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
Prime has an Environmental, Social and Governance (ESG) policy that states the commitment of the company to consider E&S aspects to go beyond local regulatory requirements and follow Good International Industry Practices (GIIP). The ESG policy includes an exclusion list of activities that cannot be financed by the company and is generally aligned with IFC Performance Standards.
The company does not have an E&S management system (ESMS) to properly identify and manage E&S risks from Prime’s operations. E&S risk and impacts are identified for each asset following local regulatory requirements. The company engages with external consultants to identify potential E&S risks associated with each project. This assessment includes E&S aspects related to natural hazards, required permits, fire safety, security risks, maintenance programs, among other topics. Findings and E&S considerations from this assessment are reviewed by independent committees during the decision-making process for the acquisition of new assets, however Prime does not have a procedure to perform the assessment of E&S risk prior to acquiring the assets. As per ESAP # 1: Prime will develop a corporate ESMS across all projects and operations. The ESMS will require the company to follow Prime’s ESG policy, which will be enhanced to include an exclusion list in line with IFC’s, the prohibition of any form of forced or child labor, the adherence to GIIP on environmental, health and safety, and social standards. The ESMS will incorporate, as a minimum, an E&S risks and impacts identification process for acquisitions, construction, and operation of assets; an E&S monitoring and review process; and specific management plans to mitigate identified E&S risks and impacts including: (i) a corporate waste management plan, (ii) construction noise and dust management plan, and (iii) a Stakeholder Engagement Plan (SEP) in line with the requirements set forth in IFC PS1. As part of the ESMS, the company will develop an asset acquisition assessment, screening, and selection procedure to identify and avoid assets that may involve: (i) involuntary resettlement, (ii) significant E&S impacts on surrounding communities, (iii) significant labor risk, (iv) asbestos containing materials (ACM) and historical contamination, (v) legal liability related to the remediation of historical contamination, and (v) risk and impacts to biodiversity, indigenous peoples, or cultural heritage. As per this ESAP item, Prime will develop a chance find procedure, aligned with local regulations and IFC PS8 provisions.
Prime’s operations manager is responsible for overseeing construction and maintenance activities of the company. Investment decisions are reviewed by an independent technical committee and an independent internal control and risk management committee, who takes into consideration E&S aspects as per Prime’s ESG policy. The company relies on experienced external consultancy firms to conduct E&S studies and permits, where required. As per ESAP # 2, Prime will assign a qualified EHS officer for the development and implementation of the ESMS in all Fibra Prime’s operations and for the development of internal or external capacity to adequately manage the ESMS.
Prime’s operation, maintenance and construction activities rely on contractors. The company delegates the E&S responsibilities to contractor companies as part of the contractual obligations. Among those responsibilities, contractors are required to comply with local E&S laws and requirements. Prime has a contractors’ assessment policy which does not cover E&S aspects. As per ESAP # 3, Prime will develop an E&S contractor management procedure in line with IFC PSs requirements, including requirements to comply with Prime’s ESG policy and ESMS. The procedure will include: (i) minimum environmental and social health and safety (ESHS) requirements for contractors in line with IFC PSs and WBG General EHS Guidelines ; (ii) ESHS pre-qualification selection criteria; (iii) a communication and training plan; (iv) ESHS audits; (v) E&S risk assessments prior to the commencement of works; (vi) monitoring and reporting (including KPIs to assess E&S performance in terms of water and energy efficiency, waste management, OHS statistics, and workers and community grievances), (vii) labor requirements in line with Peruvian labor laws and IFC PS2, and (viii) audit process to assess labor and OHS performance of its contractors, including prevention and management of GBVH risks and grievance mechanism effectiveness.
Prime does not have a corporate Emergency Preparedness and Response Procedure (EPRP). As per local regulatory requirements, each project is required to develop an EPRP that includes emergency scenarios and evacuation plans. Prime develops EPRPs for the buildings they administrate. These EPRPs include risk assessment, emergency response, assessment of evacuation time, and definition of responsibilities. Office buildings and warehouses are required to have fire suppression and alarm systems to obtain local permits. As per ESAP # 4, Prime will develop a corporate EPRP to establish requirements for emergency preparedness and response in all of the assets and operations in line with IFC PS1 and WBG General EHS Guidelines requirements.
PS2- Labor and working conditions
Prime has nine direct employees (seven male, and two female). The company has not developed a human resources (HR) policy due to the limited size of its workforce. Most HR management related activities are carried out by an external service provider. Prime has a code of ethics which includes a grievance mechanism which is generally aligned with PS2 requirements but requires some enhancements. The company is committed to implementing fair and equitable standards for wages and benefits, as well as providing adequate health and safety working conditions for employees and contractors. Its HR practices are considered in compliance with local legislation. As per ESAP #5, Prime will develop a corporate HR policy and procedures aligned with IFC PS2 and local regulatory requirements, including compliance with minimum wages, labor benefits, permitted working hours, shift times and overtime payment, a statement for freedom of association, the prohibition of forced and child labor; non-discrimination; prohibitions on gender-based violence and harassment (GBVH), and a grievance mechanism.
Prime has a workers’ grievance mechanism described in the company’s code of ethics. This mechanism aims to receive any claim or complaint by workers. However, it does not include provisions for receiving anonymous claims and is not accessible to contractors. As per ESAP # 5 above, Prime will develop a workers grievance mechanism in line with IFC PS2 requirements to include a detailed, clear, and transparent process to register and resolve grievances in a promptly manner, providing timely feedback to those concerned, and prohibiting retaliation. The mechanism will allow for anonymous complaints to be raised and addressed, including grievances and cases of sexual harassment with a survivor-centered approach. Grievances will be treated with anonymity and confidentiality, and a clear pathway to address GBVH will be incorporated.
Prime delegates the responsibility to manage labor, working conditions and OHS management and monitoring of its operations in contractors. The company includes in all contracts requirements to comply with local labor regulation, including the need for the development of OHS risks identification and assessment, job safety analysis, work permits, and provisions for personal protection equipment. As per ESAP #3 above, the contractor management procedure will include an audit process to assess labor, OHS, and working conditions of its contractors, comprising of contract verification, payment of social security benefits and monthly salaries, working hours and overtime, due disciplinary and termination process, contractor management, prevention and management of GBVH risks and grievance mechanism effectiveness. The procedure will include OHS controls such as i) OHS risks identification and communication, ii) competency assessment and certification of light & heavy equipment operators, iii) safety inspections of equipment, iv) emergency response protocols and communication, v) field based OHS monitoring to be executed by contractors as well as the company’s oversight mechanisms during construction, maintenance, and operations.
PS3-Resource Efficiency and Pollution Prevention
In all the assets of the company, electricity is sourced from the local utility, drinking water is sourced from the public systems and wastewater is discharged into the public sewerage system which is treated in wastewater treatment plants located in Lima and Callao. Air conditioning systems, when installed, are electrically powered. Natural gas is used in the commercial kitchen. Prime has developed several initiatives to enhance resource efficiency in office buildings including energy and water, although these measures have not been formalized in a corporate plan. The initiatives include the installation of insulated windows and roofs, LED lights, efficient ventilation and air conditioning equipment, intelligent temperature control systems, and selection of water efficient sanitary equipment in toilets and bathrooms. As per ESAP #6 Prime will formalize these initiatives in a corporate resource efficiency strategy to be implemented during construction, maintenance, and operation of all assets (office buildings, warehouses, commercial properties) to gradually implement measures for improving efficiency in its consumption of energy, water, and construction materials. This strategy will include regular measurements and reporting of energy consumption, definition of energy efficiency targets for similar types of assets and comparison with benchmark data to confirm that targets are set at an appropriate level.
Prime does not monitor its carbon footprint nor calculates GHG emission. The estimated GHG emissions are considered less than 25,000 tonnes of CO2-equivalent annually.
Waste is handled by each tenant or building administrator, who collects waste in the premises, and then uses licensed municipal waste management and collection services. Prime does not have procedures to handle waste. Maintenance and construction contractors are required to manage non-hazardous and hazardous waste in line with local regulatory requirements, which are generally aligned with IFC requirements. As per ESAP #1 above, Prime will develop a corporate waste management plan for construction, maintenance, and operation activities in line with WBG General EHS Guidelines. The plan will include provisions for non-hazardous and hazardous waste, including provisions for spill control in construction sites.
The Project’s demolition and construction activities are expected to generate noise and particulate matter, and may involve exposure to hazardous materials from existing infrastructure such as asbestos containing materials (ACM). As per ESAP #1 above, Prime will develop a construction noise and dust management plan to be implemented by the contractor during decommissioning and construction activities to identify and manage these risks in line with the WBG General EHS Guidelines. This plan should reference Prime’s ESMS and the contractor management procedure as per ESAP #1 and ESAP # 3 above.
As per ESAP #1 above, asbestos containing materials and historical contamination should be identified during the acquisition as well as the legal responsibility to remediate the identified contamination. As per ESAP # 7, Prime will develop procedures to manage ACM and remediate historical contamination from existing infrastructure before demolition and refurbishment. The ACM management procedure will describe management and monitoring actions to handle and dispose asbestos containing materials, in line with Peruvian regulations or GIIP, when local legislation is not available. In addition, the historical contamination management procedure will include guidance to develop a contaminated site assessment and remediation plan in line with local laws and regulation. The demolition of the warehouse in Chorrillos will follow the procedures described in ESAP #7.
PS4-Community Health, Safety and Security
Prime requires that fire safety measures in all assets comply with national fire safety codes and local regulatory requirements including fire detection and alarm systems, fire suppression systems, evacuation routes, and site-specific EPRPs. All assets are required to obtain municipal permits and are subjected to audits from the local authority. The company applies some aspects of GIIP related to fire safety systems during building renovations. For structural safety, Prime follows national building codes and permits. As per ESAP #8, Prime will develop a Life and Fire Safety (LFS) framework following international standards, such as National Fire Protection Association (NFPA) or similar. In addition, Prime will seek local structural certification in line with international structural codes, such as from the International Code Council (ICC) or similar and obtain a certification by a qualified structural engineer.
With regards to security management, Prime hires specialized unarmed security contractors for all buildings managed by the company. Security contractors control buildings’ access and report any alarm to first responders. As per ESAP #9, Prime will develop a Security Management Plan aligned with the requirements set forth in IFC PS4 to prevent and mitigate any risks related to security, human rights and provide adequate engagement with neighbors and communities. The Plan will include requirements for vetting of security company to identify past abuse, rules of conducts, background check, valid certification, training requirements of the company for the selection.
In order to improve the E&S management of community risks and impacts for construction projects, Prime will, as part of ESAP #10, develop a Community Health and Safety Management Plan (CHS-MP) for the construction projects, to be implemented by all construction contractors. The plan will be in line with the requirements set forth in IFC PS4 and will include provisions for the management of E&S aspects related to traffic, emissions, hazardous and non-hazardous waste management, as well as any other ESHS identified risk for the community during construction. The plan will also include necessary provisions to prevent sexual harassment and exploitation. The CHS-MP should cross reference the Stakeholder Engagement Plan and grievance mechanism in relation to the response and management of community grievances, as well as security arrangements from the Security Management Plan. The CHS-MP shall include key performance indicators to assess the effectiveness of the proposed E&S mitigation measures.
It is not expected that the project may create or induce influx, since the majority of the assets are located in urban areas, where most of the workers will be secured from.
