This is a Category B project according to IFC’s Policy on Environmental and Social Sustainability (2012). Based on IFC’s review, coupled with existing knowledge of the sector, the project is expected to have limited adverse environmental and social risks and impacts that are site-specific, and can be avoided or mitigated by adhering to recognized good international industry practice (GIIP).

Environmental and Social Assessment and Management System:

All hotels acquired under this phase of the project are currently and will continue to be operated and managed by Accor. As defined in the Hotel Management Agreements (HMA) with each respective hotel, Accor, as the hotel operators, have the sole and exclusive control of the hotels in terms of management approaches and the determination and implementation of all policies and procedures, including Accor E&S policies and procedures.

Accor’s Environmental and Social Management System (ESMS) includes E&S management programs, policies, charters, and global standards relating to environmental compliance, safe food and hygiene, ethics and corporate social responsibility, grievance management, recruitment and selection, workplace health and safety (for both employees and contractors), hotel incident management, fire and life safety and security. In addition, all hotels will implement Accor’s Planet 21 program that looks to improve the sustainability of hotels in relation to energy and water efficiency, food management, carbon emissions, waste management, sexual harassment, non-discrimination, employment equity, and corporate social responsibility.

For Project Umbrella, the hotel currently has in place elements of an ESMS, however this is not managed or structured in a consolidated or centralized manner. The hotel currently has various E&S policies in place, including an Environmental Policy, staff handbook, Hiring Policy, and a disciplinary code and procedures. Hotel management and operations are thematically and departmentally structured, however no formal E&S functions (quality, occupational health and safety (OHS), stakeholder engagement) are defined. The hotel is subject to annual audits by the Kenyan National Environmental Management Authority (NEMA). As the hotel was privately managed, it will be required to transition the existing ESMS to Accor policies and procedures over a period defined in the ESAP. (ESAP #1)

Identification of Risks and Impacts:

As a component of its hotel acquisition approach, Kasada currently undertakes both pre- and post-acquisition due diligence processes. The existing pre acquisition process predominantly relates to technical, financial and legal due diligence at the time of acquisition, as well as the assessment of compliance with national standards, E&S regulatory permits, building permits, land titles etc. The post-acquisition assessment process requires an ongoing commitment to Accor’s existing ESG and Planet 21 programs and policies. For Project Umbrella, Kasada procured an independent pre-acquisition E&S audit of the hotels against the requirements of relevant local legislation and IFC Performance Standards.

For the acquisition of under-construction greenfield hotels, the Fund has developed a screening procedure vis-à-vis the agreed eligibility criteria and the standard operating procedure for conducting E&S due diligence of potential investments against IFC Performance Standards. As part of the screening procedure, the fund will assess the applicability of all the PSs for all the future greenfield acquisitions and developments to comply with PS requirements (ESAP #2).

Organizational Capacity and Competency:

As a component of the ESAP, Kasada has employed a dedicated E&S Manager to provide monitoring and oversight of their hotel portfolio, including conducting pre- and post-acquisition due diligence and the management and assessment of E&S KPIs. This role is supported by the general counsel, Asset Manager, and the technical and construction team (ESAP #3). To support this function, Kasada will review and assess their internal E&S capacity as the portfolio grows, and where necessary, procure additnoal E&S resources to ensure adequate oversight and monitoring (ESAP #4).

As the operator of the hotels, the various Accor departments (including sustainability, crises management, occupational health and safety, security etc.) provide an ongoing E&S oversight, support and monitoring function to Kasada.  As per the HMA, as  operator of the hotel, Accor, retains unfettered management control of the hotel, including recruitment, however, some recruiting including the employment of the General Manager must be agreed by Kasada. At a hotel level, the General Manager (GM) is ultimately responsible for all E&S aspects of the hotel, including providing monthly feedback to the business review meetings and annual monitoring against the pre-defined Accor KPIs.

Emergency Preparedness and Response:

Accor has developed and implemented a Hotel Incident and Crises Manual for all hotels they operate in the Middle East and Africa (MEA). All incidents, including accidents, armed robbery, electrical failure, bomb threats, fatalities, demonstration, food poisoning, fire or explosion and theft, are classified as either bronze, silver or gold which determines the appropriate management response. As per the manual, each hotel must have a crises response team as well as a Crisis Plan. All employees are required to receive training in relation to the procedures and guidelines detailed in the Crisis Plan. The General Manager of each hotel has ultimate oversight of crises management and reporting. For significant incidents, Accor has established a MEA Crises Response Team.

Ongoing training, maintenance as well as any incidents in relation to the Crisis Plan will be recorded and reported as per the requirements of the Hotel Incident and Crises Manual and monitored by Kasada as per the monitoring framework.

COVID-19:

In response to the ongoing COVID-19 pandemic, all Accor-managed hotels have been required to implement the ALLSAFE program. This has introduced intensified hygiene and prevention measures and safety standards. The program includes a dedicated guest hotline, enforcement of social distancing in all common areas, contactless check-in, and payment (where possible), provision of hand sanitizer in public areas, reinforced cleaning of public areas, employee safety and hygiene training, guest access to medical professionals and reinforced food safety standards and protocols. The Project Umbrella hotel, as a component of the transition to an Accor-managed hotel, will be required to implement the Accor ALLSAFE program. In addition, Kasada will obtain Safehotels certification for their hotels, that includes a hygiene element (further detail included under Performance Standard 4).

Monitoring and Review:

The Fund has developed initial key performance indicators (KPIs) that go beyond the current industry benchmarks, which they aim to achieve over the next three to four years. These KPIs relate to enhanced sustainability in the areas of employment equity, improved energy efficiency, Excellence in Design for Greater Efficiencies (EDGE) certification for all hotels, food waste reduction and Hazard Analysis Critical Control Point (HACCP).

As a component of ESAP #5, Kasada has also developed and implemented a standardized monitoring framework that assesses individual hotel compliance against predefined Kasada KPIs, Accor policies and procedures, including Planet 21, local regulatory requirements, IFC Performance Standards, contractual and collective bargaining agreements.  All hotels are required to provide feedback on any material E&S issues to Kasada at the monthly business review meetings and quarterly reviews. Comprehensive monitoring results against all the KPIs will be provided for the annual review, and where necessary, mitigation and management measures factored into the budget requirements.

In addition to these measures, as per the HMA, Kasada agrees that the operator, Accor, may once every fiscal year, carry out an audit of the hotel’s systems to ensure compliance with Accor Group Policies, including policies relating to the security of the network. Kasada will be responsible to implement all recommendations following such an audit.

 Human Resources Policies and Procedures:

The eight Project Ayaba hotels have a total of 635 employees (approximately 66% male and 34% female) while the Project Umbrella hotel has a total of 38 employees. These employees are predominantly in the areas of management, human resources (HR), front of house, housekeeping, food and beverage services, maintenance, IT, administration, sales, and marketing,

The majority of employees are provided with open ended (permanent) contracts, while a smaller number are provided with term (temporary) contracts. All hotels also employ a number of contractors provided through third-parties including security guards, garden maintenance etc. The majority of employees, including management, at each hotel are locally sourced.

As per the HMAs, it is agreed that Accor, as the hotel operator, has unfettered management control and absolute discretion, in relation to all human resource (HR) matters of the hotel employees including recruiting, secondment, training, supervisions, promoting, discharging, and liaising with, and negotiating with workers unions.

Accor HR policies and procedures will be implemented across all the hotels. This includes a Recruitment and Selection Policy, Recruitment Charter, Code of Conduct, Ethics and Corporate Social Responsibility Charter, grievance management procedure, workplace health and safety procedure among others. These policies are noted to be consistent with the respective local labor laws and requirements of IFC PS2.

Labor and Working Conditions

Building upon the Accor’s HR policies and procedures, labor and working conditions at the eight Project Ayaba hotels reviewed, are determined predominantly by existing collective bargaining agreements, that are aligned with respective local legislative requirements. The collective bargaining agreements cover working conditions including recruitment, probation, salaries, working hours, benefits, leave, disciplinary action and termination, retrenchment etc. All employees are provided with a written contract (open ended or term), as per the requirements of the collective bargaining agreements, detailing their terms of employment.

Labor and working conditions within the Project Umbrella hotel are defined by Kenyan legislative requirements and detailed within the staff handbook. This covers areas of non-discrimination and equal opportunity, retrenchment, and employee grievance management.

Within the first six months of Accor assuming operations of the respective hotels, Kasada will commission an independent labor audit to verify and ensure alignment of existing practices, procedures, and employment contracts with both local legislation, as well as Accor policies and procedures. This will cover areas relating to labor and working conditions, hiring, compensation and benefits, employee relations, safety, and security (ESAP #7). Where gaps or non-alignment are identified, corrective actions will be implemented through a timebound action plan.

Workers Organizations:

As articulated in Accor’s Ethics and Corporate Social Responsibility Charter, all employees have the right to find and join organizations of their choosing with the aim of collectively defending their interests through a collective bargaining process. This stance is reiterated in the respective HMA which state that Kasada, as the owner and employer, will comply with hotel employees’ rights to join and form workers’ organizations and/or unions of their choosing, and undertake collective bargaining.

The majority of employees at the eight Project Ayaba hotels are currently unionized, however, membership of the unions is on a voluntary basis. Each union has an elected representative committee who engage with hotel management on a regular basis. The committees are re-elected every three years. Each hotel currently has a collective bargaining agreement (CBA) in place. The CBAs govern all aspects of the employment terms and conditions in accordance with local legislative requirements.

In order to ensure a labor management and engagement approach that is aligned with the requirements of both local legislation and Performance Standard 2, Kasada has developed a timebound management and engagement action plan detailing their management approach to labor and working conditions (ESAP #6). The action plan includes a training schedule at both a group and hotel level on the requirements of Performance Standard 2.

The Project Umbrella hotel does not currently have a defined approach or policy regarding freedom of association or collective bargaining; however, several employees are currently members of the Kenya Union of Domestic, Hotels, Educational Institutions and Hospital Workers (KUDHEIHA). As a component of the transition to an Accor ESMS (ESAP 1), the hotel will be required to adopt Accor’s Ethics and Corporate Social Responsibility Charter, whereby all employees are entitled to join an organization / union of their choosing, and bargain collectively.

Non-Discrimination and Equal Opportunity 

Accor has developed and implemented a compulsory Ethics and Corporate Social Responsibility Charter, which is overseen by their Group Ethics an CSR committee. As per the charter, all Accor managed hotels are committed to eliminating all sources of discrimination and promoting equal opportunity, including in the areas of recruitment, promotion, training and career support.

Furthermore, as captured in the Diversity and Inclusion Commitment, Accor promotes diversity and non-discrimination on the grounds of country, region or neighborhood of origin, family name, culture, age, gender, physical appearance, disability, sexual orientation, education and others. Accor has also implemented the RiiSE initiative which is an international network to promote diversity and gender equality in the workplace.

Additionally, Kasada is targeting 100% gender pay parity across all their hotels and 50% female general managers by 2025.

Retrenchment:

None of the Project Ayaba hotels were required to retrench any staff due to the ongoing Covid-19 pandemic and all salaries were maintained, however, approximately 183 term contracts were not renewed during this period, representing 78% of temporary employees. Any planned retrenchment in the future, has to be managed as per the requirements of the existing collective bargaining agreements, taking into account length of service, family responsibilities, professional qualities etc. The employee representative is consulted regarding any retrenchment plans. 

Due to COVID-19 related restrictions and financial constraints, the Project Umbrella hotel was required to retrench 144 employees and place an additional 46 on unpaid leave. The process included the payment of salaries up to end August 2020, severance pay, payment of accrued leave, and a certificate of service.

Grievance Management:

Accor has developed a grievance procedure that is applied across all its hotel operations. The procedure details the process for raising grievances, timelines for feedback and resolution, documentation and the appeal process.

Accor has also implemented a Whistleblowing hotline, the Accor Integrity Line, allowing employees to report any grievances or conduct that is contrary to Accor policies, in complete confidentiality and anonymity if necessary. The mechanism is also offered on an internet platform accessible 24 hours a day, 7 days a week and is available in 29 languages.

Project Umbrella  does not have a formal documented employee grievance policy in place at the time of their respective appraisals. The transition to an Accor managed hotel would require the implementation of the Accor grievance procedure as well as their whistleblowing hotline (ESAP #8). 

Protecting the Workforce:

As per Accor’s Ethics and Corporate Social Responsibility Charter, no hotel under their management is permitted to institute any form of forced, child or undeclared labor. In terms of child labor, Accor commits to comply with the legal minimum working age in each host country and to never employ anyone under the age of 14. As a component of Accor’s selection and recruitment process, the age of all potential employees is verified and recorded. In addition, the Charter also details a zero-tolerance approach to any form of harassment, including sexual harassment, and bullying in the workplace. These policies are applicable to both employees within Accor managed hotels, as well as suppliers and third-party service providers.

Occupational Health and Safety:

Accor has developed and implemented policies and procedures identifying specific occupational health and safety risks in its hotels. Occupational Health and Safety is reiterated in Code of Conduct. As per the Hotel Incident and Crises Manual, all hotels are required to develop their own Hotel Incident and Crises Manual to facilitate the response to an incident.

During planned refurbishment and upgrades to the hotels, it is anticipated that numerous contractors will be on site. For this purpose, Accor has developed and implemented a Workplace Health and Safety Policy and associated agreement for contractors and suppliers to ensure a suitable safe environment and work site. This forms the basis of all agreements with contractors and covers areas such as product safety, environmental management, health and safety, hazardous material handling, hygiene, insurance and compliance (fire, electrical, plumbing and ventilation).

Should an employee be involved in an incident, even a minor one, they are required to immediately report the incident to the relevant hotel manager, who subsequently completes either an Accident and Dangerous Occurrence Report or Incident Report which is sent to the Director of Operations and the MEA Risk Management team. After every incident a debrief form must be completed and a meeting held to review the outcomes of the incident. Incidents must be reported within 48 hours.

Third Party Workers

The hotels in the current pipeline of acquisition under Phase 1 utilize a limited number of third-party service providers to fill roles such as security and garden maintenance. These third-party service providers are required to comply with all Accor policies and standards, as well as local legislative requirements. All third-party workers and service providers are also required to comply with the Accor policy on Workplace Health and Safety Agreement for Consultants, Contractors and Suppliers. The policy forms the basis of all agreements with contractors and suppliers and sets out the minimum health and safety, environmental protection and fire prevention requirements of all contractors, suppliers or consultants.

Resource Efficiency:

Accor has committed to environmental management and sustainability through several policies and standards. The Ethics and Corporate Social Responsibility Charter reiterates its position on energy and carbon footprints, pollution and discharges, water conservation and waste recycling.

In addition, Accor has also developed and implemented an Environmental Compliance Guideline that provides design and operational strategies and technologies to reduce energy and water consumption, carbon footprint and maintenance costs. Lastly, all Accor managed hotels are required to achieve at least a mandatory ‘bronze’ status in terms of the Planet 21 requirements. This includes initiatives to improve and monitor water and energy efficiency as well as waste management. 

In addition to Accor’s mandatory requirements of the Environmental Compliance Guideline and Planet 21, Kasada is looking to operate its hotels following internationally accepted green building standards, as part of IFC’s Excellence in Design for Greater Efficiencies (EDGE) certification. The fund, as one of their KPIs, is targeting at least 20% of hotels to be EDGE certified by 2025. Kasada will also look to achieve a 10% per room energy reduction by year two of operation.

Greenhouse Gas Emissions:

Greenhouse Gas (GHG) emission sources from operations will be mainly related to grid electricity use, diesel use for back-up generators and vehicles. As per the Accor Environmental Compliance Guidelines, all hotels are required to keep accurate and documented records and measurements of all energy consumption. This includes sub-metering at high-energy use areas kitchens, laundries, and swimming pools. All hotels are required to track their energy consumption via the Planet 21 Gaia platform.

Kasada, as a component of its monitoring framework, will monitor and record resource usage, including water, energy as well as their estimated gross GHG emissions from all the hotels.

Pollution Prevention and Waste Management:

As per the Accor Environmental Compliance Guidelines and Planet 21 mandatory ‘bronze’ requirements, all hotels are required to manage their waste (water, solid, and hazardous), in a sustainable and environmentally friendly manner. This includes the removal of plastic straws and cotton buds, using eco-friendly cleaning products, ensuring that 100% of wastewater discharge, including sewage and grey water, is connected either to a municipal wastewater treatment network or a hotel owned treatment facility and sorting and processing of hazardous (paint, batteries, fluorescent bulbs, printer cartridges, aerosols, waste oil etc.) and solid waste (glass, paper, plastic, cardboard) into appropriate waste streams.  Hotels are also required to identify and document all hazardous material on site.

In addition to the Environmental Compliance Guidelines and Planet 21 requirements, the fund is targeting zero waste to landfill at 20% of their hotels by 2025.

Community Health and Safety:

Food Safety

Accor has developed and implemented a Safe Food and Hygiene Standards Manual that includes a Food Safety Policy, roles and responsibilities, food safety team, HACCP requirements, supplier management, receiving and storing of food, pest control etc. Accor’s intention is to ensure that all their managed hotels will achieve a basic compliance level of food safety based on international food safety requirements, with an expectation that hotels move forward to seek HACCP certification.

Currently the Project Umbrella hotel has the relevant food and hygiene license granted by the Nairobi City Council. Food and hygiene were also covered under the annual NEMA audit.

Life and Fire Safety

Accor has implemented a corporate life and fire safety (L&FS) system technical document (i.e. L&FS Master Plan), aligned with the requirements of the WBG EHS General Guidelines and international fire safety codes, that provides the minimum requirements for L&FS at all Accor managed hotels (new facilities or to be renovated).

For existing hotels, and before starting under Kasada’s management, the hotel general manager is required to commission a L&FS audit (or “Fire Safety Strategy”) against the minimum performance requirements set out in the technical document. The audit is prepared by qualified fire safety consultants who put together a corrective action plan with an associated implementation timetable to correct the deficiencies and non-compliances. Additionally, the hotels have implemented a periodic O&M plan, including inspection, testing and maintenance of L&FS systems by own personnel and qualified local subcontractors.  

IFC’s virtual visit to hotels based in Dakar confirmed that the hotels have the required L&FS infrastructure and systems including required L&FS features, as described above. Also, the hotels have fire brigades with good emergency training provided by an external certified company. The evacuation procedures, roles and responsibilities of the various staff are reviewed regularly through pro-active measures and exercises.

L&FS at the Project Umbrella hotel is compliant with national requirements, including emergency exits, ventilation, fire suppression and containment, equipment maintenance, and the hotel is subject to annual NEMA audits. The hotel is in possession of a current fire clearance certificate.

All hotels in Kasada’s portfolio, both as a component of this phase and potential future acquisitions, will adopt and comply with Accor’s Fire Life and Safety System technical document, local legislative requirements, and the World Bank EHS Guidelines. In addition, Kasada will obtain Safehotels certification for their hotels, that covers L&FS, including detection, suppression, equipment and infrastructure, evacuation, training, and certification (ESAP 5). 

Security:

All hotels for both Project Ayaba and Project Umbrella are required to adopt and implement the Accor Global Brand Security Standard. The standard provides minimum baseline security requirements pertaining to physical, technical, human and operational practices and is largely aligned with the requirements of IFC Performance Standard 4 as well as the Voluntary Principles on Security and Human Rights.

Security at all the hotels in Dakar, Cameroon and Ivory Coast is provided by private third-party contractors.  Due to perceived terrorism threats in the region, the Senegalese government provides gendamerie for additional security. As per the Accor Global Brand Security Standard, contracted security companies must be properly licensed in accordance with local laws and comply with the requirements of the standard. This includes the justified and legitimate use or force, training and vetting.

Security at the Project Umbrella hotel is provided by a third-party service provider, Secure Kenya Limited. This includes guards for the day and night shifts, respectively.  Project Umbrella will be required to undergo the necessary requirements, as per the Task World platform, to transition to the Accor Global Security Standard.

Kasada is in the process of ensuring all their hotels are Safehotels certified (https://safehotels.com/). This covers processes and procedures, training, management and organization, systems and infrastructure, and crises management. Audits and subsequent certification for the Project Ayaba hotels will commence in Q1 2022 (ESAP #9), while Project and Umbrella will be conducted in Q3 2023.

Accor, through its Ethics and Corporate Social Responsibility Charter, commits to responsible communication practices, including responsible marketing, communication and transparency. This includes engagement with communities in which they operate, as well as with guests. Stakeholder engagement is managed at global, regional and brand levels. Accor also utilizes engagement channels such as their webpage (https://group.accor.com/en/commitment/planet-21/our-partners), social media platforms and their annual integrated report to communicate progress and performance in relation to diversity, challenges, strategy, and sustainability (https://group.accor.com/-/media/Corporate/Investors/Documents-de-reference/2019-integrated-report.pdf).

In 2009, Accor signed the Responsible Communications Charter, which was revised and consolidated to become the FAIRe program in 2018, which Accor is a signatory. Accor also contributes to local economic development through direct and indirect employment by promoting local recruitment practices and offering skills and technical training.

External grievances can be lodged on a variety of platforms including the Accor website, phone, email, social media and via Accor’s Integrity Line.

Contact Person: Pierre d’Auriac

Company Name: Kasada Capital Management

Email: pierre.anglesd'auriac@kasada.com 

Phone: +27 10 541 0900