This is a category B project in accordance with IFC’s Policy on Environmental and Social Sustainability. The company continues to operationalize its integrated EHSQ management system across operations - olive farms, oil presses, refinery, extraction, bottling and warehousing, and cosmetics manufacturing – in accordance with the requirements of ISO 22000, ISO 9001, ISO 14001, ISO 45001, organic farming and the IFC Performance Standards. E&S issues to be reviewed for the project include: i) QHSE management system development and implementation in new acquisitions; ii) labor and working conditions in Tunisia and, when applicable, Morocco, iii) unionization of workers in agricultural sector and gender issues in Morocco, iv) water sourcing in planned plantation expansion in Morocco v) further opportunities for water reduction and energy efficiency across all operations; vi) security arrangements in all countries of operations; vii) assessment of audits of olive suppliers undertaken by company against its code of conduct for suppliers, specifically on environmental issues, and how non-compliances are dealt with, viii) screening for biodiversity issues in the proposed expansion sites.     

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

For Disclosure

The scope of the current Quality, Health, Safety and Environment (QHSE) management system implemented at the Tunisia facilities and considered to be in compliance to the requirements of this Performance Standard, will be similarly implemented at the planned expansions in Tunisia and Morocco. As such, it will be expanded to include creation of and adherence to an overarching policy, identification of impacts, hazards and risks, design and implementation of management programs to address and mitigate key/significant issues, ensuring competency of those charged with its operations, monitoring and measurement of key issues and reporting to senior management on its effectiveness at those new sites. 

Policy

CHO has adopted a global QHSE policy which was last updated in 2019. The scope of the policy includes the requirements of the applicable management standards namely ISO 14001and 45001 and other legal, regulatory, and contractually applicable requirements (such as those from CHO’s customers). 

In addition to the Group-level QHSE Policy, every operational site (such as the extraction plant, soap plant, cosmetic plant, bottling plant, etc.) has a QHSE policy that describes the most relevant risks at that operation and includes objectives specific to those operations. The company also has a Sustainable Sourcing Policy, developed in 2017, which references a Supplier Code of Conduct.

Risk Assessments

Environmental and social risks are listed in a risk register for each facility under CHO ownership. For example, risks associated with the physical and chemical extraction plant at Chararda are described; also, for the soap processing facility, the physical extraction plant at El Amra, the oil press, the warehousing facility; risks related to food safety practices (as identified using a Hazard Analysis and Critical Control Points Program or HACCP) at the warehousing facility, the bottling units, the refinery, and the oil press. Assessments are governed by a procedure with an emphasis on food safety and good manufacturing/production processes; environmental risks are contemplated with a view to applicable law, regulation and 3rd party requirements and OHS risks identified in association with jobs involving handling materials and movements within the facilities, as well as equipment maintenance and other operational realities.

Detailed risk assessments are also carried out for primary suppliers in the CHO olive oil supply chain, including those engaged in farming and processing. At CHO, primary suppliers are defined as suppliers of raw material and packaging; therefore, suppliers of olives, olive oil, co-products and packaging material suppliers are assessed through risk assessment and suppliers’ selection and approval procedure. In addition, other suppliers to CHO are also subject to evaluation and assessment.

There is an emphasis on the risk assessment of food safety and good manufacturing/production processes.  In addition to the specifics of the food safety requirements, suppliers adhere to CHO’s code of conduct which requires compliance to CHO’s environmental, health and safety and social strategy while also referencing the need for compliance with applicable host nation laws and regulations. With respect to such laws and regulations, it is relevant to note that Tunisia has ratified the major ILO conventions, including those pertaining to child labor and forced labor.

At present, expansion elements in Morocco have yet to be fully defined, however, IFC understands that they will be limited to bottling, packing and distribution activities and that such operations will be subject to the company’s food safety management system, which considers aspects and hazards, in due course. This is addressed in ESAP #1With respect to the planned expansion of agricultural land in Tunisia, the company has engaged with the government agency that is providing land to the company. Operations to be located on these lands are the same as those currently practiced on the company’s existing agricultural lands and will be incorporated into the existing ESMS. The locations of the planned expansion were assessed by IFC, however, as part of this appraisal; see relevant sections of this document for more details. As stated in ESAP # 1, a land acquisition policy and procedure will be developed for newly acquired lands to screen against PS5 requirements as part of the ESMS.

Management Programs

Management programs are used to drive improvements and enhanced E&S performance in those areas of company operations that have significant aspects/risk elements that pose greater risks to workers, the environment or the safety and quality of the company’s products. Management programs have associated objectives, targets, and Key Performance Indicators (KPIs). Examples of such KPIs are developed for significant aspects, such as water use, waste management, matters pertaining to HR, etc. IFC’s Annual Monitoring Report (AMR) requirements are also considered KPIs. Likewise, customer requirements around food safety are used to indicate performance. KPIs are reviewed annually for continued relevance and are discussed as part of the quarterly management board meeting.

In addition to companywide KPIs, each CHO operation has developed its own set of KPIs. These are determined based on commitments made in the various plant-level policies. The policy commitment leads to an SOP or program which is required to have an indicator. Actions, review and scoring against the indicators then take place. Indicators may relate to regulatory requirements, customer requirements or other measures designed to drive performance and are subject to specifics around frequency of occurrence, performance levels, etc.

Organizational Capacity

The integrated QHSE function is led by the Head of the Department (the QHSE director) who reports to the deputy Director General of CHO. Currently, nine managers report to the QHSE director; the QHSE director’s assistant, one for Health, Safety and Environment, and one each for the cosmetic operation, the extraction plants, the Soccohuile unit, the bottling plant and refinery, the La Gazelle (bottling) operation, and the laboratory. These managers have Health, Safety and Environment (HSE) responsibilities depending on the nature of the operation they oversee. In addition, there are a further 10 individuals responsible for the quality elements of the integrated QHSE MS. Throughout the company, Human Resources (HR) are managed as part of the administration function (see below for more details on HR management).

The E&S performance of suppliers is overseen by the QHSE director, HSE manager, laboratory director and quality manager. Farming operations fall under the responsibility of the QHSE Director who oversees individuals responsible for the organic certification programs. All individuals responsible for E&S management and oversight are judged to be competent, based on experience, education, etc. For example, the director is an International Register of Certificated Auditors (IRCA) Quality auditor; the HSE manager is a qualified environmental health and safety internal auditor and trained to be a safety manager by the civil protection authority. The laboratory director is trained on sensory analysis and is a physio-chemical and sensory expert. In keeping with the use of competent individuals, CHO has appointed a similarly qualified QHSE team to be responsible for all aspects of QHSE Management System implementation for operations in Morocco. CHO will train the QHSE manager and officers to be responsible for all aspects of QHSE Management System for operations in Morocco; the team will report to the Group QHSE Director (ESAP # 2).

Training

Trainings are provided by qualified trainers employed within CHO GROUP, and through training sessions conducted by external trainers. Internal qualified trainers are determined within CHO based upon their experience in the group in a specific domain, and their qualifications attained through third party qualifying training programs. For example, by third party auditor training sessions and safety manager training as provided by civil protection authorities, Preventive Controls Qualified Individuals training sessions are used for those overseeing matters of food safety. The determination of the annual training plan is based on data and information collected through observations and review of a number if inputs, such as fire drills, incident reporting and corrective action plans, and the outcomes of internal and external audits. Subjects listed in the latest current training plan include ISO 45001/14001 requirements, chemical risks, proper use of PPE, working in confined spaces, working at height, evacuation in case of emergency, and other occupational health and safety risks. All training subjects in the training plan are reviewed and approved by senior management on an annual basis.  

Emergency Preparedness and Response

All CHO facilities have emergency preparedness measures in place. Information is annually provided to IFC on the number of fire drills conducted annually, the inspection and certification of fire detection and suppression electrical and mechanical systems and the inspection, refill/recharge of portable fire extinguishers. From year to year, CHO continues to implement these activities are conducted with adequate frequency across all CHO sites. Fire extinguishers found to be non-functional are replaced and any observations are recorded to enable tracking and closure before the next inspection takes place.

Monitoring and Review

The company has several internal audits and continues to consolidate its efforts regarding compliance with applicable requirements for E&S certifications, customer specifications, etc. in order to streamline its processes. CHO developed and implemented management programs to successfully complete the ESAP items agreed upon in the former investments with IFC in 2015; no additional actions were required under the 2021 investment. Under the new investment, CHO will develop a monitoring and review program for the new operations contemplated for Tunisia and Morocco (ESAP # 3).

Management review of the certificates held by CHO company subsidiaries takes place after each external audit. This is conducted prior to the expiry date of each certificate either on annual basis or every 3 years based on the schedule designed by the QHSE team. This is called the “Planification” schedule within CHO. The team annually fills out a form for the annual audits program that gets approved by management. Once each audit is completed, the outcomes are compiled and escalated to management for review and approval of outcomes and resulting corrective action plans including the training plan mentioned above.

In addition to the above requirements, CHO organic olive oil suppliers are subject to audit against food safety, quality and environmental and health and safety requirements found within specific organic standards to which the company is certified. The Sustainable Sourcing Policy contains aspirations with respect to promotion of organic olive oil farming/production. For example, the company is committed to improving their overall sustainable supply of their annual raw material purchases of priority ingredients. CHO continues to use blockchain technology, which is based on the IBM Food Trust platform. Such traceability allows a retail customer buying a Terra Delyssa olive oil product to scan a QR code on the product to see the farm where the olives were grown, which mill crushed them and where the oil was bottled. The Terra Delyssa product is grown without pesticides, which can be verified by the customer prior to making a purchase. Distributors and retailers can access additional information such as the laboratory test results for the product.

PS2: Labor and Working Conditions

For Disclosure

In 2022, CHO employed a total of 875 employees; 42% of the workforce were women. All were employed in Tunisia. Of the total workforce, 589 were employed in the processing of oil and other products; the remaining 286 were employed in the growing and harvesting of olives in the agricultural division.

Human Resources Policies and Procedures

The company continues to follow its HR policy (dated July 2017). The policy states its commitments to the applicable requirements of national and international standards, such as the United Nations Guiding Principles on Business and Human Rights, the core conventions of the International Labor Organization (ILO) - which are reflected in IFC’s PS2, the 10 principles of the United Nations Global Compact, as well as the Tunisian labor code and collective agreements applicable to their activities. The HR policy remains applicable to all employees, suppliers and contractors. To support the implementation of the objectives of the HR policy, a series of HR procedures have been developed. Details of and scope of such procedures are presented in the relevant sections below. The implementation of these collective measures leads to performance that is judged to be aligned with the requirements of this Performance Standard.

Working Conditions and Terms of Employment

The 2023 appraisal confirmed that new hires are provided with written contracts and are provided with information on their rights and responsibilities of the employee, referring to the Tunisian local labor law requirements in the HR policy, including disciplinary measures in the event of non-compliance with their contract. Upon arrival, employees are provided with a welcome booklet (that highlights environmental protection, safety instructions required hygiene measures, roles and responsibilities, etc.). Induction training includes general background about the company, components of the HR manual, contract and updated OHS training. As a next step, new hires are assigned to a manager or an employee with seniority in the same line of work for on-the job training and receive immersion seminars to learn more about CHO overall business.

Worker Organizations

CHO has a specific procedure entitled ‘Freedom of Expression’ which provides for worker organizations at CHO Group. The choice of joining unions within CHO is freely chosen by the company employees. Currently, 132 employees are members of the trade union Union Générale Tunisienne du Travail (UGTT). CHO employee representatives in these unions are selected through elections. The access of union representatives to CHO workers they represent is freely guaranteed. The company does not restrict workers from attending union meetings. Employees are free to meet and discuss workplace issues on site during scheduled breaks and before and after work.

Collective negotiations are conducted during meetings between the management of each site and union representatives to determine working conditions and terms of employment by joint decision. They also include the implementation and administration of any possible agreement that may result from Collective bargaining agreements (CBAs) as well as the resolution of other matters arising in the context of the employment relationship concerning the workers represented by the union. CBAs include matters of working conditions and annual salary increases among other employment aspects. These are then approved by senior management after being channeled through the HR manager for the development of a proposal for implementation. The plant manager of each CHO site is responsible to implement and abide by the working conditions and methods described in the collective agreement applicable to their site. The HR Director is ultimately responsible to ensure compliance with these conditions and the well-being of all CHO Group staff. 

Non-Discrimination and Equal Opportunity

The HR policy includes reference to the implementation of the recruitment procedure which utilizes a selection mechanism free from all forms of discrimination. A detailed definition of what could constitute discrimination is referred within the procedure.  Beyond prohibitive actions, the procedure also aims to promote diversity, including promotion of gender equality, thereby setting the framework for such to occur, noting that this is also subject to a KPI (see elsewhere in this ESRS document). The existing employee Code of Conduct will be updated to address Gender Based Violence and Sexual Harassment (GBVSH) in the workplace and included in induction training and annual refresher training for all CHO employees. (ESAP item # 4).

Grievance Mechanism

In addition to employee participation in interviews and continuous consultation within CHO to ‘check the pulse’ of the employees, there is an HR procedure that describes how complaints and suggestions are managed at CHO. The procedure allows for the receipt and follow up of both external complaints and suggestions (raised by members of the community) and those internally derived complaints and suggestions (i.e., from workers) through the company website. See Stakeholder Engagement below for a brief description around handling externally derived complaints. Internal complaints can also be received in staff suggestion boxes; this allows for anonymous submissions. The submissions received at each site are collected weekly from the staff suggestion box and recorded in a register. An example of the form used to record such was provided to IFC. The employees’ suggestions register for end of 2022 shared by CHO outlines that only one grievance was received from staff in 2022. The suggestion revolved around transportation of the employees to the company offices and plants during the COVID 19 Crisis. Each communication is examined by the HRD of CHO Group and the director of the site concerned. Follow-up is then carried out depending on the nature and seriousness of the complaint/suggestion through e-mail directed to the individual that raised the grievance. The grievance mechanism will be updated to have different channels to raise grievances including one for GBVSH and procedures for resolving in a confidential, survivor centered manner, as well communicating this through new employee induction training and annual refresher training for all CHO employees (ESAP #4).

Concerning gender and gender-based violence, the company will conduct gender-smart safety audit of the workplace, engage expertise to help assess the risks of sexual harassment in the workplace and gender-based violence in affected communities and supply chains. Within the grievance mechanism, CHO will provide an option for employees to make a choice about the person they speak to when reporting sexual harassment. The company will also identify dedicated focal point to receive reports of sexual harassment incidents and provide specialized training on how to respond to incidents of sexual harassment. CHO will also implement disciplinary consequences for perpetrators of sexual harassment and integrate into contractor management (ESAP # 5).

Protecting the Workforce

The HR policy contains references to the prohibition of child labor and the minimum age of labor is 18 years old, as provided for by the Tunisian labor code and international laws and codes. The company does have an apprentice program which allows those between 16 and 18 to be hired as an apprentice for certain non-hazardous jobs. There is a detailed definition of child /forced labor in the procedure along with what activities can be undertaken by such apprentices which is monitored as part of the annual audits of the key suppliers.

Occupational Health and Safety

As described above, CHO uses its QEHS integrated management system to identify and assess occupational health and safety hazards and risks at all its operations. The key driver to understanding and ultimately avoiding, managing, or mitigating job risks is the CHO corporate level OHS policy and its performance requirement to assess activities for inherent risk. Elements regarding assessment of hazards and risk, identification of control measures, determination of residual risk, definition of roles and responsibilities with respect to OHS, reference to legal compliance, conduct of root cause analysis, corrective and preventive actions, and the involvement of those most impacted by hazards and risks, etc. are all performed/conducted as part of this independently certified management system.

The company reported its Lost Time Incident Frequency Rate (LTIFR) for CY 2022 as 14 (based on the sub-set of 589 employees involved in manufacturing). Manufacturing at CHO involves not only food products, but also pomace oil extraction and manufacturing cosmetics. As was discussed in previous ESDD, there are different LTIFR reference rates for different economic activities – for example, tree nut farming (relatively comparable to olive tree production) is 11, oil seed farming is 9 and specialty food manufacturing is 6 – the direct comparison of the aggregated LTIFR number remains a challenge. Therefore, IFC updated the AMR for the 2021 investment; reporting since then showed a reduction in LTIFR to 3.7 from 15 reported in 2020 showing an overall downward (i.e. improving trend) trend.

Workers Engaged by Third Parties

Temporary or seasonal workers may be employed by CHO (such as during the harvest) and through third parties (such as truck operators for transport of finished products for export). Any third-party provider of such labor is subject to the requirements of the Code of Conduct and can also be audited to ensure that labor and safe working conditions meet the requirements of applicable Tunisian labor law and regulation and, as such, will meet the objectives of this Performance Standard. Third party service providers will be included under the contractor management plan (ESAP # 3)

Supply Chain

The supply of olives from lands not under the control or ownership of CHO, and other elements of the company’s supply chain (such as olive mills) are subject to the conditions and requirements detailed in the Supplier Code of Conduct (CoC). As was reported beforehand, this CoC is communicated to suppliers to require them to adhere to CHO principles concerning PS 2 aspects such as child and forced labor. In addition, supply chain workers are also protected by CoC and monitoring procedures, by identifying foreseeable risk in their workplace and the application of mitigation measures to manage this risk. Each CHO Group site monitors its primary supply chain on an ongoing basis to identify any significant changes that may occur. If new risks of child labor and / or forced labor are identified, the supplier is required to take appropriate measures to address them. The CHO Group also undertakes monitoring to avoid and eliminate any risk constituting human trafficking such as the recruitment, transport, transfer, accommodation, or reception of persons by means of threats or the use of force or other forms of coercion, kidnapping, fraud, deception, and abuse of power. This is observed by CHO QHSE manager during annual audit visits.

There are two types of assessments for suppliers at CHO; a supplier evaluation survey and a risk assessment. The former is shared each year with suppliers and is used to determine matters of E&S performance and as well as crisis management and food safety. The latter takes into consideration the local context of the supplier, including matters related to regulatory compliance and any issues the primary supplier may have with their suppliers (i.e. tier 2 suppliers to CHO). Summary information provided to IFC indicates that these practices are commensurate to the risks and impacts and in compliance with PS2 supply chain requirements.   

PS3: Resource Efficiency and Pollution Prevention

Resource Efficiency

Most of the power supplied to the CHO Group operations continues to be sourced in the form of electricity from the national grid. LPG and heavy fuel have been currently replaced by natural gas. Natural gas has replaced heavy fuel oil and LPG to fire some boilers used by the company (refinery, extraction site EL AMRA). Biomass, a by-product of the processing operation, is also utilized to generate heat energy or is returned to the olive plantation fields as organic fertilizer. This practice aims to reduce the use of natural resources and enhance efficiency of the company’s internal resources. The total volume of biomass used in 2022 was 27,105 MT; 28,660MT was used in 2021. Further, there is also a shift at the company to the use of solar energy in the fields (for pumping) resulting in overall more efficient utility management. Water is consumed in both the production processes and in irrigating the olive trees.

The operational practices that consume the most natural resources are monitored and subject to KPIs (as noted in PS1 section above). The company continues to apply resource efficiency practices to minimize the consumption of these resources while maintaining its commercial operations. Practices in place at the time of the prior investments, are still utilized. For instance, irrigation of the olive trees is still applied to closely spaced trees to minimize the amount of land required to supply a sufficient amount of olives. Night irrigation is practiced limiting losses due to evaporation. As is soil moisture monitoring in all fields/orchards to ensure that only water that is required to support growth and production of olives is applied. The situation where most of Tunisia’s agriculture relies solely on rainfall has not changed; this is still taken into consideration in CHO fields to ensure only appropriate supplemental irrigation is conducted. Conversion to sub-surface drip irrigation from above ground drip, as reported in the ESRS of 2020, has now been completed in 830 hectares and continues to be undertaken in conjunction with the planned maintenance of the irrigation system as a whole; such practices continue to result in a 30% reduction in the amount of water required following conversion to drip.

Water used in the industrial processes is still obtained from the municipal system. That is also metered, and the company is charged based on usage. Efficiency is promoted through specific management programs (such as process engineering) for this and other consumption, and opportunities for reductions and/or cleaner production are assessed using these programs and when planned upgrades of equipment are to take place.

Effluent from all but one of the operations is discharged to the municipal system. The one operation not tied into the sewer network – Chararda – treats its effluent on-site and re-uses it in the processing operation. Redesigning the process in 2018 reduced the volumes of effluent produced – this continues to allow for up to 95% being reused (such as in the boilers). The practice of safe disposal of the small amounts of effluent that cannot be re-used (such as that which exhibits high salinity that can corrode equipment) remains the same; these volumes are stored onsite, to be collected and taken to a municipal plant for final disposal. Amounts remain small requiring only 1 or 2 pick-ups per year.

Biomass – by-products of the processing operation – are used to fire the company’s boilers and reduce the need for additional fuel sources as noted above. Such residues from the pomace oil operation and olive cake are used in this manner.

Air emissions from the company’s boilers are subject to Tunisian regulation as well as those found in the IFC’s EHS Guideline limits. Regular maintenance is performed upon these boilers. IFC reviewed the latest monitoring data that showed compliance with both, except for the results of 3 sites that were found to exceed Tunisian regulatory limits for sulfur dioxide.  Based on those exceedances, authorities requested adjustments to be introduced on the boiler combustion systems and if possible, substitution to an eco-friendlier energy source. In response, CHO developed a corrective action plan for exceedances of sulfur dioxide levels observed in the 2022 air emissions monitoring. These actions included substitution of heavy fuels with natural gas.  An adjustment of combustion parameters has now been completed for all boilers and the results of air emissions for 2023 are in line with both Tunisian and WBG limits.

Ambient emissions associated with the use of hexane in the extraction plant are monitored and are within IFC’s EHS Guideline limits. Other considerations regarding the workplace ambient environment such as those related to noise, temperature and dust are monitored; data reviewed by IFC indicated compliance in general to norms in the EHS Guidelines and Tunisian regulatory requirements. Where exceedances have been observed, and other controls cannot be utilized to avoid the hazard, appropriate PPE is provided to employees as a mitigation measure such as using earplugs where noise exceeds maximum allowable limits.

Solid and hazardous wastes are subject to management and monitoring and measurement. Amounts generated are tracked and subject to KPIs (see reference under PS 1, ref. Monitoring and Review section).  Likewise, for the types and amounts of Hazardous Waste (HW) that are generated.

Greenhouse Gas Emissions.

Based on energy consumption data provided regarding use of LPG, heavy fuel oil and biomass (as used in the boilers), the total Scope 1 and 2 emissions from 2019 was 54,300 tonnes, where now it is only 5,800 tonnes with the 2022 energy and fuel consumption figures.  Hence, GHG intensity of the produced oil is observed to have dropped from 6.8 tonnes GHG / tonnes oil in 2019 to 0.35 tonnes GHG / tonne oil in 2022. The company will calculate its GHG emissions, to report to IFC on annual basis, along with progress on initiatives designed to reduce consumption of inputs generating emissions (and the use of benchmarks to compare efficiencies). 

In terms of environmental activities and events, CHO started the calculation and preparation of scenarios for reduction of carbon footprint for TERR DELYSSA products. The company also started the enhancement of olives value by improving Zero Residues of Pesticides olive oil exports.

Pesticides Use and Management

The company still uses the Integrated Pest Management Program (IPM) for its farming operations as was seen during appraisal in 2015 and reported upon in 2020. In addition, CHO’s organic farming production (as a percentage of its total farmed outputs) is increasing year by year. Supplier farms are required to comply with the regulations pertaining to the type and use of pesticides; compliance is checked by assessing pesticide residues in the CHO laboratory. As was reported in prior ESDD, application of pesticides is rarely required; insect pests that may occur in Tunisia continue to be limited to infrequent outbreaks due to the arid growing conditions favored by olive trees. Application, when needed, is therefore limited and targeted. All crop protection products (CPPs) that may be used remain approved by the Tunisian Ministry of Agriculture (and therefore by association to the standards of the FAO/WHO Codex Alimentarius, or Codex). CHO uses external contractors for pest control (rats, insects, etc.) in its processing operations as per the requirements of its food safety management system. These services are approved by the Ministry of Health. Monthly inspections continue along with the use of UV lights and traps to control such pests. The company maintains the MSDS of any pesticides used in these practices. 

PS4: Community Health, Safety and Security

Community Health and Safety

CHO continues to maintain certification to recognized international standards (ISO 22000, IFS, BRC) regarding food safety management system. This certification provides a good level of assurance that CHO’s products are safe for consumption and will not impact community health. In addition to certifications, the transparency found within the blockchain technology adopted by CHO for one of its premium products provides further assurance and confidence to consumers regarding the use of these CHO products.

The location of company operations has not changed; they are in industrial zones or away from human settlements which greatly reduces the chance of community health and safety risks and impacts stemming from such operations. Each operation has undertaken an assessment of risk as part of its integrated management system. As noted in PS1, emergency preparedness plans are in place should an incident occur; each is available to local communities in keeping with the requirements of the integrated management system.

Use of Security Forces

All processing facilities are located in industrial zones which greatly reduces the impact of project operations upon communities. CHO has traditionally used its own employees for the protection of the company assets. However, starting in 2019, they supplemented their own personnel with the services of a third-party provider for 2 of their processing sites (the bottling and cosmetic units); all other sites still only utilize CHO employees. Security at CHO is largely based on passive measures (walls, gates, etc.) which limits access to company property and provision of support should an emergency (such as a fire) occur. As such, security personnel receive training in dealing with such possible events, including first aid. Such training is provided by another external service provider along with how personnel can and should react to all situations, what is acceptable behavior in terms of response, etc. The company also employs an extensive network of closed-circuit cameras (CCTV) and utilizes other technology in providing a safe workplace, such as fire detection systems and unauthorized entry detection systems. Security personnel are not armed, and no security incidents were recorded between 2020 and 2022.

PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources

CFor Disclosure

CHO will continue to be involved in sourcing olives as input for its operations from its own land. The land used for olive tree plantations spans a total of 3,000 hectares that were previously utilized for agricultural purposes prior to acquisition by CHO. Under this investment, CHO III is planning to add over 1,200 hectares of plantation fields in Tunisia which are all greenfield. All existing or planned lands used for plantation fields are located within areas that have been zoned for agriculture activities by the government and are either owned by the company or leased directly from the state.

Olive plantations in Tunisia are located on consolidated agricultural lands and agricultural zoning; cultivation of olive trees is strictly regulated under Tunisian law. Additional expansion of olive plantations is to take place on existing agricultural and/or degraded lands rather than into natural/critical habitats, which are managed and protected under Tunisian law. IBAT screening has indicated the presence of El Gounna protected area within 14 km from new plantation plots to be acquired in Mahres. The company has indicated that there is a significant distance between the relatively small plots (5 and 30 hectares in size). Additional measures to eliminate impact on birds, if any, is the nonuse of machinery in harvesting olive and avoidance of nighttime operation.

In alignment with IFC PS6 and the overall approach to olive tree cultivation in Tunisia, CHO continues to select and locate its cultivation on suitable agricultural land, avoiding impacts upon biodiversity. To continue to manage their natural resources in a sustainable manner, CHO continues to apply good agricultural management practices and certifying their farming operations to indicate adherence to global and local standards. Some of these certifications include organic farming certification in accordance with the requirements of various organic standards by ECOCERT, including BIO-TN (Tunisian/European equivalent Organic Standard), NOP (US and Canadian organic standard), BIO-BR (Brazil organic standard) and JAS (Japanese Agricultural Standard for organic). CHO will continue to hold these certificates for its existing olive production sites and aspire to manage newly added land using the same standards.

For the bottling and industrial sites, some CHO facilities hold the certification for bottled virgin olive oil sourced from at least 95% original ingredients farmed organically. These companies continue to pass EcoCert biological inspection of olive oil which is held regularly to maintain certification. To maintain these certifications, CHO does not source olives from suppliers where pesticides are used, or conversion of natural/critical habitat occurs. In addition, CHO applies a mix between ISO 9001 standards for traceability purposes, Food safety standards as well as IFC Performance Standards they follow to cover the requirements of their own QHSE managements system. The company plans to extend such practices to the new plantations to be added to its portfolio under this investment.                  

 Mohamed WALHA / QHSE director for CHO Group/ CHO Company, Mahdia Road km 18, Sfax, Tunisia Walha.mohamed@cho.com.tn