This is a Category B project according to IFC’s Policy on Environmental and Social Sustainability (2012), as the proposed project is expected to have limited adverse E&S risks and/or impacts that are few in number, generally site-specific, largely reversible, and readily addressed through mitigation measures, as described in the following sections. Key E&S risk and issues associated with this Project include: the Company's capacity and systems to assess and manage E&S risks and impacts associated with its operations and construction; provision of fair and safe working conditions; measures to conserve energy; L&FS and ERP; and stakeholder engagement and grievance redress including gender-based violence and harassment.

Identification of E&S Risks and Impacts Assessment:

The Group identifies and manages E&S risks and impacts associated with its operations per national standards and regulatory requirements. The Company has granted required approvals for both colleges operations including L&FS design and system and food safety from local governments. The Company prepared environmental impact registration forms for college buildings and facilities constructed in recent years following relevant government requirements. These forms summarize the key environmental impacts of the construction and the relevant environmental protection measures being taken. The Company will comply with government agency requirements and obtain approvals as per the national regulation for the construction of new buildings and facilities under the Project. However, there is no formal E&S due diligence (“ESDD”) procedure available. As part of ESAP 1, the Group will develop and implement a screening procedure vis-à-vis the agreed eligibility criteria and the standard operating procedure for conducting ESDD of potential investments against IFC Performance Standards (“PS”). As part of the screening procedure, the Group will assess the applicability of all these PSs for all the future developments under the Project to comply with PS requirement.

E&S Policy:

Edvantage has developed a Group employee code of conduct and ethics applicable to the Group’s operations setting out the rules, standards, and principles, however, there is no E&S policy in place. As part of ESAP 2, the Company will develop and implement a Group E&S Policy in line with IFC PS1.

E&S Management System and Program:

Edvantage has an E&S Management System (“ESMS”) in place covering legal compliance checks, identification of E&S risks and impacts, and implementation of EHS standard operating procedures applicable to the Group’s operations, generally in line with IFC PS requirements. Each college under the Project has procedures related to E&S management including safety management procedures, waste management procedures and emergency procedures to ensure campus health and safety in line with government guidelines. The Company formulated the notice on strengthening the prevention and control of COVID-19 pandemic on campus and conducts regular safe inspection and assessment of colleges under the Project identify potential safety hazard, enhance the risk prevention and control.

Organizational Capacity and Competency:

The Company has a Group level environmental, social and governance (“ESG”) working party which comprises core members of various departments led by Internal Control Director of the Group. The working party summarizes and reports the Group’s ESG performance to the management including annual ESG report. Each college has a dedicated management team with relevant departmental managers and officers assigned including construction and campus operations management, HR and L&FS to oversee various E&S aspects. As per ESAP 3, the Company will nominate a college level E&S coordinator to oversee and coordinate the implementation of the Group EHS policy and ESMS in each college under the Project.

Emergency Preparedness and Response:

The Company formulated a campus safety emergency plan, which stipulates all the colleges to: organize safety emergency drills on a regular basis; complete various emergency preparedness; and cooperate with rescuers to

deal with safety incidents. Each college under the project has various policies and ERP setting out detailed emergency systems including organizational structure and detailed guidelines to manage and deal with different emergency situations such as fire, safety accidents, food poisoning, riot, traffic incident, etc.

Monitoring and Review:

The group ESG working party monitors the Group’s ESG management and performance. Each college monitors all their campus operations and projects under construction, focusing on occupational health and safety (“OHS”), L&FS, and energy consumption. OHS monitoring during construction is supported by a specialized third-party company. Regular meetings are held between the third-party company and the relevant department to monitor the construction projects of each campus. All the canteens/stores at each campus are subject to regular supervision and inspection by local fire police and food safety department.

Edvantage has around 6,900 employees across all nine private educational institutions as of 31 August 2023, with a male-to-female ratio of approximately 40:60. Most of the workers under the Project are directly employed by the colleges. Huashang College has about 1,780 employees and Urban Vocational College has about 1,680 employees.

Human Resources Policies and Procedures:

The Company formulated an employee management system covering its recruitment, training, resignation, promotion, etc. and abides by all the applicable laws and regulations related to HR management. Each college has developed a detailed set of HR policy and procedures include the rights and obligations of the workers, working places, leaves, recruitment and employment, and terminations, etc. As part of the ESAP 4, Edvantage will update HR policies and procedures related to the campus operations under the Project in line with IFC PS2, including grievance mechanism and sexual harassment, as described in relevant sections below. Edvantage will take the relevant measures to supervise the updated HR policies and procedures adopted and implemented throughout the campus operations.

Working Conditions and Terms of Employment and Retrenchment:

All the employees including each campus under the project have a signed employment contract with the key employment terms and conditions include the job description, working place, duration of employment, salary and benefits, leave entitlements, welfare and social insurance, probation and notice periods, provision of trainings, etc. There has been no retrenchment occurred in the past three years nor planned at each campus operations.

Workers’ Organization:

According to the Company management, the Group respects its staff’s right to freedom of association (“FoA”) and being members of trade unions. There are labor unions in place at each college under the Project and the Company and all the full-time employees including teachers from both colleges have joined the union. As described in ESAP 4, Edvantage will review and update the policy and procedure of the colleges under the Project to align with PS2 requirements.

Non-discrimination and Equal Opportunity:

The Company is committed to build a diversified, anti-discrimination and resists any form of child and forced labor in strict compliance with law on the protection of minors, provisions on the prohibition of using child labor and other applicable laws and regulations. Non-discrimination and equal opportunity are described in the Company’s teacher’s code of conduct and in annual ESG report. However, no clear description about sexual harassment included. As described in ESAP 4, Edvantage will review and update the relevant policy and procedure to include a gender-based violence and harassment (“GBVH”) prevention and redress beyond the workers, covering students and others.

Worker Grievance Mechanism:

Edvantage has established a Group level whistle blowing policy. In addition, at each campus under the Project, employees can raise their grievances through a mailbox, e-mail and/or face-to-face meetings with relevant management or HR department. There have been no substantial complaints in the past three years. As described in ESAP 4, Edvantage will develop its worker grievance procedure for its employees, and contracted workers, as applicable. The grievance procedure will include but not limited to (i) resolution of all types of workplace concerns and grievances, including sexual harassment and GBVH, (ii) anonymous grievance channel and a fair redressal process, (iii) mechanism to ensure third-party workers to submit workplace grievance to seek resolution if their employer did not provide them with such mechanism.

Occupational Health and Safety:

Edvantage has a set of safety management regulations and guidelines in terms of fire safety, management of facilities and equipment safety, and campus sanitary management. The Group conducts regular safe inspection and assessment of all the campuses to identify potential safety hazard and to enhance the risk prevention. Each college’s departmental unit is in charge of conducting relevant trainings, supervision works and keeping records to ensure the safety work is implemented according to the relevant safety management regulations. There have been no major OHS incidents at any of the colleges in the past three years including work related traffic accidents.

Workers Engaged by Third Parties:

During construction of new campuses facilities, construction contractors is supervised by relevant departments in charge of each campus supported by a third-party company conducting safety supervision in line with national requirements. Each campus construction management team looks at various performance aspects of construction contractors including their labor practices through its procurement process, and regularly conducts its own inspections during the construction. Apart from the construction contractor, the Company employs third-party agencies to perform activities including, shop operations, waste management, security personnel, etc. These third-party workers are also selected based on the review process to comply with local governments and other legal requirements, as well as its policies and procedures.

Supply Chain:

The Company has a procurement management system to manage the Group’s suppliers in terms of customer classification, screening, information-based management and assessment to standardize the material supply procedures and strengthen the monitoring of suppliers. The procedure includes the purchasing of daily necessities, consumable equipment and teaching equipment. The Group checks the qualification certificates provided by the supplier such as certificates regarding its environment, health and safety and sustainability, e.g., green and environmentally friendly materials.

Resource Efficiency and Greenhouse Gas Emissions:

Edvantage has set group emissions reduction and water efficiency targets as followings: reduce 3% of energy and water consumption intensity by financial year 2024/25 and 8% by financial year 2029/30 compared with the baseline year 2021/22. Based on the available information, the estimated greenhouse gas (GHG) emissions from the Project, upon its completion, are expected to be about 40,000 tons carbon dioxide equivalent per year. The Company will report to IFC the GHG emissions of the project-financed facilities.

Energy Supply and Air Emissions:

Electricity is sourced from the national public grid for all the colleges under the Project. For heating activities and backup generators it is not expected to generate significant quantities of air emissions.

Water and Wastewater:

Water for all the college operations under the Project is sourced from local municipal water supply system. Drinking water for employees and students is provided through the water supply system and local third-party bottled water supply companies. Each college regularly takes samples to inspect the water quality and keeps relevant records of water quality inspection.

There is no process wastewater generated from the Project operations, other than for a cleaning process and for class lectures with testing chemicals. Such wastewater is separately collected and handled by the specialized third-party companies. Domestic wastewater from colleges operations is discharged to the sewage system.

Waste and Hazardous Material Management:

Each college has policies and procedures to manage hazardous/non-hazardous materials and waste including a system of appropriate handling, storage and disposal, which is consistent with the applicable national standards. Non-hazardous wastes are properly disposed of by third-party environmental sanitation service companies, including recycling wastes. Hazardous materials from colleges under the Project are expected to be limited including dry cell batteries, cleaning and experiment chemicals and electric waste such as LED lights, which are stored with small quantities, segregated and disposed in line with the legal requirement by third-party authorized companies.

Infrastructure and Equipment Design and Safety:

The Group has a fire safety management system pursuant to the regulatory requirements of fire protection law and a management system to ensure campus electricity safety. The design of each college buildings follows a good international practice on L&FS based on national standards of educational facilities. Each college under the Project has L&FS certificates from the respective government authorities and a set of procedures for fire safety describing actions to be taken as part of ERP. Regular fire drills and safety education conferences are conducted to all staff and students. The campus facilities that were visited, have maintained appropriate L&FS infrastructure and systems, such as fire extinguishers, smoke detectors, fire alarms, emergency exits and signs except some dormitory buildings observed no fire alarms installed. As per the ESAP 5, the Company will confirm that all buildings used for student dormitories have automatic fire alarm system in all areas, regardless of the size of the building, and as per ESAP 6, a suitably qualified L&FS professional will conduct a review, as part as project completion test, at the time of the L&FS systems testing and commissioning and will certify that the construction of the L&FS systems has been carried out in accordance with the accepted design for each building and facility under the project. As needed a corrective action plan with a time frame for implementation will be submitted to IFC, after the professional’s first review.

Community Health Safety:

The Company follows applicable laws and regulations on community health and safety including national law on prevention and control of infectious diseases, food safety law, regulations on the sanitary management of student canteens and other relevant laws. The Company formulated student dormitory management regulations including prohibition of inflammable, explosive and other materials that may harm others into the dormitory. The student dormitories are sex-segregated and female security guards assigned to the female dormitories; glass-breaking buttons installed each floor.

Security Personnel:

Colleges under the project are guarded with unarmed security guards from licensed private security agencies. Background screening checks including criminal records were conducted when hiring. Regular training programs are conducted for the security workers on the standard operating procedures for their job including life and fire safety emergency trainings.

  Stakeholder Engagement and Grievance Mechanism:

Edvantage developed a stakeholder engagement mechanism identifying stakeholders and the framework of engagement, describing various engagement channels. Edvantage also publishes its ESG report every year. (http://www.edvantagegroup.com.hk/en/index.php?m=content&c=index&a=lists&catid=17)

Edvantage has established a Group whistleblowing policy. While there are no official nor written procedures for managing complains, grievances can be lodged with via designated email accounts. There has been no public complaints nor litigations with respect to the Company’s EHS and safety performance in the last three years.  As per ESAP 7, the Group will develop a stakeholder/external grievance mechanism, including sexual harassment and child protection, and which is user-friendly for younger children and adolescents, including but not limited to stakeholders, students, interested parties, and nearby communities, with measures to address issues in a timely and effective manner.                                                 

 Contact Person: Mr. Brendan Wong

Company Name: Edvantage Group Holdings Limited

Address: 9/F, Admin Building, Guangzhou Huashang College, No.1 Huashang Road, Licheng Street, Zengcheng, Guangzhou, PRC

Email:  brendan.wong@edvantagegroup.com.hk

Phone: +852 3852 0822 (HK); +86 184 2068 4553 (PRC)