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
Policy and Management System:
The Hikma facilities are generally located in industrial zones and all the plants have the requisite environmental approvals from the local authorities and report on compliance with the host country’s relevant legislations, as required.
Hikma has adopted and disclosed the following corporate policies and procedures: Environmental, Health and Safety (EHS) Policy, Code of Conduct, Auditing and Monitoring, Supplier Code of Conduct, Anti-Bribery and Corruption, Modern Slavery, and Speak UP Lines and Reporting Concerns (instruments for raising grievances). The EHS policy includes Company commitments with Environmental, Health and Safety laws, regulations, and standards applicable to Hikma business including the IFC Performance Standards and the World Bank Group EHS Guidelines.
All Hikma facilities in the MENA region have Environmental and Social Management Systems (ESMS) aligned with IFC PSs and certified to ISO international standards (ISO 45001 and ISO 14001). In addition, the Hikma Jordan facility is also ISO 50001 certified for (energy management system), and Hikma KSA facility is ISO 9001 certified (quality management system), reflecting integration of quality assurance, environmental and energy considerations into the overall ESMS.
All the Group facilities are certified under Good Manufacturing Practice (GMP), a system for ensuring that products are consistently produced and controlled according to a set of quality standards related to their intended use and as required by the product specification. A system is in place for conducting GMP related internal and external audits. All other facilities operate in accordance with requirements of the relevant national food and drug authorities.
Hikma has procedures for the regular identification and assessment of risks and hazards associated with its current and planned operations. These procedures are developed in the context of their ESMS and in accordance with their ISO 14001 and ISO 45001 requirements and is designed to assess site-specific sources of risk, hazards, and how proposed activities could interfere with workers safety. Facility specific EHS risk assessments are carried out annually, or when a change is implemented in routine activities, and the outcomes are recorded in a risk register. The EHS risk assessment matrix used is industry standard with several categories of risk, and Hikma conduct periodic reviews of high-risk areas or activities to evaluate the effectiveness of existing control measures. At corporate level, Hikma operates an Enterprise Risk Management (ERM) framework to ensure a comprehensive and structured approach and to enables a thorough view of its risk exposure to assist in decision-making and improvement in operational and compliance processes.
Organizational Capacity and Competency:
At the country level, each Hikma facility has a separate EHS Department and an EHS manager, supported by EHS team including EHS engineers / officers (whose size varies across facilities), responsible for implementation of the ESMS. The EHS representatives at the facility level report to the senior Site Management. At Corporate level, an EHS lead coordinates across all Hikma facilities on EHS related matters and the EHS related data / information required for corporate EHS oversight and including the information for reporting in the AMRs submitted to IFC. There is an HR department at each facility that reports to the Corporate HR Vice President. The facility’s HR department is responsible for labor related matters. Hikma’s corporate responsibility activities are overseen by the Compliance, Responsibility and Ethics Committee, a board-level committee which focuses on formalizing the company’s ethical commitment to business integrity. Hikma's annual budgets and five-year plans are developed through a bottom-up and top-down process across the Group. At annual budgetary exercise, site specific opex and capex plans are presented for discussion and once cleared by management, these are presented to the Board for approval.
Trainings:
In-depth EHS training is undertaken as part of induction as well as ongoing general and job specific trainings. As part of the facility level ESMS, the annual EHS Training Plan are developed which includes practical modules and theoretical training sessions.
Hikma will ensure updating the content of the Annual EHS Training Plan across facilities to: (i) align with the risk assessment matrix, including the outcome of the analysis of the incidents and near-misses, so that it focuses on the management of specific risks, and develop a schedule of training that reflects these risks and the workers who are exposed to them, and (ii) include details of the relevant content of the IFC Performance Standards and WBG EHS Guidelines (ESAP #1)
Emergency Preparedness and Response:
Hikma Jordan and KSA facilities have facility specific Emergency Preparedness and Response Plan (EPRP) in place and structured around key emergency scenarios, including fire, road accidents, chemical spills, utility outages, natural disasters (such as sandstorms, earthquakes, floods), pandemics, workplace violence, and bomb threats. Site specific emergency response plans (ERP) have been developed for all Hikma facilities and are implemented accordingly.
The facilities maintain trained emergency response teams (first aid, firefighting, and evacuation teams) and conduct periodic drills on firefighting, spillage management, and evacuation to test preparedness and response capabilities. The EPRPs are reviewed and updated periodically to ensure ongoing alignment with operational risks and regulatory requirements.
Monitoring and Review:
For consistency in EHS performance monitoring across all facilities, Hikma has established a set of EHS monitoring indicators, referred to as key performance indicators (KPIs), relating to waste management, water consumption, energy management, quantity of wastewater treated, and utility consumption. Data is collected monthly and consolidated through a centralized platform, which enables tracking and review at the corporate level. All facilities have a monitoring program in accordance with local regulatory requirements, GMP standards and the site-specific EHS management systems. The EHS monitoring program covers regulated stack emissions (Oxides of Sulphur, Oxides of Nitrogen, and Particulate Mapper), production areas environmental and occupational health parameters (e.g., temperature, humidity, differential pressure, noise at workstations, etc.), waste parameters and review of performance against environmental objectives and targets.
Hikma publishes annual Sustainability Reports on its website which provide an overview of Group’s E&S performance relating to management of water and wastes, GHG emissions, sustainable supply chain, recruitment and retention, CSR activities, and the Sustainable Development Goals (SDGs). Hikma’s Annual Reports also includes reporting on employees, sustainability, and stakeholders’ engagement. Crisis & Continuity Management (CCM) programme integrates various disciplines, including Crisis Management, Business Continuity, Emergency Response, and IT Continuity and Disaster recovery to develop organisational resilience.
The Corporate Responsibility (CR) Department is responsible for target setting and data collection for some environmental and social issues such GHG emissions, energy consumption, community engagement etc. and facilities report environmental and social performance to the Corporate Communications (CC) Department and for including in the AMRs.
PS 2 – Labor and Working Conditions
Human Resources Policies and Procedures:
Across the three facilities in Jordan (Hikma Jordan, APM Sult and APM Sahab) the Group employs approximately 2,000 workers, including administrative, technical (processing plants) staff, of whom 29% are female; in Saudi Arabia it employs about 730 direct workers of which, 16% are women across the manufacturing plant and the offices and about 50 contractors in the manufacturing plant.
Hikma has an overarching Code of Conduct that sets out principles and standards on equality of opportunity, non-discrimination, harassment, bullying and sexual harassment in the workplace, health and safety, privacy and confidentiality, as well as protection of company’s assets, business integrity, environmental protection and community engagement. The Code is disclosed on the company website in multiple languages, is supported by relevant procedures and policies and applies to all Hikma direct and contracted workers, as well as the third-party contractors working across all Group operations.
The Code outlines mechanisms for raising concerns or reporting misconduct, including anonymous channels, and commits to non-retaliation for those who speak up. It emphasizes individual accountability and ethical decision-making across all levels of the organization. These policies and procedures are communicated to all employees at onboarding and through regular online training. Communication with employees on broader organizational matters is facilitated via online and in-person trainings, newsletters, e-mails, intranet and notice boards situated throughout the plants. Further employees undergo annual performance evaluations to assess their progress, identify areas for improvement, and set goals for future development.
The actual terms of employment are defined in individual employee contracts and are governed by Hikma’s human resources policies and procedures, and national laws. These cover key areas such as recruitment and hiring, working hours, overtime, attendance, annual and other forms of leave, compensation, performance evaluations, disciplinary measures, grievance and complaints mechanisms, health and safety protocols, social security, medical insurance, and other employment benefits. As per ESAP #2, Hikma will develop, at a corporate level, a Contract Workers Management Framework (CWMF), as part of the ESMS, to guide the facilities update their HR policies and procedures to include provisions specifically addressing migrant workers, both direct and contracted ones. The CWMF will address the full scope of the employment relationship, including their recruitment, employment terms, wage and benefit entitlements, overtime, and provisions ensuring migrant workers retain the right to return to their home countries periodically as part of their employment arrangements. The CWMF will also include a procedure for corporate level oversight ensuring its implementation through monitoring, auditing, and reporting methodology.
Workers Organization:
The company affirms support for employees’ rights to freedom of association and collective bargaining and recognizes the role of worker representation in fostering open dialogue and accountability in its Modern Slavery Statement of 2024. As per ESAP #3, Hikma will update its local policies to include a specific commitment to upholding employees’ rights to freedom of association and participation in collective bargaining agreements, in alignment with IFC Performance Standards-2 and international labor standards.
Grievance Mechanism:
Hikma’s Code of Conduct establishes a corporate based grievance mechanism that enables employees and stakeholders to report concerns or violations through multiple accessible channels, including line managers, Human Resources, Legal and Compliance, Internal Audit, and an independent, confidential, and anonymous “Speak Up Line” available 24/7 on Hikma’s website in multiple languages. The Code emphasizes confidentiality, commits to investigating concerns promptly, guarantees non-retaliation, and mandates regular training and communication to ensure all employees understand and adhere to its principles.
As per ESAP #4, Hikma will update its grievance mechanism (Speak Up Line) to provide a separate and accelerated procedure for reporting and handling “sensitive cases” such as discrimination, harassment, sexual harassment and human trafficking, as well as referral pathways to survivors. It will also enhance its efforts to sensitize all employees on these issues through more targeted and frequent training programs, ensuring greater awareness, prevention, and effective response.
Retrenchment:
In Saudi Arabia, the company employed a total of 720 full-time and contract workers in 2023, increasing to 738 in 2024. The turnover rate in 2024 was 9%, reportedly due solely to voluntary departures. In Jordan, the workforce grew from 1,595 in 2023 to 1,631 in 2024, with a turnover rate of 6% in 2024. The company does not anticipate a workforce planned reduction.
Occupational Health and Safety:
All Hikma operations are governed by an integrated HSE Policy that includes procedures on employee health and safety, accident prevention, monitoring and reporting of workplace incidents, safe machine operation, use of Personal Protective Equipment (PPE), contractor safety, and chemical handling.
All employees, including contract workers, are provided with trainings on applicable SOPs and OHS aspects internally by the EHS coordinator.
Manufacturing areas are equipped with HVAC systems designed according to Good Manufacturing Practice (GMP) protocols, including the use of HEPA filters in sterile processing zones. All facilities follow GMP provisions and site-specific Standard Operating Procedures (SOPs), which include safety protocols based on annual risk assessments conducted at the plant, department, and unit levels. These assessments identify hazards and outline mitigation measures.
Hikma facilities have formal safety committees in place, comprising representatives from each department, and are responsible for reviewing safety performance, supporting implementation of corrective actions, and promoting a safety culture across the facility. Risk assessments are carried out annually and updated as needed based on operational changes. All forklift operators are certified, and trained for safe equipment use. Preventive maintenance systems are in place for safety-critical infrastructure.
In 2024, the Jordan facility recorded 14 non-fatal incidents and 25 with less than 15 lost workdays, resulting in a Lost Time Injury Frequency Rate (LTIFR) of 8.34, up from 5.1 in 2023. All incidents are subject to investigation and are formally documented. A centralized digital reporting tool is in place, accessible through a QR code, which allows any employee to log safety issues. Data from inspections and incident reports are collected in a central log-sheet for monitoring and follow-up.
In 2023, the JPI facility in KSA recorded approximately 1,460,800 manhours worked and reported seven non-fatal incidents, resulting in a Lost Time Injury Frequency Rate (LTIFR) of 4.79, up from 2.77 in 2023. A total of 194 lost workdays were recorded over the year. No fatalities or major regulatory non-compliance issues were reported during the last two years.
Hikma will develop a formal process, at the corporate level, for conducting a regular analysis of the recorded incidents and the near misses to proactively identify risks and tailor its annual EHS training plan based on actual site conditions and evolving operational needs. Hikma will develop a procedure to benchmark LTIFR at each facility against the regional or international standards and Good International Industrial Practices (GIIP) and implement action plans where performance exceeds industry norms (ESAP #5).
Protecting the Work Force:
Hikma’s Code of Conduct reflects strong ethical practices in relation to labor and human rights and prohibits the use of forced or child labor. The minimum age of employment is 18 at all facilities and the national identification card is reviewed before the processing of a work contract.
Workers Engaged by Third Parties:
Third-party workers are engaged for services such as maintenance, construction and catering. Hikma’s Code of Conduct and EHS Policy apply across all facilities to all contractors, who receive safety instructions and must meet task-specific requirements prior to starting work. The pre-engagement process includes safety documentation, risk assessment and work permits. Critical tasks are inspected, and long-term projects are overseen daily by the company who has full supervision authority.
At the JPI facility in KSA, the company also engages approximately 50 contract workers through a labor broker (Faris Al Reef Contracting Co.) that varies depending on operational needs. The labor supply agreement is in line with local labor regulations. These workers are subject to the same site-specific safety protocols and contractor management procedures as other third-party service providers. The contract between the labor broker and the company includes provisions related to contractor safety by acknowledging their commitment to following all occupational health and safety rules and procedures in place at the company.
As per ESAP #6, Hikma will also strengthen its oversight of third-party service providers and contractors by establishing a formal procedure to evaluate and continuously monitor the employment conditions of contractors and subcontractors, ensuring full alignment with national laws and PS2 requirements.
Supply Chain:
Hikma has a Suppliers Code of Conduct that applies to its suppliers, partners and third parties providing goods and services to or working with Hikma. The CoC aims to improve the overall sustainability level of the supply chain and identify any areas of risk. The CoC requires the Suppliers to comply fully with the laws and ethical standards applicable to their business operations including environment, health and safety, workers protection, discrimination and harassment; etc. Hikma applies a structured supplier pre-qualification process for all categories of suppliers, who are required to complete a detailed questionnaire, which is scored to determine eligibility. Compliance requirements, including health and safety, environmental, and quality parameters, are embedded in purchase orders, which suppliers are contractually obliged to follow. Supplier performance is monitored through periodic audits.
PS 3 – Resource Efficiency and Pollution Prevention
Resource Efficiency:
Hikma is committed to continuous improvement in energy and resource efficiency across its manufacturing operations in Jordan and Saudi Arabia. Hikma has set internal targets and implemented strategic initiatives aimed at optimizing energy use, reducing water consumption, and minimizing waste generation, as part of its broader sustainability agenda.
As part of its resource efficiency strategy, Hikma tracks electricity, fuel, and water consumption intensity relative to production output across its sites, with encouraging trends noted particularly at the Jordan facilities.
Water consumption at the Jordan facility improved from 0.025 m³/KPU in 2023 to 0.019 m³/KPU in 2024. The site is equipped with an onsite wastewater treatment system, which includes settling tanks, chemical coagulation, and sludge removal. In contrast, water consumption at the KSA facility remained constant at 0.03 m³/KPU over the same period, with no wastewater treatment at site level.
At the Jordan Bayader facility, electricity consumption decreased from 14.31 kWh per Kilo Production Unit (KPU) in 2023 to 12.93 kWh/KPU in 2024. The site uses an AI-enabled Building Management System (BMS) to support energy optimization, particularly for HVAC operations. Fuel consumption at this facility also decreased significantly, from 37.93 MJ/KPU in 2023 to 29.17 MJ/KPU in 2024. The facility operates LPG-fueled steam boilers with regular preventive maintenance and leak detection systems in place. In KSA, the JPI site also recorded a reduction in electricity intensity, from 10.13 kWh/KPU in 2023 to 9.72 kWh/KPU in 2024. Fuel consumption, however, remained relatively stable, increasing slightly from 13.53 MJ/KPU in 2023 to 13.69 MJ/KPU in 2024. This site operates diesel-fueled steam boilers, with regular maintenance and pressure safety systems.
Hikma has implemented a range of measures to enhance resource efficiency at its manufacturing facilities in Jordan and KSA. As part of the company’s resource efficiency strategic measures, both sites have replaced conventional lighting systems with LED fixtures and monitor resource consumption through a centralized digital platform, called Green Ops along with the AI enabled BMS system at specific sites. This platform allows for monthly tracking of leading KPIs for electricity, fuel and water usage and waste generation data, which is collected by the respective engineering teams at each site and reviewed by the corporate sustainability team. These statistics are reported in annual Sustainability Reports and aligns with the Sustainable Development Goals (SDG).
GHG Emissions:
Hikma is committed to minimizing its impact on the environment and have procedures to measure and manage the use of resources to ensure sustainable growth and reduction in the GHG emissions. In 2021, Hikma put in place a target to reduce its Scope 1 and 2 GHG emissions by 25% by 2030, using a 2020 baseline. The target was developed using the absolute contraction approach and is in line with the Paris Climate Agreement’s well-below 2°C scenario. In 2023, Hikma’s overall Scope 1 and 2 emissions (market-based) measured 123,727 tonnes of carbon dioxide equivalent (tCO2e). As of 2024, Hikma has reduced its emissions by 17% compared to the 2020 baseline. Hikma’s GHG emissions from its Middle East regions facilities is estimated as 10,800 tCO2e. Hikma has both solar thermal and photovoltaic panels across its MENA estate including a large-scale array at APM Salt in Jordan. Hikma plans to install further solar panels across its global facilities as a measure to improve its energy efficiency and emissions footprint.
Air Emissions and Ambient Air Quality:
Air emissions from Hikma’s operations in Jordan and KSA primarily result from fuel combustion in steam boilers and backup diesel generators. Manufacturing plants are equipped with steam boilers fired by liquefied propane gas (LPG) in the case of Jordan and diesel, in the case of Saudi Arabia, and in some other cases natural gas, with nitrogen oxides (NOx) being the primary regulated pollutant. Available data from 2023 indicates that emissions from these sources comply with applicable local regulatory limits and the relevant thresholds outlined in the WBG EHS Guidelines. All facilities monitor key air emission parameters in accordance with (GMP requirements and, where applicable, local environmental regulations. At the Jordan Bayader site and the JPI facility in KSA, third-party ambient air quality monitoring is conducted periodically. Results for parameters in the 2023 reporting period such as particulate matter (PM2.5 and PM10), CO, CO2, and TVOCs were within Occupational Safety and Health Administration (OSHA) acceptable limits.
Particulate emissions from sensitive production areas, including beta-lactam manufacturing zones, are managed using high-efficiency particulate air (HEPA) filtration systems. Overall, air emissions management and ambient air quality monitoring systems appear to be in place and functioning in accordance with industry and regulatory standards.
Wastewater and Waste Management:
Wastewater management practices at Hikma’s facilities in Jordan and KSA follow different operational models. At the Jordan Al-Bayader facility, an onsite wastewater treatment plant (WWTP) is in place. Effluent quality is monitored regularly and tested by an external laboratory to verify compliance with national discharge standards. Sludge generated through the WWTP is collected and removed by an authorized third-party contractor, which is approved by local authorities and responsible for all waste treatment services at the facility.
At the JPI facility in KSA, wastewater is collected at site in underground storage tanks. The wastewater is collected by a licensed third-party contractor, approved by local authorities, for disposal into the municipal sewage system. Prior to discharge into the municipal sewage system, the contractor conducts testing to ensure that the effluent complies with applicable standards.
Materials handling and wastes management at Hikma’s Jordan and KSA facilities are governed by internal procedures aligned with GMP standards and local regulatory requirements. Waste is segregated at the source into hazardous and non-hazardous streams, appropriately labeled, and stored in designated areas. Hazardous waste at both facilities is stored in quarantine zones within the warehouses, which are accessible only to the Quality Department, ensuring controlled handling prior to removal. At the Jordan Al-Bayader site, hazardous waste including expired or rejected materials, contaminated packaging, and process residues is tracked using barcode tagging and manifest forms. Waste is collected and transported by third-party licensed contractor, approved by local authorities, for off-site treatment and disposal facilities. At the JPI facility in KSA, hazardous waste is also managed by a third-party provider authorized by national regulators. Waste is temporarily stored in secure quarantine areas before being transferred offsite for treatment and disposal. Both sites track waste data through the Green Ops platform, supporting centralized oversight by the corporate sustainability team. Other Hikma facilities also engage authorized third-party vendors for off-site disposal of wastes. These practices reflect a structured approach to waste management, with secure handling, restricted access, and traceability mechanisms in place to minimize environmental and compliance risks.
As per ESAP #7, Hikma will augment the EHS oversight of its third-party waste management contractors and develop a procedure for conducting site audits of the wastewater and the wastes (including the hazardous waste) contractors to verify their compliance with national legislation IFC PS 3, and WBG EHS Guidelines for Pharmaceuticals And Biotechnology Manufacturing concerning the handling, transportation, and off-site disposal of the wastes collected from Hikma facilities, including a strong focus on the management of EHS risks.
PS4: Community Health, Safety and Security
The Hikma facility in Jordan is situated within a designated industrial zone, and there are no residential communities or social receptors in the immediate vicinity, allowing the facilities to operate without posing risks to local populations. Furthermore, the facilities do not store hazardous chemicals or waste. In terms of transportation, the company does not maintain its own fleet; instead, it provides transportation for workers through a contracted service.
The Hikma facility in KSA is located in the industrial zone of Al Kharj, with no residential communities or social receptors nearby, thereby minimizing potential social or environmental impacts. The facility is equipped with filters and sensors designed to prevent dust emissions and detect any leakage, ensuring that no dust is released outside the premises. Hikma KSA maintains its own transportation fleet for logistics and distribution activities.
Life and Fire Safety:
Hikma facilities have emergency response plans being structured around key emergency scenarios including fire incidents. The facilities organize emergency response teams and provide them trainings and conduct periodic drills on firefighting.
Hikma facilities have a firefighting system that includes smoke detectors, heat detectors, addressable and conventional alarm system, sprinklers in the warehouse areas, fire extinguishers, fire hose reels, fire hydrants, and a dedicated full set of fire pumps capable of maintaining the recommended pressure. The stand-alone fire extinguishers include a FM-200 System, CO2, and foam type extinguishers placed at appropriate locations based on the outcome of a risk assessment. Fire detection and suppression systems are checked monthly and inspection of the fire extinguishers is conducted semiannually. Internal and external trainings are provided to all employees and contract workers on first aid and firefighting.
Grievance Mechanism:
Hikma has two external grievance mechanisms. The first is its “Speak Up Line”, a confidential, anonymous platform available 24/7 and managed by an independent third party, which allows employees, suppliers, and external stakeholders to report concerns related to misconduct, ethical breaches, or Code of Conduct violations, managed by the Compliance team. The second is its Pharmacovigilance (PV) system, which enables the public and healthcare professionals to report adverse events or side effects related to Hikma products, managed by the PV team for product safety. The “Speak Up Line” grievance mechanism will be updated to provide a separate and accelerated procedure for reporting and handling “sensitive cases” such as discrimination, harassment, sexual harassment and human trafficking, as well as referral pathways for survivors (ESAP #4).
Security:
Hikma has engaged external security firms to protect its personnel and assets, and all security personnel are unarmed during regular duties. A private security firm provides security services at Hikma’s Jordan facility, employing 33 security guards who operate on a three-shift rotation. Similarly, the JPI facility in KSA, through a security firm that contracts 30 security guards also deployed across three shifts. Each site has a dedicated Security Manager from the contracted firm, and Hikma appoints its own Security Manager to oversee plant-level security and coordinate closely with the contracted teams.
While most guards are ex-military personnel, all applicants must present a non-criminal record as part of the recruitment process. Hikma’s Security Management Plan is a formal document reviewed annually, and security guards participate in periodic training sessions and emergency preparedness drills. The Code of Conduct is applicable to all security personnel and is integrated into their onboarding. Guards are informed of Hikma’s grievance mechanism and how to report concerns. No weapons are carried during regular duty; in Jordan, any presence of weapons (e.g., pistols) is strictly controlled and locked, with the security firm retaining legal responsibility for their registration and liability.
Employee transport services at the Jordan facility are contracted to a private transportation company. All transport vehicles are owned and managed by the contractor, who assumes full operational responsibility. Hikma conducts regular inspections of the vehicles and verifies driver qualifications to ensure safe and compliant operations.
As per ESAP #8, Hikma will develop and implement a trainings plan for both security and transport contractors to provide training to their personnel on sensitive issues such as discrimination, sexual harassment, use of force, and grievance procedures.
