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
E&S Policies. Tecnomyl has adopted corporate E&S policies (Sustainable Development and Integrated Management System), aligned with national, ISO9001 and ISO14001 standards requirements and generally aligned with IFC PS1. These policies articulate commitments to environmental protection, legal compliance, prevention of pollution, and respect for human rights. These policies are communicated internally and externally and supported by governance structures, including the Board of Directors and senior management. In 2019, Tecnomyl adopted a sustainability strategy based on seven principles: continuous environmental improvement; health and safety; efficient use of resources; transparent performance disclosure; community engagement; cooperating with the government and institutions; and responsible management of agricultural solutions. Tecnomyl´s sustainability policy is publicly disclosed. As per ESAP #1 Tecnomyl will expand its current Integrated Management System (IMS) policy to include and formalize stakeholder engagement, aligned with PS1 commensurate to the E&S risks and impacts of their operations.
E&S Management System (ESMS). Tecnomyl has implemented an Integrated Management System (IMS) aligned with ISO9001 and ISO14001 standards and a code of ethics. The IMS covers quality and environmental management and is applied across its operations, including chemical and biological production. Tecnomyl applies risk identification and legal compliance with Paraguayan and IFC´s PS, including periodic audits and impact assessments for expansions. The company maintains external ISO9001 and ISO14001 certifications, which provide a structured framework for quality and environmental management.
Identification of Risks and Impacts. The Company has been granted with an Enviromental Licence for the Villeta Plant that includes the biological plant. In addition, an EIA was developed for the Logistics Center in Ciudad del Este. The Company has identified environmental and industrial risks, including fire hazards and effluent management. It maintains matrices for environmental aspects and impacts (e.g., water use, effluent management, air emissions) and a register of OHS risks.
To enhance the Company’s risks and impacts identification process. Tecnomyl will, as part of ESAP #2, will: (i) Conduct a targeted assessment of E&S risks and impacts across all manufacturing and commercial operations, covering the following aspects: (a) production of pesticides containing WHO Class Ia (extremely hazardous) and Class Ib (highly hazardous) chemicals; (b) climate-related risks to production, transport, and storage; (c) risks of child and forced labor in raw-material supply chains; (d) life and fire safety (LF&S); and (e) community health and safety; and (ii) update ESHS Management Programs to incorporate the necessary mitigation measures resulting from the targeted assessment.
E&S Management Programs. The Company implements environmental management programs for effluent, waste, and emissions-aligned with PS1 requirements- and supported by ISO standards and legal compliance. The Company’s Environmental Management Plan (EMP) incorporates measurable targets, timelines, and designated responsibilities to ensure accountability and adaptive management. Progress is tracked through key performance indicators (KPIs) and documented in integrated monitoring systems, with periodic reviews by senior management. To further align E&S management programs with PS1, as per ESAP #3, the Company will: i) define and include social KPIs related to social aspects and impacts and (ii) adapt and apply the EMP for the construction and operation of the Distribution Center.
Organizational Capacity and Competency. Tecnomyl's operational and industrial areas feature a well-organized team with specific roles in HR, quality, environment, and OHS. It uses performance evaluation tools and has a Health and Safety Committee. Training programs cover ISO standards, safety, and environmental legislation. Also, the Administrative Department Head has been appointed as the officer in charge of stakeholder engagement and serves as the main point of contact between Tecnomyl’s Plant and surrounding communities.
Emergency Preparedness and Response. Tecnomyl´s Emergency and Preparedness and Response Plan (EPRP) describe emergency protocols, including evacuation procedures, fire safety standards as per NFPA, and training of emergency brigades. The EPRP also lists specific procedures and compliance with national laws and includes protocols for significant weather events, ongoing monitoring, and organized emergency procedures. During the site vit it was observed that the fuel tank is relatively close to the chemical storage area. Therefore, in order to further align the Company’s ESRP to IFC requirements, Tecnomyl will as per ESAP #4: (i) enhance the EPRP by incorporating flood risk preparedness, early warning systems, and site-specific response measures tailored to local hazard exposure and vulnerabilities, evaluate the risk of heightened releases of hazardous materials caused by flooding at the project sites; (ii) conduct a technical assessment to determine if in the event of a fire or explosion in the fuel tank or the chemicals storage areas, there are sufficient barriers and/or adequate physical distances to prevent a spillover effect of the emergency, and (iii) engage local communities in emergency preparedness initiatives and organize regular drills with active stakeholder involvement, as required in PS1 and PS4.
Monitoring and Review. Tecnomyl conducts internal audits, external reviews as per ISO recertifications, and environmental monitoring (e.g., effluent quality, emissions). Performance data is tracked through digital platforms, and monthly reports are issued to senior management.
PS2- Labor and working conditions
At the time of the appraisal, the Company employed 1,089 direct and indirect employees, 639 of which work at the agrochemical production plant and 40 people at the biological production unit (Biotech). Temporary workers were also hired through a contractor for the construction of the Logistic Center at Ciudad del Este. All employees are hired in accordance with national labor legislation. Between April and August, the Company hires approximately 200 temporary workers each year.
Human Resources (HR) Policies & Procedures: Tecnomyl’s HR practices are designed to support both operational efficiency and employee’s well-being. Seasonal workers work eight-hour shifts in production and logistics and help meet seasonal production demands. Employee selection is based on performance evaluations.
Working Conditions and Terms of Employment. Tecnomyl demonstrates structured alignment with IFC PS2 requirements through its HR Management Policy. Employment terms include adherence to Paraguay’s labor code, formal contracts, and defined probation periods (30–60 days depending on skill level), as well as rights to fair remuneration, rest periods, and annual paid vacations. The Company offers additional benefits such as transportation, medical assistance, and educational support. Seasonal hiring is managed under clear HR procedures, ensuring eight-hour shifts and compliance with local labor laws. Tecnomyl maintains formal policies for recruitment, termination, evaluation, compensation, and benefits, and confirms adherence to national labor legislation regarding wages, working hours, and social security contributions. Additionally, the Company provides medical examinations for all employees prior to hiring annually thereafter. These exams include clinical evaluations, chest X-rays, blood tests, and psychological assessments (except for temporary contracts), ensuring health monitoring as part of employment conditions and in line with local regulations.
Workers’ Organizations. Tecnomyl does not have active unions or collective bargaining agreements, and no employees are represented by independent organizations. No labor disputes or strikes have occurred in the past 5 years.
Non-Discrimination and Equal Opportunity. Tecnomyl’s HR policy commits to equality and non-discrimination, ensuring fair recruitment, internal promotions, and a non-sexist work environment. The Company actively promotes gender inclusion, evidenced by efforts to increase female representation in operational roles which supports PS2 on equal opportunity. As per ESAP #5, the Company will (i) implement targeted recruitment and training programs to enhance diversity, (ii) formalize gender-sensitive measures in project planning and monitoring, and (iii) targeted training programs.
Retrenchment. Procedures for termination are documented in the HR policy, which mandates professional communication, detailed explanations, and provision of severance and work certificates to support future employment. Given the high turnover of temporary staff, as per ESAP #6, Tecnomyl will develop a workforce planning strategy to reduce reliance on short-term contracts and implement retention programs for seasonal workers.
Worker’s Grievance Mechanisms. Tecnomyl maintains grievance channels through suggestion boxes, emails and its web site. An ethics committee ensuring confidentiality and protection against retaliation is in place. However, no formal grievances have been reported over the past few years, while there are some grievances submitted outside official channels without a proper record. Moreover, there are no evidence of documented resolutions of grievances, and there is no formal process to conduct grievance monitoring. To align with PS2, as per ESAP #7, the Company will: (i) strengthen the formal grievance mechanism and ensure all employees are aware of and use official channels, ensuring timely resolution and protection against retaliation; and (ii) implement grievance tracking and reporting systems.
Occupational Health and Safety (OHS). Tecnomyl’s OHS management system is robust, based on national regulations, supported by progressively incorporating ISO45001 requirements and systematic risk assessments (Job Hazard Analysis), PPE protocols, and emergency preparedness plans. The Company records and monitors safety indicators monthly, with 2024 data showing 59 incidents, 3 lost-time injuries, and zero fatalities. There are documented policies, annual training programs, and active health surveillance programs in place. Tecnomyl maintains an internal accident prevention committee and emergency brigades, conducts drills, and has procedures for emergency response and evacuation. The company uses laminar risk cabins to reduce air pollution and exposure to particulate matter and dust and has protocols for handling biological materials and effluents.
Supply Chain Labor Risks. Tecnomyl’s HR policy prohibits child and forced labor, and supplier contracts include exclusion clauses. Internships for minors are regulated under the local law, limited to non-production areas, and capped at 240 hours. The review conducted at appraisal found no evidence of child labor or forced labor risks in Tecnomyl’s operations or supply chain. The Company’s compliance department monitors labor and human rights conditions among suppliers and clients. However, there is no detailed procedure or audit framework for supply chain labor practices. Therefore, as per ESAP #8, the Company will develop and implement a Supply Chain Management Procedure that will incorporate: (i) a supplier mapping and risk assessment process, (ii) Standard Operating Procedure (SOP) to identify and manage risks in the supply chain, and (iii) third-party labor audits to monitor high-risk suppliers. The SOP will align with IFC PS requirements and include: (a) a procurement policy and supplier code of conduct addressing child and forced labor, as well as significant safety issues as per PS2; (b) contractual clauses prohibiting forced labor and child labor and compliance with the code of conduct, extending this obligation to lower-tier suppliers; (c) a communication strategy to inform all primary suppliers of labor requirements and risks, ensuring dissemination to lower tiers; and (d) a formal process for supplier engagement, remediation, or disengagement in cases of non-compliance and refusal to address violations. The third-party labor audits will be conducted on a representative sample of suppliers in line with PS requirements, with corrective actions implemented as needed.
Workers Engaged by Third Parties. The company requires its contractors to comply with national labor laws through specific contract clauses. To further align Tecnomyl’s E&S contractor management practices to IFC standards, the Company will, as part of ESAP #9, engage an independent consultant to conduct a labor audit of working conditions and terms of employment across project components, in line with PS2 requirements and IFC’s Good Practice Note on Managing Contractors’ Environmental and Social Performance.
PS3-Resource Efficiency and Pollution Prevention
Tecnomyl demonstrates substantial alignment with IFC´s PS3 requirements, particularly in resource efficiency and pollution prevention. Advanced wastewater treatment systems, water reuse initiatives, and robust waste segregation practices reflect strong environmental management. Reliance on renewable hydroelectric power and biomass reduces carbon intensity. Since 2023, Tecnomyl has operated a new wastewater treatment plant (WWTP).
Resource Efficiency. The Company monitors energy consumption (2,954,872 kWh in 2023) and water use (20,712,000 liters), with reuse of 284.05 m³ of treated water. Automation and digitalization have improved operational efficiency. Tecnomyl employs measures such as greywater reuse, presmatic faucets, and weekly water consumption monitoring. The fully automated effluent treatment plant using Biological Membrane Reactor (BMR) - BIOMEMBRAT system - and nanofiltration technology enables sustainable water reuse.
Greenhouse Gas Emissions. The Company has not undertaken a GHG inventory yet. As per ESAP #10, Tecnomyl will: (i) implement a GHG accounting protocol aligned with PS3, and (ii) Integrate GHG reporting into sustainability disclosures.
Pollution Prevention – Soil Contamination. Tecnomyl reports no contamination zones and conducted a hydrogeological study in 2022, with an update planned for 2025. Spill prevention measures include secondary containment sensors, alarms, and emergency spill kits, aligning with PS3. Waste Management. Tecnomyl operates a comprehensive waste management system, recycling 772,722 kg of material in 2023 and producing 183,910 kg of pellets. Total waste generated was 935,080 kg, with 65% recycled. The Company recycles 100% of the packaging and containers from raw materials, inputs, and various materials used in the production process, derived from all imports. In 2024, contaminated waste totalized 1,333,873 kg and non-contaminated waste 1,281,384 kg. Hazardous waste is disposed of in authorized facilities.
Wastewater Management. Tecnomyl’s treated 6.374,320 m³ of effluents in 2025. Tecnomyl has implemented a state-of-the-art wastewater treatment system that aligns with IFC PS3 requirements and the World Bank Group EHS Guidelines standards for water quality and effluent management. The Company operates a fully automated effluent treatment plant using MBR (Membrane Bioreactor) technology combined with nanofiltration, a process that treats industrial wastewater biologically and physically without chemical additives. This approach significantly reduces environmental impact compared to conventional chemical-based systems. The plant has a capacity of 30 m³/day, supported by two 900 m³ storage ponds for raw and treated effluent, and a 180 m³ bioreactor. The treated water meets stringent national and international standards, is reused for irrigation and cleaning, with only surplus water discharged into the Paraguay River through a system that is independent from the other effluents of the industrial park, allowing the Company to control disposal under its own responsibility. Additionally, Tecnomyl has implemented recirculation systems, reusing approximately 284.05 m³ of treated water in production processes.
Hazardous Materials Management (including PCBs). Strict protocols govern hazardous substances, supported by ISO 14001 certification. Chemicals are stored securely in lockable, ventilated warehouses with secondary containment and spill kits, away from water sources, residential areas, and food storage. All products are kept in their original labeled containers, with SDS available, and a register tracks quantities received, used, and remaining. Trained personnel handle and chemicals using appropriate PPE. Expired or unwanted products are managed as hazardous waste, and only products compliant with FAO guidelines are procured, avoiding highly hazardous substances. Tecnomyl adheres to national commitments under the Stockholm Convention to phase out PCBs by 2025. A new transformer without PCBs was installed in 2023.
Pesticide Use and Management. Tecnomyl promotes Integrated Pest Management (IPM) and complies with national laws. The Company, as a pesticide producer, complies with the Basel and Rotterdam conventions, which Paraguay is a signatory of. At the date of the appraisal, Tecnomyl does not purchase, produce, distribute, or market pesticides corresponding to Extremely Hazardous (Ia) and Highly Hazardous (Ib) classes. To further align its practices with IFC PS requirements, Tecnomyl will, as part of the ESAP #11, commit for the project to: (i) non purchase, store, use, manufacture, transport or trade activities involving chemicals classified under the World Health Organization’s (WHO) Hazard Classification lists, Class Ia: Extremely hazardous and Class Ib: Highly hazardous, associated with the project; and (ii) perform periodical audits to verify WHO’s Class 1a and Class 1b products will not be associated with the project sites.
PS4-Community Health, Safety and Security
Since Villeta Plant is located within an existing industrial complex and plans to expand exiting finishing processes, no significant additional impacts on the health, safety and security of the local community are expected. Tecnomyl operates with a fully external fleet for export activities, while local distribution relies on a mix of 40% company-owned trucks and 60% external providers.
Infrastructure and Equipment Design and Safety / Life and Fire Safety. Tecnomyl applies NFPA standards and Paraguayan regulations for fire safety and evacuation protocols. Emergency drills and hydrant systems are in place. As per ESAP #12, Tecnomy will commission a third-party Safety / Life and Fire audits for high-risk facilities in line with PS4 and implement actions needed to enhance LF&S.
Hazardous Materials Management and Safety – Storage and Handling of Hazmat. Procedures of the Company govern chemical storage and handling, supported by spill containment and SIGEV recycling programs. As indicated in ESAP # 3, the Company will review its EPRP in line with IFC requirements.
Traffic Management. Fleet operations are managed through a formal traffic management plan that includes providing each driver with the optimal route prior to departure. Therefore, in accordance with ESAP # 13, the Company will the Company will update this plan to assess transportation risks and impacts to community safety, including but not limited to Gender Based Violence (GBV) community impacts correlated to truck traffic/rest areas on women and children's daily activities routes, risks of accidents, emergency procedures, among others. Based on this assessment, Tecnomyl will develop and implement a transportation management plan to mitigate identified risks and impacts, aligned with PS4.
Security Services. Tecnomyl relies on 10 armed guards - 4 assigned to the day shift and 6 to the night shift - to control access to its facility and adheres to internal policies; No evidence was found during the appraisal of human rights training for security staff. As per ESAP #14 Tecnomyl will: (i) develop a Security Risk Assessment and a Security Management Plan specific to each Project site, including the respective actions, infrastructure and processes to prevent and mitigate the risks of each unit; (ii) introduce mandatory training, screenings and monitoring mechanisms for security personnel in line with PS4 requirements and IFC´s Good Practice Handbook on Use of Security Forces.
