This is a Category B project as per IFC’s Policy on Environmental and Social Sustainability (2012). The key E&S issues include: (i) implementation effectiveness of PRAN’s and HAL/PDL E&S management system, including risk identification & assessment of construction contractor oversight for maintenance works; (ii) assurance of fair, safe and healthy working conditions, including key risks such as OHS, Gender-based Violence and Harassment (GBVH), and 3rd party workers; (iii) resource (energy/water) efficiency, GHG emissions, pollution prevention and control, storage of hazardous materials and management of solid/ hazardous wastes; (iv) community health and safety risks, including hazardous materials transport, life & fire safety risks, offsite emergency preparedness and response, and food safety management systems; v) sourcing of local (e.g. potato, cassava) and imported raw materials (e.g. (flour, sugar, milk powder, vegetable fat, resin, packaging material, etc.) and risks  of child/forced labor, significant OHS risks,  and risks of significant natural habitats conversion for the production of these raw materials.

PS1: Assessment and Management of Environmental and Social Risks and Impacts

Environmental and Social Policies. PRAN Group has approved a corporate environment, health and safety (EHS) policy in January 2022, which is adopted by all its companies and implemented at all facilities. This EHS policy covers all E&S risks and impacts of PRAN’s operations and is communicated to all workers, and other relevant stakeholders through displays. The company has established E&S management system certified as per ISO9001(Quality management), ISO14001(Environmental management) and ISO45001 (Occupational Health and Safety) across all its operations, including at HAL and PDL production sites. This ESMS is aligned with IFC PS1 requirements. HAL and PDL have adopted hazard analysis and critical control point (HACCP) certification for food safety for products manufactured at their facilities, along with Food Safety Systems Certification (FSSC 22000), British Retail Consortium (BRC) Certification and registration with US Food and Drug Administration (USFDA).

Identification of E&S risks and impacts. PRAN Group 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. The company also conducts annual identification of E&S risks in accordance with ISO14001, ISO45001, and ISO22000 standards. The company has established and maintain processes for identifying the E&S risks and impacts of its operations consistent with good international industry practice (GIIP, such as the WBG EHS Guidelines) and utilizing standards tools such HIRA (Hazard Identification and Risk Assessment) for workplace risk assessment. Comprehensive HIRAs have been developed for all production-related activities, with revisions being conducted at defined intervals. The company maintains legal registers separately for its facilities and the registers capture the key applicable permits and approvals (including Environmental Clearance, Factory License, Fire License, Waste Licenses, Safety Permits, etc.). The legal register includes information on the validity of each permit along the permit renewal calendar); both HAL and PDL operate with current and valid E&S licenses and permits. The Company maintains compliance with permit conditions and ensures regular reporting to regulatory authorities. There are no E&S related regulatory actions, show cause notices, legal cases against company operations.

E&S Management Programs. PRAN Group maintains certified management systems (ISO22000, ISO14001 and ISO45001) at HAL and PDL along with food safety and quality certifications (HACCP, BRC and USFDA). As part of its management system, HAL/PDL has developed Standard Operating Procedures (SOPs) for waste management, wastewater management, air emissions management, hazardous material management, chemical safety, EHS monitoring, emergency response, etc. in accordance with WBG EHS Guidelines (ref. General and Sector-specific, beverage and food production). Furthermore, a set of EHS KPIs, such as lost time injuries (LTI), fatalities, energy and water consumption, waste generation and EHS training hours, have also been adopted. These KPIs have been implemented at HAL and PDL and are regularly monitored.

Organizational Capacity and Competency. Pran Group has an EHS organizational structure in place with defined roles, responsibilities, and authority to implement the ESMS at Group and plant-level. The personnel with direct implementation role and responsibility for E&S performance have the knowledge, skills, and experience necessary to perform the work. The corporate EHS team comprises of a General Manager (Manufacturing and EHS), who holds overall responsibility for overseeing EHS at the Group level and duly supported by an Assistant General Manager responsible for E&S management system implementation and compliance. The corporate EHS team is supported by dedicated EHS Managers and Fire Safety Officers at site level and EHS members at individual shopfloor/department levels. The corporate EHS team consists of a General Manager (Manufacturing and EHS), who holds overall responsibility for overseeing EHS at the Group level and duly supported by an Assistant General Manager, tasked with managing system implementation and ensuring compliance. The corporate EHS team receives support from dedicated EHS Managers and Fire Safety Officers at the site level, as well as from EHS members from individual shopfloor/department levels. Supply chain management operates as a corporate function at the Group level and is led by a Chief Supply Chain Officer (CSCO). The CSCO is assisted by two Assistant General Managers (AGMs), with one responsible for overseeing the procurement of food-related items and the other managing the procurement of non-food-related items, such as labels and packaging materials. Each of these units, focusing on food and non-food items, is staffed by a team of 6 individuals, reporting directly to the respective AGM.

E&S Training. The company has developed a detailed training calendar and trainings on different topics (e.g. EHS, Prevention of Sexual Harassment, Worker’s grievances, Life and Fire Safety) are being organized on a regular basis. PRAN will sustain its collaboration with contract farmers engaged in cassava and potato cultivation at HAL, and with dairy farmers at PDL and continue to organize capacity-building sessions with an emphasis on its Supplier Code, sustainable farming, and animal welfare practices.

Emergency Preparedness and Response. The company has documented Emergency Response and Preparedness Plans (EPRPs) for HAL and PDL facilities, to deal with emergency scenarios, such as fires, hazardous chemical spills, toxic gas release. PDL has equipped one of its two operational units with essential gas detectors and alarm systems to promptly signal any ammonia release from the refrigeration systems. Additionally, PDL has implemented a response protocol for addressing accidental ammonia releases and prominently displayed crucial instructions at appropriate locations throughout its facilities. The EPRPs also outline specific procedures to be followed in case of climate-related incidents such as heavy rains, flooding, cyclones. Specific emergency response organization within the company has been defined with list of certified fire fighters, first aiders, etc. and external responders to be contacted during emergencies have also been identified. The HAL facility has a designated fire safety officer and is supported by a team comprising of 3 supervisors and 9 firemen; a similar fire safety organization is maintained at the PDL site, with a designated fire safety officer, supported by 10 firemen. At both HAL/PDL facilities, PRAN adheres to factory regulations by ensuring that a minimum of 6% of the total workforce are certified firefighters, with an additional 6% having received rescue training and a further 6% having undergone first aid training.

Monitoring & Reporting. The company regularly monitors E&S indicators linked with resource consumption (energy and water usage), stack air emissions and ambient air quality, drinking water quality, wastewater generation and quality of treated effluent, noise levels, waste generation and disposal, accident/incident records, first aid cases, lost time in injuries, labor compliances, grievance redressal, etc). Plant-level EHS Manager and Fire Safety Officer conducts internal audits on monthly/quarterly basis, while the corporate EHS Head organizes periodic meetings of all EHS personnel from PRAN production plants.  The E&S performance of each facility, including HAL and PDL, are discussed, and challenges/best practices are shared at Group-level. A management review is conducted annually during which senior members of the PRAN management are present. External audits are organized as per requirements of PRAN Group’s policies and management systems. Implementation effectiveness of EHS procedures during surveillance and recertification on E&S management system and food safety systems is also assessed. Benchmarking of resource efficiency against WBG EHS Guidelines (GIIP) was not undertaken at the HAL and PDL facilities. PRAN will develop and disclose its Sustainability Report at the Group level within the current or next fiscal year. As part of this process, monitoring metrics will be standardized through a thorough benchmarking exercise with GIIP, including WBG EHS Guidelines.

Supply Chain Risk Assessment and Management Systems. For its food manufacturing at HAL and dairy operations at PDL, PRAN sources respectively agro commodities like cassava and potato from the farm supply chain and raw milk from dairy farmers. PRAN also uses processed products at HAL and PDL, procured from local and international vendors, comprising of food as well as non-food (packaging) items. The procurement of food items includes sourcing sugar, flour, oil, and margarine from local suppliers, and purchasing sugar, flour, milk powder, vegetable fat, food raw materials, and beverage concentrate from international vendors. The procurement of non-food items involves sourcing of packing materials, resins, and films from local/international vendors. PRAN has established a supply chain management system (SCMS) and has adopted a Supplier Code that includes specific guidance for suppliers on prohibition of child and forced labor practices, occupational health and safety requirements, working hours, humane treatment, non-discrimination/non-harassment, freedom of association, ethical standards, etc. All PRAN’s third-party suppliers are required to sign the PRAN Code of Conduct and abide, on a voluntary basis, to its E&S requirements. PRAN has established a risk screening platform for supplier screening, selection, and performance audit check list against the Supplier Code. Awareness sessions are conducted to sensitize third-party suppliers against the Supplier Code while screening audits are regularly conducted to assess the implementation effectiveness of the Supplier Code and its performance (at least once in a year). These audits involved site visits to supplier facilities.

PS2: Labor and Working Conditions

As of December 2023, HAL reported a total workforce of about 7,726 employees, of which 3,723 were female employees; PDL had an on-roll workforce of 6,732 employees with 2,314 female employees; no contractual or third-party workers are reported to be engaged at HAL and PDL sites.

Human Resource (HR) Policies and Procedures, Working Conditions and Terms of Employment. Pran Group has documented HR policies and procedures adhering to national law, covering aspects such as recruitment, wages, working hours and overtime, prohibition of child labor and forced labor, sexual harassment and abuse, non-discrimination, freedom of association, etc. Appointment letters are issued to enrol workers at the time of employment and describe the working conditions and terms of employment. New employees receive induction training on HR policies and procedures. The company has also developed an employee handbook which is distributed to all staffs.  The company has in place a functional Human Resource (HR) Information System (HRIS) to address and manage HR and labor related aspects of the Company’s operations.

Workers Organization.  There are no staff unions at HAL or PDL. However, the company has developed a Freedom of Association Policy and does not restrict formation of employee unions. Worker participation committees (WPCs) have been formed that have representation of workers and management and are tasked to discuss and resolve workplace issues. The representatives of the workers in the WPC are chosen through an electoral process. The WPC meets on a monthly basis to discuss issues related to workplace and improvement of facilities.

Non-discrimination and Equal Opportunity. The company has a policy on Equal Opportunity which mentions about equal employment opportunities and no discrimination at HAL and PDL production plants was observed during the appraisal.

Worker’s Grievance Mechanism. The company has an internal grievance redress mechanism (GRM) which include multiple grievance intake points, such as in-person, grievance box to raise and address allegations including anonymously, if complainants so prefer, with provision of a Group and plant-level grievance committee. The grievances boxes have been placed in the worker changing rooms to allow workers to anonymously raise grievance without any risk of reprisal. The grievance redress committee meets on a monthly basis and discusses with the management on redress of grievances. Grievances had been raised in relation to quality of food, drinking water, nonfunctional appliances. The review of the grievance register at both sites indicate a total of 25 grievances being registered at HAL and 29 grievances at PDL in course of 2023. All grievances were reported to be resolved. The company has developed a Policy on Prevention of Sexual Harassment, and a specific anti-harassment committee has been constituted. The company reported of 3 cases of harassment both at HAL and PDL (related to verbal harassment) and were successfully address by the anti-harassment committee.

Protecting the Workforce. The company clearly indicates its commitment in respect of child labor and forced labor through its policies and employee manual. No instances of child labor or forced or bonded labor were noted during the site visits. In addition, during the recruitment process, screening of minimal ages is taken place.

Life and Fire Safety. HAL and PDL sites have valid fire license from Bangladesh Fire Service and Civil Defense Department (BFSCD). During the site visits, the facilities were noted to have fire detection, alarm and firefighting passive and active systems, fire hydrant, sprinklers (at warehouses) and fire extinguishers, manual call points, fire exit signages, emergency lights and public address systems. The emergency evacuation plan was displayed appropriately at strategic locations within the units. The firefighting equipment is subjected to periodic inspection and regular life and fire safety (LFS) training is provided for workers. Mock drills are organized at unit levels by associating with BFSCD, biannually. However, during discussion with the Plant Heads and the EHS and LFS teams at HAL and PDL facilities, it was assessed that the coverage and availability of the existing fire detection and suppression systems is not commensurate to the scale of the facilities and additional fire detection and suppression systems are required along with addition/capacity expansion of hydrant lines. The sites are reported to have conducted a detailed internal L&FS assessment to identify the specific gaps and have also prepared remedial plans for improving the quality of LFS infrastructure and systems. Accordingly, as per ESAP#2, PRAN/HAL/PDL will execute the remedial plans developed by the HAL and PDL sites to enhance coverage and efficiency of fire detection and suppression measures at their sites.

Occupational Health & Safety (OHS) Management. The company has established an Occupational Health & Safety (OHS) Management System certified as per ISO 45001 Standards at HAL and PDL plants. To evaluate the implementation effectiveness and performance of the OHS management system, the company conducts regular internal audits. The company maintains health clinics within its premises. In case of work accidents, workers are attended to by nurses and doctors at the clinics. In case of any major injury, workers are reported to the nearest Sun Health Care Hospitals (a PRAN Group entity). In the past 3 years, the company reports no fatal workplace accident or incident at HAL and PDL plants. The company maintains an injury register and tracker to document all injuries and accident/incidents that have occurred within the company premises. A review of the injury register for 2023 indicates 11 medical injuries, 3 first aid cases and 4 LTI (lost time incident) cases at HAL; at PDL there were 35 first aid cases and no medical injuries or LTI cases during the same period – most of them were noticed to be cut injuries, minor burns, slip, trip and fall, etc. and were treated at the health clinic. Loss-Time Frequency Injury Rate (LTIFR) in HAL and in PDL was recorded as 0.52 and 0 respectively which is below OSHA Industry benchmark for food manufacturing in 2021 (4). All accidents and incidents were analyzed by the EHS team to identify the root causes and the appropriate action plan to mitigate as a result. The company conducts regular OHS training, including fire and emergency preparedness training, and first aid training for its operational personnel.

During the site visits to the Cassava Starch Unit at HAL, it was noticed that there was a need to reinforce the use of PPEs amongst the workers on the shop floors and to enhance awareness among the workforce and augment supervisory oversight. The Company agreed to reinforce the use of PPEs by the workforce through further training and increased supervision. During the site visits at PDL, following gaps were noticed in respect of occupational health and safety, that will require PRAN to implement remedial actions as part of ESAP#3, (i) PDL operates two ammonia units within its facility, each containing storage tanks for ammonia. Any release of the toxic ammonia gas at these plants poses a significant threat to the nearby workforce (the locations are located within industrial zones and are sufficient away from residential areas, to create any adverse impact); while unit#1 has installed the necessary gas detectors with alarm systems to alert in case of ammonia release, the same was found to be missing in unit#2. Hence as per ESAP#3, PDL will ensure installation of appropriate gas detectors and alarm systems for the ammonia unit#2, subject to an external verification confirming the safety of the current ammonia detection systems. Additionally, targeted training programs will be arranged through external service providers to adequately prepare relevant personnel for handling emergency situations, involving accidental releases of ammonia gas. It was further noticed that PDL utilizes numerous refrigerated containers for storing of butter and other dairy products; however, all have not been equipped with necessary thermal sensors and alarms; therefore, as per ESAP#3, PRAN/PDL will ensure proper installation of temperature sensors and alarm systems for refrigerated containers operating at or below sub-zero temperature levels.

Supply Chain.  PRAN sources agro commodities like cassava and potato from the farm supply chain and raw milk from dairy farmers. PRAN also procures processed products for HAL and PDL from local and international vendors, comprising of food as well as non-food (packaging) items. The products procured for HAL include (i) from local suppliers in Bangladesh - sugar, flour oil and margarine, BOPP film, PET film, printing ink (ii) from international suppliers - flour (India), milk powder and vegetable fat (Singapore), food raw material (Hong Kong), resin (India, Qatar, China, South Korea, Dubai, and Singapore), PET film (India) and Injection Mold (Canada). The products procured for PDL includes (i) from local suppliers in Bangladesh - sugar, flour, and margarine (ii) from international suppliers - sugar (India and Singapore), flour (India), milk powder (India, Germany, and Malaysia), beverage concentrate (Singapore), resin (India), aseptic pack (India) and packaging material (Hong Kong).

PRAN's Supply Chain Management System (SCMS) and Supplier Code provide specific guidance on labor practices, occupational health safety, and ethical standards for suppliers. The company utilizes a risk screening platform and conducts regular audits, including site visits, to assess Supplier Code implementation. The company builds awareness among third-party suppliers regarding the Supplier Code.

HAL mostly sources cassava for extracting liquid glucose and potatoes for manufacturing wafers. HAL has been involved in contract farming arrangements with local farmers. HAL also sources processed mango pulp from PRAN Agro Limited (PAL - a PRAN Group company that has contract farming agreements with mango farmers). The number of contract farmers involved with the program includes 390 for cassava and 1333 for potato. IFC has been involved with PRAN Group (and specifically with PAL) in running an advisory program on ‘development and implementation of good agricultural practices (GAPs) for PRAN- RFL produce suppliers in Bangladesh’. This has built capacity within PRAN to adopt sustainable contract farming practices and align with PS2/PS6 requirements in relation to raw material sourcing. HAL signs one-year contracts with farmers and supports them with training to adopt GAPs and improve the productivity at their farms and the quality of their farm produce. HAL also provides farmers with agri-inputs (e.g. seeds, fertilizers) and arranges for interest free farm loans, if required; oversight is maintained through block supervisors who maintain regular contact with the farmers and regularly sensitize them on E&S issues, as per PRAN Supplier Code. HAL also organizes training programs for the contract farmers - in addition to technical sessions on GAPs. These sessions cover PRAN polices and Supplier Code, labor issues and compliance (specifying PRAN’s commitments on prohibiting use of harmful child and forced labor, preventing any form of discrimination, and  requirements around minimum wages and working hours, health and safety and environmental issues, discouraging the use of harmful chemicals, especially WHO Class Ia and Ib, growth hormones, etc.; HAL also maintains an inventory of all contract farmers associated with the program including details on farm locations and farmers contact information and can be effectively utilized to maintain proper traceability of the farm produce.

PDL has a well-established system for the collection of milk from the farmers at the village level and thus providing them with opportunities for generating additional income. One key feature of the supply chain development for dairy operations is the concept of “Dairy Hub” which comprises the establishment of a network of village level milk collection and chilling centers (VMCC) and the transportation of chilled milk to the plant through these hubs. PDL has set up 7 hubs covering 140 village level collection centers. The program has been running successfully for over 10 years and currently covers 1,6245 dairy farmers. PDL also focuses on increasing the farmers’ awareness and knowledge about dairy cow husbandry, such as health and hygiene of animals and improving the milk yields. PDL has instituted a dedicated team for this purpose (dairy academy team) comprising of 20 full time block supervisors, veterinarians, and other support staff. PDL organizes monthly training programs for the dairy farmers and has developed a specific training curriculum for this purpose; training records are being maintained with details of attendees. PDL has also developed an SOP for the VMCCs and maintains oversight through block supervisors, ensuring adherence to standard practices and ensuring animal health. A health card is maintained for each animal, including details of vaccinations provided. PDL has also developed and implemented an information system to track milk production from each farmer and the payments issued to them – this system enables PDL to maintain traceability of the sources of raw milk. Additionally, PDL also maintains detailed list of all dairy farmers involved in the program, including block - village details and their contact information.

PRAN’s Supplier Code and risk screening platform align with requirements of IFC PS2, but currently lacks provisions addressing the risk of significant conversion of natural and/or critical habitats, as stipulated in IFC PS6, particularly regarding sourcing of agro commodities in its supply chain. Therefore, in accordance with ESAP#1, the company will update its Supplier Code of Conduct with due inclusion of IFC PS6 supply chain requirements and strengthen its due diligence of its agro commodity suppliers by augmenting the traceability of contract farmers involved in cassava and potato cultivation at HAL through development of spatial mapping platform and improving monitoring/verification oversight against PS6 supply chain requirements. The Company will arrange for an independent verification to be conducted on an annual basis to verify the implementation effectiveness of the Supplier Code.

PS3: Resource Efficiency and Pollution Prevention

Resource Efficiency. HAL and PDL operations consume resources, such as electricity, gas, diesel, and water. Based on last year’s consumption (Jan – Dec 2023), the annual resource consumption covering the HAL production plant is 33.5 million (kWH) of electricity purchased from the national grid and 272 million (kWH) of electricity, generated from gas generator based captive power plant; 69.4 million cubic meters of gas; 60,269 liters (KL) of diesel and approx. 2.4 million cubic meters of water. The annual resource consumption for the PDL site is around: 0.7 million (kWH) of electricity purchased from the national grid and 91.5 million (kWH) of electricity generated from gas generator based captive power plant; 8.8 million cubic meters of gas and approx. 1.6 million cubic meters of water.

The company sources its energy requirements at HAL/PDL from national power grid power and from installed captive power plants with gas being used as the primary fuel. There is limited use of renewable energy at HAL/PDL, in the form of solar lights being installed along internal roads (~ 20 KW) at HAL. The company is planning for installation of 15 MW of rooftop solar at the HAL site (expected by 2026). The company sources its water at HAL/PDL from its licensed groundwater wells and the extraction is monitored on a daily basis. The water is treated in-house through filtration and softening for various industrial and domestic uses. In view of water intensive processes at PDL and as per ESAP#4, the company will conduct a source vulnerability assessment (SVA) study, in accordance with IFC PS3 requirements, and develop a water management plan (WMP) for the PDL facility.

The company is actively engaging in initiatives to enhance resource efficiency and energy conservation and reduce its waste generation and has adopted specific target for 2024 which includes (i) HAL site to achieve a 5% reduction in water consumption compared to the previous year, an 8% decrease in energy consumption from the previous year, and a 15% reduction in solid waste generation compared to the previous year; (ii) PDL site to achieve a 2% decrease in energy consumption from the previous year, and a 10% reduction in solid waste generation compared to the previous year. As per ESAP#5, the company will develop and implement specific improvement plans and assign adequate resources to facilitate the realization of adopted goals for enhancing resource and energy efficiency, as well as reducing solid waste at HAL and PDL.

Greenhouse Gases (GHG) Emissions. Expected GHG emissions from the Company’s operations are anticipated to be approximately 163,300 tonnes of CO2 equivalent (tCO2) (149,500 tonnes direct and 13,800 tonnes indirect) for the HAL site; and approximately 18,725 tonnes of CO2 equivalent (tCO2) (18,400 tonnes direct and 325 tonnes indirect). As part of GHG emission reduction strategies, PRAN is planning for installation of 15 MW of rooftop solar plant at the HAL site.

Air Emissions.  Air emissions from the Company’s operations are primarily from the captive power plants, diesel generator stacks and the boiler exhausts. HAL and PDL operate gas generator based captive power plants for generating power and also procures electricity from the national grid. Diesel generator sets provide backup power where required. HAL also operates 4 boilers of capacity 48 tons per hour, using gas as the fuel together with exhaust health boilers (10 Nos.) of capacity, 35 tons per hour; while PDL operates 3 gas boilers of 5 tons per hour capacity and 4 exhaust heat boilers of 4 tons per hour capacity. Ambient air quality and stack emission monitoring are conducted, and the available results reviewed during appraisal indicated overall compliance with national standards and WBG EHS Guidelines. As part of the ESMS, PRAN has established monitoring program for air emission in line with permit conditions wherein boiler and DG set stack emissions as well as ambient air quality are monitored regularly using independent, accredited, 3rd party laboratories at fixed periodic intervals.

Wastewater Treatment. Effluent treatment plants (ETPs) are available at HAL and PDL sites with secondary treatment for treatment of industrial effluent. HAL operates two ETPs with capacities of 1200 m3/day and 1800 m3/day, respectively, while PDL also manages two functional ETPs of 1400 m3/day and 175 m3/day. The effluent quality is tested regularly, and results showed compliance with national standards and WBG EHS Guidelines. Domestic sewage is disposed in septic tanks and soak pits; nonetheless, PRAN is pursuing plans to install sewage treatment plants at both sites. The designs are underway and post approval of the designs by the Department of Environment (DOE), the construction will be initiated.

Waste Management. PRAN operations generate electronic wastes, hazardous and non-hazardous wastes. The non hazardous domestic waste is disposed through arrangement with the local service providers while the recyclable plastic waste is transported to TEL Plastics (a PRAN-RFL Group company) for reuse in the manufacturing process of plastic and PVC products. PRAN’s companies handle limited quantities of hazardous waste (e.g. e-waste, cartridges, filters, used oil, chemical drums). During the site visits, it was noted that PRAN’s companies does not have dedicated hazardous waste stores at both HAL and PDL and the hazardous waste is being stored at the general waste store along with other wastes and scrap; PRAN’s entities have also not finalized an authorized vendor for disposal of hazardous waste. As per ESAP#6, PRAN’s companies will build dedicated storages with secondary containment at both HAL and PDL sites for storage of hazardous waste along with contractual arrangement with licensed third-party operators for disposal of the hazardous waste.

Hazardous Chemicals. PRAN handles hazardous materials (mostly food processing chemicals) which are transported, stored, and handled as per national regulations. The company has in place a Standard Operating Procedure (SOP) for hazardous chemicals; the SOP offer essential guidance for storage and handling of hazardous chemicals and for addressing accidental spills, aiming to minimize the potential harm to both human health and the environment. The company operates hazardous chemical storage facilities equipped with built-in safeguards in accordance with SOP requirements.

PS4: Community Health, Safety and Security

PRAN’s HAL/PDL production plants are located within established industrial zones and have been designed, constructed, and are operating in compliance with the national building and fire safety codes. The company has obtained factory licenses from the competent authorities for all its operations. The company has established regular infrastructure and an equipment safety related inspection regime in compliance with local factory regulations. All high-pressure vessels, lifting equipment, and other critical equipment are tested on a regular basis by competent authority as per national standards and norms. The nature of the HAL and PDL operations does not present significant safety and security risks to nearby communities. However, there can be impacts due to the movement of vehicles on the access road to the facilities. Transport is used for receipt of raw materials including agro farm produce and delivery of finished product. PDL maintains its fleet of insulated tankers for transport of the milk from the village milk collection centers to the factory; company vehicles are also used for delivery of the packaged milk to the distribution centers. As per ESAP#7, the company will develop a transport management plan which includes regular training of drivers on road safety and implement at HAL and PDL facilities.

Security Personnel. PRAN does not employ armed security guards at HAL or PDL. Security guards are appropriately trained to interact with the neighboring communities and workers. The company reports no security incident in the past involving security personnel and local community members at these two locations. The security personnel are also provided with training on basic safety, first-aid, fire safety and emergency response.

PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources

Supply Chain. PRAN sources agro commodities like cassava and potato from the farm supply chain for HAL. The farmlands used for contract farming at HAL are located on consolidated agricultural areas. PRAN’s companies (HAL/PDL) maintains an inventory of all contract farmers and dairy farmers associated with the supply chain program including details on farm locations and farmers contact information and can be effectively utilized to maintain proper traceability of the farm produce. As per ESAP#1, PRAN will strengthen its due diligence of its agro commodity suppliers by registering the traceability of contract farmers involved in cassava and potato cultivation (pertaining to HAL) and dairy farming operations (related to PDL) through development of spatial mapping platform and improving monitoring/verification oversight against PS6 supply chain requirements.

PRAN’s engagement at its HAL/PDL production sites with the neighbourhood communities is limited as these are located inside designated industrial areas. PRAN has developed a specific procedure for engagement with internal and external stakeholders (workforce, suppliers, contract farmers, regulators, communities, etc.). PRAN and its companies maintain regular engagement with the labor department and other regulatory authorities regarding regulatory compliance.