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
Interoc has an environmental, health and safety and quality integrated management system policy consistent with the principles of IFC Performance Standards. The policy reflects the company’s commitment to legal compliance, environmental protection, employee’s health and safety, and product quality across all operations. To manage E&S risks and impacts, Interoc complies with national laws and permit requirements, prepares legally mandated risk assessment instruments, and implements tailored management plans at each facility. The company holds an Environmental Register for its Buena Fe facility (Category II License, May 2024) and Environmental Certificates for its San Rafael and Palestina farms. Nevertheless, to complement legally required E&S risk assessment instrument, Interoc will develop a focused E&S assessment (FESA) for its San Rafael farm activities, identifying any unmitigated risk and impact vis-à-vis IFC PSs and will develop and implement any corresponding mitigation measures. The FESA is a supplemental assessment of E&S risk and impacts to confirm alignment of the Company’s activities with the requirements set forth in IFC PS 1 (ESAP #1).
Interoc’s ESMS has been developed following ISO standards environmental and occupational health and safety and has been implemented in all facilities through documented procedures, including waste management, aspect and impact matrices, health and safety manuals, accident investigation procedures, and emergency response plans, among others. Emergency response plans (ERP) for each facility define roles and responsibilities for teams in charge of responding and are comprehensive covering: fire, spills, health and safety evacuations and earthquakes. Nevertheless, ERP for both farms and Buena Fe are being updated and will be finalized, together with adequate training for employees and contractors (ESAP #2).
The Corporate HSE manager reports to the Operations Manager. The company’s HSE function in Ecuador has a coordinator for each health & safety and environment, overseeing ESMS implementation across all facilities and with the support of two analysts. Interoc monitors legal requirements compliance and undertakes internal audits against ISO requirements (QHSE). It also tracks workplace injuries, emergency response drills and training. As part of the ESAP #3, Interoc will develop a set of E&S key performance indicators (KPIs) to assess the efficiency of its management program and implement a monitoring program (i.e. audits and inspections) to measure progress against ESMS objectives and ensure that PS1 requirements on monitoring and review are properly met.
The company’s ESMS was noted to be commensurate with the nature and scale of E&S risks and impacts of its operations across facilities and the implementation at project level to be largely adequate.
PS2: Labor and Working Conditions
Interoc will employ 8 permanent full-time workers at the San Rafael farm, and approximately 300 temporary workers at the peak of the harvesting season. The farm does not have accommodation facilities and workers will commute to site on a daily basis.
Interoc has established a Code of Conduct and a Labor Internal Regulations aligned with Ecuadorian regulations, addressing key labor and human rights principles such as non-discrimination, equal opportunity and anti-harassment. Working hours are determined with due consideration of local regulation. To strengthen the alignment of these to IFC Performance Standards, the company will: as per ESAP #4, (i) update its Code of Conduct and Labor Internal Regulations to include explicit prohibition of child and forced labor, and the respect to the right to unionization; (ii) develop and implement a Workforce Management Plan (WMP) aligned with IFC PS2 to ensure all workers, permanent and temporary, as well as contractor personnel, have appropriate working and labour conditions. The WMP will establish procedures for local recruitment and demobilization, including terms and conditions of employment, wages and benefits (including wage calculation methods and pay slips), working time arrangements (working hours, overtime, rest days, and breaks), authorized deductions, occupational health and safety provisions, termination and disciplinary procedures, social protection (health insurance and pension contributions), provision of advance notice periods, and payment of severance packages in accordance with applicable law. All workforce management procedures will be communicated to workers, including contractor personnel, through mandatory induction programs upon hire and through regular refresher trainings to ensure continued awareness and understanding of their rights and working conditions.
Interoc has a workers’ Grievance Mechanism (Ethical Line) in place and is accessible through a phone number, managed by an independent third-party. Processing and investigation of complaints and grievances are handled by Interoc’s Compliance Officer, and closure is approved by the Ethics Committee.
To align its existing grievance mechanism to IFC PS2 requirements, the company will, as per ESAP #5: (i) include non-retribution considerations; (ii) it is accessible to all employees and contractors and that there are multiple accessible channels for reporting grievances (e.g. online, phone call, email, letter, and in person, including anonymous complaints) and that; (iii) it documents the details on the grievance handling process outlining the step-by-step process for the receipt, record, investigation, response and close-out of grievances, including monitoring and evaluation of all grievances using defined Key Performance Indicators (KPI); and (iv) ensure gender-based violence and harassment (GBVH) grievances are adequately addressed with a survivor-centred approach, managed by a designated team that has received specific GBVH training.
Interoc developed a health and safety manual (Reglamento de Higiene y Seguridad) establishing company and employees’ commitment to maintaining safe workplace, defining roles and responsibilities for each. As part of its integrated management system, Interoc has an OHS program that includes procedures for hazard identification and risk assessment (that includes periodic reviews), regular monitoring of workplace risk factors, periodic industrial safety inspections, and a work-permit system in place, aligned with ISO 45001 requirements. The system also includes an induction program on EHS, provision of adequate PPE, and training for employees and contractors. Furthermore, Interoc will develop an OHS risk assessment and develop relevant procedures at its farm that will take into consideration heat stress and heat-related illnesses and exposure to crop protection products (ESAP #6). Interoc’s OHS performance is adequate and has corresponding lost time injury frequency rate (LTIFR) is 0.98 accidents per million hours-worked, which is significantly lower than the industry benchmark of 9.0.
PS3: Resource Efficiency and Pollution Prevention
Interoc’s seed production and processing involves procurement and storage of rice and corn seeds for multiplication, laboratory activities for quality control and research and farm activities to produce and harvest seeds, seed processing and packaging for distribution. The primary source of waste relates to fertilizers and chemicals used for crop protection, equipment operation (lubricants), R&D laboratory activities.
Consistent with its E&S policy, Interoc has programs in place to monitor water and energy use across all facilities, i.e., water, natural gas, electricity, and chemicals, through routine monitoring. Going forward, Interoc will implement water and energy conservation measures and develop key performance indicators to monitor progress as part of its ESMS (ESAP #7). Interoc has quantified its GHG emission for its seed production business following the relevant ISO 14064-1 standard. For 2025, annual GHG emissions were calculated at 239 tCO2e (scope 1 and 2).
Electricity is sourced from the national grid for all facilities, additional emissions result from transportation distribution of products, and grain drying. Interoc monitors noise and ambient air quality at plant boundaries on an annual basis. Ambient air quality and monitoring reports indicate compliance with applicable legal requirements. Measured noise levels at all facilities plant are under the guidance values are aligned with good international industry practice. For its seed processing facility at Buena Fe, Interoc will implement measures to reduce dust and particulates generated during the seed coating and treatment stage (ESAP #8).
Water for is sourced from local utility supply company (Buena Fe, seed processing), permitted wells (Palestina farm) and irrigation channel (San Rafael farm), with specified volume allocations. Irrigation at the San Rafael farm is done by a mix of drip and a pivot. Interoc undertook a water footprint study, which shows no significant risk of depleting available regional water resources and adverse effects to neighboring communities or farms. Nevertheless, it highlights opportunities to implement water efficiency measures, which will be included on the ESAP #7. Interoc’s seed processing doesn’t require water. Domestic effluents are collected in septic tanks at all facilities.
Interoc’s hazardous materials usage is limited to crop protection products, batteries, used personal protective equipment (PPE), oils and lubricants. All facilities have adequate storage and labeling for hazardous materials, with spill prevention measures in place; in line with applicable legal requirements. All hazardous and non-hazardous wastes are collected for disposal by authorized public service agencies specializing in each type of waste. Interoc has crop protection plans for its seed producing farm and focuses on maximizing solutions for pest management and crop enhancement solutions derived from natural sources (biorational). Additionally, Interoc is committed to not using Class Ia, Ib and II chemicals (WHO Recommended Classification of Pesticides by Hazard) for its farm’s activities. Interoc will summarize its crop protection plan into an Integrated Pest Management (IPM) Plan that is risk-based and focused on OHS and environmental pollution prevention, in line with PS3 requirements, including the requirements set forth in the WBG EHS Guidelines for Agribusiness and Food Production (ESAP #9).
PS4: Community Health, Safety and Security
Interoc seed production and processing facilities are located either in industrial or agricultural areas and no significant additional impacts on the health, safety and security of the local community are expected. A key Interoc activity relates to the transportation of seed and agricultural inputs. Thus, Interoc will undertake a risk assessment of all its transportation activities that may pose risks to nearby communities and define corresponding mitigations in a E&S Transport Management Plan (ESAP #10). Interoc transportation contractors have plans to respond to any emergency while transporting Interoc products and the company regularly undertakes trainings on environmental management, emergency response, and sexual harassment.
Interoc subcontracts security services for all its facilities to a company that complies with local applicable requirements. As part of its operational risks management, Interoc undertook a security risk assessment and developed a security management plan, with a Security Manager leading the implementation. The annual training plan for security personnel includes training on topics such as human rights, customer support, and use of force, among others. Security personnel safeguarding facilities are not armed. The E&S appraisal confirmed that current security arrangements are in line with PS4 requirements.
PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources
The three sites of relevance to PS6 are the San Rafael seed multiplication farm in the Ecuadorian Dry Forests ecoregion and the Palestina research center and Buena Fe seed plant in the Western Ecuador Moist Forests ecoregion, both of which were considered endangered ecoregions. The Palestina and Buena Fe facilities are on long-time modified habitat in established agricultural settings. While the same is true of the San Rafael site, on its eastern boundary it directly abuts the 490 km2 Engabao-Engunga-Zapotal-Olmedo KBA, an area of largely pristine natural habitats protecting two Least Concern bird species.
At the San Rafael farm, the abutment with the KBA increases the need that the practices of this operation achieve certification to a standard that will ensure the neighboring KBA is unaffected. Ideally, certification would be to a standard specific maize and rice, but a more generic certification is acceptable if it ensures the implementation of sustainable management practices such that airborne drift and runoff of potential contaminants is avoided and that meets PS6 certification requirements.
There are no current plans to use contract farmers for seed multiplication. Nevertheless, Interoc will require contract farmers to be certified for sustainable management practices or obtain demonstrable evidence of no recent natural habitat conversion and sustainable practices. Interoc will seek similar assurances from international seed suppliers. As part of ESAP #11, Interoc will: (i) certify San Rafael farm operations under a sustainable management practices standards with independent verification. (ii) establish a supply chain due diligence procedure for international seed suppliers to ensure no recent conversion and sustainable practices, as well as establish on-boarding procedures for contract seed multipliers with demonstrable or certified no recent conversion and sustainable practices (ESAP #12).
