This is a Category B project according to IFC's Policy on Environment and Social Sustainability (2012). Based on information reviewed by IFC, the proposed project will have limited adverse E&S impacts that are few, site specific, largely reversible, and readily addressed through existing mitigation measures and good international industry practices (GIIP). 

Key E&S aspects associated with the project include:

- the Company's ESMS to assess and manage E&S risks and impacts from its operations;

- management of labor and working conditions and occupational health and safety (OHS) policies and practices, including of contractors and subcontractors;

- management of project-related economic displacement of population; and 

- the Company's stakeholder engagement activities related to E&S aspects.        

Ecorodovias has a sustainability policy and strategy (see https://www.ecorodovias.com.br/sustentabilidade/estrategia-e-compromisso/), a corporate-level Sustainability Committee, and a robust ESMS, which is used as the basis for developing the ESMS of its Concession project companies such as EcoNoroeste. Ecorodovias is also signatory to the UN Global Principles. The CA requires that the project meets local regulations and IFC PSs, and that it adopts an E&S Policy and an Integrated Management System, including an ESMS aligned with ISO 14.001 and an OHS-MS aligned with ISO 45.001

The Company’s ESMS and related policies and procedures will be implemented by a qualified team of E&S specialists, supported by external specialized consultants and Ecorodovias’ corporate E&S team as needed. The ESMS will also include the establishment of a Local Sustainability Committee at the project level, involving local communities and stakeholders. Construction contractors that do not have their ESMS or equivalent are contractually obliged to follow the concessionaire's ESMS and related procedures. 

The CA’s package includes a preliminary E&S assessment (PESA) dated June 2022 (see Annex), which describes EcoNoroeste’s E&S obligations under the CA, and contains a description of E&S and permitting requirements, a preliminary high-level assessment of key E&S risks and impacts, potential mitigation measures, indicative terms of reference (ToRs) for additional assessment and actions plans (e.g. Resettlement Action Plan - RAP), Climate Change Risk Assessment (CCRA), Stakeholder Engagement Plan and Grievance Redress Mechanism (SEP), among others, all of which are based on IFC PS. The PESA also includes an indicative budget for E&S management.

The E&S information in the PESA can be used as a reference by the Company to commission the different types of E&S Impact Assessments (ESIA) and Management Plans (ESMP) required depending on the type of work and commensurate with potential E&S risks.  For road expansion and duplication, the Company will commission comprehensive ESIAs, while for rehabilitation and minor interventions, it will commission simplified ESIAs. The Company is required to complete the ESIAs and corresponding ESMPs, as well as the environmental licenses and other permits required prior to construction or each section in line with Federal Law Nr 6.938 1981) and law Nr 9.509 (1997).

The CA requires that the Company conducts a Risk Assessment (RA) and implements an Emergency Response Plan (ERP) to attend to emergencies such as fires, fog, accidents involving hazardous materials, landslides, and floods, among others.

The CA also requires that the Company: a) defines E&S key performance indicators (KPI); b) conducts annual audits of the ESMS and OHS-MS; b) commissions E&S audits against IFC PS bi-annually during the first three years and annually thereafter by a qualified External E&S Auditor (EESA); and c) conducts a monthly E&S Performance Evaluation (ADA – Avaliação de Desempenho Ambiental). 

As set forth in the ESAP, EcoNoroeste will develop an Integrated Management System (ESAP 1); ToRs for the EESA (ESAP 2); indicative ToRs for the different ESIA and ESMP processes required by the CA (ESAP 3); ESIAs and ESMPs for duplication and expansion works prior to start of construction (ESAP 4); and general E&S requirements for construction contractors (ESAP 5), all in in line with local regulations, IFC PS and EHS Guidelines.                                                   

EcoNoroeste is expected to involve a team of 18 engineering/construction employees, who are responsible for managing works and conservation, and the Company will have approximately a total of 400 own employees in the 3rd year.  The Company prioritizes local hiring.

Ecorodovias’ human resources (HR) policies and procedures are aligned with the local regulations and PS2 requirements and applicable to all its controlled concessionaires, including EcoNoroeste, and communicated to employees and third-party contractors through onboarding and periodic training programs The Company’s HR policies will include provisions for non-discrimination, equal opportunity, prohibition of child and forced labor, grievance mechanism, training, freedom of association, and gender-based violence and harassment (GBVH). The sexual harassment policy also applies to workers engaged by third parties. Recently, the Company has been implementing awareness campaigns against gender-based violence and harassment. The Company will have a workers’ grievance mechanism (‘Canal de Ética’) in line with PS2, which would be accessible to third-party workers. 

Ecorodovias’s HR policies guarantee freedom of association, in line with local laws. Most workers are represented by a state-wide union. The Company negotiates annually Collective Bargaining Agreements (CBAs), including workers’ rights and benefits.

The OHS-MS includes the identification and analysis of risks and procedures for activities performed by employees and contractors during construction and operation; procedures for work permits; personal protective equipment (PPE); and training program, among others. Employees receive OHS training in onboarding and periodic training, carried out by supervisory teams.

As described under PS1, the Construction Contractor’s labor and OHS management and performance assessment and monitoring procedures are regulated by the PAF. The Company´s field inspectors will periodically monitor all contractors. Additionally, as described under PS1 the OHS-MS will be subjected to annual audits and works will be supervised by the EESA.                  

As per its Sustainability Policy and ESMS, Ecorodovias’s concessions follow local requirements and GIIP to assess and manage project-related resource efficiency and pollution prevention aspects.  As described in PS1 above, the Company must conduct different types of ESIAs and develop the corresponding ESMPs in line with IFC PS and WBG EHS Guidelines and will cover all relevant construction and operation risks such as noise, soil and water contamination, chance finds, erosion, drainage, construction waste management, dust, etc.  Construction-related environmental control measures will be implemented by Construction Contractors and monitored by the Company.

Regarding key risks, such as noise, the Company must conduct specialized assessments and implement any required measures to achieve the noise standards required for the project. For more details see the PESA (Annex).

The CA includes a list of minor and site-specific environmental legacies from the existing operations, such as erosion, deposition of residues, and potentially contaminated areas, and as part of required the ESIAs processes the Company must reassess those legacies and implement the required measures to address all of them.

Ecorodovias has in place a Climate Change Strategy applicable to all its concessions that is based on three pillars: adaptation, mitigation, and compensation. About adaptation, Ecorodovias assesses the related risks and opportunities and identifies relevant measures to reduce such risks. In terms of mitigation, Ecorodovias implements resource efficiency efforts such as the use of ethanol instead of gasoline; studies for the electrification of its fleet, use of efficient equipment; use of renewable energy; and studies to improve the production of asphalt, among others. Finally, in terms of compensation, Ecorodovias compensates 100% of its Scope 1 and Scope 2 emissions through carbon credits.

As per the CA, the Company must identify the risks associated with GHG emissions, natural disasters, and climate change and adaptation opportunities, including those aimed at reducing GHG.  After the project becomes operational, the annual GHG emissions are expected to be approx. 2.500 tons CO2e.             

The ESIAs and ESMPs to be developed for the project described under PS1, will assess community health and safety issues and identify mitigation measures in line with PS4.  

One potential risk related to potential traffic accidents during construction works. As per Ecorodovias’ procedures, site construction management plans, including traffic management and safety, are implemented for each work front, including signaling, speed limits, and training.

Another risk relates to the influx of workers and the development of truck rest areas, which could lead to tensions with communities, gender-based violence (GBV), and sexually transmitted diseases (STD). To mitigate risks related to the influx of workers, the Company will disseminate and enforce its Code of Conduct with relevant measures among its workforce and construction contractor workers.

The Company is a signatory to the Program “Na mão certa”, an initiative of the Childhood Brasil, which aims at mobilizing governments, companies, and third-sector organizations to confront, in a more effective manner, child and adolescent sexual exploitation on Brazilian roadways. The project seeks to disseminate information on how employees, highway users, partners, and suppliers can act as protection agents for children and adolescents in the prevention and confrontation of sexual exploitation incidents.

The CA also requires the implementation of an Emergency Response Plan (ERP), as previously recorded (PS1), in accordance with Brazilian law and IFC PSs, which requires the company to assist and collaborate with the affected communities, local government agencies, and other relevant parties, to respond effectively to emergency situations. The client will disclose relevant information on the ERP and activities with affected communities, government agencies and other stakeholders.

The CA requires that the Company implements a Road Safety Program (RSP) for the concession.  This RSP includes improvements in signaling, road conditions, visibility, ordering of accesses, and communications program, among others. In any case, the project is expected to increase road safety due to the duplication of the carriageway, the construction of service roads, and pedestrian bridges in urban areas, among other measures.

The CA also requires that the Company implements a Security Management Code for third-party security providers based on IFC PS4 and relevant UN guidelines.                                                   

The project is located in the Alto Paraná Atlantic forests and Cerrado Ecoregions (WWF), in a landscape characterized by a predominance of modified and degraded habitats associated to agricultural and urban land uses, with scattered remnant patches of Natural Habitat consisting mostly of secondary growth Atlantic Forest, gallery forests and marshes along riparian areas, and patches of Cerrado (savanna).

Land use baseline information has been assembled by the Client in consultation with State environmental authorities and research institutions. The project footprint on Natural Habitat (from road duplications, additional lanes, intersections and other road works) is estimated as approximately 36 hectares. Habitat loss compensation as required by national and state legislations is anticipated to meet PS6 No Net Loss Natural Habitat requirements.

The project’s ESMS includes the implementation of programs aimed at: the control of contamination risks and emergency procedures; management of solid residues and water quality monitoring; protection of fauna and flora, through rescue and minimization of footprint; prevention, control and monitoring of erosive processes; and wildfire control. According to the CA, the client will conduct monitoring studies to identify fauna roadkill hotspots and address eventual need for fauna passages.

The project intersects areas pertaining to the Atlantic Forest Biosphere Reserve (UNESCO MAB).  As per ESAP 9, the Concessionaire will engage with stakeholders of the Atlantic Forest Biosphere Reserve to agree on efforts to promote the conservation aims of the MAB, as appropriate, with a focus on neighboring protected areas.   

Stakeholder engagement and consultation between 2021 and 2022 were part of the structuring of the concession and included: availability on the regulatory agency's website (www.artesp.sp.gov.br) of the draft contract, annexes and appendices related to the concession, for more than 60 days (October 30, 2021 to January 10, 2022); public hearings held in October 2021 in which participated representatives of public authorities, impacted communities, the press, social groups, among others.

Throughout the concession, at each ordinary revision cycle of the CA, the company must conduct a consultation process and public hearings on consolidating demands for investments, expansions and improvements to the road system, including E&S aspects. The process should allow interested parties to evaluate the compiled demands and suggest new investments and improvements that should be considered for eventual adequacy of the investment plans.

The CA requires that the client implements a Stakeholder Engagement Plan (SEP), including procedures for disseminating E&S-related information during the duration of the life of the concession. EcoNoroeste will develop a SEP, including a Grievance Redress Mechanism (GRM), in line with Ecorodovias’ guidelines, environmental permitting requirements, and IFC PS 1.

Information about the project will be disclosed through the information channels used in the group's operations: periodic meetings with communities and public authorities, disclosure on the website, and social networks. The Company will implement the GRM and establish communication channels with communities, through telephone, email, WhatsApp and individual dialogue, and will disseminate it to the project-affected communities in a broad and culturally appropriate way.

The company will conduct detailed stakeholder engagement and consultation as part of the different ESIA processes in line with local regulations and IFC PS1, as required by the CA and will take into account community feedback and concerns for the development of the ESMPs.  The Company will also conduct more focused engagement with people affected by land acquisition and resettlement as described under the PS5 section above.

The CA requires EcoNoroeste to present annual report to the affected communities, addressing aspects of the Concessionaire's actions to meet the IFC PS, as well as other project E&S KPIs.

Ecorodovias and its concessionaires based their social management on ISO 26000 for social responsibility. Ecorodovias publishes annual Integrated Reports based on Global Reporting Initiative (GRI) standards, including information about the E&S performance of its concessions (see https://www.ecorodovias.com.br/wp-content/uploads/2022/12/20220815102144904-Relatorio-Integrado-EcoRodovias-2021.pdf).

Finally, Ecorodovias implements a voluntary Community Investment Policy (Politica de Investimento Social) in all its concessions, which include the creation of Local Development Committes to discuss and agree social investment programs with local communities.

As outlined in ESAP Action 10 EcoNoroeste will develop a Stakeholder Engagement Plan and Grievance Redress Mechanism in line with IFC's PS1.                       

Contact Person: Rui Juarez Klein

Company Name: Concessionária de Rodovias Noroeste Paulista S.A

Address: Rua Gomes de Carvalho, n. 1.510, Vila Olimpia, São Paulo, Brazil.

Email: rui.klein@ecorodovias.com.br

Phone: +55 11 4359-6000

Website: www.ecorodovias.com.br