The areas to be impacted by the project are either already developed urban areas, as is the case for the projects in HCMH, or a rural area intervened long time ago for forestry production and other uses, in the case of the PHK eco-township; hence PS6 on Biodiversity Conservation and Sustainable Management of Living Natural Resources is not applied. The PHK eco-township is located 10 km away from the Ba Vi National Park and no direct or indirect impacts from this development are expected.

The majority on households in the area of the PHK eco-township project belong to the Muong ethnic minority (the third largest ethnic group in Vietnam) who coinhabit with the mainstream community.  IFC acknowledges the presence of this ethnic minority group in the project area, but based on the findings of the external supplemental social assessment it is concluded that IFC PS7 is not applicable to this investment based on the following findings: i) the affected ethnic minority households speak the Vietnamese language in their day to day communications; ii) there is no indication of the presence of distinct customary cultural/economic/social/political institutions and practices such as ethnic-based judicial systems,  decision making mechanisms or other institutions; iii) land and natural resources within the project footprint are not considered by these ethnic minority households to be subject to collective customary/ancestral use or attachment; and iv) ethnic minority households are highly integrated into the mainstream culture and economy.   Hence, it was determined that the anticipated impacts of the PHK eco-township project on the  ethnic minority households and other community members are not materially different and that the ethnic minority households are no more vulnerable to such impacts. Any impacts on the ethnic minority households will be managed as needed per the relevant PS. PS8 on Cultural Heritage is not applied since no adverse impacts on cultural heritage is envisaged in any of PMH’s IFC-financed projects. Any cases of “chance find” of cultural heritage resources will be managed per Vietnam’s Law on Cultural Heritage (2001).                                                 

    This is a Category B project according to IFC’s Policy on Environmental and Social Sustainability because the proposed developments have limited E&S risks and adverse impacts, such as: PMH’s E&S management capacity, including of E&S performance of third party construction contractors; labor and working conditions, including occupational health and safety (OHS); life fire and safety; waste water management; water and energy efficiency; land acquisition and economic displacement; stakeholder engagement and grievance redress mechanisms. The proposed projects for use of IFC proceeds under this investment is not expected not required physical displacement of population.                                               

     Environmental and Social Management System: PMH manages the environmental and social (E&S) aspects of the planning, construction and operation of its projects based on relevant national and municipal regulations and standards.  Per ESAP#1, the company will consolidate and complement its current approach and procedures by implementing an E&S Management System (ESMS) covering project planning, construction and operation in line with local regulations, IFC PSs and relevant WBG EHS Guidelines, including: (i) E&S policy; (ii) E&S risks and impact assessment procedure; (iii) key management programs (e.g. Contractor E&S Management, Fire Life & Safety, Emergency Preparedness and Response, Land Acquisition and Ethnic Minorities, Occupational Health and Safety (OHS)); (iv) allocation of responsibilities and competency for E&S management; (v) Stakeholder Engagement and Grievance Redress Mechanism; and (vi) Monitoring and Review Program.

The operation of the hotel to be built as part of the PHK eco-township project will be conducted under the formal ESMS of the international brand that will operate it.

Assessment and Management of E&S Risks and Impacts: PMH projects are subject to a detailed construction planning and permitting process per local regulations, which include the preparation of 1:2000 scale Master Plans for the broader development area covering, among others: urban and traffic planning; environmental protection; water supply; drainage and waste water management; green spaces; consultations with local community, etc. After the general Master Plan is approved, as condition for obtaining a Construction and Environmental Permits, the company must prepare a more detailed 1:500 scale Investment Plan and a site-specific Environmental Impact Assessment (EIA) prepared by an accredited consultancy firm.

The PMH projects in HCMH to be financed under this investment have obtained the required permits and no significant risks or impacts were identified during the EIA process.  Basic environmental management measures (e.g. noise, dust, wastewater, solid waste, traffic, OHS, etc) are included in the corresponding construction contracts. Compliance with E&S requirements is supervised by an Environmental, Health & Safety (EH&S) officer appointed by PMH for each site and the sites are also subject to supervision by the relevant government authorities.  

In the case of the PHK eco-township project, a previous developer prepared an EIA per local regulations in 2010 for developing a food processing plant on the same land, and no significant E&S issues were identified at the time. However, that project was never built and PMH acquired the development rights in 2017. Per local regulations, the new residential project requires the preparation of the 1:2000 and 1:500 scale planning documents, as well as a new EIA.  The planning and EIA process is expected to be completed by the end of 2019 and construction to start by early 2020.

As a set forth in ESAP #2, PMH will agree with IFC Terms of Reference (ToR) and Consultation Plan for a E&S Impact Assessment (ESIA) for the PHK eco-township project, including the proposed access road, in line with IFC PSs and relevant WBG EHS (General and Tourism and Hospitality Development) covering any gaps in the local EIA process, such as: social impact assessment; community health and safety; water and energy efficiency; waste management, traffic safety; biodiversity; and ecosystem services. Per ESAP#3, prior to construction, PMH will prepare the ESIA and corresponding E&S Management Plans (ESMPs) for the PHK eco-township project, including a Stakeholder Engagement Plan for construction and operations.

Organizational Capacity and Competency:  PMH commissions the design of its projects to internationally recognized architecture firms, manages the environmental and construction permitting process through its Real Estate Department, and oversees environmental and OHS compliance during construction and operation through its Operations and Engineering Departments.  PHM outsources the construction of its projects to third parties, which are contractually required to comply with local E&S regulations and implement the commitments under the EIAs, including on OHS aspects. Contractors are required to submit site-specific E&S Plans, including OHS aspects, and to appoint an experience Environmental. Health & Safety (EHS) Officer to ensure compliance, provide training, and ensure implementation of any corrective actions needed. Additionally, PMH appoints a Developer Engineer to supervise each of its projects, which is required to appoint an EHS Supervisor for each site. Per ESAP #1, as part of its ESMS, PMH will define clear allocation of responsibilities and competency for E&S management of its projects and will implement a Contractor E&S Management program.

Monitoring and Review: During construction, PMH delegates most of the E&S supervision activities to the contractor and the Developer Engineer as described above. During operations, E&S supervision is conducted by PMH’s Operations and Engineering Departments. Per ESAP #1, as part of the ESMS, PMH will adopt a Monitoring and Review Program to ensure ongoing monitoring of all its projects and timely implementation of corrective measures and update the ESMS as needed.                                              

    Currently, PMH employs at the corporate level 1,000 people, out of which 33 % are women.  It is estimated that the projects to be financed by IFC will generate approximately 5,200 jobs during construction and 270 during operation.

Human Resources Management: PMH manages labor aspects in line with Vietnam’s Labor Code (2012), which covers a range issues in IFC PS2, including among other: labor disputes, working hours, overtime limits and payments, annual and maternity leave, salary, social insurance, and is subject to supervision by the Ministry of Labor. Per the Labor Code, all companies must permit employees to join a trade union. At present, 90% of PMH’s workforce belongs to a labor union.

The Code defines the right for all employees to work without being discriminated against based on their gender, nationality, social class, beliefs, or religion. Moreover, employers are strictly prohibited from discriminatory behavior toward female employees or conduct that degrades female employees’ dignity and honor. Employers must implement the principle of gender equality regarding recruitment, utilization, wage, and wage increase. Additionally, in 2015 Vietnam adopted a Code of Conduct 2015 on Sexual Harassment in the Work Place.

PMH does not employ individuals below the age of 18 and it does not engage in forced labor for any of its projects. 

Occupational Health and Safety: Per PMH’s Contractor E&S Requirements Template, all construction contractors must abide by the OHS requirements in the Labor Code and supplemental regulations, which constitute a comprehensive set of conditions including, among other: development of OHS management plans in consultations with workers’ representatives; employer responsibility in the event of an accident; compulsory health insurance for all workers; use of personal protective equipment (PPE); annual medical checkups; and workers’ right to refuse tasks that are deemed unsafe without fear of reprisal. 

Before starting a project, PMH requires its contractors to submit a site-specific OHS Plan that includes, among other: safety procedures (e.g. scaffolding, working at heights, electrical work, excavations, safety guardrails,  etc); daily OHS tool box meetings; provision and use of PPE (e.g. safety hats, shoes, and harnesses, etc); first aid post; emergency and evacuation plan; firefighting equipment and training; and workers canteen with food hygiene and safety certificate.  

Contractors are required to appoint an experience Environmental. Health & Safety (EHS) Officer to ensure compliance, provide training, maintain OHS statistics, investigate any accidents and ensure implementation of any corrective actions needed. Additionally, the project’s Developer Engineer is required to appoint an EHS Supervisor for each site. Based on the observations at PMH’s active construction sites in HCMC, all workers had appropriate PPE; housekeeping, scaffolding, and signaling was adequate; and no significant accidents were reported.

AS set forth in ESAP #1, the company will develop a ESMS that will include an OHS Program.

Workers Accommodations: PMH contractually requires construction contractors to provide and maintain, where necessary, suitable and hygienic accommodation and amenities for workers, including toilets, bathrooms, rain and sunshine shelter, eating area and mid-shift rest accommodation; first-aid room; and conduct regular pest control.  Construction activities in HCMC do not require workers accommodations but given the rural location of the PHK eco-township, such accommodations are likely to be required.

As set forth in ESAP #4, as part of its ESMS, PMH will complement its existing Contractor E&S Requirements Template and adopt a Contractors E&S Management Program to cover relevant labor and OHS aspects in IFC PS2 and relevant WBG EHS Guidelines, such as: (i) internationally recognized standards for workers accommodations and (iv) Worker’s Code of Conduct.                                               

    Resource Efficiency: For all projects, PMH sources electricity from the national grid and water from the corresponding municipal water companies. For the PHK eco-township project, the raw water will be further treated to meet national potable water quality.

PMH will develops its projects and common infrastructure facilities (e.g. parks, walkways, etc) keeping in mind sustainable design principles such as water and energy efficiency. LEDs will be used for street lighting at most of the locations. PMH is exploring with IFC opportunities to adopt green-building standards in some of its new projects.

Wastewater Management: The projects in HCMC follow municipal regulations for treatment and discharge of wastewater. In the case of the PHK eco-township project, per ESAP #5 the company will build dedicated water treatment plants (WWTPs) that meets local regulations and the requirements of the WBG General EHS Guideline and will provide a confirmation by a qualified professional that the proposed design of the WWTPs meets such requirements.

Pollution Prevention: The construction stage of the proposed projects generates noise and dust; particularly, during excavation and movement of materials by truck. However, given the nature of the proposed activities, the construction impacts to neighbors in urban and rural areas are expected to be moderate and temporary.  Per local regulations, project-level EIAs and management plans include a range of pollution prevention and control measures, including for dust, noise, waste management, etc, that are required for the contractors and monitored by the EHS Officer and supervised by the Developer Engineer’s EHS Supervisor. Per Decision No. 09/2008 on Construction Standards, developers are required to avoid using asbestos or other hazardous materials in buildings.

Solid Waste: Per local regulations any generation of solid wastes must be minimized, collected, recycled, transported and disposed to minimize adverse environmental standards, and waste classified as hazardous must me managed accordingly.  Solid construction wastes such as excess building materials and other normal building waste are collected and trucked daily to designated municipal waste disposal or landfill areas. Once the buildings in HCMC and the PHK eco-township are occupied, solid waste will be removed by companies designated by the local municipality.

Green-house Gas Emissions: GHG emissions associated with the construction activities associated to this investment are not expected to be significant as they are not energy intensive. The project will therefore not be required to quantify and report on the CO2-equivalent emissions as required under this Performance Standard for projects with emissions exceeding 25,000 tCO2 equivalent per annum.                                               

    For the projects in urban areas of HCMC, the key potential community health and safety risks are limited and related mainly to increased truck traffic and pedestrian safety around construction sites, both of which are covered by the corresponding EIAs and the specific contractor OHS procedures, such as: clear road and safety signaling; segregated pedestrian pathways; access control construction site; flaggers to control traffic, etc.

For the PHK eco-township, given its location, per ESAP #3 the company will prepare a E&S Impact Assessment (ESIA), with corresponding E&S Management Plans (ESMPs), that will cover aspects related to community health and safety, particularly in relation to: traffic and pedestrian safety, labor influx, and communicable diseases. Per ESAP #4 the company will adopt a Worker’s Code of Conduct for all workers, including those engaged through contractors and subcontractors, to avoid any risks and tensions with surrounding communities. Additionally, per ESAP#11 the company will implement a Stakeholder Engagement and Grievance Redress Mechanism, which should help identify any potential impacts on communities on ongoing basis. 

PMH does not engage the services of armed personnel to provide safety to its projects.

Life and Fire Safety: Regarding Life and Fire Safety (L&FS), PMH designs and operates its projects following Vietnamese building code requirements. In the case of the projects located in Phu My Hung township, projects are designed incorporating passive fire prevention systems, hydrants, extinguishers evacuation exists, and fire alarm systems connected to HCMC’s Fire Department. PMH conducts regular inspections of fire prevention and fighting equipment; on-site training of personnel and firefighters; awareness campaigns for residents and staff regarding LF&S; annual fire drills, etc.  PMH will design, construct and operate new greenfield buildings that will be accessed by members of the public (e.g. hotels, hospitals, shopping malls), in full compliance with the local L&FS code and with an internationally accepted L&FS standard (e.g. U.S. NFPA, Singapore Fire Code). The design of such buildings will be consistent with the principles of universal access.

In the case of the hotel to be built as part of the PHK eco-township, per ESAP #6, PMH will commission a qualified L&FS professional to prepare a LF&S Master Plan (i.e. a set of L&FS design specifications, applicable codes and regulatory requirements, identification of key risks, and mitigations), and provide a professional certification that the design of LF&S systems for the project complies with the requirements of the L&FS Section of the WBG General EHS Guidelines,  which included compliance  with local L&FS code and also one internationally recognized L&FS standards.

Per ESAP#7, the company will commission a Post-construction LF&S Audit of the hotel building in PHK eco-township by a qualified LF&S engineer to confirm that the works were completed in accordance with LF&S Master Plan specifications. Any remedial measures needed to bring the building into compliance with IFC guidelines will be completed within a timeframe agreed with IFC.                                               

  Currently PMH conducts stakeholder engagement activities following the requirement of the Environmental Protection Law and other regulations, and it consults the EIAs of its projects with the corresponding commune-level People’s Committee in which the project is to be implemented, as well as representatives of directly affected communities. In each case, after an EIA is approved, PMH publicly discloses the E&S Management Plans at the corresponding People’s Committee office. Currently, grievances are addressed directly by the construction contractor at each site of elevated to the commune-level People’s Committee, where required.

PMH requires all contractors, such as in the case of the Saigon South Residences under construction, to provide a signboard at its construction sites with information regarding: names and logos of the project developer and main contractors, project description, estimated duration and contact information in case of questions or complaints, which are addressed by the contractor directly.

In the case of PHK eco-township, since 2017 the project has been discussed with the authorities of Hoa Binh province, Ky Son district and communes in the affected area. The planning map of the project was also placed at the People's Committee offices of 2 nearby communes (Hop Thanh and Phu Minh). However, most of the engagement with local communities has been related to the land acquisition process and total level of information dissemination needs to be enhance as the planning and ESIA processes begin. Per ESAP #2 PMH will agree with IFC Terms of Reference (ToR) and Consultation Plan for the PHK eco-township project ESIA, to ensure early and ongoing engagement with affected communities early in the process. Per ESAP #3 the resulting ESIA and ESMPs, will include a Stakeholder Engagement Plan for construction and operations.

Per ESAP #11, PMH shall adopt an Stakeholder Engagement and Grievance Redress Procedure (SEP) in accordance with the requirements of IFC PS1 as part of its ESMS to: (i) provide information about project development to nearby communities; (ii) receive and register external communications from the public; (iii) screen and assess the issues raised and determine how to address them; (iv) provide, track, and document responses, if any; and, (iv) adjust its processes, as appropriate.     

     Nguyen Thi Thu Ha (Ms.)
Finance Manager
Phu My Hung Corp.
10th Floor, Lawrence S.Ting Building, 801 Nguyen Van Linh Parkway, Tan Phu Ward, District 7, Ho Chi Minh City, Viet Nam
Tel. 028 54119999 Ext. 1150
Email: thuha@pmh.com.vn