Land Acquisition and Involuntary Resettlement (PS5), Biodiversity Conservation and Sustainable Management of Living Natural Resources (PS6), Indigenous Peoples (PS7) and Cultural Heritage (PS8) were not considered to be applicable as existing owned facilities are mainly located on previously undeveloped land and were acquired through willing-buyer-willing-seller transactions. There were no cases of involuntary resettlement or economic displacement, and the Company intends to follow this practice in future. TEG and Korca retail park are located in modified habitats (urban environment) and no cultural heritage, and no indigenous peoples are known to be present in the project area. Going forward, prior to any significant expansion or new development requiring land acquisition, the Company will conduct an E&S due diligence to ensure that risks and impacts, if any, will be adequately identified and managed in a manner compliant with IFC’s PSs 1-8. BALFIN’ corporate E&S management system (ESMS) will include these relevant screening procedures, as discussed under PS1 below.

This is a Category B project based on IFC’s 2012 Policy on Environmental and Social Sustainability given that project involves activities with potential limited adverse environmental or social risks and/or impacts that are a few in number, generally site-specific, largely reversible, and readily addressed through mitigation measures.

Key E&S issues associated with this project include (i) development and implementation of a corporate  ESMS and relevant procedures and plans, including internal capacity and staffing to undertake the operations in a manner consistent with IFC Performance Standards; (ii) fair labor and safe occupational health and safety aspects during the construction/renovation and operation of the facilities, including management of third party workers and COVID-19 contingency measures; (iii) life and fire safety (L&FS) and emergency response; (v) resource efficiency, potable water quality and waste management;  (vi) management and control of pest; (vii) tenant management; (viii) security management; and (ix) stakeholder engagement and community consultation.

BALFIN identifies and manages E&S risks and impacts associated with its operations through compliance with applicable national standards and E&S regulatory permits and requirements during design, construction and operational phases. In accordance with the Albanian regulations, BALFIN’s property development projects require the EIA which outlines potential environmental impacts and mitigation measures. BALFIN follows applicable national legal requirements for the design and construction, including the specifications defined by the municipal authorities and the national building code and the requirements of environmental, sanitary and fire safety authorities. The corporate project development and legal teams and Mane TCI are responsible for obtaining all construction and operational permits, including the environmental authorizations.

At corporate level, there is a series of HR policies and procedures, which are adopted and implemented across BALFIN’s companies, including TEG and the Korça Retail Park. However, currently, there is no overarching E&S policy defining the environmental and social (and occupational health and safety - OHS) objectives and principles at the BALFIN and TEG level, or a documented ESMS. At present, group’s responsibilities on EHS aspects are owned and managed by Mane TCI, who is accredited with ISO 14001 (environment), ISO 50001 (energy), ISO 90001 (quality) and ISO 45001 (OHS) certifications and has an established EHS Management System.

Under the proposed investment, as per ESAP#1, BALFIN will develop and implement an appropriate environmental and social management system (ESMS) commensurate with the level of risks and impacts associated with the Company’s business activities in line with IFC PS 1. The ESMS will include an overarching environmental and social policy specifying that the Company’s operations will comply with applicable laws and regulations, including those laws implementing host country obligations under international law. The management system will define a procedure for performance monitoring of key indicators to monitor and report on compliance with applicable national laws and standards and with IFC Performance Standards. Once established, the ESMS will comprise the following procedures: (i) corporate oversight  for E&S and OHS related regulatory compliance; (ii) E&S risk and impact identification, assessment and management for future facilities, including a screening procedure for land and biodiversity risks early in the site identification and selection process, (iii) waste management, (iv) occupational safety and health management, (v) contractor management; (vi) life and fire safety and emergency preparedness and response plan, (vii) security management, (viii) stakeholder engagement procedure including community grievance mechanism, and (iv) supply chain management. The screening findings will be merged into a consolidated Corrective Action Plan (CAP) and reviewed by BALFIN’s Board. BALFIN’s internal audit committee will track non-compliant items for management/Board follow-up.

As per ESAP#2, TEG and Retail Park will enhance and update its EHS related operational procedures and associated plans in commensurate with its operational EHS risks consistent with IFC PS1 requirements and relevant provisions of World Bank Group (WBG) General and EHS Guidelines. Once the corporate ESMS is developed, TEG and Retail Park management will review its procedures to align with corporate requirements.

According to the EPC contract for TEG reviewed by IFC, the sub-contractors are contractually bound to follow applicable Albanian legal requirements with regards to EHS. For TEG and Korca Retail Park projects, the construction EHS management plans have been developed by Mane TCI to address EHS potential risks, including storm water runoff management, waste management, traffic and transport management plan and job safety measures. As part of the corporate ESMS, BALFIN will also develop and implement a Contractor Management Plan defining their approach to manage the EHS performance of their contractors, subcontractors, and other third parties working for future developments (including solar rooftop project). The Contractor Management Plan will outline how BALFIN will manage project EHS performance during the different phases of the project and how it will monitor and report on contractor performance.

BALFIN has in-house professionals experienced in real estate development, and engages qualified design, architect, construction contractors and consultants to ensure the design and development of its properties’ compliance with legislative requirements and its own building standards. As per ESAP item #3, BALFIN will appoint an environment, health and safety specialist/coordinator with adequate technical knowledge of good international industry practice and defined roles and responsibilities at corporate level, whose responsibilities will include: developing and implementing corporate level relevant ESMS policies, procedures and plans; establishing processes and reporting lines to collect, analyze and report data and E&S related information, including construction related activities performed by the EPC Contractor consistent with IFC PS requirements.

TEG has a technical team which is responsible for day-to-day E&S operations and maintenance which comprises of engineers, LFS and OHS specialist and technicians. TEG is also supported by Mane TCI’s EHS team, especially with regard to LFS and OHS risk management and monitoring of its facilities. Furthermore, BALFIN has an internal audit program which includes periodic L&FS audits of its assets conducted by a qualified external L&FS consultant.

TEG has a process for emergency preparedness and response and evacuation plans, that include responsibilities in the event of emergencies, emergency notification system, actions to be undertaken by emergency teams and other employees. Further, this process is incorporated into the contracts with tenants and contractors, as also determined by national legislation. Emergency Preparedness and Response Plan (EPRP) trainings are provided to the staff and occupants twice per year and regular drills are conducted for staff and tenants. Mane TCI supports TEG operations and periodically inspects, verifies and confirms the level of preparedness for specific scenarios, and emergency drills are conducted on both a planned and ad hoc basis. As part of ESAP#2, TEG will update the EPRP, to adapt to the conditions of the TEG Extension activities (and future retail park developments), with the identification of potential new hazards, and include specific elements for the safe evacuation of the mall occupants (e.g., public, elderly, families with children, and people with disabilities), tenants and workers.

Currently, each asset has its own EHS monitoring system based on national standards and E&S regulatory permits and reporting requirements during construction and operational phases. As set forth in the ESAP item#1, BALFIN will develop and implement a documented EHS monitoring procedure, as part of the corporate ESMS, covering construction and operation phases of the assets. The monitoring procedure will include key performance indicators on OHS (e.g., accidents, incidents, lost time injuries, near misses), labor compliance (working hours, overtime payment, grievances), energy and water efficiency, solid waste management, and the implementation of management programs during construction and operations.

The Company’s existing supply chain screening or audits does not comprise of forced labor or child labor aspects. As per ESAP item #1, the Company’s procurement processes should be updated in line with IFC PSs to incorporate basic labor risk screening involving, at a minimum, child and forced labor. This might include (but not limited to) additional questions for supplier selection and evaluation as well as a supplier E&S risk analysis.

BALFIN Group employs more than 5.500 employees (female % 25). At the time of appraisal, TEG had six direct employees and 158 contracted employees mainly responsible for leasing operations, engineering and security (which are direct employees of ACREM). Additionally, TEG utilizes outsourced services for unarmed security for outside of the mall, cleaning and pest management. During the appraisal visit, the EPC Contractor had 25 employees at the project site, while its sub-contractors had a total of 59 staff on site. For Korca, at the peak time of the construction approximately 30 to 40 workers are expected to be on site and is expected to employ three to four workers during the operational phase. There are currently no migrant workers employed by TEG or Retail Park LTD. The workforce for construction and operation is anticipated to consist of Albanian nationals.

BALFIN has a formalized corporate level HR policies and procedures, related to hiring, onboarding, work schedule, compensation, training, annual leave, ethics code and grievance mechanism, included in their documented HR management system and applicable for all subsidiaries. All information related to the labor and working conditions are provided during the on-boarding procedure of all new staff.

The company does not prohibit the freedom to associate and workers right to form and join workers organization. The company policies encourage non-discrimination and equal opportunity for its on-roll staff, contract staff and contractor workers. The labor code of Albania forbids forced labor. The company and its contractors do not employ anyone under the age of 18 years and employee’s age is verified and recorded during the recruitment process.

According to the grievance handling procedure all employees are expected to direct their grievances either to their supervisor or HR. As per the ESAP item # 4, BALFIN will include in its HR procedures provisions for receiving and handling anonymous grievances from its employees and will provide access to its internal grievance mechanism for the 3rd party workers as well.

OHS performances of service provider companies (i.e., pest management, cleaning) are supervised by its facility managers. In addition to that, Mane TCI provides regular EHS trainings to both staff and contractors, along with personal protective equipment. TEG reported to have had no lost time incidents/ fatalities during the last three years, including contractor workforce. As part of ESAP#2, TEG will develop an OHS risk management and monitoring procedure for its operations.

The overall OHS obligations are included in the contract with the EPC Contractor, such as having its own OHS officers on site, and having staff that is properly trained, and equipped with personal protective equipment in accordance with the type of performed works. During TEG extension project, ACREM’s Project Manager and her team responsibility included daily site inspection and received a weekly report from the EPC contractor to monitor the compliance with the site safety plan and safety performance. The EPC Contractor also reported no workplace accident or injury for the last three years.

Energy efficient measures are considered at design stage of each asset as per the local regulatory requirements, with TEG implementing a 1-2 MW rooftop solar park as part of the TEG upgrade and refurbishment activities. Both TEG Extension and Korça Retail Park have Energy Performance Certificates with ‘A’ energy performance class in compliance with local regulation. Managed by Mane TCI, TEG has a Building Management System (BMS), with a specific focus on monitoring and control of heating, ventilation and air conditioning (HVAC). In addition, TEG has three back-up generators isolated in a protective casing, air handling unit (AHU), lighting and alarms.

Electricity is the main source of energy sourced from the national grid used in total of nine chillers at TEG, and there are no other major air emissions / pollution from TEG operations. BALFIN is planning to use chillers for Retail Parks as well. Total GHG emissions of the project are calculated to be less 25,000 tons of carbon dioxide equivalent per annum. Going forward, TEG and Retail Park facilities will monitor GHG emissions, using internationally recognized methodologies.

Water supply during construction and operation of assets is provided through the municipal network and domestic wastewater is discharged to the municipal wastewater collection network. The potable water quality measurements are conducted periodically by 3rd party authorized laboratory and the results are submitted to local authorities. 

At TEG, solid waste consists mainly of cardboard paper, plastic and wooden packaging, that is segregated at source and handed over to the local recyclers. Used fluorescent lamps and used oils (fuels and lubricants) are stored separately in special containers in compliance with the national legislation of Albania. The solid wastes and hazardous wastes are disposed by licensed contractors. Waste management practices are included in the tenant occupancy contracts.

TEG has one above ground diesel storage tank, with a proper bottom and secondary containment structures.

TEG outsources pest control/management to a specialized service provider. This company follows the local regulatory requirements and relevant EU Directives while performing the activity and storage of the relevant substances.

Based on the site-tour, Life and Fire Safety (L&FS) is generally well managed at TEG (the Extension will follow the same L&FS approach and standards), with designs of buildings and facilities in accordance with international and local regulations. TEG’s L&FS protection systems compliance to local and international standards were verified by a third party independent LFS expert. TEG has a 2-hr fire resistance structure, and has enough staircases, corridors and egress doors to manage the maximum potential population of the mall (3,000 people) at a given time. TEG has a L&FS fire detection and response system, with fire detection and alarms in all areas, as well voice paging systems to communicate messages to tenants, clients and own personnel during emergencies.

The fire protection systems are supported by a security control room using the mall CCTV system cameras and trained security personnel, emergency lighting systems, emergency power, and signage. The underground carpark has carbon monoxide (CO) detectors and associated ventilation system connected to the BMS, to activate ventilation fans in the case of fire, and avoid accumulation of the CO or smoke.

For the operational phase of the facilities, TEG has a well-documented set of fire safety procedures to be followed in the eventuality of a fire with trained personnel, regular inspections, and fire drills. The Company also has an ‘Operations and Maintenance’ program for the leased stores, as a part of the tenant occupancy contracts, including information relating to the L&FS systems, the frequency and procedure for inspections, testing and maintenance, and coordination with TEG in both normal conditions and emergency situations.

The emergency plan lay-out and designs of Korca Retail Park demonstrates that there is a fire separation wall between each of the four stores and the Retail Park will be fitted with a fire hose reel system, fire pumps and water reservoir tank, emergency lighting with emergency power generator, and illuminated exit signs. The two larger stores will have a main entrance, also used as the main emergency exit, and a secondary means of egress out of the back side of the building. The two smaller stores will have only one emergency exit utilizing the main entrance to the stores.

For TEG, BALFIN hires periodically an external qualified consultant/expert to perform safety and fire audits as part of their internal audit program, with the implementation of the recommendations monitored by Senior Management. Based on the site appraisal observations, some potential risks were noted, particularly in emergency corridors/exits and around the back of the food court providers e.g., evidence of smoking inside, housekeeping issues in emergency corridors and exits, unmounted fire extinguishers, and incorrect storage of flammable gas cylinders and drums.

As part of the ESAP#5, BALFIN will perform a L&FS risks assessment for both operational TEG and Retail Park to address mediation issues observed during the site appraisal. Additionally, the assessment will address if the Retail Park is required to provide a formal, separate and independent secondary exit from the two smaller stores. Furthermore, fire detection and alarm system will be developed across all areas of the Retail Park, particularly protecting main retailing zone of the four stores, the storage rooms, office and service areas. For future BALFIN developments (including Korça and future Retail Parks), BALFIN will develop a L&FS Corporate Design Manual, or L&FS ‘Master Plan’, to include accessibility requirements, as well as a maintenance program schedule of L&FS systems across retail parks.

BALFIN will conduct a review of the engineering design of the future Retail Parks at the time of the L&FS systems testing and commissioning and certify that the construction of these systems has been carried out in accordance with the accepted design and the L&FS section of the WBG General EHS Guidelines (ESAP#6).

The construction management plan developed by Mane TCI identifies the measures to protect the community during construction, specifically clear demarcation (with fencing) of construction areas, restricted access to construction sites, proper illumination of areas, provision of safety information to visitors, and information to nearby communities on managing, truck traffic, dust and noise during construction.

TEG has both direct and contracted unarmed security employees which are suitably trained and equipped with security sticks and pepper spray, which enforced by the local legislation.

As part of the local project approval process, the Municipality manages relations with stakeholders and public consultation meetings organized by the municipality. Similarly, community or other external grievances are routed to the Company via the Municipality. Although TEG has an ‘Information Point’, and social media channels and an email address whereby customers and stakeholders can submit their complaints, there is no documented procedure or feedback mechanism.

In light of the upcoming Retail Park developments, as part of ESAP #1, BALFIN will develop a stakeholder engagement plan at corporate level which will be trickled down to TEG and Retail Park and a formal Grievance Mechanism to receive and facilitate resolution of Affected Community concerns and grievances about the Company’s environmental and social performance. The Company should inform Affected Communities about the mechanism during the course of the stakeholder engagement process for its new projects.

Contact Person: Edlira Muka

Company Name: Balkan Finance Investment Group Sh.p.k

Address: Street ‘Papa Gjon Pali II’, Floor 11, ABA Center, Postal Code 1010, Tirana, Albania

Email: info@BALFIN.al

Phone: +355 44509250