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 Impacts
ESMS: Yondr’s Environmental Management Policy outlines its commitment to protect the environment, support communities, identify efficient solutions to water/energy use, continual improvement, identify opportunities to minimize wastes, maintain ISO14001 (environmental management), and aim to achieve ISO50001 (energy management). Yondr’s ESMS is commensurate with its operations' scale and E&S risks and impacts and seeks to ensure compliance with local E&S requirements of host countries and includes the identification of risks and impacts, management programs and procedures, Emergency Preparedness and Response (ERP), monitoring and evaluation (continual improvement), organizational roles for implementation, training, and Stakeholder Engagement. All operational sites are certified for ISO 9001 (quality), ISO 14001, and ISO 45001 (Occupational Health and Safety (OHS)).
Based on the national regulations, the STeP DC project does not require specific E&S studies or permits. However, Yondr conducts an integrated E&S assessment of the environmental opportunities for all new DCs, resulting in a sustainability roadmap of options including Zero Waste, Zero Energy, and Zero Water. Yondr re-enforces these actions through the Global Guidelines HSE Performance Expectations that frame all E&S needs for both construction and operations of DCs, including the project. As per ESAP 1, the client will enhance its existing E&S plans for the project through an E&S Management Plan (ESMP) for Construction and Operation in line with IFC PS and the WBG General EHS Guidelines, including procedures for stakeholder engagement and for assessing and managing E&S aspects associated to potential future expansions.
Organization Capacity and Competencies: Yondr’s E&S actions are implemented through a team under the Global Head of Operations, with a Vice President of HSE supported by regional Directors, cascading down to Regional HSE managers supported by site-appointed managers and supervisors. A Global Head for Continuous Improvement (ISO Certifications) supports the operations of the ISO system. This management structure is applied to construction sites and operating facilities and works effectively for the STeP DC project.
Emergency Preparedness and Response: All Yondr sites maintain ERPs. During the construction phase, the General Contractor must develop and maintain an ERPs that include fire, landslide, major injury, confined space, flooding, and loss of utilities. The project will comply with national fire regulations with the final ERP and Life and Fire Safety (L&FS) standards defined based on the Service Agreement with the future client. Pre-approval of the project’s active and passive fire suppression systems has been preliminary approved by the local fire authority.
Monitoring and Review: Yondr’s ESMS requires continual monitoring and review for all DC operations. During the construction of the STeP DC project, Yondr monitors Key Performance Indicators (KPIs) such as the record of injuries, L&FS measures, usage of personal protective equipment, energy and water consumption, and waste generation. Every month, the KPIs are reported to the APAC regional HSE director. All incidents are tracked and recorded, with remedial actions applied. The project must comply with the ISO requirements and the Global HSE Performance expectations.
PS2: Labor and Working Conditions
Human Resources Policy and Procedures: Yondr has 196 full-time employees, with an approximate gender split of 66% male to 34% female. The STeP DC project currently employs ~150 General Contractor workers, which fluctuates based on the project's construction phase. The project is expected to employ 37 workers during operation split between direct employees and contractors.
Yondr has Human Resources (HR) policies and procedures consistent with host country labor regulations and IFC PS 2 requirements, including anti-sexual harassment and non-discrimination, prohibition on child labor, and equal opportunity for its staff, contract staff, and contractor workers. The STeP DC project will comply with Malaysian labor laws and supporting regulations. Yondr also has a Global Peoples Policy, which includes additional employee requirements and benefits that will apply to the project. Each worker receives a written contract that describes the working conditions and terms of employment, with all workers enrolled in the mandatory social insurance scheme of the host country.
The General Contractor has an HR division supported by a Director of HR and a staff of 11, including two staff dedicated to Industrial Relations. At the site level, an appointed Administrator oversees HR compliance for the site and contracted General Contractor employees.
Workers’ Grievance Mechanism: The project’s General Contractor maintains a worker grievance mechanism that is displayed in dual language, with an anonymous complaints channel being made available.
Freedom of Association: Yondr respects the rights of workers to freedom of association. The project’s General Contractor had no union presence on site but confirmed that the General Contractor confirmed the inclusion of workers' rights to freedom of association within its HR policies and procedures.
As outlined in ESAP #2 the client will enhance its Labour Policies and Procedures for the project to align them with the requirements of IFC PS 2, including a Workers’ Grievance Mechanism.
Occupational Health and Safety: Yondr requires the project’s General Contractor to comply with specific HSE requirements that are based on Yondr’s OHS policy and manuals based on Hazard Identification and Risk Assessment (HIRA), as required by ISO45001, with OHS training conducted daily (Tool Box Talks).
The General Contractor HSE teams (supervised by the Yondr HSE manager and supervisor) collect monthly incident statistics from each site. Near misses and accident (as applicable) data are collected. There have been no accidents on the site since the start of construction in February 2023.
The General Contractor has Permit Work requirements, including Hot Work, Working at Heights, Confined Space, Electrical Work, Scaffolding, and Lifting. There is a HSE Manual of procedures for all work actions, including minimum requirements for OHS. The General Contractor maintains an HSE Handbook, which is accessible to all staff working on the site (in English, Bengali, and Indonesian); the document articulates all the HSE requirements for operations and a Code of Conduct for the work site.
Migrant Workers: The General Contractors engage migrant workers for construction. These workers are employed following national regulations and under license from the Malaysian Ministry of Manpower. Migrant laborers receive salary and benefits following regulations, signed employment contracts, meet overtime requirements, were free to leave at any point (no passports retained), and were registered for local health and social insurance. As outlined in ESAP #3 the client will develop a Contractor and Migrant Workers Management Procedure in line with PS2.
Workers Accommodations: The General Contractor has a worker accommodation block approximately 30 kilometres from the project site. The accommodation is certified by Malaysian Authorities, including for L&FS. The General Contractor supplies workers with a shuttle bus to and from this location to the construction site. Yondr conducts periodic inspections of the workers’ camps and identifies corrective actions if any are required. Based on documentation reviewed during site visit the workers accommodation is considered as compliant to IFC PS2 expectations.
Supply Chain: Yondr has a Supply Chain Code of Conduct in place with measures address human rights and labor risks (e.g., child labor), comply with labor laws, and manage OHS-related risks. As per ESAP #2, the project will develop a Supply Chain Procedure in line with IFC PS2.
PS3: Resource Efficiency and Pollution Prevention
Resource Efficiency: Yondr implements energy and water efficiency plans, programs, and performance metrics, as communicated through its Sustainability Strategy, which identifies opportunities for Zero Energy, Zero Water, and Zero Waste.
All the water required for the Project future operations will be provided by the water utility provider for Johor State Ranhill SAJ Sdn Bhd.
Cooling water consumption for the project is expected to be 1.2 litres to 1.5 litres per KWH load, which translates to ~ 1.1 billion liters per annum. Under the Sustainability Strategy, Yondr is evaluating alternatives to drawing water directly from the utility provider; these include innovative evaporative cooling systems, water recycling, rainwater capture, and air-cooling systems.
The project will consume ~840,000,000 KWH annually. Plus, testing of the UPS system will consume ~700,000 liters of diesel fuel per annum for the backup generator system. The UPS system will rely on Lithium Battery banks.
Yondr will apply energy efficiency measures as part of its Sustainability Strategy and is actively looking to reduce its energy footprint as part of its sustainable commitments and for efficiency savings. Based on the Sustainability Strategy, energy consumption per m2 is anticipated to be reduced by ~30% over five years of operation. Tenaga Nasional Berhad (TNB), the Malaysian energy provider, will supply power to the site. Yondr is considering purchasing offsite renewable energy certificates for net zero energy targets.
GHG Emissions: Based on annual diesel fuel consumption, (Yondr will test backup UPS systems regularly; this will consume 14,000 liters of diesel fuel per generator per annum), combined with anticipated grid energy consumption the total GHG emissions shall equal ~370,398 tCO2e per annum. Yondr will be required to report on its Greenhouse Gas emissions from the site as part of the annual monitoring report and demonstrate targeted reductions on a per m2 basis of DC floor space.
Pollution Control: Yondr commits to having Zero Waste entering landfills, requiring all facilities to have a waste management plan that describes the minimum standards to minimize waste, reduce waste sent to landfills, and have target-driven approaches to increase reused and recycled waste. Searches for current recycling options for end-of-life Lithium Battery disposal/recycling are present within the Johor Bahru state. The spill prevention measures, including double-skinned diesel storage tanks, are in place for fuel storage tanks required to operate Diesel Generators. An identified waste management provider will manage standard office and domestic wastes.
PS4: Community Health, Safety and Security
The project is in an existing industrial complex where no significant additional impacts on the local community's health, safety, and security are expected. The nearest urban settlement to the site is ~1.7 kilometres (km) from the park's fence line, with no identified urban settlements within ~2.5 km of the facility's fence line.
