PS5 does not apply as the only land required for the project did not involve involuntary resettlement; the village that owned the 20 ha of land needed for the new gin entered into a voluntary negotiated agreement with the company. Refer below for more information on how CIDT obtained the land required for the proposed new gin. PS 7 and PS 8 do not apply as the land acquired is not associated with either indigenous peoples nor did it contain cultural heritage, having been used for light agricultural purposes previously.

This is a Category B project according to IFC's Policy on Environment and Social Sustainability (2012). Based on information reviewed by IFC, the proposed project will have limited adverse environmental and social (E&S) impacts that are few, site specific, largely reversible, and readily addressed through existing mitigation measures and good international industry practices (GIIP).

Key E&S risks and issues associated with the project include: (a) need to conduct an E&S assessment in line with applicable legal requirements and IFC PSs for the proposed ginning plant; (b) confirmation that the company has sufficient E&S systems and staffing to manage construction and operations of new/existing plants and an expanded supply chain in line with IFC’s PSs; (c) assurance of fair, safe and healthy working conditions in line with IFC PSs (including on gender based violence) and those requirements within Ivorian regulation both during construction and operations; (d) those related to provision of security management; (e) management of emissions and waste as per World Bank Group Environmental (WBG) EHS Guidelines; (e) avoidance/mitigation of any impacts on communities; and (f) implementation and management of IFC PS2 and IFC PS6 requirements in the company’s cotton seed supply chain.

As part of the appraisal, the company completed the IFC environmental and social management system (ESMS) self-assessment tool (see ifc.org/esms) and shared it with IFC. This is a tool developed by IFC to help businesses assess their existing management system elements and to identify areas where improvements can be made. Based on their self-assessment, the company determines that they have each element of an ESMS as envisaged by PS1 (policy, identification of risks and impacts, management programs, organizational capacity and competency, emergency preparedness and response, monitoring and review and stakeholder engagement.) See relevant sections of this document for review and comment on the assessment results and IFC’s opinion of each element of the current CIDT ESMS.

Policy

The company has developed an environmental charter that speaks in high level terms of the need to protect the environment, reduce waste, use resources efficiently, minimize pollution, sensitize producers regarding the use of plant protection products and protect biodiversity found within their sourcing areas. In addition, at the time of the appraisal, CIDT had in place a more specific draft corporate Health, Safety, Security and Environment (HSSE) policy; this policy is expected to be finalized in September 2021. The draft policy aspires for zero work-related accidents and protection of the environment and is extended to third party service providers and contracted workers. It states that CIDT will comply with applicable law and regulation, involve workers in the development of a management system designed to protect them and the environment, commits to communicating the policy and its results to all staff, and that it will train staff, systematically analyze accidents and provide feedback to reduce risks. Additional policies, such as those that pertain to Occupational Health and Safety (OHS) and Social matters are also in place; these are detailed below in the relevant sections of this document. As per the ESAP Plan, the company will finalize the HSSE policy and communicate its contents to those who conduct work for or on behalf of the company. This is addressed in ESAP #1.

Identification of Risks and Impacts

The company has several processes and practices that identify and assess the risks and impacts associated with its ginning operations and its sourcing of cotton. For example, as part of the company’s compliance to regulatory requirements, it is required to have the elements of an ESMS as included in the ISO 14001:2015 standard, which requires an aspect and impact assessment of all plant operations. Environmental and Social (E&S) audits of the company’s operations are conducted every 3 years to ensure the associated systems remains operational. The scope of the audits is dictated by applicable law, regulation and decree, international conventions and agreements to which CDI is a signatory, and the norms of ISO 14001:2015.  This program is conducted under the auspices of the National Environment Agency.  IFC reviewed results of audits conducted at the facilities in 2019. The audits are carried out by qualified consulting companies who visit the individual plants (including surrounding communities), review documents and records and, where needed, develop corrective action plans, which are required to be completed under regulation, using management programs (see more below).

The scope of the audit covers the activities expected to be found within an operation of this kind. For example, the 2019 audit listed the following operations for the Seguela ginning plan as being included in the audit: engagement and training of farmers/suppliers through use of agronomists including the functional literacy program to help them develop business acumen, provision of seeds and other agricultural inputs, collection and transport of seed cotton to the gin, cleaning and ginning of the seed cotton, and cleaning and packaging of the fiber into bales. Also, ancillary services required at the ginning operations such as storage of fuel for vehicles, health clinics for workers, maintenance shops to repair equipment, etc are included in the audit. The audit describes inputs beyond seed cotton (e.g., energy and water), and equipment required in the ginning process. In doing so, the audit lists the E&S risks and impacts associated with all the focus areas as per above and assesses them for significance as well as reviews what is currently being undertaken in the way of actions to address these risks and impacts. A gap analysis is also performed against administrative, technical, and management system requirements (of ISO 14001) and gaps are documented in a corrective action plan within the audit report. See the Monitoring and Review section for more details on corrective action plans.

Another practice undertaken by the company to identify and assess E&S risks and impacts is the development of a regulatory-required ESIA for the proposed ginning plant to be located in Tiefidougou. This ESIA, which was shared with IFC, is currently in draft form (dated December 2019) and is being reviewed by the authorities prior to being finalized. The major risks and impacts identified in the draft ESIA were for the construction phase (an increase in truck traffic bringing building supplies to the site potentially resulting in road accidents and degradation of the road, excessive noise and possible air pollution from earth moving activities) and those for the operations phase (also road degradation and possible increase in accidents, cotton dust emission from ginning, noise from machinery and risks of developing diseases due to dust.) The draft ESIA is disclosed along with this ESRS.

Lastly, all the three ginning plants are certified to the Cotton made in Africa (CmiA) standard, which aims for sustainable cotton production both in the primary production of seed cotton and its ginning. The most recent CmiA audit was conducted in February 2021, resulting in re-certification to the standard for all three plants, which is valid for 2 years. The report was provided to IFC for review along with the corrective action plan. CmiA focuses on smallholder production, excludes use of irrigation, the worst forms of child labor (as per ILO conventions 138 and 182), trafficking and bonded or forced labor of persons, prevention of freedom of association or collective bargaining, cutting of primary forest or other forms of natural resources designated by law or legislation (including Important Bird and Biodiversity Areas or IBAs, International Union for Conservation of Nature (IUCN) designations and Ramsar sites), use of certain pesticides (such as those listed on the Stockholm and Rotterdam Conventions, WHO Ia and Ib, etc.) and the application of allowed pesticides by untrained or young persons and pregnant women. As such, it complements the risks and impacts identification and assessment practices described above.  It further requires many sustainability criteria to be in place at the farm level and the ginnery as well as management criteria that must be fulfilled by the management entity (in this case, CIDT). These criteria align with many elements of the PS’s and include the need for policies, risk and impact assessment, management programs, implementation capacity, reporting on incidents, and emergency preparation and for monitoring and review and use of corrective actions as needed. See sections elsewhere in this document where further elaboration on the CmiA standard are made.

The combination of the scope of the regulatory assessments, the ESIA for the proposed new ginning operation, and the criteria to be met in order to achieve third-party certification to CmiA of both supply chain and primary processing sufficiently assesses the nature and scope of E&S risks and impacts associated with an operation of this kind and that is required under this Performance Standard. Whereas the company self-assessed their E&S risk and impact assessment practice as just over 3 out of a possible score of 5 using the IFC ESMS self-assessment tool, a review of actions that would have scored this practice at least at 4 (i.e. predominantly extending the assessment of the risk in supply chains, for example) are already being undertaken by CIDT. Similarly, actions that could be taken to further raise the level of performance of this important element, such as engaging with all stakeholders, are undertaken in part as required by the ESIA process and CmiA.

Management Programs

Based on various inputs, reviews and the certification process as outlined above the company develops and implements management programs to focus on the more significant risks associated with their operations, to close gaps and address required actions when needed, etc. For example, management programs are created to address findings stemming from the regulatory audits and CmiA audits. Based on discussions with the company, it is understood that they create timebound action plans to address such findings, that personnel are assigned to complete the tasks, and that budgets are earmarked to support required actions. Further, actions found wanting in one aspect of an operation are assessed in other locations (i.e., the other ginning operations) and a determination made as to whether improvements are needed at those other facilities. This approach was corroborated by the company when they completed the ESMS self-assessment, with their responses to questions around management programs highlighting such a process and/or practice. Again, the company scored themselves lower than it would appear they merit using the ESMS self-assessment tool. For example, practices associated with higher levels of performance, such as determining the root cause of issues that require addressing through management programs appear, based on what was discussed during the appraisal, to be in place and already part of the company’s practice.

Lastly, the Environmental and Social Management Plan (ESMP) developed as part of the ESIA defines the project E&S management program to be followed during construction and operation phases. In order to ensure this is implemented, CIDT will require the Tiéfidougou project contractor to abide by the ESMP as part of the contract conditions to ensure construction, operation and maintenance contractors are in line with the company’s policies and comply with the project E&S requirements. Examples of these include actions to be taken during construction to minimize noise, dust and impacts on soil and water resources, proper storage and use of hazardous materials, traffic management, matters related to OHS of the construction workers, waste management, etc.

Organizational Capacity and Competency

The company has instituted a Sustainable Development Department, which consists of a Head of Department, who is supported by three other officers namely in charge of; (i) Quality, Hygiene, Security and Environment (QHSE); (ii) Projects and Partnerships and; (iii) Social Responsibility of the company. The Head of the Department also acts as the coordinator among stakeholders for CmiA activities.  At the factory level, E&S is managed by the factory manager and their subordinate with oversight from the sustainable development department. This approach, discussed during virtual meetings, was also illustrated by the response to the ESMS self-assessment conducted by the company where they scored themselves quite highly, which also referenced the use of external experts when necessary. The head of the Sustainable Development Department reports directly to the Managing Director of the company.

Given the size of the supply chain, it is important to note the organizational capacity in place to interface with co-operatives and farmers who supply cotton to CIDT. CIDT does not own any fields and all the seed cotton processed at its plants are sourced locally, grown by such farmers. These farmers are organized into zones within the production area, and within zones into co-operatives (known locally as organisations professionnelles agricoles or OPA) ranging from 5 farmers to over 100 farmers. CIDT does not deal with farmers directly but rather through the co-operative’s management entity; latest figures show some 1500 co-operatives in the CIDT supply chain. The company has annual contracts with each cooperative; these contracts clearly state the requirement for farmers and co-operatives to abide by and apply the policies and standards of the company.

The company, with the support of these cooperatives, provides inputs such as seed, fertilizers and pesticides to the farmers and also conducts awareness programs regarding the proper and safe use of agricultural chemicals. They also provide information on good agricultural techniques. The management of the supply chain and support to cooperatives/farmers  requires significant resources; the company, therefore, has its own field officers known as ‘Conseiller Agricole’ who reside in the different zones and who, with the help of co-operatives, work with farmers on a daily basis. These field officers are trained in agricultural techniques to help better disseminate this knowledge to the farmers. For the 2020/2021 season, 148 Conseiller Agricoles were employed to support the farmers within 11 zones overseen by a supervisor in each zone. The ration of Conseiller Agricoles is approximately 1 for every 10 cooperatives.

Training

A list of training courses for staff was provided to IFC. The list included road hazard training and storage standards to be observed in the ginning plants, provided to its logistics staff. Training topics are chosen based on a review of data and information, for example, incidents and accidents and inputs and suggestions from staff. Actions deemed necessary following audits, and programs required to address these actions also contain elements around training and capacity building where appropriate. One such example was the program around better maintenance of equipment used to maintain ambient air quality in the ginning plants; staff responsible for doing so received training about better implementing those procedures as part of that program. New staff receive training on general E&S risks and impacts as part of their induction.

Emergency Preparedness and Response

CIDT has internal procedures in which responsibilities, instructions, and facilities for preventing and managing disasters and emergencies are provided. Each of the three existing factories has its own internal procedures, which have been prepared after carrying out a risk assessment of the plant. The risks covered under these procedures includes those related to fire, workplace accident including injury and exposure of workers to hazardous materials or pollution, incidents during transport of materials and that related to floods. The approach to addressing associated risks at the warehouses in detailed below.

In addition to the training courses listed above, the company provides instruction to its first responders/firefighting officers on fighting fires, matters of OHS in the event of an emergency including use of personal protective equipment (PPE) and providing first aid. Factory-wide fire drills are carried out annually, while every month, a specific scenario-based emergency drill is carried out at a chosen department.

Monitoring and Review

Regulatory assessments and findings from CmiA audits can generate corrective action plans (CAP) as noted above. The company provided those to IFC for the three main facilities i.e., the gins at Bouaké, Mankono and Seguela. Such CAPs included administrative and technical actions to be undertaken; the document provided to IFC showed those actions that had been completed and those in-progress. Example administrative actions include the need to obtain permits for on-site wells for all sites. Example technical CAPs for Bouaké include the need to control lint/dust laden air, including that from cyclones and the need for separate solid waste storage areas. All items for Bouaké were either complete or were in progress according to the summary provided to IFC during appraisal. Technical actions required of operations at Mankono were similar, with the addition of the need to provide ventilation in the pesticide storage area. This was also required of the Seguela ginning operation, as well as the need to meter water wells. Management reviews progress in achieving successful outcomes to these required actions. Compliance with these regulatory requirements will be determined by IFC as part of its review of this project, following commitment and prior to disbursement and is addressed through the inclusion of standard covenants in IFC’s investment agreements.

As part of the corporate EHS reporting efforts, the company publishes its EHS efforts and commitments in its annual report. Currently, however, no reporting is done for KPIs such as accidents, loss time injury (LTI), hydrocarbon spills, fire incidents, training, near misses and safety violations, energy consumption, water use, solid and hazardous wastes and GHG emissions. CIDT will monitor and report these KPIs and ensure appropriate benchmark indicators are established under its E&S monitoring procedure. This enhancement to monitoring is addressed in the ESAP (ESAP #2).

As noted in the project description, this investment will involve the construction of a new factory in Tiéfidougou for which land has been acquired in July 2019. The 20 ha of land required for this plant is located on the outskirts of the Tiéfidougou village and belonged to the village. As part of its monitoring activities around obtaining the land and complying with regulatory requirements such as entering into a legally compliant written agreement with the village, making payments to the village for the land, etc. the company reviewed the status of the fourteen farmers, residents of the village, who were farming peanuts, yams, and cassava rent free on the land prior to its being acquired by CIDT. This monitoring and reporting showed that CIDT compensated the farmers for the standing plants as per regulation and that the village provided the farmers with land so they could continue their farming activities on other land owned by the village. As part of its monitoring activities, CIDT carried out a post-relocation survey of these farmers to ensure they have acquired land to replicate their farming activities and therefore their livelihoods. As part of this review, the company had in place a mechanism to receive grievances, however none were recorded.

Note: Côte d'Ivoire has ratified 8 of the 8 fundamental International Labor Organization (ILO) conventions referenced in paragraph 2 of this Performance Standard.

Human Resources Policies and Procedure

As noted above, CIDT has prepared a draft HSSE policy, which will be implemented in all its plants (see ESAP #1). The company has also developed a social charter that speaks to prohibition of child labor, a gender policy, access to healthcare for workers and their families, prevention measures related to infectious diseases, and sensitizing farmers regarding the need for their children to be educated.  Other more specific HR policies and procedures are also in force (e.g., recruitment policy), copies of which were provided to IFC and are detailed in the sections below.

Direct employees are hired on open-ended permanent contracts (40% of the workforce), fixed term renewable contracts for a period of 6-12 months and short-term seasonal contracts for a period of 1-6 months. The latter category of employment is usually required during the harvest season. As of May 2021, CIDT had 857 direct employees, of which 9% were women.

All vacancies for the above type of employment at CIDT are advertised, interviews of the candidates are carried out and, if hired, each employee is provided with a written contract. Example contracts (e.g., for a welder, press officer and a driver) were provided to IFC for review. The contract details the salary to be paid, hour of works, annual leave, duties, and obligations of the employee.

The company also employs casual workers who are paid at an hourly rate or for a specific task during the four months of the harvest season. These casual workers regularly work for CIDT but do not receive a written contract; however, a record of attendance is kept for these casual workers. The company reported that this is standard practice in this industry, and that the labor law is not prescriptive on this issue. The lack of a written contract, however, was also highlighted by the CmiA audit. As per the ESAP, the company will explore appropriate, pragmatic ways to ensure that casual workers are made aware of their rights under Ivorian labor law (ESAP #3).

Working Conditions and Terms of Employment

CIDT has in place HR procedures for direct employees on hiring and onboarding (training) staff, matters around annual leave and the disciplinary mechanism that has been put in place. During the harvest season, the company operates on a 24 hours-7 days basis and has a 3-shifts system per day. Employees are required to work 40 hours per week, and any overtime worked more than the 40 hours is paid at a premium rate in accordance to the national law. Additionally, employees are entitled to one-and-a-half-days rest per week. Annual leave is provided at a rate of 2.2 days per month worked. CIDT will document the methodology for overtime calculation and payment in its HR procedures as per ESAP#4 and communicate this to its employees.  Further relevant sections of the document are referenced below.

Workers’ Organization

Employees are legally allowed to join worker’s unions as per the labor law in force in CDI. The latest CmiA audit reports that right to wage negotiations is recognized as fundamental by CIDT. Workers are represented by two unions, SYNTRAT-CIDT and SYN-LIT-CIDT. Membership in each of these two unions is free/voluntary and the report concludes that these organizations work actively to defend the material and moral interests of workers. The report further states that during discussions with representatives of these two unions, it emerged that there was a constructive collaboration with the management entity with which statutory meetings are also held every quarter. Recent outcomes from these meetings have included matters around the compensation of retired volunteers, the recruitment of all employees as permanent with at least two fixed-term contracts, etc.

Non-Discrimination and Equal Opportunity

The HR policies and practices include reference to sexual harassment, and the need to provide equal opportunities.  Confirmation of the implementation of this stated position was confirmed by the latest CmiA audit report that reviewed practices of hiring and promotion within the workforce. The report concluded that female employees receive the same compensation for doing the same work as male employees. This non-discrimination culture extends into the supply chain where the company has actively encouraged female participation in cotton production. Despite such measures, the participation of women remains low (with just over 3% participation in the latest harvest season).

Retrenchment

In 2018, CIDT offered a voluntary departure package to employees nearing the retirement age, which was taken up by 80 employees. The voluntary package was reported to be in accordance with the national labor law and provided medical insurance cover for the year 2018, payment for accumulated leave and contribution to the national pension fund and was developed based on recommendations of the authorities and unions. No future retrenchment is currently planned by the company which is undergoing an expansion of its cotton production process and the new plant is expected to increase the employee count by around 150 individuals.

Grievance Mechanism

The company has a grievance mechanism, which involves the employee informally approaching the direct supervisor to resolve the grievance. Employees also have recourse to anonymous complaint filing through suggestion boxes in the plants; as such, they are available to all workers, regardless of their employment status. If the grievance remains unresolved, employees may report the matter directly to management. CIDT will document its grievance mechanism in its HR procedures, to also include reference that it can be used to raise matters of sexual harassment, and will include response and handing timelines and tracking and recording all grievances in accordance to the requirements of PS2. The documented HR grievance procedure will be communicated to all direct employees and extended to all contracted/casual employees. This is addressed in ESAP #5.

Protecting the workforce

Child Labor and Forced Labor

The minimum age for recruitment for jobs at the ginning plants is 21 years old as per national requirements. Identification is required as part of recruitment and those under this age are not eligible for employment. With respect to those within the supply chain, the CmiA audit determined (in its last audit) that CIDT is aware of the worst forms of child labor, that it provided training and awareness sessions to its supervisory network (i.e. the Conseiller Agricoles), who in turn routinely sensitize farmers on the subject of child labor. It should be noted that the farms encountered within the CIDT supply chain are family-type farms and children do engage in light work such as thinning, weeding, applying fertilizers and harvesting but are not engaged in other inappropriate activities or those that would keep them from education. In conclusion, the audit determined that no case of a worst form of child labor was identified during the visits to the plots or encountered during the interviews with the producers.

There is no forced labor at CIDT.  With the exceptions of casual workers (see above) all those working for or on behalf of the company receive written contracts and employment is at will. The US DOL/ILAB app does not list cotton as a good associated with forced (or child) labor in CDI. Regardless, the company publicizes the prohibition of forced labor in production areas. Lastly, both forced labor and child labor are prohibited for cotton certified to the Cotton made in Africa standard. Farmers are audited as part of the company maintaining that certification; the most recent audit report concluded that there was no forced labor activities found in the CIDT supply chain.

Occupational Health and Safety

CIDT has a charter regarding health and safety and a more specific health and safety policy. The charter speaks of objectives around risk control, provision of awareness, knowledge and proper equipment in order to protect employees and other partners, suppliers and service providers, along with a commitment to compliance to applicable laws and regulations. The policy further stipulates compliance with applicable law and regulation, the need to manage risks (or eliminate them altogether) in the work place, through use of a management system and includes reference to suppliers, service providers or sub-contractors, requiring their adherence to the policy and using that as a criterion for their selection and assessment.

A combination of company driven assessments and those required by regulation are used to identify the hazards and risks within the ginning operations; those within the supply chain are assessed as part of the compliance to the requirements of the CmiA standard. For example, an OHS risk assessment, detailing all work areas in a ginning operation, was shared with IFC. This was created by a team including the QHSE manager, a factory (gin) manager, shift supervisor, company fire team leader, company nurse, two members of the Health and Safety Committee and a maintenance manager. It covers hazards and risks within the operations; entry/exit points of the operation, office/administrative tasks, the clinic, ginning, packaging the cotton, emergency situations, vehicle maintenance, hot work/working with energized equipment, driving, loading/unloading, etc. Risks are ranked and mitigation measures listed to be included in SOPs.

Results from the regulatory required audits highlighted the need for better practices around some aspects of OHS management. For example, engineering controls with regards to workplace hazards were lacking. Fall hazards, exposed moving parts (e.g., belts) were documented. Also, the need for better awareness and training of staff with regards to these hazards was identified.  The regulatory reference that requires compliance with such aspects was listed in the report and the company will have to address these shortcomings under law. As is noted elsewhere in this document IFC will review the company’s correction of actions included in the CAP following commitment and prior to disbursement as is required by standard covenants in IFC’s investment agreements.

Workplace air quality, noise and lux monitoring is carried out on an annual basis as part of national regulatory requirements. Plants are equipped with dust cyclone filters and dust collectors to reduce its dust emissions both indoors and outdoors. Measures such as humidification of the air and use of PPE by workers in those areas (for example, ear plugs and dust masks) are reported as being employed, however, the regulatory audit did find a couple of instances where hearing protection was not being used. The report added that such high noise areas would benefit from pictograms showing what PPE is required to be used by workers; that is addressed in the CAP resulting from the audit. Respirators are required to be used by those whose duties include assurance of phytosanitary standards (for example, in seed fumigation).

Each plant keeps a register where incidents, potential incidents and near misses are recorded. The frequency rates of workplace accidents across CIDT operations were recorded to be 22.89 in 2019 and 14.89 in 2020, while severity rates decreased to 0.32(2020) from 0.46 (2019). All workplace accidents are documented and investigated, and root cause analysis undertaken, and corrective actions proposed and implemented. An example completed investigation form, describing the nature of the incidents and detailing all such required actions, was shared with IFC. Information within these registers is used to target training, areas of improvement. All employees are enrolled in a medical insurance scheme, through which periodic medical check-ups are undertaken.

Workers Engaged by Third Parties

Eight contracted workers are employed per plant through a third-party employment agency for security services (see PS 4 below). The HR policies and procedures of CIDT are extended to cover the contracted workers, including access to the grievance mechanism.

Supply Chain

With regards to E&S risks in the CIDT cotton supply chain as contemplated in this PS (child labor, forced labor and significant safety issues related to supply chain workers), the company has put in place steps to prevent such from occurring and actively monitors its supply chain on an ongoing basis. For example, CIDT is certified to CmiA (that does not allow child labor or forced labor) and stipulates what chemicals can be used in cotton production (not allowing the most harmful WHO class chemicals to be applied). With regard to the latter, CIDT provides pesticides and fertilizers to its farmers mainly through its own warehouses in the cotton fields and those owned and managed by co-operatives. A small amount is also distributed through farmer-owned warehouses; going forward, this practice will be phased out as the company aims at having centralized storage facilities for better management. The warehouses are visited by the CIDT field officers once per week and by the production department at least once per month who inspect for proper storage practices and to make sure only allowable chemicals are found. The company also provides regular training to farmers on the safe use and storage of pesticides and fertilizers and appropriate disposal of empty containers (see PS 3 discussion below). As is noted elsewhere in this document, field agents make regular visits to farmers. As such, production practices are well known and observed. The most recent CmiA audit report confirmed the existence of good practices with regards to use of pesticides.

To reinforce sustainable practices along its supply chain, CIDT has established Environmental, Social, Health and Safety charters which covers its other suppliers and communicates the EHS commitments of CIDT. CIDT will ensure these charters include prohibition of child labor, biodiversity management, Gender Based Violence (GBV) and provide resources to create awareness on these issues among its other (non-cotton) suppliers. This is addressed in ESAP #6.

Resource Efficiency

Opportunities for technically and financially feasible and cost-effective measures for improving efficiency in CIDT’s consumption of energy, water, as well as other resources and material inputs are somewhat limited given the nature of CIDT’s business. For example, no water is used in ginning cotton and no irrigation is used in the supply chain. The vast majority of ‘wastes’ from ginning are already reused. However, and as noted above, the company will enhance its monitoring and reporting on its raw material use and operational performance (such as number of spills), including the use of available benchmarking, as required in ESAP #2.

With regards to inputs in its supply chain, soil quality is maintained through good agronomy, application of compost and organic fertilizers – with at least half of farmers interviewed in the latest CmiA audit reporting organic fertilizer application; erosion is prevented through use of ploughing with respect to slopes, etc. See below for measures used to reduce chemical inputs.

Greenhouse Gas Emissions

The main source of energy in the plants is electricity, which is sourced from the national grid for all the ginning operations. The amount of electrical energy consumed is a function of how much cotton is ginned. For example, a total of 6193 MWh of electrical energy was consumed in 2020. Butane is also used in the drying process of cotton and amounts to around 50,040kg per year.  In addition, an estimated amount of diesel 808,097 liters were also used to fuel vehicles, used mainly for the transportation of cotton.

Electrical power and fuel consumption contributed to 2,361 scope 1 tons of CO2e and 2,705 of scope 2 tons of CO2e in 2020. Currently CIDT does not track and monitor its GHG emissions. The company will develop a means to calculate its annual GHG emissions and use that information to seek ways to reduce its carbon footprint. It will also report on emissions and initiatives to reduce them in the Annual Monitoring Report submitted to IFC as part of its compliance to at-commitment requirements.

Water Consumption

The project is not a significant use of water. Potable water for use at the gins is sourced through the national water company, while each plant is also equipped with a borehole. The borehole water is kept as a firefighting reserve and, despite not being used as a source of drinking water, the quality is tested regularly as required by the national authorities. As noted earlier, no irrigation is used in the production of the cotton in the CIDT supply chain.

Pollution Prevention

Each plant is equipped with 1 aboveground and 2-3 underground diesel storage tanks. The storage capacity of these tanks ranges from 10,000 to 30,000 liters. This equipment is are checked and maintained by a third party. CIDT monitors and tracks the use of fuel under its control. At the new plant, CIDT will ensure any above ground and underground piping or storage is equipped with a secondary containment.

Wastes

CIDT operations primarily result in the generation of organic solid waste and dust emissions. A total estimated amount of 4,300 tonnes of solid waste consisting of cotton shells and fibers was generated in 2020 by the three ginning operations. This waste is redirected to the fields to be used as a compost and organic fertilizer. A small amount of medical waste is generated by the on-site clinics; also, used oils and lubricants from mechanical workshops. Both these waste streams are disposed of through registered waste collectors. Empty fertilizer and pesticide containers, including those generated by the farmers, are collected and temporarily stored in dedicated warehouses in the different agricultural zones, and ultimately disposed of by the national authorities, who have the required facilities for the disposal of such wastes.

Water is not used in the ginning process and hence no process wastewater is generated. A small amount of domestic wastewater is generated in the plant; this is disposed of through on-site septic tanks.

The regulatory audit found sub-standard practices with regards to solid waste management. The need to improve separation, disposal practices is addressed in the CAP developed in response to that finding. As noted above, IFC will review the company’s correction of actions included in the CAP following commitment and prior to disbursement as is required by standard covenants in IFC’s investment agreements.

Hazardous Materials Management

Oils, lubricants and other hazardous materials (HM) are stored and used in various locations within the ginning operations, for example, in the mechanical workshops. The regulatory audit found sub-standard practices regarding the separation of areas using HM from the stormwater drainage system. Again, this audit finding is addressed in the CAP.

Pesticide Use and Management

CIDT do not supply or make use of WHO Class Ia or Ib type pesticides; such a use is not allowed under the CmiA certification and is subject to verification during audits. Crop protection products are centrally purchased, stored until required for use and then transported in CIDT trucks to the respective production zones. Products distributed to co-operatives are logged by both the company and the recipients. All those involved in the storage, handling, and distribution of such products are trained to do so safely, according to the CmiA audit report. As noted above, field agents conduct regular training of farmers on the types of pesticides that can be used. Cotomence is used to fumigate seeds while in storage. Cotomence includes Thiram and Indoxacarb as active ingredients, which are both WHO Class II pesticides.

The company provides allowable crop protection products at cheaper prices than other, non-allowable products that may be found for sale in the region to further ensure that only allowable pesticides are utilized by farmers in its supply chain. Whereas no full-blown Integrated Pest Management Program exists, methods are employed to reduce the amounts of chemicals used (e.g. manual weed control, crop rotations (including some use of cotton, cereals and legumes rotations), varietal resistance to some pests, etc.) and only application of pesticides when threshold numbers of pests are observed. A current initiative involves educating farmers in the cultivation of soybeans as part of rotation to provide soil benefits and an alternative source of income.

The three existing plants are equipped with fire and electrical systems in line with local fire regulation and standards. Site-level Fire Safety, Emergency Prevention and Response planning is integrated in the internal procedures. The new plant will be designed and tested in accordance to the ASPAD (Assemblée Plénière des Sociétés d'Assurances Dommages) and MASE (management system for health and safety) standard which includes provision for Electrical installation and Life and fire safety.

CIDT employs security guards per plant through a registered third-party provider and some of them are armed at night. The company will develop and implement a Security Management Procedure which will include the conduct of a security risk assessment to ascertain the risks posed by its security arrangements to those within and outside its facilities. It will also include matters pertaining to the hiring, equipping, and training needs of security personnel to ensure all actions around the use of such personnel are aligned with the requirements and meet the objectives of this performance standard. This is addressed in ESAP #7.

Cotton transportation is carried out mainly via 15 CIDT owned vehicles and 490 contracted vehicles. Cotton seeds from the farms are collected at cooperative collection points within a radius of 40-60kms from the ginning operations and transported directly to the factory for processing. As for the finished product, 60% is sent to warehouses, some of which are leased from the CIDT parent company, to be stored for a period of 2-3 weeks prior to be sent to the port, while 40% is sent directly to the port via contracted trucks.

CIDT-owned vehicles are maintained by plant staff, while contracted vehicles are maintained by the owners.  The selection of contracted vehicles and operators involves a verification of the driver’s license and a general check on the maintenance/roadworthiness of the truck. The need to have a fire extinguisher on the vehicle is also checked prior to its being allowed to transport goods on behalf of the company. The company will enhance its oversight of the large number of contracted vehicles. They will require more thorough vehicular checks, track incidents and use benchmarks to manage the risks associated with the transport of seed cotton from the farming areas to the gins is minimized the greatest extent possible. This is addressed in ESAP #8.

For the leased warehouses used by the company, CIDT will develop a practice to conduct regular compliance audits to ensure that the storage facility meets the requirements of the life and fire and electrical systems as required by local fire regulation and standards and complies with the requirements of the CIDT HSSE policy. This is addressed in ESAP #9.

The region from which CIDT is purchasing primary production overlaps the Guinean forest-savanna ecoregion. The landscape is a mix of modified agricultural lands, including existing cotton production, and natural habitat of varying quality due to ongoing use (e.g., grazing, wood collection) and/or proximity to human settlements. The landscape includes 2 Key Biodiversity Areas (Marahoue National Park; Sangbe Mountain National Park), as well as other nationally classified forests. CIDT is thus purchasing from a region that could be at risk of conversion of natural and/or critical habitat.

CIDT has partially mitigated these risks via tracing and certification of primary suppliers against the “Cotton made in Africa” (CmiA) certification. CmiA, as part of a recent audit, recommended development of maps showing boundaries of proposed areas of cotton supply against sites of biodiversity risk as defined by CmiA (e.g., primary forests, some types of legally protected areas and internationally recognized areas). Development within some protected areas is also illegal and monitored regularly by government agencies. IFC Advisory Services are undertaking a project that will include digitizing and mapping boundaries of cotton sourcing areas in an effort improve productivity. Building on these ongoing mapping and monitoring efforts, the company will also integrate additional data to allow overlays of cotton sourcing areas with areas of biodiversity risk that consider (i) the full set of legally protected and internationally recognized areas considered in PS6; and (ii) natural and/or critical habitats (ESAP#10). In doing the company will have developed their own GIS system defining both legally protected and internationally recognized biodiversity important areas juxtaposed against their areas of cotton supply so as to ensure such areas are avoided. The company will also update relevant sourcing requirements as defined in the associated contracts to require avoidance of significant conversion of natural and/or critical habitats (ESAP#11).

Detailed discussion of CIDT supply chain

The cotton currently sourced by CIDT is from farmers who own and manage the land from which the cotton originates, organized into co-operatives. These lands are farmed by the farmers themselves and are located on land already in use for agricultural purposes, including to produce foods such as yam, peanuts and cassava as well as cotton.

CIDT can only source its seed cotton from small farmers in two zones designated by the government of Cote d’Ivoire, found in the central and northern parts of the country. One of the zones is exclusively reserved for CIDT; the other zone is a development zone adjacent to the exclusive zone, which can also supply other ginning operations.

Certification is predicated on traceability and requires auditing to verify appropriate production practices. As with any audit, however, only a sample of farms can be visited during the re-certification process. Therefore, to further ensure traceability, the company utilizes Conseiller Agricoles (extension agents/field officers) who are employed at a ratio of 1 per 10 co-operatives. These agents interact with co-operatives, whether it be over provision of inputs (seeds, fertilizers, pesticides, etc.) or information (on good farming practices); as such, they are fully aware of the location of the farms and the land under cultivation. Indeed, after the planting season, which lasts from around April to July, the company’s field officers go on site to physically verify each parcel of land that has been planted. The field officers use GPS equipment to measure the parcel area. The area of each parcel is noted along with the name of the farmer(s).  The area, farmer’s ID, the administrative zoning and sub-zoning, and, if applicable the village/camping site name, are recorded in a database, the GesPlan. The company’s field officers are in the fields daily and it is estimated by CIDT that each farmer is visited by these field officers no less than once every 2 weeks. Therefore, the company’s field officers know exactly where each field is located, hence it can be said the cotton is traceable to the level of the fields. And all farmers are put under contract, which includes clauses relating to compliance to the law, regulation, etc.

Additional activities are undertaken in the broader cotton sector in CDI with respect to protections of important biodiverse areas. For example, Intercoton (https://intercoton.org/ and listing both the EU and IBRD as partners) is a professional organization for ginning companies in CDI of which CIDT is a member. Intercoton works directly with farmers and supports them with training and mechanization. Intercoton also conducts research to help increase the productivity of cotton fields – aiming to raise production without the need for additional land. The data collected by CIDT in the ‘GesPlan’ is shared with Intercoton, which analyses these data to devise ways to better help farmers. Intercoton also conducts awareness in the national language on protection of sensitive and classified forest and prevention of deforestation.

The Ministry of Water and Forests of CDI has the statutory role in the protection of classified forest. CIDT reported that the representative of this Ministry regularly visits the classified forest to ensure farmers are not carrying out deforestation in the pursuit of additional production. Deforestation is illegal and thus farmers are prosecuted if their fields are found to be in prohibited areas. CIDT also has a policy to ban farmers that have been found to extend their fields into classified forests.

It is important to also consider the expected increase in the size of the CIDT supply chain as part of this proposed investment. For perspective, in 2020, the number of farmers supplying cotton to CIDT was 30,588, who cultivated a total surface area of 90,680 ha. As part of its planned expansion, the company is targeting to reach 43,000 farmers by 2028 with a total surface area of 120,000ha cultivated with cotton – an expansion of land under cotton and cotton farmers of some 30% from 2020 levels.

As noted above, farmers cultivate on agricultural lands that either belong to them or to their village. A resident of a village is given land free of charge for cultivation. In rare cases, farmers may opt to go to another village to farm thus incurring rental charges. The surface area cultivated by each farmer can vary from 2 ha to 30 ha. The farmers may practice rotating crops during seasons, especially if they feel they have not been able to make enough profit from cotton production alone. Most of the fields are located with 1 to 2 km of the village allowing farmers to stay near to amenities and reduce the walking distance to/from the fields. In some case, where the land is far from the village, a group of farmers, perhaps made up of one or two families, may establish a small camping area near the field and stay there for the season. These camping sites are mobile and move in-between harvest seasons. The aim of setting up these camping sites is again to stay within a 1-2 km radius of the production area.

According to CIDT, the target expansion will be reached in two ways: by the addition of land found within farms in the existing supply chain and the recruitment of new farmers. The process can be described as follows: At the end of the previous harvest season and in preparation for the next season, CIDT field agents visit the different villages in the dedicated zones and identify new farmers. New farmers are basically farmers cultivating other plants such as rice, peanut, yams and the like. Only farmers with land under cultivation can be involved in this process, which is facilitated by the co-operatives to which the farmer belongs. Potential new farmers and indicative areas for cultivation are identified and surveyed.  After identification of these farmers, CIDT carries out a rigorous sensitization of the farmers to shift to cotton cultivation and the field agents go ‘door to door’ delivering a sensitization program. The second option for increasing the amount of cotton supplied to CIDT is from farmers who are already supplying cotton to CIDT but have additional land under their care that could be converted from other crop production to cotton production. As such, either approach does not involve conversion of land from any other state – it is already under some form of agricultural production. Of course, all additional farms, and their farmers, will be subject to engagement by the extension agents and subsequently their involvement will also be governed by the CmiA certification. As such, the risk of land conversion, in a manner not aligned with the objectives of PS 6 is not judged to be significant. The practice of adding land to the supply chain will be reviewed carefully during IFC’s supervision of this project, should it become committed.