E&S Risk and Impact Identification. As per Chinese environmental permitting requirements, Anyou has commissioned qualified third-party technical institutes to undertake environmental impact assessments (EIA) of each of the four feed mills. The EIAs identify sensitive receptors, key risks and impacts, and required management and monitoring plans during pre-construction, construction, and operational stages to manage and mitigate identified E&S risks and impacts. Environmental, fire safety, and occupational health and safety (OHS) permits have been secured for each feed mill, which list and stipulate ongoing compliance with relevant national regulations and monitoring requirements. Anyou monitors its regulatory and permitting compliance status. There have been no known deviations or non-compliances at its feed mills in the past three years.
E&S Policy and Management Programs. Anyou has a corporate level EHS policy and Manual of Standard Operating Procedures (SOPs) which: (i) describes its overall EHS goals and objectives; (ii) delineates the EHS roles and responsibilities of all staff (from senior management to working level staff, such as electricians), departments, and subsidiaries, and their reporting lines and relationships, together with organizational charts; (iii) outlines 20 SOPs which cover key EHS risks at feed mill level, including mitigation requirements common to a feed milling operation (e.g. life and fire safety; dust explosion risks; workplace risk assessment to minimize injuries from contact with machinery moving parts; hazard point identification and risk rating procedures; electricity related risks and safety requirements); (iv) lists EHS related Key Performance Indicators (KPIs) and how they are utilized in day-to-day performance monitoring and reporting. The EHS policy and SOPs manual is applied to all Anyou subsidiaries, including the four proposed greenfield feed mills. Each facility, using the corporate policy and manual as performance-based benchmarks, develops finetuned EHS SOPs which are consistent with corporate level requirements, and which reflect local conditions. The Company has obtained ISO 9001 (Quality) and ISO 22000 (Food Safety) certification. The EIAs, Anyou’ EHS policy, and SOPs Manual (at corporate and subsidiary/facility levels) reviewed are materially compliant with IFC PSs and World Bank Group (WBG) Environmental Health and Safety (EHS) Guidelines.
Organizational Capacity and Training. Anyou has a dedicated corporate-level EHS department which directly reports to the CEO. This department exercises technical guidance and oversight of each regional office and facility as the latter implement feed mill-level EHS management programs. At each facility, the General Manager (GM) is accountable for meeting corporate-level Environmental and OHS performance targets. The GM is supported by a designated Environmental manager and OHS manager (supported by environmental and safety officers), and a facility-level EHS committee whose members consist of department heads. Across the Anyou Group, there are 180 professional environmental and safety staff directly involved in the EHS/OHS function, as well as dedicated food safety and human resource personnel. Linked to the above organizational structure is a detailed ongoing EHS training program with all staff required to attend various training modules, as per their roles/responsibilities and workstations. Knowledge uptake is verified through tests conducted at the end of training sessions, during day-to-day inspections of workstations, and at end of year annual performance reviews. Another important mechanism to facilitate ongoing learning are the internal Social Media chat groups at Anyou where EHS and operational staff discuss such topics as audit outcomes, effectiveness of corrective actions, and good industry practices, such as introduction of new energy efficiency technologies and equipment retrofits. The Company has shared its annual EHS training plan for 2022 which includes details on training content/methodology, intended attendees, means to verify knowledge uptake, and other relevant details.
Emergency Preparedness and Response Plan. Anyou’s corporate level EPRP plan, which is embedded into the corporate EHS SOPs Manual, is applicable to all facilities. The roles, responsibilities, and procedures for firefighting, evacuation, rescue, external communication, medical support, etc. are defined under various emergency scenarios (e.g., fire incident, dust explosion, OHS injuries), to ensure that all team members are fully prepared in the event of a emergency situation. Emergency drills are carried out at least twice every year, and required equipment and supplies are procured and regularly inspected/maintained.
EHS Monitoring and Reporting. Sector-specific KPIs and annual EHS targets have been included in Anyou’s EHS SOPs Manual (e.g., zero fire and/or explosion incidents, zero mortality, zero workplace related accidents, zero regulatory non-compliance, and improvements in lost time injury frequency rates (LTIFR) to monitor Anyou’s environmental and OHS performance). These are implemented at all subsidiaries/facilities. Using these KPIs and workplace’s hazard identification and risk assessment rating results, Anyou facilities monitor EHS performance closely on a monthly/quarterly basis with results linked to annual performance reviews of facilities, departments, and personnel. At the corporate and facility levels, EHS teams develop and utilize site-inspection checklists as a primary tool to carry out day-to-day EHS compliance monitoring on site. Such internal monitoring is supplemented by various EHS monitoring audits carried out by qualified external parties (e.g. L&FS site inspections by local fire departments; bi-annual waste discharge and air emission and noise level monitoring by external technical institutes). Anyou regularly organizes EHS cross-audits between its existing 35 facilities and departments, both as a monitoring mechanism and to share lessons learned and good practices to foster cross-learning between personnel and department.
Raw Material Procurement and Supply Chain Management. Anyou procures agricultural raw materials for its feed mills through a competitive bidding process as per its Procurement Manual; Tendering Procedure SOP; Procurement Monitoring SOP; and Supplier Management SOP. These are supported by a set of procurement procedural flow charts. A corporate Vice President (Procurement Department) is the overall responsible person, to whom the Director of Procurement reports. A procurement organizational chart within the Manual delineates the various functions and sub-departments who report to the Director, and their duties and responsibilities, and describes the roles of several corporate level procurement committees. The Procurement Manual also describes supplier identification, evaluation, scoring, and selection procedures and evaluation criteria, and procurement tendering procedures, and packaging and warehousing /storage management requirements.
Raw materials procured by Anyou for its feed mills comprise of (i) grains (e.g. maize, barley, wheat, from China, USA, and Ukraine origins); (ii) proteins (soybean meal originating from Latin American countries); (iii) soybean oil; and (iv) small volumes of nutritional supplements such as amino acids. Anyou procures these from a very large number of China-based agricultural traders of various sizes, who in turn procure raw materials from China and other origins, through other commodity traders/aggregators further up the supply chain. The soybeans in Anyou’s supply chain are by and large commoditized and also involve mixed shipments at various stages of the supply chain i.e. any given shipment lot arriving at Anyou may comprise a mix of commoditized soybeans from varied global sources. The trader entities that sell to Anyou include Chinese companies, such as COFCO, and the Chinese subsidiaries of global grain trading companies such as Bunge, Cargill, and Louis Dreyfus Company. Some of the soymeal and soybean oil are procured by China-based traders from soybean crushing plants based in China and overseas. A substantial percentage of soymeal is bought from the China-based trading subsidiaries of large global traders (Cargill, LDC, COFCO). Refer to PS2 and PS6 sections below for descriptions of potential supply chain impacts and mitigations.
