The proposed expansion (fruit juice production line) is within the existing facility. As such, issues related to PS5: Land Acquisition and Involuntary Resettlement, PS7: Indigenous Peoples, and PS8: Cultural Heritage do not apply for the company’s direct operations.                                                  

  This is a Category B project based on IFC’s 2012 Policy on Environmental and Social Sustainability. The key E&S risks and issues related to this investment are: (i) existence and implementation effectiveness of KB’s EHS, HR and food safety (FS) management systems; (ii) capacity and competency of its EHS/HR/FS functions; (iii) fair labor and safe working conditions, including terms of employment and OHS measures of direct employees and contractors; (iv) life and fire safety at the facility; (v) compliance of contractors and/or service providers with applicable national HR/OHS requirements; (vi) monitoring of EHS parameters (air emissions, effluents, noise, waste and Lost-Time Injury Frequency Rate) at KB’s facility (vii) risk screening of KB’s raw material (fruit) third-party suppliers. Applicable World Bank Group (WBG) Environmental, Health and Safety (EHS) Guidelines include the General and Sector-specific (Food & Beverage Processing) Guidelines.                  

Environmental and Social Policies. The company manages its facility in compliance with national legal and regulatory requirements. KB has yet to formalize an Environmental, Occupational Health and Safety and Security (EHSS) policy (ESAP#1) aligned with IFC PS1 requirements. For its fruit sourcing from third-party suppliers, the company has yet to develop a Supplier Code, including documented EHS procedures for supplier risk screening, management and monitoring. These procedures are currently being formalized into an E&S Management System (ESMS). Going forward, KB will develop and implement an ESMS manual, including EHS Standard Operating Procedures (SOPs) commensurate to the E&S risks and impacts associated with its facility. In addition, the ESMS manual will formalize the screening and review process of its third-party fruit suppliers, especially on issues of harmful child labor, forced labor, significant OHS risks (e.g. use of pesticides and sharp knives) and risk of conversion of natural/critical habitats (ESAP#2).

Environmental and Social (E&S) Risk Assessment. Based on information provided during IFC appraisal, Kings Beverage appears in compliance with applicable national legal and regulatory EHS requirements for its facility. Further validation of the compliance of all legal EHS requirements will be carried out during the development of the ESMS Manual (ESAP#2). Elements of a legal register has been sighed during IFC appraisal, including review of copies of operational permits and licenses for its water bottling and CSD facility. These included the Environmental Impact Assessment (EIA) License Certificate, Sierra Leone’ Environmental Protection Agency’s (EPA) License’ Terms and Conditions (T&Cs), Ministry of Health and Sanitation’ Health & Safety compliance certificate, Sierra Leone Standard Bureau Food Microbiology and Chemical Analysis Certificate (ref. CSD), water purification certificate (ref. bottled water finished product), National Fire Force training Certification, and Sierra Leone’ water and electricity regulatory commission permit for the stand-by generators.

The E&S risk assessment and mitigation measures of the facility is currently part of the food safety and quality certifications from local government. KB undergoes comprehensive inspection of its operations from the Standards Bureau of Sierra Leone every 3 to 6 months. In addition, KB is inspected every 6 months by the Ministry of Health and Sanitation which any pending issues are shared with KB (ref. inspection report on occupational health and safety). Going forward, the company will develop an E&S risk assessment matrix, including risks associated with the company’s production activities, owned vehicles, warehouses, and laboratory (ESAP#3). As mentioned above, it will also develop/implement a risk screening checklist for its third-party supplier and selection (ESAP#2).

EHS Management System and Programs. The company is in the process of establishing an Integrated EHS management system, including SOPs Manual and management programs at its facility (ref. ESAP#2 above). Performance-based EHS requirements of this system are based on compliance with the national EHS/HR legal and regulatory requirements mentioned above. Going forward, performance-based requirements will be aligned with the IFC PSs requirements and applicable WBG EHS Guidelines. Based on the EPA License’s T&Cs, KB conducts quarterly environmental reviews of the implementation effectiveness of its E&S Management Plan (ESMP), as required by these T&Cs. Based on this ESMP framework, EHS procedures and training plan have been developed, covering  issues such as Life and Fire Safety (L&FS), electrical safety, first aid, facility’s safety procedures and operational instructions required to be followed by staff.  Going forward, KB will roll-out an expanded EHS Training Plan, including training on HR manual, ESMS (including fire drills), Supplier Code, etc. to be provided to all permanent/temporary workers, contractors and service providers (ESAP#4).

EHS organizational structure and competency. The facility’s general manager is currently responsible for overseeing EHS compliance with the License’ T&Cs. A team, managed by the operations manager and composed of the line managers, HR manager, technical manager and production manager, is responsible for EHS monitoring and reporting. The operations manager reports to senior management through weekly meetings to discuss operational issues, including EHS issues. Going forward, the company will identify and appoint a competent E&S officer to be responsible for the implementation and co-ordination of the ESMS; management, monitoring and reporting on EHS performance; coordinating investigations of workplace injuries and incidents and corrective actions and reporting; managing health and safety training (ESAP#5).

Emergency Preparedness and Response. In accordance with Sierra Leone’s regulatory requirements, the company undertook emergency preparedness and response planning for its operations, which includes the development of an evacuation procedure. Fire safety training is provided by the local fire department and is delivered to 5 designated KB staff (fire brigade) who then train new hires. Fire safety training is delivered as part of the induction training of new hires. Refreshers on fire safety awareness are conducted periodically (every 6 months) for all staff. Fire drills are regularly conducted, however not consistently since March 2020 (COVID-19). When conducted, reports are handled by the operations manager. In terms of safety preparedness measures, KB has an assembly point outside the facility, three fire exits in case of an emergency and a manually operated fire alarm. The factory is equipped with 36 fire extinguishers and one placed outside the factory. Fire extinguishers are checked on monthly basis. The local fire department undertakes refilling, as needed. The checked extinguishers are labeled with the latest inspection date. In case of a fire emergency, when there is power outage, there is a fire reel and a battery back-up for the fire hydrant pump. KB will formalize its emergency preparedness and document its Emergency Response Plan (ERP) (ESAP#6).

COVID-19 contingency measures. KB is following the Government of Sierra Leone’ policy on COVID-19 contingency measures. No salary or compensation cuts happened due to COVID-19. In addition, working hours were not reduced and the company only experienced one week of work stoppage to assess the situation and plan to resume work under the enforcement of new contingency measures. The measures that came into effect include the installation of a sanitization chamber, one side facing security at the outer gate of the facility and the other side leading to the entrance of the plant. Everyone on site is instructed to wear a face mask and gloves. Sanitization is provided at the facility and at the management residential area behind the factory. KB maintains a 3-month stock of masks and hand sanitization which are imported from India.

EHS Monitoring and Reporting. Under the Environmental Permit’ T&Cs, the ESMP entails valid medical certificates for staff at employment, safety and first aid training for all staff, health promotion posters, repair finished product area floor from cracks, reconstruct production area floor to prevent spill related accidents, paint the raw material area metal floor to avoid corrosion, provide borehole inspection chambers with tight fitting covers to prevent contamination, raw water and finished products to be tested by an approved laboratory, provision of changing rooms for staff, observe working hours not to exceed 8 hours per day, and, addition of four fans to the production room, 3 fans in the finished product room and three fans in the raw material store.

At the facility was recently commissioned, there  is a very narrow coverage of EHS parameters which will need to be broadened to capture IFC PS requirements, including WBG EHS Guidelines for beverage production. Most of the EHS parameters analysis are currently undertaken at its own lab and at the Ministry of Health’ labs. Based on results shared during the appraisal, all parameters are meeting the local regulatory requirements since the commissioning of the plant in March 2020. Going forward, the client will develop a comprehensive EHS monitoring framework in line with IFC PS requirements and WBG EHS Guidelines (ESAP#7). This will include the definition of a set of Key Performance Indicators (KPIs), including monitoring frequency, methodology, and responsibility center which will be captured in the ESMS manual.

Supply Chain Risk Assessment and Management. As the company will install a new fruit production line in its existing facility, it will expand its direct sourcing of fruit from third-party suppliers to achieve up to 85% of its raw material needs. The company has identified three main suppliers (farms) but has not yet entered into contractual (sourcing) agreement with these fruit suppliers (e.g. pineapples, mangoes, oranges and cashew fruit). In case of shortages, additional fruit may have to be sourced directly from smaller local farms and/or through aggregators. In anticipation of this additional fruit sourcing volumes, the company will develop a Supplier Code of Conduct and screen/qualify these additional suppliers against PS2/PS6 supply chain requirements. Effective implementation of the Supplier Code will be independently verified on an annual basis (ESAP#2). The results of the risk screening for the three farms using IBAT and Global Forest Change (GFC) are described in the PS6 section. Risk screening using the GMAP and the ILAB Sweat & Toil did not document risks associated with the production of fruits sourced by KB as raw material.

 The company currently employs 125 employees, composed of 62 full-time employees and 63 casual workers. The total number of employees includes 7 females (one having a supervisor role). Casual workers are offered ad-hoc tasks depending on workforce requirement and skillset. If the casual employees perform and meets expectations then they are awarded a 3-month, 6-months or yearly contracts. 90% of the casual employees are hired from the facility’ surrounding communities. The key differences in working terms & conditions between full-time and casual workers are in terms of benefits, above and beyond salary payments.

There are 26 foreign Indian nationals on staff who hold management positions within the company. Once the juice production line starts, it is expected that additional 180-190 employees may be recruited over the next months. KB has set a target of recruiting 25% of female workers. While there is an HR manager currently managing employee contracts, the company will strengthen its HR function and management capacity to manage additional HR aspects, such as the development of the HR policy and procedures manual and handle the workers grievances mechanism (ESAP#8).

Human Resource Policy & Management. There are currently no HR policies and/or procedures in place. Going forward, in accordance with IFC PS 2 requirements, the company will develop a HR policy that covers Non-discrimination and Equal Opportunity, Child Labor, Forced Labor, Freedom of Association, and Sexual Harassment and a set of HR procedures that include recruitment; induction; terms and conditions of employment; OHS requirements; performance management; procedures for workers representation or committees in the absence of a union; disciplinary procedures including explicit provisions for sexual harassment, labor grievance mechanism (see below); termination of contract and dismissal; and workers engaged by third parties. These HR Policies and Procedures and labor grievance mechanism will apply to all workers including those employed by any sub-contractors and will be readily accessible and clearly communicated at induction and through the provision of additional sensitization and training. (ESAP#9).

Working Conditions & Terms of Employment. All KB employees (including casual workers) receive employment contracts, although the terms of contract (T&C) differ between casual and term/permanent employees (mainly in relation to benefits). Casual worker contracts may be converted to term contracts depending on the workers performance. At a minimum, the T&Cs of the contract are aligned with the requirements of the national labor law. These T&Cs cover the training period, contract renewal, working hours and overtime, employee duties, salary and compensation, statutory salary deductions, confidentiality, disciplinary measures, offences leading to dismissal, resignation, and termination conditions. It also refers to the industrial trade group’ grievance mechanism which requires enhancement to be in line with PS2 requirements (ESAP#10).

The company minimum wage is set above the statutory minimum wage in Sierra Leone of LE 600,000 per month. The company also provides a yearly bonus based on the employee's performance. The bonus system applies to all employees and is based on annual performance appraisal.

The company provides accommodation to all its foreign employees who make up the management team. The company also provides transportation to and from the factory for local employees. KB has started building a dedicated accommodation facility at the factory for foreign employees.

The company provides induction training to all new employees. In the induction training, KB employees receive training on OHS, including use of Personal Protective Equipment (PPE), fire & safety, manufacturing plant rules and operational instructions commensurate with risks at each workplace. The company also provides follow-up trainings on regular basis.

Worker’s Organization. The company is supportive of employee rights to freedom of association and workers seeking collective bargaining agreements (CBAs). Specific provisions for these rights will be explicitly mentioned in the proposed HR policies (ESAP#9). This provision will be informed to staff as part of their induction upon hiring. There is currently no union in KB.

Non-discrimination and equal opportunity. While not documented yet, KB considers itself an equal opportunities employer that does not discriminate on basis of age, nationality, gender, or religion. Specific provisions will be explicitly mentioned in the HR policies (ESAP#9).

Worker & Contractors’ Grievance Mechanism. The company has adopted the grievance mechanism of the industrial trade group agreement which is defined in the employment contract and is based on a governmental public announcement published in a journal for the food and beverages sector. This sector-based grievance mechanism is a 5-step process which starts with sharing the grievance at the employee’s supervisor level and escalates to the commission of labor in Sierra Leone for reconciliation. Each step is bound to a timeframe for completion. Going forward, the current grievance mechanism will be upgraded, including the development of a relevant procedure that explicitly mentions an anonymous channel for raising grievances, has relevant forms developed, a separate route for addressing sexual harassment and related grievances and the establishment of a grievances register as well as appointment of competent staff to handle the grievances (ESAP#10). In addition, the company will formalize policies and procedures on the prevention of sexual harassment at the workplace (ESAP#9). Training to KB’s management team and permanent and casual workers of such procedures will be provided (ref. ESAP#4 above).

Protecting the workforce. As part of its current recruitment process, all employees are required to present proof of age, such as national ID card or birth certificate to recruitment staff during the application process, such proof is retained in all workers’ personal files for reference. In addition, child labor and forced labor need to be explicitly prohibited in KB’s direct and sourcing operations (refer to ESAP#2 above, Supplier Code).

Workers engaged by third parties. To ensure compliance of its contractors and service providers with applicable national labor and OHS requirements, KB will develop an appropriate screening for such provisions, including verification of registration with Ministry of Labor and compliance with local labor and OHS provisions, namely payment of workers’ legal benefits, timely payment of wages, OHS training and provisions of PPEs, ILO Convention 138 on minimum age, in line with KB’s own HR policy (ESAP#11).

Occupational Health and Safety (OHS). The company has adopted an OHS training plan while its OHS management system is under development (ref. PS1, ESAP#2). This training plan entails the provision of personal protective equipment (PPE) and an incident reporting mechanism. In addition, OHS training includes emergency procedures/fire prevention, electrical safety, safe use of machinery and personal hygiene and food safety. Employees are also provided with PPE required for food safety and for their own safety. KB monitors its incidents involving all its employees (permanent and casual) and company owned vehicles. The record of incidents in the past year was provided in addition to the corrective measures which were applied. KB’s lost-time frequency rate will be monitored as part of the company OHS KPIs, based on leading and lagging indicators (ESAP#12). KB has not reported any fatalities during the construction phase and since commissioning its plant in March 2020.                                                

   The ESMS currently under development (ref. PS1, ESAP#2) will establish a comprehensive set of procedures for generator equipment servicing and maintenance, and regular monitoring of environmental aspects. These will include air quality (ambient and point source), mapping of noise levels and mitigation, as needed, water quality analysis (for raw and finished product), pest control within the facility, waste and hazardous waste handling, etc. KB has indicated the operation of a 2-ton capacity water boiler but does not currently monitor its point source air emissions.

Resource (Energy and Water) Efficiency. Energy supply for KB’s facility is provided by a private electricity utility company. As the electricity supply is not reliable, 6 generators are located onsite and used for power generation in KB’s facility. Carbon dioxide (CO2) emissions generated by the gensets are collected and turned into food grade CO2 for use in the process of production of CSD products at the rate of 500kg per day. KB records annually its energy consumption (electricity and diesel from generators and vehicles). Supportive evidences of presence of secondary containment for the diesel storage tanks have been represented during appraisal. Total GHG emissions for KB operation since March 2020 (ref. Scope 1 and 2 – MT CO2-equivalent) was respectively 296 and 456 tonnes.

Raw water supply is currently sourced from a borehole, spring water and rainwater harvesting for production purpose. Water is stored in underground tanks with a total capacity of 600,000 liters. The company has a reverse osmosis water system on site. Annual usage of process water at KB operations is estimated at 2.31 m3 per ton of production. KB has not performed any energy/water benchmark studies to compare its water/juice efficiency to similar industries. Going forward, the company will validate the sustainability of its current water consumption from the above sources, including the additional volumes for the installation of its juice production line (ESAP#13). The company will also assess energy use specifications and efficiency of new machines and vehicles during the procurement process.

Noise. As per WBG EHS guidelines, the ambient noise level at KB’s operations should not exceed 70 dBA in day and night-time. Noise-generating equipment are enclosed to reduce noise levels at source. Wearing ear plugs and earmuffs is required for workers exposed to higher workplace’s noise levels.

Wastewater treatment. Process wastewater is treated through the on-site Effluent Treatment Plant (ETP) prior to discharge into the local sewage network. Preliminary treatment includes physical separation of impurities, waste syrup, wastewater from the rinsing of the production line along with the wastewater directed from the Reverse Osmosis (R.O.) treatment unit. Physical water treatment employs gravity to remove suspended solids. A clarification step is used for the separation of solids from liquids. Next step is the removal of floating and settleable materials, such as suspended solids and organic matter. Both physical and chemical methods are used in this treatment level. Chemicals are then added to the wastewater to improve the quality of water parameters such as pH control, coagulation, chemical precipitation and oxidation. KB uses the water filtered through this ETP process for toilets and landscape irrigation around its facility. There is no expected wastewater from fruit juice production line, except from the cleaning processes (Clean-in-Place, CIP) which will go to the ETP as well.

Solid and hazardous waste. The company has a waste management procedure whereby all plastic, cardboard and packaging material are handled by a licensed waste contractor. KB’s lab waste has some biological waste (from microbiology tests of finished product samples) and is shipped off for incineration. All other solid waste including domestic waste is sent to authorized landfill sites through service providers.

Pest Control. The company uses a service provider (same company as for waste handling) for pest control on its site, which is based on the principles of Integrated Pest Management (IPM). Pesticides used at KB’s production facility are applied by a licensed contractor recognized by the GoSL.                                                

 Road traffic safety. Currently, all drivers at KB are holders of valid driving licenses. Under ESAP#2, a safe road safety policy and procedures will be part of KB’s ESMS and mainly apply to truck and minibus drivers. All drivers will be required to achieve a defensive driver training course from a 3rd party service provider.

Food Safety Management System. To meet food safety specifications at its facility, KB voluntarily follows Food Safety standards and provide training covering Personal Hygiene, Health and safety requirements, and GMP procedures to ensure that that its consumable products are manufactured and stored under safe and sanitary conditions. Mandatory new hire food safety orientation and additional job-specific food safety training is also provided.

Security Personnel. KB contracts a private security company (360 secured) to provide security guards. This service deploys 6 guards per shift who are not KB direct employees. KB will document a specific Security Policy consistent with the requirement of PS4 (ref. ESAP#2). This will include the guards’ behavior with the community and workers. The policy (ESAP#1) shall be communicated to the security guards as part of the induction as well as refresher training.                                                  

Supply Chain Risk Assessment and Management.  

Given the early stage of business development for the fruit juice production line, the fruit supply chain is not yet established. The location of all farms has not yet been confirmed and the location of any smaller suppliers to these farms is also not known. A sample of the three proposed farms in the southern and northern provinces of Sierra Leone has been provided to IFC for analysis. To date, no farms have been identified in the eastern province of Sierra Leone. As the three farms screened are still under negotiations with KB, no third-party audits or certificates have been shared with IFC during the appraisal visit. With the limited information available at appraisal, risk screening of these potential farm fruit suppliers for recent deforestation has been conducted as part of this appraisal. Biodiversity risk screening tools used included IBAT and University of Maryland’s biodiversity related risk screening (Global Forest Change).

This biodiversity review confirmed that fruit sourcing from these three farms are in consolidated agricultural lands and/or not located in recently deforested areas. However, the production landscape for each site includes areas recently deforested and areas of what appear to be natural forest that could be threatened by expanding agriculture in the future.

Currently, the results of the risk screening are inconclusive and further analysis is needed to ensure alignment of KB with PS1/PS6 supply chain requirements. Going forward, based on the E&S supply chain risk requirements of its Supplier Code, KB will expand this risk screening to existing/future smallholders in its supply chain (ESAP#2). As previously indicated under PS1, Supply Chain section, the company will develop a Supplier Code, including a risk screening process aligned with PS2/PS6 supply chain requirements to qualify the inclusion of any additional direct and indirect third-party fruit suppliers (such as smallholder farms, reached through aggregators for additional fruit supply). These third-party suppliers will be informed of the provisions of the Supplier Code and the prohibition of engaging into deforestation within their production area (with a cut-off date of 2009), or to expand on already modified habitats (consolidated agricultural areas). Independent verification of the implementation effectiveness of the Supplier Code will be done on a yearly basis (ESAP#2).