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.
PS 1 - Assessment and Management of Environmental and Social Risks and Impacts
Environmental and Social Assessment and Management System: LTH have an Environmental and Social Management System (“ESMS”) in place for the operations. The ESMS includes Health, Safety and Environment (“HSE”) policies and procedures for risk assessment processes and management, legal compliance, training, monitoring and review, emergency response, grievance management, and stakeholder engagement. There is an adequate structure for continual review and update of the ESMS.
Identification of Risks and Impacts and Management Programs: LTH implements Cassava Group Risk Management Manual which includes provision for managing E&S risks across the business. At the corporate level as well as in the respective operating countries (OpCos), LTH keeps EHS risk registers which are updated quarterly based on quarterly risk assessments. However, the E&S risks and impacts related to the company operations in fragile and conflict states are unique, and will be assessed and appropriate mitigation included into the Cassava Group Risk Management Manual and implemented by LTH (ESAP #1).
Organizational Capacity and Competency: The Cassava Group Board of Directors sets corporate objectives and targets and takes strategic decisions on safety, health and environmental management. The Group Executive ESG team provides operational oversight to the LTH OpCos. Liquid operations are divided into three regions, Southern Africa (south Africa and Botswana), Eastern Region (Kenya, Uganda, Tanzania and Zanzibar, Rwanda, South Sudan), and Central Region (Zimbabwe, Zambia and DRC) - operations in Nigeria and Egypt are currently small and HSE oversight lies with the East Africa Region. The HSE Lead for each region is supported by HSE managers, officers, and HSE representatives, depending on the scale of the operations in each country. HSE meetings are held monthly at each OpCo and between OpCos and the regional HSE Leads; while quarterly ESG meetings (including EHS) are held between the Cassava Group Executive for ESG and LTH Regional HSE Leads. ESG reporting to the Board of Director and company shareholders is done quarterly, and all corporate key performance indicators are reported at this level.
PS 2 – Labor and Working Conditions
LTH has a total of 2,029 direct employees, all of whom are either on permanent (80%) or fixed term (20%) contracts. Women represent 32% of the workforce and 3% of the senior management positions. An estimated 922 third party contract workers are indirectly employed to conduct various infrastructure or maintenance activities.
Human Resources Policies and Procedures: The LTH HR policies and procedures are aligned with IFC PS2. An updated, centralized Human Resources Management System (HRMS) aligned to the Liquid ESMS and PS2 requirements, is currently being rolled out across all OpCos.
Working Conditions and Terms of Employment: All LTH employees are provided with written contracts of employment that detail terms of employment, probation period, remuneration and leave entitlement (annual, sick, paternity, maternity, family responsibility). All employment contracts are signed by the LTH CEO or the appointed representative such as the HR Manager. Working hours comply with relevant national labor regulations of the country of operation. All operations employ shift work where necessary which are managed as per adequately defined shift rosters.
Workers’ Organizations: Employees LTH are allowed to join or form labor unions by policy and in practice.
Non-discrimination and Equal Opportunity: LTH promotes non-discrimination and equal opportunity across the business through several platforms and policies. These commitments are also documented in the LTH Code of Conduct and the matters arising are addressed within prescribed structures.
Retrenchment: A total of 82 employees have been retrenched since 2024 (mostly in South Africa) due to business restructuring, with further retrenchments anticipated (less than 50 personnel) to take place in the new financial year (FY25/26). Collectively this represents less than 10% of the entire Liquid workforce. Most retrenchments to date have been done in line with stringent national labor legislation in South Africa and Kenya – which largely align with IFC PS2 requirements for retrenchment. Given these retrenchments and that future retrenchments are anticipated, a standardized Retrenchment Policy and Plan will be developed and implemented at the OpCos, especially those in countries where legal requirements on retrenchment are not aligned with IFC PS 2 (ESAP #2).
Grievance Mechanism: The LTH Internal Grievance Management Procedure is adequate and stipulates the various processes for managing internal grievances, and adequately implemented. Most reported grievances in 2024/25 were adequately managed.
Protecting the Work Force: The LTH HR Policy and Code of Conduct stipulate that no child or forced labor shall be used by any OpCo, as specified in the Group ESMS Handbook. This requirement is further described in the Liquid Human Rights Policy. All employees are required to produce identification to demonstrate they are over 18 years of age and have written contracts.
Occupational Health and Safety: The ESMS Handbook includes adequate requirements regarding Occupational Health and Safety (OHS). All operational activities are required to be assessed for hazards and elevated risk, and staff are required to go through appropriate training. Key operational activities, in particular fiber infrastructure build, are undertaken by contractors on behalf of LTH. To manage OHS risks among contractor workers, LTH implements an adequate Contractor HSE Specifications Procedure as the guideline that requires contractors to effectively manage safety, security, health and safety, and the environment and abide by relevant standards. LTH reports OHS incidents and accidents in their annual ESG reporting. No serious incident has occurred since 2022.
Workers Engaged by Third Parties: The business model applied across Liquid relies heavily on the use of third-party contractors for both infrastructure builds and operations and maintenance. The LTH Contractor HSE Specifications Procedure, Third Party Service Providers Policy and Supplier Code of Conduct are adequately implemented to ensure that all workers are treated with respect and dignity and that business operations are environmentally responsible and conducted ethically.
PS 3 – Resource Efficiency and Pollution Prevention
Resource Efficiency: LTH operations do consume electricity and water. However, the consumption of these resources is not considered material, including contracted activities that are largely civil works with minimal energy and water consumption. Grid electricity use data from OpCos in 2025 was 0.159 MWh/employee/year, while municipal water use in was 44,671 KLitres.
Waste and Wastewater Management: Key waste streams in LTH operations include office waste, packaging waste, cable and conduit offcuts, damaged cables, e-waste (small batteries, obsolete optical network terminals etc.). Waste management requirements are defined in the ESMS Handbook. Liquid generated 6, 833 tons of waste in FY 2025, which included 5,690 tons of non-hazardous waste and 30 tons of e-waste (classified as hazardous). Due to the limited certified handlers in numerous LTH operating jurisdictions outside of South Africa, the Cassava Group have commenced a holistic review of e-waste across all subsidiaries and are in the process of development an e-waste management plan to be integrated in their ESMS and implemented across each subsidiary (eg. LTH).
PS 4 – Community Health, Safety and Security
Community health and safety: Community health and safety issues in LTH operations are mainly associated with road transport, earthworks, trenching, laying of cables and site clearance could include exposure to dust, noise, vibration, restricted access, open trenches and excavations that pose fall and collapse hazards and risk of fire due to the presence of flammable materials in installation areas. However, the potential impacts are limited and short-term and largely considered via existing risk assessment processes. Risks to communities relating to operations (including potential electrocution, exposure to optical hazards from fiber lasers, noise pollution from generators and accidents involving vehicle fleets) are considered low to moderate within the business operating context (urban/peri urban localities, regulatory compliance requirements and stringent HSE protocols/policy/procedure implemented by contractors and Liquid). The Liquid ESMS Handbook includes the Environmental and Social Screening and Risk Assessment Tool for operational risk identification and assessment, and a requirement for developing procedures to mitigate risks that could impact communities, i.e., excavations, trenching, driving, site establishment. The Tool is adequately implemented in LTH projects.
Security: Although most Liquid operations use unarmed third-party private security contractors, LTH has recently extended to some countries where armed government security personnel are engaged due to heightened security risks. The Liquid Physical Security Policy will be updated to cover PS 4 requirements, including appropriate training and oversight of security personnel, and collaboration modules with external government or private security service providers (ESAP #3).
