IFC’s appraisal considered the environmental and social management planning process and documentation for the Project and gaps, if any, between these and IFC’s requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable period of time, are summarized in the paragraphs that follow and (if applicable) in an agreed Environmental and Social Action Plan (ESAP). Through implementation of these measures, the Project is expected to be designed and operated in accordance with Performance Standards objectives.
PS1: Assessment and Management of Environmental and Social Risks and Impact
To effectively manage the scale and range of E&S risks posed by the company’s operations, STEP has developed, and implemented, a robust ESMS aligned with local laws and regulations, IFC Performance Standard (PS) 1 and commensurate to the level of risks associated with the company’s activities. The ESMS is underpinned by several policies, including an Environmental Policy statement, Community Health and Safety Policy, Human Rights Policy, Emergency Preparedness Policy, and Health and Safety Policy among others.
As a component of their ESMS, STEP has developed a procedure for the identification, assessment, and management of E&S risks associated with their operations. The process covers all E&S risk areas associated with the company’s operations. A further component of the company’s risk identification and management process is the Guideline for Site Screening, Land Acquisition, and Right of Way. The guideline details the pre-construction requirements for site screening, as well as potential risks associated with stakeholder engagement, regulatory requirements, occupational health and safety (OHS), land acquisition, resource efficiency and biodiversity. STEP will further enhance its Guideline for Site Screening, Land Acquisition, and Right of Way process in relation to the identification and screening of sites near either Key Biodiversity Areas (KBAs), Alliance for Zero Extinction (AZE), or World Heritage Sites (WHS) sites. This will include the development and implementation of a defined management process for the construction and operation of sites within sensitive areas, and further training to STEP’s network deployment and technology teams, and key contractors involved in site identification and construction (ESAP #1).
While STEP has employed a dedicated E&S manager, the implementation of the ESMS is multifaceted and falls across numerous business units. The company are also in the process of employing a Human Rights Manager who will sit within the External Affairs department. STEP has also constituted a board Environmental, Social and Impact sub-committee that provides oversight and guidance to the board on key E&S risks and management areas.
To ensure compliance with local regulations, IFC PS, and identify areas for enhancement, STEP actively monitor and measure the implementation and efficacy of the ESMS. This includes ongoing monitoring conducted by both the ESG and Health and Safety Managers, and the development of quarterly E&S monitoring reports covering key aspects such as E&S risk assessments, Key Performance Indictors (KPIs), fiber and tower rollout, climate initiatives, stakeholder engagement, human rights, training and awareness, compliance, security, and grievances. In addition, STEP has an internal audit function that monitors compliance, including ESMS implementation, quarterly. STEP is also implementing annual independent audits of their ESMS.
PS2: Labor and Working Conditions
STEP currently employ about 900 direct workers, with a male-to-female ratio of 60:40, and a further 4,200 contract workers. Contract workers are predominantly required for ongoing network deployment and operation, as well as for the operation of the company’s call centers. The company is actively reducing its number of expat workers, which peaked at 193 at the onset of operations, and building local capacity through active local recruitment.
All HR activities are overseen by the company’s HR Department. STEP has developed and implemented a number of HR policies aligned with local labor law and IFC PS 2 requirements.
Labor and working conditions within the company reflect the provisions of the Ethiopian Labor Proclamation No. 1156/2019. The Staff Manual covers aspects such as recruitment, performance management, learning and development, workplace health and safety, salaries and benefits, overtime and leave. As per the requirements of local labor legislation, all workers are provided with a written contract governing their terms of employment. As per local labor requirements, STEP recognizes the worker’s freedom of association. While workers are not unionized, STEP is in the process of formalizing a Staff Council Policy that will define the formation of a formal structure to further enhance the current worker engagement process.
The company has established several mechanisms for the receipt and management of worker grievances. This includes a formal Workers’ Grievance Handling Policy and Procedure, aligned with the requirements of IFC PS2. Training is provided to line managers and workers on all HR policies and procedures, including the grievance policy. In addition, STEP has implemented a Whistle Blowing Policy whereby both internal and external stakeholders can submit grievances and concerns. The Whistle Blowing Policy caters for anonymous submissions and is managed by an independent third-party.
STEP has developed and implemented a robust Health, Safety, and Wellbeing management framework, overseen by the Health, Safety, Environment, and Wellness business unit. Key OHS risks identified by the company include road safety, working at height, and working in proximity to powerlines. In relation to these risk areas, eight ‘Absolute Rules’ have been developed and implemented, as well as specific risk management plans and procedures (vehicle inspections, driver competency training, In Vehicle Monitoring Systems (IVMS) etc.). All contractors are required to demonstrate basic health and safety requirements and competencies, as well as define a risk treatment plan upon procurement. Contractors and suppliers are also required to be National Examination Board in Occupational Safety and Health (NEBOSH) certified.
The company has developed and implemented a Procurement and Supply Chain Management Policy defining the approach to manage and monitor contractors and third-party service providers. This process is further supported by leveraging the Vodafone Global Supplier Network, guided by the Vodafone Responsible Buying Policy, when selecting preferred contractors and third-party service providers. All contractors go through a mandatory qualification and compliance process, including reputation and integrity risks, and are assessed for competence depending on the nature of their role.
PS3: Resource Efficiency and Pollution Prevention
STEP utilizes national grid electricity as the main energy source for approximately 79% of their infrastructure, including towers, main office, call centers, data centers etc. Additionally, to limit power interruptions, and/or where grid electricity is not available or inconsistent, approximately 17% of sites are equipped with diesel generators. The company is also implementing solar power where feasible, however, this is only equipped at approximately 6% of sites to date.
STEP currently utilizes municipal water for the majority of their operations. Quantities are limited and primarily used for routine administrative, sanitary, and cleaning purposes. No significant water use is expected due to the nature of the project.
Currently, STEP only monitors and reports on Scope 1 greenhouse gas (GHG) emissions. The company reported a total of 10,938 tonnes of CO2-equivalent from April to December 2023. As a component of ESAP #2, the company will define a GHG Monitoring and Reporting protocol, covering both Scope 1 and Scope 2 emissions, as per the requirements of internationally recognized methodologies and good practice.
As a component of its ESMS, STEP has developed an Integrated Waste Management Policy defining the approach to waste management, including an approach of reuse, reduce and recycle. To support the implementation of the policy, the company has also developed an Integrated Waste Management Standard defining roles and responsibilities, procurement of approved service providers, waste streams and categorization, monitoring, and training. As a component of the recently implemented waste management report, the company reported a 70% waste diversion rate.
PS4: Community Health, Safety and Security
The primary community health and safety risks associated with the project could include exposure to construction vehicles and transport, and exposure to dust, noise and vibrations caused by construction works. Construction works are typically limited in terms of magnitude, duration, and impact. Operational phase hazards may include tower failures and collapse, unauthorized site access, road safety and Electro Magnetic Frequency (EMF) exposure. STEP has developed an overarching Community Health and Safety Plan, that details the company’s approach to identifying and managing these risks during both construction and operation. In addition, as a component of their site screening process, STEP proactively identifies, and where possible avoids, potential community health and safety risks emanating from their operational activities.
STEP currently operate in a highly dynamic environment that requires proactive and informed security management. Security is managed by the company’s security business unit and governed by a Security Management Plan (SMP), and Emergency Preparedness and Evacuation Plan. At an operational / asset level, primary contractors are responsible for providing their own security arrangements and comply with STEP’s SMP. As a component of their ongoing bi-monthly security forums, STEP will implement a training module on the Voluntary Principles on Security and Human Rights (VPSHR) for all key contractors (ESAP #3).
PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources
As of March 2023, STEP had constructed approximately 2,200 sites, including existing co-location and greenfield build to suite (BTS) sites. The telecommunications infrastructure has been constructed across the country and is, as per the license agreement, predominantly located within existing urban centers and along major transportation corridors. As per the company’s existing site selection approach, sites within the boundaries of either a Key Biodiversity Areas (KBA) and legally protected areas have been identified.
As a component of the existing ESMS, under ESAP #4, STEP will define their PS6-compliant biodiversity commitments in a Biodiversity Policy, including commitments related to avoiding Alliance for Zero Extinction (AZE) Sites and UNESCO Natural/Mixed World Heritage Sites. Additionally, as described under ESAP #1, STEP will update the existing site screening process, in particular the site identification and assessment process by defining appropriate assessments and mitigation measures depending on the biodiversity risk identified for any future site across the business.
