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
Environmental and Social Assessment and Management Systems
The Company currently does not have a formal Environmental and Social Management System (ESMS) in place and will develop and implement this ESMS as part of ESAP#1. This ESMS will include the necessary and relevant policies, programs and management plans aligned with Good International Industry Practice (GIIP) and IFC’s Performance Standards and commensurate to the environmental, health and safety and social (altogether, referred as E&S) risks and impacts of its facility.
As part of the ESMS, TCG will formalize the requirement for its contractors and suppliers to follow and use the E&S policy of TCG for all assigned activities while working on the company premises or providing services to it such as parcel delivery (ESAP #1).
Policy
As described above, TCG will develop an E&S policy that guides its operations. The E&S policy will also cover inherent risk areas such as occupational health and safety (OHS), safe work practices, use of personal protective equipment (PPE) and incident reporting. Currently, there is a fire safety policy where it will be reviewed, finalized and integrated into a management endorsed E&S policy, to be shared with employees, contractors and suppliers. All staff will be trained on the policy and related operational procedures (ESAP#1).
Identification of Risks and Impacts
As per applicable regulatory requirements, no Environmental Impact Assessment (EIA/ESIA) is required for the establishment or operation of a courier distribution company in South Africa. However, the company is required to be licensed to operate. In addition, for the imported equipment stored in the warehouse and distributed through TCG, these are expected to be compliant with the standard regulatory requirements of South Africa. TCG’s Independent Communications Authority of South Africa (ICASA) certificate was obtained in April 2023 and is valid for 5 years.
The Company has not yet developed a risk assessment plan but has identified both health and safety and fire risks and prevention measures. E&S risk assessment including risk rating, severity and consequences as well as action along with required time scale will be developed. Major risks will be escalated for management interventions where additional resources may be needed to address them. Risk management at TCG will revolve around the development and implementation of policies and standard operation procedures (SOPs) to mitigate the identified risks and establish streamlined business procedures including a security management plan (ESAP #1). In addition, the company will conduct on-going risk management training and monitoring. While TCG will develop EHS risk assessments to adequately cover the risks related to the workplaces directly owned by TCG, the company will also request the risk assessments of the facilities it uses such as customer care offices and aviation service provider as part of the checklist for risk screening its third-party supplier and selection (ESAP#1).
Management Programs
In addition to an E&S Policy, the ESMS will include programs and management plans aligned with Good International Industrial Practice (GIIP) and IFC’s Performance Standards and commensurate to the E&S risks and impacts of each facility. There is no formal E&S management program currently in place. TCG will develop and implement management programs, to mitigate its E&S impacts and risks. The programs will include health and safety measures, safe working procedures, fire and other emergencies management as well as drills to be conducted regularly at each hub, kiosk and lockers’ locations. Various procedures, protocols and working forms will be developed for the implementation and auditing of the program.
Organizational Capacity and Competency
Although not yet formalized, the responsibility of implementation of the draft health and safety policy is currently shared between the Health, Safety and Quality (HSQ) Manager based at the Johannesburg Hub and the Health, Safety and Environmental (HSQ) representative based in Cape Town. Once in place, they will have additional support in the implementation and overseeing of the health and safety management system (ESAP #2). In addition, the company will undertake a labor assessment, safety and health assessment and advise on the contractor management system (ESAP #2). The employees will have responsibility to abide by the requirements of the E&S policy and procedures once they receive training on these. Hence, TCG are to appoint an HSE liaison to manage the development ESMS including the above-mentioned policies and various management programs and coordinate the documentation and receive follow-up from the various departments and service providers (ESAP#2).
The company will form an internal Health and Safety Committee, consist of employees from various departments, to provide guidance for the day-to-day implementation of the ESMS (ESAP #2). The committee members will receive training on E&S, IFC PS requirements and OHS (ESAP #1).
Emergency Preparedness and Response
The Company does not yet have its own policies which entail as an emergency preparedness and response plan (ERP). As per ESAP item #3, the Company will develop an emergency response plan (ERP) in line with GIIP and increase staff training frequency on emergency evacuation and regular fire drills.
Monitoring and Review
TCG does not currently have a monitoring and review process in line with IFC PS requirements. As per ESAP #4, its ESMS will include the process for monitoring of E&S performance, reporting and review by its senior management. In addition, TCG will be audited by external registered auditors for life and fire safety (ESAP #3).
PS2: Labor and Working Conditions
TCG’s workforce in September 2023 was 2,245 employees, including the contractors. The Company has a total of 914 female employees (representing 41% of staff). While TCG staff are hired to deliver core functions such as the financial department, HR, warehousing, and customer care activities, other functions are outsourced such as last mile delivery and 90% of security (warehouse guards, armed response provided by local police, car track monitoring and investigations). The company has a pool of 1,300 drivers in total hired under the owner driver model. Also call centre staff are currently about 144 employees.
Human Resources Policies and Procedures
While each contractor company has its own HR policies for their directly employed staff, TCG has a Human Resources (HR) policy that provides detail on recruitment and appointment procedures in accordance with local regulatory requirements for its direct employees. The policy is communicated to staff at induction and articulates working conditions (working hours, performance evaluation, leave, duration of probation), non-discrimination and equal opportunity, recruitment, promotion, overtime, staff development/training and employment termination. TCG also has an employee handbook that communicates the code of conduct and working conditions to newly hired staff. The company will update its induction training to include an explanation of the medical benefits to the new hires (ESAP #5). As part of the contractual language review for its contractors and suppliers, TCG will include a requirement on alignment of HR policies and procedures with PS 2 requirements (ESAP#1).
Working Conditions and Terms of Employment
All direct employees have formal written contracts provided upon recruitment and the terms of service are explained during staff orientation. The contracts describe details such as job title, working conditions, terms of employment and benefits. All hiring contracts will detail the recruitment terms, compensation, benefits, leave, overtime and termination conditions (ESAP #5).
Grievance Mechanism
The Company has also developed an employee grievance mechanism. It applies to all employees but does not cover drivers under the owner driver model. Grievances are currently submitted via email. The company will enhance its employee grievance mechanism to explicitly mention an anonymous channel for raising grievances, accessible to all employees, including outsourced services, contractors and drivers, has relevant forms developed, a separate route for addressing Gender-Based Violence (GBV) related grievances and the establishment of a grievances register as well as appointment of competent staff to handle the grievances and provide a timely response. (ESAP#6).
Non-discrimination and Equal Opportunity
As per the HR policy, TCG is an equal opportunity employer, and the company does not discriminate on the basis of gender, ethnic background or religious and social affiliation. The Company will develop a policy on sexual harassment that is part of its employee handbook. In addition, the company will conduct a gender smart safety audit, integrate into the existing code of conduct for employees and contractors a statement on prohibiting gender-based violence and conduct training on this for employees and managers separately (ESAP#7).
TCG will enhance the staff and contractor training to put more emphasis on gender-based violence at the workplace under ESAP#8. The company will improve implementation of HR policies by renewal of staff induction training on HR policy including GBV and sexual harassment policy, procedures and grievance mechanism. Refresher training will be provided for existing staff, and during onboarding of any new staff. The management team will be trained separately from other employees (ensuring that training provided to managers covers how to respond to incidents of sexual harassment) (ESAP#8)
Protecting the Workforce
The Company's employment screening requirements for potential employees will include verification of birth certificates and national identity cards. In case of employment of staff between the age of 15 and 18, the company will conduct a risk assessment of the type of work, monitor hours of work, working conditions and OHS. The local labor law also prohibits the employment of child labor or forced labor. The company will include explicit reference to non-use of forced labor in their recruitment and appointment standards operating procedure (SOP) (ESAP#5).
Occupational Health and Safety
The company will conduct a health and safety risk assessment for warehouse employees and for work-related trips by drivers and will align with traffic laws safety requirements (ESAP #1). The assessment will explore the modes of transportation employed during deliveries, safety installations in the vehicles, preventive maintenance and license issuance and renewal requirements. Vehicle integrity, defensive driving training, fire safety equipment and safety measures will be checked. For transport that is directly provided by TCG or its partners, the fleet management plan may include satellite trackers to monitor the exact speed the car is being driven, the Geo location, any signs of dangerous driving (sharp turns and sudden breaking, for example), and fuel consumption during work trips (ESAP#9).
The company has a policy on prohibiting dangerous chemicals in packages. However, incidents have been recorded where hazardous chemicals leaked from packages injuring TCG employees. Implementation of the hazardous material safety policy will be enhanced through additional measures (ESAP #1).
A total of 110 workplace incidents, were reported between 2021 and 2023. Incidents included cuts, bruises, strains to fingers, elbows and back strains from lifting of heavy loads. Any incidents including road safety incidents are reported and recorded in the incident reporting system as well. More than 182 road accidents were reported in 2023 including 5 hijacking incidents. The company will record all incidents in a register that covers the root cause analysis, corrective action plans with clear timelines and responsible person for follow-up for each incident. Hence, the company will develop a comprehensive EHS monitoring program aligned with WBG EHS Guidelines, with clear frequency, method and reporting lines. It will incorporate an incident recording system to describe the incidents, the root cause(s) and corrective action plan that is then communicated to the relevant department for action (ESAP #4).
Workers engaged by Third Parties and Supply Chain
Third party contractors include the security service provider, licensed waste management contractors and contractors providing services such as delivery of parcels. There is no documented E&S policy that is communicated or implemented for contractors or suppliers. However, TCG will formalize the requirement for its contractors and suppliers to follow and use the E&S policy of TCG for all assigned work while working on the company premises or providing services to it such as parcel delivery. The contractors will be required to follow the national regulations and applicable PS requirements related to occupational safety, and fire safety in addition to the company’s EHS policy and procedures in general (ESAP #10).
TCG currently does not review its suppliers’ E&S policies, including its commitments to prevention of child labor and forced labor as well as OHS provisions. The ESMS will formalize the screening and review process of its third-party suppliers, especially on issues of harmful child labor, forced labor, significant OHS risks. Under the ESMS, the company will (i) develop a Supplier Code of Conduct, including a checklist for risk screening its third-party supplier and selection consistent with IFC PS2 related supply chain requirements; (ii) provide its suppliers with training on checklist and supplier code; (iii) verified Supplier Code on annual basis (ESAP #10). Further, under ESAP#1, the company will monitor the Supplier Code of Conduct on annual basis as part of the ESMS.
PS3: Resource Efficiency and Pollution Prevention
The operations of TCG offices and warehouses are not expected to exceed 25,000 tons of Carbon Dioxide equivalent (CO2 eq) in total if limited to land transportation without taking into account the volume of air cargo flights. Limited information is available on the emissions due to cooling and heating, fuel usage for vehicles fleet, emissions due to bottled water consumption and waste management. The company is committed to the management and optimization of route planning and consideration of alternative vehicle technology such as LPG and hybrid/electric ground transport vehicles. This will result in GHG reductions and reduce exposure to air pollution and fire hazards. To achieve this, the Company will develop a climate policy and collect information on its Scope 1, 2 and 3 GHG emissions (ESAP # 11).
Energy and water are supplied from the public network for all of TCG facilities. Wastewater is discharged to the local public connection network and treatment is handled by local authorities. The wastes are expected to be limited to packaging materials. As per ESAP#1, the ESMS will include the procedures and instructions for resource efficiency and pollution prevention, such as waste segregation and water conservation measures.
PS4: Community Health, Safety and Security
In addition to the assurance of safety of drivers during transport in the field by the local partners, traffic laws in South Africa will be observed to ensure community safety during delivery of parcels to clients.
The company has 2 guards to monitor entrance and exit of its properties and there are only armed security guards at night. Hence, the client will formalize the security management plan to include a screening process of the private security provider appointed personnel on the company’s facilities (ESAP #1).
