Identification of E&S Risks and Impacts Assessment:  The company identifies and manages E&S risks and impacts associated with its operations in line with applicable national standards and regulatory requirements, which includes business license, food safety and hygiene certificate, fire prevention scheme certificate. Risk identification and screening procedure for selecting new project sites including warehouses has been designed to align with regulatory requirements including legal compliance and L&FS requirements. According to local legislation, the company is not required to undertake an Environmental Social Impact Assessment (ESIA) for the project. The existing identification of E&S risks and impacts and assessment system is generally in line with PS1 requirements.

E&S Policy: GS25 VN has a Code of Conduct including a set of policies for internal working regulation for its operations. However, there is no E&S policy in place. As part of ESAP 1, the company will develop a corporate EHS Policy in line with IFC PS1.

E&S Management System and Program: The company has procedures related to E&S management including safety management procedures, waste management procedures and emergency procedures applicable to all stores and warehouse. The company also has a supplier management system including supplier assessment and review mechanism. All the corporate procedures are available on the company’s internal information system and accessible to all the employees and relevant documents shared with contractors. The company prepared COVID-19 response procedures to ensure employee health and safety in line with government guidelines (e.g. temp. checks, frequent sanitization, provision of test kits).

Organizational Capacity and Competency: The company has several departments to oversee various E&S aspects. The compliance and legal department, with three staff, performs supervision on compliance of the company’s standard operating procedures (SOPs), Code of Conduct and national regulations. Food safety requirements are managed by the quality control (QC) department with five staff including one manager position. Fire safety team reports to construction and maintenance department is in charge of fire safety management. At each store, the store manager is in charge of SOP compliance, food safety and fire prevention. As per ESAP 2, the company will nominate a corporate level E&S coordinator, to oversee and coordinate the implementation of the corporate EHS policy and ESMS.

Emergency Preparedness and Response: The company has emergency response procedures (ERPs) for the store and warehouse operations including responsibilities and duties defined for various staff and departments. The ERPs include fire, power outage, accidents, robbery and theft situations as well as provision of relevant emergency trainings.

Monitoring and Review: The company monitors all the stores in accordance with key performance indicators (KPIs) such as accidents and labor compliance (working hours, overtime payment, grievances). Each store manager reports to QC department and senior managements on monthly basis including food hygiene. Compliance monitoring and supervision with local regulations are conducted as duties of internal audit department and corrective actions are implemented as needed. All the stores are also subject to regular supervision and inspection by local fire police and food safety department.                                                 

As of March 2022, GS25 VN has 2,216 employees, out of which 202 work at the head office and 2,014 work at the stores. The part-time employees account for 50% of the total employees. The employee ratio is 34% male and 66% female.

Human Resources Policies and Procedures: The company’s HR policies and procedures are general consistent with IFC PS2 requirements, and include working hours, overtime limits and payments, annual and maternity leave, salary and benefits, social insurance, health insurance, accident insurance, and resolution of labor disputes. According to the company’s management, all employees exceed the minimum age of 18 years. Per the site visits findings, there is no forced or under aged labor practices. Going forward, as part of ESAP 3, the company will update its HR policies and procedures in line with IFC PS2 and prevailing national labor law (i.e., 2019 Labor Code) and regulations, including (i) the right to refuse overtime; (ii) overtime limits and define compensation scales for agreed overtime; (iii) employee grievance process including anonymous options; (iv) workplace sexual harassment including procedures for reporting, receiving,  reviewing, and responding; (v) define and exclude forced, or child labor; (vi) nondiscrimination and equal opportunity; and (vii) retrenchment.

Working Conditions and Terms of Employment: For full time employees, terms of employment and the rights and responsibilities of employees are formalized into employment contracts and communicated to all direct employees. For the part time employees, the contract is in a form of which outlines the basic terms of engagement. Employees are enrolled in social insurance, covering pension, unemployment, medical, injury, and maternity. In addition to basic salary, employees are provided with various allowances, including meal allowance, per diem, fuel, mobile phone, etc. Employees also receive annual health check. As per ESAP 4, the company will review and update the employment practices, working conditions and terms of employment concerning part-time workers and apprentices/interns to align with the prevailing national laws and PS2 requirements.

Workers’ Organization: As per Vietnamese Labor Code, workers have the right for freedom of association and collective bargaining. 20% of the employees are members of the labor union, all of them are full time employees. A collective bargaining agreement (CBA) was being developed in April 2022, covering working hour and rest hour, overtime, annual leave, insurance, salary and bonus, and allowances.

Non-discrimination and Equal Opportunity: There is no clearly defined policy on Non-Discrimination and Equal Opportunity. GS25 VN does not have a documented process for anti-sexual harassment nor any mechanism to receive allegations of sexual harassment in the workplace. Going forward, as described in ESAP 3, the company will update its employment policies and procedures to include non-discrimination and equal opportunity. In addition, the policy will include a zero-tolerance approach for proven cases of gender-based violence (GBV) or reports of sexual harassment and will include a mechanism for receiving complaints that protects the identity of the complainer, investigates the process based on a survivor centered approach, applying remediation in accordance with the HR policies and procedures and national regulations.

Worker Grievance Mechanism: Employees can raise their grievances through company website, face-to-face meeting, or by talking to HR department and/or Employer Branding team. However, there is no formal grievance process in place. As mentioned in ESAP 3, the company will update its worker grievance mechanism procedure which will be available for its permanent, part timers, and contracted workers, as applicable. This procedure will include steps to be taken by workers to manifest any concerns, engage in a mediation process, contact responsible persons, and provide timely feedback. The company will also reinforce the policy of confidentiality and non-retribution, along with ability to raise anonymous grievance.

Workers Engaged by Third Parties: No major construction activities are expected due to the project other than store and warehouse renovation/shop fit-outs which are developed by third party contractors selected. For warehouse management and delivery services, GS25 VN outsourced to CJ and subcontractors (security, cleaners, loading/unloading laborers). As part of ESAP 5, the company will develop a policy on minimum labor standards for labor engaged by third parties. This policy will set the standards expected for labor, OHS, relevant trainings including onboarding training/orientation and accommodation (if any) for screening, auditing and reporting on compliance with appropriate contractual enforcement processes. The company will undertake mechanism to monitor ongoing compliance of any third-party service providers.

Occupational Health and Safety: The company has developed and implemented corporate safety management procedures and incident handling protocols stating key operating principles and requirements for the stores and warehouse. Operational requirements include workplace safety and hygiene, provision of trainings and the use of personal protective equipment (PPE). All employees undergo annual health checks.

Regular OHS trainings including security, safety and emergency situations are conducted to all employees and parttime and fulltime store staff. All new employees are required to receive an induction training. There are no fatalities nor major incidents have been reported during the company’s operation over the past years.

There has been no significant health impact due to COVID-19 on the workforce at GS25 VN. The company approach has complied with the Governmental requirements, including regular monitoring of the workforce, and isolation protocols and no retrenchment conducted so far and/or it has been anticipated. 

Supply Chain: The company currently has about 100 suppliers which are divided into three categories based on food safety system certificate. The company provides regular surveillance audits to suppliers at least once a year. However, the company does not have a formal E&S screening process or a documented supplier Code of Conduct. Going forward, as part of ESAP 6 the company will establish a supplier Code of Conduct articulating its commitment to prohibit forced, or child labor and significant occupational health and safety risks; and a procedure to assess supply chain E&S risks for its primary suppliers. The company will monitor its primary supply chain on an ongoing basis in order to identify any significant changes in its supply chain and if new risks or incidents of child and/or forced labor are identified. If such risks are identified, the company will develop processes to prevent and remedy such practices including termination of contracts if risks are not adequately addressed in a reasonable period of time.

 Resource Efficiency: The company assesses its operations to ensure energy and resource efficiency. Some of the resource efficiency initiatives implemented include installation of LED lighting, waste recycling and fuel savings with efficient logistics arrangements. Based on data from the company’s energy consumption, a store consumes about 7,000 to 8,500 kW per year and total gross greenhouse gas (GHG) emissions at the end of 2021 is estimated to be about 600 tons of carbon dioxide equivalent per annum (CO2 eq tpa). The estimated GHG emissions from the project with the new stores are expected to be around 2,000 tons CO2 eq/annum.

Energy Supply and Air Emissions: Electricity is sourced from the national public grid for all operations including stores and the warehouse. No major air pollutant emission is expected from the company’s operations. Small amount of diesel oil would be used by the backup generators installed in the warehouse but due to annual consumption, it is not expected to generate significant quantities of air emissions.

Water and Wastewater: Water for all the operations is sourced from local municipal water supply system. The drinking water for employees is sourced from local bottled water supply. The annual consumption of water by a store is estimated to be about 10 to 15 m3. There is no process wastewater generated from the project operations, other than for store cleaning purposes. Domestic wastewater from store and warehouse operations are discharged to the sewage system.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

Waste and Hazardous Material Management: The company has waste management procedures to dispose waste and to manage expired/damaged items including a system of appropriate handling, storage and disposal, which is consistent with the applicable legal requirements. All the waste is collected for disposal by an authorized public service agency specialized in each type of waste. Hazardous materials is expected to be limited to pest control, cleaning and/or maintenance related chemicals, which are stored with small quantities, segregated and disposed in line with the legal requirement by third party authorized companies.

 Life and Fire Safety Management: The company has a set of procedures for fire safety describing actions to be taken at store and warehouse. All the stores and the warehouse obtain firefighting and prevention certification from the local authority. The L&FS requirement incorporates a routine inspection including condition of fire extinguisher, ensuring emergency exit pathways, and regular checks on electrical appliances. The warehouse and stores that were visited, have maintained appropriate L&FS infrastructure and systems such as fire extinguishers, smoke detectors, fire alarms, emergency exits and signs and sprinklers.

Fire drills are conducted at all stores and warehouse, and each drill is followed by an assessment of observed gaps with corrective actions. The fire safety team is responsible for the implementation of fire drills and safety trainings. There have been no major fire accidents in the past three years.

Community safety management: The company has a documented pest control procedure and food safety requirements to suppliers and ensures compliance with applicable national standards and regulatory requirements including food safety and hygiene certificate. The company does not own a transportation fleet and contracted to third-party transportation fleet operators. There have been no major traffic incidents reported in the past three years. As mentioned in ESAP 5, the company will update policy and monitor on labor and OHS compliance for third-party contractors.

Security Personnel: Some store premises are protected using contracted unarmed security while the others are using security of the university or residential apartment building, etc. These individuals work outside the store to protect assets including incoming supplies. The contract between GS25 VN and the security provider has stipulated basic labor conditions for the security guards including requirement for training and skills of the guards. Security personnel is also trained to assist GS25 VN in evacuation of people in case of emergency, according to the contract.  

Stakeholder Engagement: The company regularly engages with the public through marketing events, promotions, and other community initiatives. No local community has been significantly affected by environmental risks or impacts from GS25’s ongoing operations.

External Communications and Grievance Mechanism: There is a customer complaint handling procedure to address customer grievances and feedback. Channels to receive customer complaints are through customer services via on-line, hotline number, email, etc. The procedure includes the following steps with respective timeframe: receipt acknowledgement, categorization and sending to relevant departments for resolutions, resolution, response to customers, and following up with customers. There has no public complaints nor litigations with respect to the company’s environmental, social or health and safety performance, in the last three years.