Issues related to PS5: Land Acquisition and Involuntary Resettlement, PS6: Biodiversity Conservation and Sustainable Natural Resources Management, PS7: Indigenous Peoples and PS8: Cultural Heritage are not expected with this investment for the following reasons: company processing operations are small scale, with limited E&S risks and impacts, taking place in an urban area that contains other small scale industrial and economic activity; the proposed production expansion of VACPA will take place within its existing facility with the new production line to be located in a nearby company-owned building. VACPA’s dates are sourced from small holder farmers, grown on established date plantations; any increase in the amount of dates sourced will come from similar established plantations.

The Project has been classified as category B according to IFC’s 2012 Policy on Environmental and Social Sustainability. The Company’s business is one of date processing; it does not have any primary production facilities of its own, i.e. VACPA does not grow any dates it merely sorts, grades and/or processes them. The Project will finance in part an upgrade to the Company’s storage and packing units and allow for the production of date juice concentrate. As such, many E&S risks and impacts associated with this Project are limited to the Company’s processing/production sites. Other E&S risks and impacts are of an indirect/reputational nature and are associated with the Company’s extensive supply chain, totaling some 1,000 date growers, many of whom are smallholders, and the farming practices traditionally employed by them in growing dates in arid parts of Tunisia.

IFC assessed the capacity of the client to identify, assess and manage E&S risks and impacts by undertaking a visit to the company’s processing and storage units, their contract farmers and meetings with local communities and government personnel involved in water and agricultural affairs. The applicable requirements include the IFC Performance Standards and the World Bank Group (WBG) General and Food and Beverage Processing EH&S Guidelines. Material E&S elements that will continue to require management include (i) the existing EHS management system used to drive required levels of E&S performance in order to meet regulatory, customer and other applicable requirements and its expansion to incorporate the new processing activity (manufacture of date concentrate), (ii) water availability for use in processing dates, and that required for date juice concentrate production as well as energy use, and the efficient consumption of both, (iii) labor and working conditions of both permanent and seasonal staff, (iv) assurance of food safety in the new production center, (v) management of third-party contractors (such as those involved in trucking) and and/or leverage over primary suppliers within the company’s extensive supply chain with respect to their agronomic practices, particularly their access to and use of water in irrigating their date plantations.

Environmental and Social Policies. From its onset, VACPA has made an explicit commitment towards promoting sustainable development principles within its operations through adoption of Business Principles which commit the Company to safe occupational health and safety conditions, safe products (with respect to food safety), and fair working conditions. VACPA has developed a Company-wide policy and a comprehensive EHS management system to provide a framework for actions related to E&S matters, including risk and impact identification and assessment approaches based on host nation law and regulation as well as different credible certified management systems (for quality, environment and food safety and ethical trading) in addition to other customer-required certification schemes.

In addition, VACPA has developed its own Code of Conduct for its suppliers which stipulates a social and environmental policy to be followed. The Code of Conduct also requires that VACPA’s suppliers should comply with the requirements of different E&S standards including the International Labor Organization principles, « Ethical Trading Initiative » ETI and BSCI (Business Social Compliance Initiative).The company is audited on a regular basis; in addition its field staff are present on the ground in both oases (as part of the Programme d’Amelioration du Systeme d’Approvisionnement or PASA) and engage with the farmers through the GDAs to provide the necessary technical assistance to ensure compliance with certification requirements.

Environmental and Social Assessment and Management System. VACPA’s existing E&S procedures – required in order to maintain certification to a wide variety of management systems – prioritize workplace safety, requiring hazard and risk assessments to be undertaken and using them to develop means to avoid, mitigate or manage residual risks. Such assessments target jobs with inherent hazards (working with energized equipment, at heights, etc.), matters of life and fire safety and other issues related to emergency preparedness and response, safety and maintenance of equipment, etc. Assessment of labor and working conditions is undertaken with ongoing review of any changes in applicable law being a part of the company’s management system. With regards to environmental matters, certification to similar internationally recognized management systems requires assessment of aspects and impacts of company operations, resulting in identifying actions to be taken with respect to management of liquid and solid wastes, reducing energy consumption, and minimizing emissions among others.

Key indirect risks associated with VACPA’s operations revolve around its supply chain. These are mainly associated with water resources use in arid areas, particularly the source of groundwater upon which the supply chains depend. The sustainability of groundwater resources in Tunisian oases is therefore identified as a contextual risk affecting VACPA amongst other date producers, as well as the livelihood of small farmers who constitute an essential element in the supply chain.  Recognizing this indirect risk and impact, the company promotes awareness of the need to use water efficiently through the GDAs. As part of this effort, VACPA also engages with relevant government and local authorities who have responsibility for oversight of water resources in date origin areas. One important issue that was raised during appraisal was the legality of some of the groundwater sources used for irrigation; for example, it is known that in some areas, farmers are using boreholes that have been drilled without the relevant authority having first been obtained. The existence of such sources of water promotes further difficulties in managing this finite resource. As part of the investment agreement, the company will review its supply chain for instances of such illegal sources and work to ensure its supply chain is devoid of dates grown using such water.

EHS Management Programs. VACPA is certified to ISO 9001, ISO 22000, ISO 14001, IFS Food, Organic products (EcoCert) and FSMA, Global GAP, Fairtrade, Kosher & Halal. VACPA has also developed a food fraud and food defence analysis in line with BRC requirements. VACPA is working towards meeting the requirements of the ISO 45001 standard for Occupational Health and Safety Management Systems (OHSMS) and expects certification during 2020.  These standards are predicated on management programs designed to identify and address E&S risks and impacts thought to be material to the operation, be they stemming from law or regulation, customer requirements or deemed by the company to be of importance or significance based on their knowledge and experience in running their business.

In addition to the above, the company has created a program to drive quality in its supply chain called PASA (Programme d’Amelioration du Systeme d’Approvisionnement). PASA uses qualified agronomists and field technicians in the areas from where the dates are sourced. The program serves a commercial purpose that helps the company track harvests, disseminates information from customers regarding matters of quality and also has several E&S benefits as well. For example, the use of nets to protect dates obviates the need for pesticides. As well as those benefits, PASA helps the producers with the documentation requirements of the certification programs to which they subscribe (such as Global Gap, Bio & Max Havelaar). There are 532 farmer members in 15 groups (Groupements de Développement Agricole (GDAs)) at present; plans are to increase this number incorporating approximately 1300 farmers. Of the current farmer members (some of whom have more than one certification), 144 are certified GlobalGap, 133 Fair Trade (Max Havelaar) & organic farming and 146 comply with the Organic Crops System of which 13 are GlobalGap. Throughout the planned expansion of its direct sourcing from farmers (from 532 to ~1,100) during the next 5 years, VACPA intends to work with the GDAs to ensure an increase in the numbers of farmers who can be certified to these schemes. VACPA will report to IFC on an annual basis such progress. 

Organizational structure and technical capacity. In terms of its existing E&S management system, competent, experienced staff are found in E&S management positions; for example, there is a manager for both environmental matters and OHS, supported by supervisors, assistants and an internal auditor. Managers for each area of the processing plant also have responsibility for environmental health and safety (EHS) matters within their operations. Key programs are in place regarding compliance with the above requirements which drive E&S performance and are monitored and/or measured with results being reported to senior management on a regular basis. Training of personnel is conducted in support of these systems and what they are designed to manage. A training schedule is established annually for employees and workers in consultation with production departments. This program is monitored and evaluated by the training manager.

Monitoring and Reporting. An EHS dashboard is used to track key performance indicators (KPIs). A monthly report covering environmental as well as OHS aspects is developed and results shared on billboards within the processing facility. When needed, corrective actions are identified to address non-conformities with prescribed performance indicators. In addition, the management team develops a comprehensive monthly report highlighting non-compliance incidences which is shared with the management committee. Key performance metrics (e.g. energy consumption, number of accidents at work and planned medical services) are communicated regularly to all employees. Audits – some unannounced – are made by the Department of Labor to assess compliance with applicable requirements.

Further, the above management systems contain the requirement to conduct internal audits; external or 3rd party audits are also required in order to maintain certification. IFC reviewed current certifications with respect to these systems demonstrating ongoing active management of the issues identified in the risks and impacts/aspects and impacts review.

In meeting the combination of requirements of the above management systems, the company can demonstrate compliance with most of the requirements of this Performance Standard for its existing operations. The need to include the new concentrate operation within the scope of these management systems, in order to similarly assess, avoid, manage or mitigate E&S risks and impacts as contemplated by this Performance Standard is addressed in the ESAP (item #1). Further, the need to enhance current methods of communication as per paragraph 43 of this Performance Standard (receipt and management of external communications), to allow for input and/or grievances from identified stakeholders and others wishing to communicate with the company is addressed in the ESAP (item #2)

Human Resource Policy and Management. VACPA’s operations employ more than 1,489 employees, out of which 1,200 workers (80% of whom are women) are direct factory workers, and the remaining staff (289) occupy different professional positions. Out of the total workforce, 661 are permanent staff, and 828 staff are temporary/contracted employees. All VACPA staff have contracts. The average annual turnover amongst factory workers is around 25%; turnover amongst administrative and management staff is around 6%. The HR department includes 7 full time staff members all of which are based in the company’s factory in Beni Khaled. As per the company’s HR guidelines, temporary workers are transferred to full time positions after four years of employment.

In addition to the factory in Beni Khalled, VACPA has workers represented in 4 different collection centers in both Tozeur and Kebili oases. These staff are placed in these centers to ensure the dates meet VACPA’s quality requirements. The largest center is called Seif Dattes in Kebili from which the company sources around 60% of its date supply.

In accordance with the Tunisian Labor Law, VACPA has developed a comprehensive Human Resources Policy whose scope is applicable to all employees. The HR manual encompasses the following provisions: terms of employment and recruitment, training and development, performance management, promotion, transfers, demotion and separation from the company, matters of remuneration, benefits and other assistance schemes, including a pension fund, provision of educational assistance,  definition of the working week (48 hours/week with overtime paid at a higher rate than normal salary), accruing and using leave, the company’s disciplinary code, grievance mechanism, employee relations, including freedom of association and the right to collective bargaining, and how the company provides safe working conditions. The policy/manual is available in both Arabic and English and is provided to all workers during the induction session. VACPA’s HR manual does not contain a specific sexual harassment policy. Whereas no cases of harassment have been reported in the recent years according to the HR department, the omission of the policy is addressed in the ESAP (item #3).

In addition to compliance with Tunisian Labor law prescriptions, VACPA has also developed respectful workplace principles with corresponding KPIs and mainstreamed its Business Principles (e.g. respect for human rights, freedom from discrimination, slavery and child labor, freedom of association and the right to collective bargaining, fair working conditions, etc.) into this HR policy. These principles are also required by voluntary standards, including those of Fairtrade, SMETA and BSCI. Certifications are current; the latest SMETA audit took place in July 2019, the last BSCI audit took place in 2018. The last SMETA audit (2019) identified a few minor non-conformities related to labor and working conditions including no training on issues related to harassment or forced/child labor, how workers’ information is kept confidential, marking the fire exits and developing a fire preventive certificate, as well as ensuring company HR procedures are applicable to sub-contractors. These elements are identified in the audit corrective action plan, subsequently addressed and are required to be confirmed as having been done during the next periodic audits.  As per Tunisian Labor Law, VACPA does not employ people whose age is under the age of 18. All employees are free to choose whether or not to work for VACPA; as such, the company does not use forced labor.

Retrenchment plan. The company has no plans for retrenchment. Through the expansion of its facilities, VACPA is looking to increase its workforce and create additional direct and indirect job opportunities (estimated to be between 50 and 100 new direct and indirect jobs) through the newly established production line as well as the expansion of its direct sourcing base from 532 farmers to ~1,100 farmers over the next 5 years.

Grievance Mechanism. As per its business principles, the Company is fully committed to establish a strong and consensual social dialogue with its workers to ensure stable and productive working conditions and performance. In case it is needed, as indicated above, VACPA has mainstreamed into its HR practices a formal and structured grievance mechanism procedure. This procedure includes steps to be taken by workers to manifest any concerns, engage in a mediation process, contact responsible persons, and provide timely feedback. Employees are made aware of the grievance mechanism procedure during their induction training. VACPA has dedicated boxes for suggestions and grievances can be submitted anonymously, however responses to some grievances relating to common issues such as workers transportation are usually shared on notice boards within the factory. The grievance mechanism is applicable to permanent, casual and contractual workers. The company reported that 18 grievances were recorded during 2019. In terms of court cases and disputes, there are currently 5 ongoing cases pertaining to labor issues mainly relating to employees’ dismissal. Four out of these five cases are related to administrative staff dismissal; the fifth relates to a factory worker.

Workers organizations. Tunisian labor law requires the presence of a workers’ organization “Commission Consultative de l’entreprise”. It is divided into two main committees; (i) Health & Safety, and (ii) Disciplinary committee. The members of the workers’ organization include 7 elected staff members (elected every 3 years) to give a voice to the workers as a whole and 7 appointed members from the administrative staff. Membership in workers organization is voluntary and no stipend is applicable to its members. The workers’ organization discusses working conditions, training needs especially addressing the topic of workers’ legal rights and obligations, and salary increase. Syndicates or unions are not required by Tunisian law. In practice, there are also no collective bargaining mechanisms in place as salary rates (and increases) are a matter of law and are universally applicable to all businesses in line with Tunisian labor law.

With the addition of a policy on sexual harassment (as per the ESAP), the HR policies and practices as described above are judged to be aligned with the objectives and requirements of this Performance Standard.

Occupational Health and Safety. VACPA has made a commitment to address safe and healthy working conditions of all its workers through its Business Principles as well as through various elements of the management systems to which it subscribes and those it is planning to certify against; as noted above, VACPA is working towards meeting the requirements of ISO 45001 for Occupational Health and Safety Management which will be provide the overarching framework for it to manage the OHS of its workers.. Risk assessments of jobs have already been undertaken as a key element of OHS management (for example, those working with phosphine gas to fumigate dates and in cool/cold storage areas, with resulting management measures being put in place, including engineering controls, use of PPE and medical monitoring to review the efficacy of such mitigating factors); these are reviewed after accidents occur (as part of a root cause analysis and to determine if changes are required) and at a minimum on an annual basis. Results on OHS performance are a KPI and are discussed with senior management on a regular basis.

The company currently assesses its workforce on an annual basis through the use of a social survey, including reviewing the type, number and causes of accidents and incidents at work. Results from the survey are used to design programs address issues going forward mostly related to occupational health and safety, as well as social services provided to staff. A doctor is available on site at the main processing plant. The doctor not only treats workplace injuries; they also undertake programs designed to promote health and wellbeing in general.

At present, a health and safety committee meet quarterly. An example agenda from a quarterly meeting was reviewed by IFC. Matters discussed included the layout of the new changing rooms, the first aid training program, inputs on the choice of PPE and working clothes, the maintenance of locker room steps, caps on the floor (proposal from a distributor) and the programming of evacuation exercises. Additional discussion on subjects concerning posture, risks of specific jobs (e.g. forklift operation), chemical management, infrastructure (e.g. handrails for stairways, safety barriers around equipment) and maintenance and/or provision of equipment (e.g. stepladders, pallet trucks), etc. were undertaken.

For 2018, the company recorded a lost time incident frequency rate (LTIFR, calculated per million hours worked) of 0.41; a rate of 0.37 was recorded for 2019. The most common types of accidents are those associated with manual handling (43% of total accidents) followed by slips (26%) and falls from height (9%). The production and logistics department accounted for the most accidents.

Life and Fire Safety. VACPA’s processing operations could be associated with fire risks. In addition to the preventive maintenance measures, the company has installed of a fire prevention system, including fire hydrant and hose and extinguishers in accordance with Tunisian standards. An OHS Sub-Committee has been established at the plant and includes in its responsibilities matters of emergency preparedness, fire prevention and incident training. Extinguishers are available at the processing operations and collection centers. An evacuation plan has been developed and fire accident meeting points have been designated at the processing unit and awareness raising on these are part of the fire training curriculum.

Supply Chain Risk Assessment and Management. VACPA currently sources dates from 532 farmers owning 818 hectares in Tozeur and Kebili Oasis. These farmers are supported with regards to technical matters by VACPA through 15 different farmers agricultural groups (Groupements de Development Agricole – GDAs). Through these GDAs VACPA has close working relationships with the farmers, including supporting them in complying to the certification requirements of recognized international standards (including criteria that relates to labor and working conditions in the supply chain) and to provide them with the necessary technical support and agricultural inputs to enhance their productivity and yield. As such, VACAP has assurances that forced labor and child labor are absent in their directly sourced dates supply chain. And, that matters of OHS are also considered and good practices promoted as needed. Further, the US Department of Labor, Bureau of International Labor Affairs (ILAB) does not report child or forced labor in association with date production in Tunisia

Energy use, water use and greenhouse gas emissions. Energy sources are electricity and natural gas (for use in the dryers required to control the moisture content of the dates); the most recent annual data on consumption of both electrical energy (5,429,875 kWh/y) and natural gas (equivalent to 250 tons) shows that GHGs are of the order of 670 (scope 1) and 2400 (scope 2) tons CO2 eq p.a.

Monitoring records show that point source air emissions meet with WBG EHS guideline values.

The company’s processing plant is provided water by the local municipality with an annual consumption of 61,200 cubic meters. A large percentage of the dates procured by VACPA are only minimally processed; they are packed on the stem after physical sorting. What effluents that are produced, through manufacture of date paste (using dates that are unsuitable for other purposes) equipment and facility cleaning, etc. are pre-treated before being discharged to the municipal treatment plant via a sewer connection. The company complies with the treatment plant’s pre-treatment requirements which is in keeping with the requirements to be found in the WBG General EHS Guidelines.

While the processing operation is not a significant consumer of water, the key risk related to water resources use is indirect in nature and is related to farming practices to be found in the date supply chain (as noted elsewhere in this document). Through this project VACPA has a 5-year plan to expand its supply chain. As per the ESAP, (ESAP #4 and #5), VACPA will promote the use of monitoring of water use in its directly sourced date supply chain and meet yearly targets regarding the percentage of its directly sourced dates that are grown using efficient water use practices.

Cooling is employed to protect the quality of the dates and to allow them to be stored for longer periods, thus enabling the company to manage production rates, meet customer demands, etc. The cooling system utilizes refrigerants to generate cold air (such as R404a, R22 and R410a). Some dates are cooled; some (organic dates) are frozen as this avoids the need to fumigate them. Organic dates are frozen at -18°C and then stored between 0-4°C. After fumigation with phosphine, conventional dates are stored under the same thermal conditions: between 0-4°C. As with any other workplace, the freezing area and refrigerators are taken into account in the company’s OHS risk assessment by considering the risks related to thermal environments and the possible impacts caused by these activities.

Being a food processing operation, care is taken to properly manage all materials, including hazardous materials. Oils and other lubricants used in machines are properly stored prior to use. Wastes are typical of a food processing operation. Waste oils and lubricants (from machinery maintenance, for example), packaging, and other solid wastes are sorted and disposed of according to local regulation. Organic wastes are provided to local farming operations.

Pest Management and Control.

As noted elsewhere in this document, VACPA fumigate some of the dates in their storage units using phosphine; the phosphine is generated on site using a commercial generator. Such practices and equipment are governed by SOPs and undertaken by those trained in the proper use of the equipment and the fumigant. Organic dates are not fumigated; as noted above, they are frozen.

Whereas VACPA does not grow their own dates, they do provide technical assistance to farmers through the PASA program. As noted above, use of nets is promoted in order to protect the dates from pests; as such, this reduces the amount of pesticides used by famers in the supply chain. When pesticides are used, they are compliant to national law and are those allowed under the certification schemes (such as Global GAP) of which many of the farmers are a part. For certified dates, the pesticides are supplied by VACPA who also conduct the spraying. With regards to the purchase of conventional dates, there are two scenarios; 1) the dates are purchased while still on the palm trees (completed during June-July each year) and it is VACPA who undertakes to treat the dates to protect their quality; 2) purchase by weight at the sorting facilities, whereby this crop (received from October-December) is checked by area supervisors who inspect the dates for the type of pesticides that were used (such as against mites) with the products used being recorded and compared with the allowable list of products as regulated by the Health Ministry

Company facilities do not pose direct risks and impacts to communities; i.e. there are no affected communities related to this project. The majority of company operations involve either simple storage or storage/processing of dates and are not located in sensitive areas.

With regards to protection of company assets, the company uses its own employees as guards and facilities are surrounded by walls and locked gates are used to control entry to company premises. Members of the public cannot access company facilities.

As noted in PS 3 above, there is very little use – and therefore transport of – hazardous materials. The majority of vehicular activity is centred on the transport of dates from the production areas in the South/Central areas of Tunisia to the storage and storage/processing facilities close to Tunis. Most of the transport of dates from sourcing areas is undertaken by 3rd party trucks using well-established road networks, traveling predominantly on highways. The company reports that during the transport of dates, the accidents or incidents that may occur are in general travel accidents or truck breakdowns. Some trucks are equipped with GPS; they are therefore controlled with regards to speed, for example. For the other trucks without GPS, the company counts upon the awareness of drivers with respect to contractual stipulations on vehicle use, etc.

Each year an evaluation of transporters is conducted by the logistic department taking into account their adherence and respect of all rules and requirements within the contracts.

Food safety in current operations is judged to be well managed, with the company being certified to recognized and credible international standards as well as those stipulated – and originated - by customers. As per ESAP #1, the company will expand the scope of its management systems to include the new concentrate production activity to ensure that the production of the concentrate is subject to similar food safety norms

VACPA has mapped its stakeholder’s in line with the requirements of ISO 9001, 14001, and 22000. Eighteen different groups of stakeholders are identified at VACPA, including employees (permanent and/or contracted), the date farmers/suppliers, collection centers, certifying and auditing bodies, government authorities, research entities, banks and financial institutions, suppliers of material and equipment, amongst others.

A significant level of stakeholder engagement takes place with farmers/suppliers through 15 existing farmer groups or GDAs. Through these groups VACPA’s field staff based in Tozeur and Kebili ensures compliance of its supply chain with certification requirements and standards, as well as other aspects related to occupational health and safety. Also, through these groups VACPA is also able to provide technical assistance and farming inputs for farmers/suppliers.

The ESRS and the attached ESAP will be made available via the IFC Disclosure Portal. The Company will also be requested to place an advertisement on its website (https://www.boudjebeldates.com/en/) to inform the public from IFC's environmental and social review (ESRS) findings and ESAP's corrective action items.

Dr. Mohsen BoudjebelVACPA Boudjebel

Adress :Boudjebel SA VACPA, Route de Menzel Bouzelfa 8021 Beni Khalled, Tunisia

Phone(+216) 72 292 133 / (+216) 72 707 386

E-mail:contact@boudjebeldates.com