incorporate a system for the development and closure of CAPs.

Supply Chain. Primary suppliers of Higest consists of: (i) hatching eggs from its breeder farm and imports; (ii) day old chicks (DOCs) from its hatchery. The Higest breeder farm provides 50% of the fertile egg stock while the rest being imported from South Africa, Zambia, Malawi; (ii) broilers from its broiler farms and outgrowers. About 90% of the broilers raised by outgrowers are processed at Higest abattoir. The outgrowers receive DOCs from Higest hatchery. Maize and soybean meal for the feed mill are currently imported from South Africa, while rice husks used for bedding is sourced from local rice mills. Traceability of soybean, maize and rice husks at farm level in South Africa and Mozambique was not possible during this appraisal. Higest has been seeking local sources of cereals but with no success due to the lack of competitiveness and consistency of local production. A supply chain management system will be established, including traceability/risk screening of soybean/maize supplier at farm gate (ESAP #3).

Higest undertakes outgrower screening and audits to meet its food safety requirements. As part of ESAP #3, the company will: (i) develop a Supplier Code aligned to PS2/PS6 requirements for all third-party suppliers, (ii) expand current supplier risk screening procedures to identify specific supplier and contextual E&S risks in accordance with PS2/PS6 requirements; (iii) develop a monitoring and audit plan for its third-party suppliers at farm gate whose scope will include CL/FL and safety of suppliers’ workers; (iii) establish a mechanism for development and implementation of corrective action plans with its third-party suppliers; (v) provide training to Higest procurement and E&S personnel to enable implementation of these commitments. Finally, Higest will engage an independent auditor to conduct an annual verification audit based on a sample of suppliers. PS2 and PS 6 risks in the supply chain are discussed below.

PS2: Labour and Working Conditions

The company has 507 direct staff of which 34% are women. There are no outsourced or seasonal workers in the company premises nor in its transportation system and outgrower support activities. 

Human Resource Policy, Procedures and Working Terms. The company HR policies are documented in an employee handbook and a recruitment policy. The documented policies outline the workers’ rights with reference to local labor law. The company policies include the right to fair treatment and opportunities for career advancement, the right to join a union, annual leave and time off, health benefit on occupation related injuries and fair wages as per company salary scale. The recruitment policy outlines procedures for fair and transparent recruitment, entry level medical examinations for staff and termination procedures. Higest employees have contracts of employment which outline individual’s working hours, applicable shift systems, wages, subsidies and allowances. Other staff benefits issued by the company include food and transport allowances, productivity awards and performance bonuses in accordance with company policies.

As part of the conditions for this proposed investment, Higest will develop HR policies and procedures manual in compliance with IFC PS 2 and local labour laws. The manual will outline company commitments to workers’ rights including freedom of association and collective bargaining, non-discrimination and equal opportunity, protection from retaliation and prohibition of child and forced labour. The manual will also outline the procedures to be applied during recruitment, induction, management of confidential and sensitive HR data/information, performance review and termination, including retrenchment. The company will further document its policies on working hours, overtime hours, overtime pay, shift systems, OHS management, remuneration and benefits, rest days, paid and un-paid leave, statutory social welfare programs including pension, health benefits and workers compensation schemes, staff code of conduct, disciplinary procedures and staff training. The documentation of these policies and procedures will consider the established terms and conditions in the latest collective bargaining agreement (CBA) to be signed with unionized workers, while maintaining non-discrimination principles for non-unionized staff (ESAP#4). The HR officer will guide the development and implementation of these HR policies and procedures.

Worker’s Grievance Mechanism. Complaints by staff are handled by the direct line managers with the option of escalation to the CEO. Higest will develop and implement a workers’ grievance redress mechanism (GRM) in accordance with PS2 (ESAP#5). The mechanism will provide the means for registration of complaints including a mechanism for raising and addressing anonymous complaints. The GRM will also outline the nominated focal points for addressing complaints related to gender-based violence and sexual harassment (GBV&SH) and outline the specific measures for identification and management of such complaints. The GRM will be integrated into the Employee’s handbook and will be presented at worker induction. The GRM will also integrate union representation for unionized workers. The GRM will not impede access to other judicial or administrative remedies that might be available under the national labor law.

Occupational Health and Safety. Higest OHS Policy documents its commitments on provision of safe and healthy working conditions, prevention of accidents and occupational illnesses. The company has a corporate level OHS register as guided by the hazard and risk assessment procedure developed as part of its Quality manual. Each operational location is equipped with first aid and firefighting systems at facility level and internal emergency response teams supported by external service providers covering emergency response dedicated to food safety, medical and fire emergencies. The company has a target of zero lost time injuries and tracks the injury frequency rates against OHSA Industry benchmarks. Records show that the company has a good OHS performance across its operations, including at the feed mill and abattoir. Higest will enhance the existing OHS policy and procedures and develop and implement a formal corporate level OHS program, cascaded to all operational locations and facilities, as part of the HR procedures and management programs (ESAP#4). Procedures and documentation under the OHS program will cover, mechanisms for identification of site and operational specific OHS risks; operational manuals and procedures; incident reporting and investigation; control of work and permits to work; emergency prevention; preparedness and response; staff training; risk specific worker’s medical tests and related protections e.g. on auditory protection, heat stress and respiratory health, performance measurement and monitoring with requisite benchmarks plus leading and lagging indicators; mechanisms for preventive and corrective action; organization, roles and responsibilities; and internal and external reporting mechanisms. The safety measures will include practices to facilitate safe handling of hazardous materials, drugs or equipment with hazardous emissions (e.g. formaldehyde), medical examination of employees and worker exposure monitoring. The company will monitor and report on OHS performance and will support the formation of an operation-level OHS Committee consistent with the requirements of the local legislation. For the construction phase of the hatchery, Higest will support the contractor’s efforts to develop and implement OHS measures under the CEHSP (ref. ESAP#2).

Supply Chain. Outgrowers are required to undertake a QHSE self-assessment prior to signing a contractual agreement with Higest. The company then engages a QHSE auditor to verify the outgrowers QHSE systems and establish a system to monitor each delivery of broilers to the Higest abattoir. The scope of the audit includes use of chemical and antibiotic, worker’s welfare and mechanisms for prohibition of child labour. To meet Higest FSSC and HACCP certification commitments, outgrowers are expected to comply with Higest QHSE requirements from receipt of DOC to delivery of the broilers to the abattoir. Any non-conformities are identified and documented in a CAP, whose implementation is assessed through-out the year. The company also provides technical and in-kind support to outgrowers to improve on food safety, general workers safety and animal welfare. Ventilation for breeder houses and feeders donated by Higest were observed during the appraisal. As part of ESAP#4, Higest will document its outgrower management procedures and enhance it to incorporate PS2/PS6 supply chain requirements, for integration into the company ESMS.

PS3: Resource Efficiency and Pollution Prevention

Water Consumption and Energy Use. Higest’s operations, including the hatchery, sources water from municipal sources supplemented by company owned boreholes. The company keeps records of water consumed at each facility with the latest consumption across all the sites estimated at 92,000m3 per annum. The main uses of water are for general sanitation and housekeeping, abattoir production activities, flushing of toilets, drinking and servicing of boilers in feed production. Water quality sampling and testing is undertaken as part of the food safety management systems, to cover both potable water and water for production purposes. The company facilities are connected to the national grid with back-up power provided by onsite generators with capacities ranging from 150-850kVA. Total energy consumption across all operations stands at 1,000MWh per annum. Energy consumption is not expected to significantly increase with project expansion.

GHG Emissions. Scope I GHG Emissions for the project are estimated at about 3,240 tonnes of CO2-equivalent annually.

Air Emissions and Noise. The main source of air and noise emissions from the company operations are from raw material/product transportation, abattoir operations, dust generation and noise associated with grain handling/processing activities, odor from solid waste handling, storage and treatment facilities at the abattoir, and emissions from use of the boiler and back-up generators.

Solid and Wastewater Management. Higest has facility level waste management plans for its operations in accordance with its food safety and biosafety standards. Discarded carcasses of DoCs and egg shells are sold to third parties. Waste feed and other waste contaminated with organic matter from the hatchery is disposed-off in the slaughterhouse’ Effluent Treatment Plan (ETP) located within the factory premises. Wastes from other facilities and activities are collected and disposed by licensed contractors. As per ESAP#1, Higest will review its existing waste management policies and procedures and establish corporate level waste management policies and procedures and ensure that these are cascaded to all sites and operations. The company operates an ETP at the abattoir in Matola while the broiler and breeder facilities in Mafavuka and Namaacha use septic tanks for management of wastewater. The ETP is audited bi-annually by local authorities and is designed to dispose treated effluent into a natural seasonal water channel. The company has yet to decommission the defunct waste-water collection ponds at the main facility in Matola. Higest will develop a wastewater collection pond decommissioning plan for IFC approval. The plan will, at a minimum, provide a schedule for treatment of the wastewater through the existing ETP (ESAP#6).

Hazardous Materials. Hazardous materials and substances at the hatchery include diesel for the generators, LPG fuel for boilers, formalin gas and smaller volumes of vaccines, disinfectant and sterilizers (e.g hydrochloric acid) as well as chlorine and flocculant for raw water and wastewater treatment plant. As per ESAP#1, Higest will establish a hazardous materials management procedure to be cascaded to all sites and operations.

Pesticide Use and Management. The company has pest control procedures, as required by its FSMS, structured to the various operations. Pest control is undertaken through outsourced service providers. Per ESAP#1, Higest will enhance these procedures by developing an Integrated Pest Management (IPM) plan, which will describe pest control and prevention procedures to fight rodents and insects in accordance with its food safety and biosafety protocols as well as worker safety requirements. Higest will ensure that the outsourced service providers adhere to these requirements.

PS4: Community Health Safety and Security

Community Health and Safety. The feed mill, hatchery and abattoir are in an area zoned for industrial activities though current land uses include both industrial and residential uses. The breeder and broiler farms are, however, located in remote areas for biosafety. Road transport to and from these facilities is the main community health hand safety risk.

Life and fire safety. As discussed under PS1, Higest will document its fire safety management practices, including the site-specific emergency preparedness and response planning to cover fire and explosion risks from its feed mill and grain storage operations in Matola and Namaacha.

Road safety. The company runs a fleet of vehicles that include staff buses and trucks that serve its production facilities and shops. Transportation services are also outsourced to a service provider. Per ESAP#1, the company will document its road safety policy, inclusive of road accident prevention measures, policies on driving hours and related rest breaks, defensive driving protocols in areas with high security threats and alignment the related reporting mechanisms to the accident and incident reporting procedures under its OHS program.

Security Personnel. The company uses both armed and unarmed security personnel and government security forces in its operations. The company will undertake an assessment of the risks and impacts on communities due to the project’s use of security personnel. Based on the assessment findings, Higest will develop a Security Management Plan that will incorporate: (i) a security staff Code of Conduct and applicable guidelines for locations using government forces, (ii) guidelines on appropriate use of force and use of firearms, (iii) training on Higest’ human rights commitments, and (iv) community grievance channel to address any community complaints related to Higest security personnel (ESAP#7).

PS 6 Biodiversity Conservation and Sustainable Management of Living Natural Resources

The project area is zoned for industrial use and characterized as modified habitat. Results of IFC biodiversity risk screening undertaken during this appraisal confirmed that there are no protected/key biodiversity areas in the vicinity of the hatchery. The ESIA identified Maputo Special reserve as the nearest protected area at about 50km to the south-east of the factory while IFC screening shows that the nearest KBA is 10km away. Based on the nature and extent of the hatchery operations and the locations of the outgrowers, the project is unlikely to impact the Maputo Special reserve or the KBA. Higest has agreements with 10 outgrowers located in Namaacha, Katembe, Maputo City outskirts and Mututuine areas of Maputo Province. As indicated under PS 1 section, traceability at farm level in South Africa was not possible during this appraisal. Findings of regional land use conversion risk screening, as undertaken by IFC, in corn and soy growing areas in South Africa show a range of low-medium conversion risks in these regions, with higher land-use changes in South Africa. IFC screening findings indicate that the risk and related significance of natural/critical habitat conversion by the company operations and its outgrowers, is low. To align with IFC PS6 requirements the company will strengthen the biodiversity risk management approaches to incorporate enhanced monitoring on deforestation and land use change management for its outgrowers and feedmill suppliers. Higest sources rice from rice mills in and around Maputo. IFC screening shows that rice in Maputo is likely to come from farms located in Maputo, Sofala and Gaza, and that rice growing areas in Maputo and Gaza show a low risk of land use conversion in the last 5 years; while rice growing areas in Sofala show a high risk of land use conversion in the last 5 years. Traceability to farm level is more likely in irrigation schemes in Gaza and Maputo where farmers are organised into water user associations. As indicated under ESAP#3, Higest will engage an independent auditor to conduct an annual verification audit on its Supplier Code, including PS6 related supply chain requirements.

Animal Husbandry Management System. Higest has adopted animal welfare policies aligned with local law requirements and its own company commitments. The Quality manual and production standard operating procedures (SOPs) cover biosecurity, animal health, vaccination protocols and animal welfare for its operations and broiler out-growers. The company monitoring and audit systems on animal welfare, health, food safety and biosecurity considerations are incorporated into its Quality and Food Safety management systems. Higest’s quality procedures include daily monitoring of aspects related to animal welfare in the breeding farms, hatchery, broiler farms (internal and outgrowers), and abattoir covering transport conditions, slaughter, condition of the crates, chick handling and euthanasia. The company also has a tracking system on corrective actions developed for non-conformities identified during internal audits. The company veterinary team and animal welfare officers co-ordinate with the QHSE team to undertake inspections of animal deliveries and monitoring/auditing of Higest and outgrower facilities. They are also responsible for guiding staff training on animal welfare and preparing evaluation reports on the effectiveness of the company’s animal welfare measures. As indicated under PS1 section, the company will develop and implement an Animal Husbandry Management System aligned with Global Smart Livestock Practices (https://globalslp.org/), as part of its ESMS, to cover PS6 requirements on achieving certification and/or independent verification of a credible voluntary animal husbandry standard for the poultry production. Higest will engage an independent auditor to conduct a certification or verification audit of its hatcheries, breeders and a sample of outgrowers and transportation contractors to satisfy the requirements of Global Smart Livestock Practices (ESAP#8). Any non-conformities identified in the certification or the verification audit processes will be documented in corrective action plan (CAP) and integrated into the existing company procedures for closure of non-conformities and continuous improvement.

  Higest stakeholder engagement protocols are focused on customer feedback and CSR activities for the communities around its operations. Complaints by the general community are generally directed to the company management prior to being cascaded to the appropriate line managers. To meet PS1 requirements, the company will develop a corporate Stakeholder Engagement Plan (SEP) covering all their direct and outgrower operations. The SEP will include the identification, mapping and prioritization of all stakeholders to cover all the project locations, operations and related zones of project risks and adverse impacts, and include (i) mechanisms for updating the related engagement roles/responsibilities and strategies to continuously ensure alignment with any changes in the project’s organization and operations; (ii) mechanisms for development of time-bound engagement plans and schedules; (iii) budgeting and resource allocation modalities; (iv) a community GRM that is responsive to the specific Higest locations and including specific measures for dealing with GBV/SH related complaints. (ESAP#9).

 Company Name: Higest Moçambique, Lda

Address: Av. Josina Machel, km15 Machava, Maputo

Email: dircemoreno@higest.co.mz

Phone: (+258) 843 500 369