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 Management System:
Maynilad achieved company-wide Integrated Management System (IMS) certification provided by TÜV Rheinland and Philippine Accreditation Bureau (PAB) for all core processes for water and wastewater. As of May 2025, 82 of its offices and facilities were certified under ISO 9001: 2015 Quality Management System, ISO 14001:2015 Environmental Management System, ISO 45001:2018 Occupational Health and Safety Management System, 2 facilities are certified under ISO/IEC 17025:2017 Competence of Testing and Calibration Laboratories, 14 facilities certified under ISO 14064-1:2018 Greenhouse Gas Inventory and Reporting, ISO 50001:2018 Energy Management System, and 14 facilities certified under ISO 22301:2019 Business Continuity Management System. All certificates are valid and up to date.
The IMS documentation consists of E&S related policies and procedures covering environment and social impact assessment, hazard identification, risk assessment, and control (HIRAC), emergency preparedness and response, contractor and visitor safety, permit-to-work systems, OHS procurement, and training. As per the ESAP# 1 Maynilad will update current documentation in IMS in line with IFC PSs and WBG EHS guidelines and to the extent necessary, will include policies and procedures covering external grievance redress mechanisms, supply chain management (including the screening of solar supply chain) and suppliers’ code of conduct, transportation safety, community health and safety, gender-based violence and sexual harassment, stakeholder engagement and consultation. The requirements of the updated IMS will be communicated to all Maynilad’s EPC contractors.
Identification of Risks and Impacts:
For new construction and upgrade of the WTFs, WTPs and conveyance systems, Maynilad conducts ESIAs in line with regulatory requirements under Presidential Decree 1586 on Environmental Impact Statement System (PEISS). In the past, for activities under the World Bank’s Metro Manila Wastewater Management Project (closed in June 2020), Maynilad has also followed the requirements of the World Bank Safeguards Policies including E&S screening of the new construction and modernization, assigning E&S category for each such investment, assessing resettlement impacts and disclosing the ESIA and land acquisition reports on Maynilad’s website.
ESIA studies contain Impacts Mitigation and Monitoring Plans which form part of the Environmental Compliance Certificates issued by the Department of Environment and Natural Resources (DENR). Maynilad’s EPC contractors, e.g., those involved in the construction of new plants, are also required to submit their environmental management plans to ensure that all the requirements of Maynilad and the local government units (LGUs) for environmental compliance will be met. These requirements include proper handling and disposal of hazardous and non-hazardous chemicals and waste, and mitigation of identified environmental impacts and associated risks. Contractors submit periodical E&S monitoring reports to Maynilad.
Maynilad will align its current Policy on Environment and Social Impact Assessment (May 2022) with the IFC PSs requirements and include E&S screening and categorization of pipeline projects against all PSs (covering aspects related to biodiversity, IPs and cultural heritage, among others not yet covered by its current Policy), ESIA requirements for associated facilities, ongoing stakeholder engagement and consultation, access to information and disclosure, continuous monitoring and adaptive management, cumulative impact assessment and climate change (ESAP #2).
Organizational Capacity and Competency:
Maynilad’s E&S management is led by its Quality, Sustainability, and Resiliency (QSR) Division, supported by its key functions, which include the Sustainability Department (SD), Occupational Safety and Health (OSH), Business Continuity and Security Management (BCSM). SD is responsible overall for E&S management and monitoring, ESIA process and environmental compliance.
Land Acquisition Process is managed by the Supply Chain Management (SCM) and Program Management (PMD) Divisions. To ensure compliance with IFC PSs, Maynilad seeks to strengthen its institutional capacity by engaging a Social Impact and Resettlement Specialist who will be responsible for the following functions: (i) ensure Company compliance with IFC Performance Standards and provide strategic support and advisory services to SCM, PMD and End-User divisions; (ii) conduct social impact assessment, surveys, and stakeholder mapping for identified projects; (iii) undertake planning and implementation of social instruments, such as Resettlement Action Plans and related measures in line with IFC PS5 and other relevant standards (iv) implement stakeholder engagement and grievance management; and (v) design and deliver capacity-building activities for Maynilad staff and relevant stakeholders to strengthen institutional knowledge and skills in social development and stakeholder engagement (ESAP#3);.
Monitoring and Review:
Maynilad conducts both internal and third-party audits covering all IMS-related standards, including E&S and OHS. Internal audits are documented in SIPAM (System Improvement Plan and Monitoring) forms and tracked until validated closure. External audits are conducted by TÜV Rheinland and PAB as part of certification surveillance and renewal.
In addition, SD prepares an Environmental Management and Monitoring Plan (EMMoP) for each project. The EMMoP is customized per project, based on inputs from the Project Proponent, DENR, EIA Consultant (if applicable), the Review Committee, affected communities, and other key stakeholders.
Stakeholder Engagement and Grievance Mechanism:
Maynilad has several channels for receiving feedback and complaints including complaint and inquiry links on its website, as well as email and phone number. Information relating to tariffs and tariff adjustment mechanisms, service standards, and investment obligations is regularly reported to the MWSS Regulatory Office. As a part of the IMS upgrade, the Company will develop a company -wide external grievance redress mechanism and associated procedure in line with IFC PSs designed to be able to receive, address and resolve complaints on EHS issues from affected communities arising from construction, land acquisition and operation activities, and to include the mechanism for grievance resolution, accountabilities and reporting back to communities (ESAP#4).
PS 2 – Labor and Working Conditions
Human Resource Policy and Management:
As of 31 March 2025, Maynilad had 2,695 employees, including project-based and fixed term personnel. Women constituted 26% of Maynilad’s workforce, with 25% female representation at the top management team. The EPC construction force is estimated to be 210 total workers across current facilities under construction.
Maynilad has developed an HR Management System in line with the requirements of the Labor Code of the Philippines. Maynilad has a code of business ethics, whistleblowing policy, recruitment & selection policy, training policy, health policies, diversity & inclusiveness policy, mental health policy, anti-sexual harassment policy, and policy on respect for and protection of the rights of the people. Maynilad has collective bargaining agreements (CBAs) with its two labor unions - for supervisory employees and for rank and file employees. These CBAs are re-negotiated twice every five-year cycle.
Maynilad enters into employment agreements with various types of workers, i.e., regular, fixed-term, and project-based employees. Similarly, employment agreements specify roles, responsibilities, compensation, benefits, and other relevant terms of engagement.
The Company has a Recruitment and Selection Policy (March 2022) which states that candidates will be considered for selection, regardless of race, ethnicity, age, gender, sexual orientation/preference, affiliation and physical abilities, provided that they possess the qualifications required by the position. The principles of non-discrimination and equal opportunity are also reflected in such company policies as Policy on Diversity and Inclusiveness (June 2021), Policy on Respect for and Protection of the Rights of People (April 2022) and other documents.
The Company also has a Whistleblowing Policy under which employees, consultants and third-party business partners, among others, are given safe and confidential channels to report to the Company, a wide range of issues including fraud, unethical or improper conduct, criminal offense. To the extent necessary, Maynilad will update its HR Management System to expand the existing whistleblowing policy and incorporate a formal internal grievance mechanism aligned with PS2, covering broader categories of workers and workplace concerns, accessible channels of communication, protection against retaliation, defined timelines, and appropriate record keeping for monitoring and reporting and which will be extended to Maynilad’s contractors (ESAP#5).
Workers Engaged by Third Parties
The Employer’s Requirements (ER) for contractors, and Terms of Reference (TOR) for service providers, contain standardized requirements on E&S and OHS. Contractors and service providers are given copies of Maynilad’s policies relating to safety, workplace conduct and relevant labor laws and regulations, and are required to adhere to these standards. For every construction site, contractor is required to organize and maintain health and safety committees conforming to the latest minimum requirements provided in the Department of Labor and Employment Occupational Safety and Health Standards (DOLE OSHS). SD oversees contractors’ environmental management and monitoring based on the Self-Monitoring Reports and Compliance Monitoring Reports (CMR) submitted by contractors and the Pollution Control Officer (PCO). The contractors must establish a Grievance Committee or designate representatives to receive suggestions, feedback, or complaints relating to the project.
Maynilad’s Vendor Code of Conduct, which governs the conduct of its contractors, consultants, suppliers and service providers (collectively, “Vendors”), requires its Vendors to comply with applicable laws relating to labor and employment, working conditions, and the provision of a workplace free from drugs, discrimination, harassment, child labor or other forms of compulsory labor, and other forms of abuse. SCM’s Vendor Management Department investigates any suspected violation of the Vendor Code of Conduct and recommends the appropriate disciplinary or preventive action.
Maynilad’s EPC contractors provide on-site accommodation for their workers. Maynilad will update the clauses in the contractor’s contract on E&S and OHS to include requirements for contractor’s on-site accommodation to be in line with the requirements of the Philippine Labor Code and DOLE OSHS, and the IFC EBRD Guideline Worker’s Accommodation: Processes and Standards (2009), and will monitor its implementation (ESAP#6).
Occupational Health and Safety:
Maynilad has a comprehensive Safety Code that serves as the OHS manual for all employees and contractors. This document outlines the Company’s safety rules, procedures, and requirements across various operations. The Safety Code is made available to all employees and relevant contractors during onboarding, toolbox meetings, and periodic refresher trainings. Maynilad implements a set of OHS programs covering its employees, contractors, and other stakeholders involved in operational activities. These programs cover high-risk work areas and are aligned with national safety standards and industry’s best practices. Key OHS programs include, but are not limited to, fall protection, electrical safety, earthworks safety, confined space entry procedures, lock-out tag-out, fire prevention and control, heat stress prevention, and requirements for personal protection equipment. Maynilad’s OHS programs will be updated in line with the WBG EHS guidelines to include (i) provisions for lifeline and personal flotation devices and availability of rescue buoys and/ or throw bags around the process tanks, ponds and pits; and (ii) provisions for electrical safety and installation and maintenance of the solar power plants (ESAP#7).
PS 3 – Resource Efficiency and Pollution Prevention
Resource Efficiency and Greenhouse Gas Emissions:
Maynilad’s facilities are supplied with electricity from the national grid except for La Mesa 1 WTP which is partially supplied by Maynilad’s own 1-megawatt solar farm. The Company’s current and future activities are not expected to generate more than the 25,000tonCO2eq per year.
MWSS allocates 4000 MLD of raw water from the Umiray-Ipo-Angat water system to the Concessionaires -- 60% or 2400 MLD to Maynilad, and 40% or 1600MLD Manila Water. Maynilad also sources, treats, and distributes 300 MLD from Laguna Lake and approximately 80 MLD from groundwater wells. Groundwater wells are regulated by the National Water Resources Board (NWRB). Withdrawal of water is allowed only under the conditions specified in the NWRB-issued water permit. Maynilad is actively diversifying its water sources and improving system efficiency to enhance supply reliability and build redundancy. For example, Direct Potable Reuse (i.e. New Water) plants such as the WRF in Parañaque, convert treated wastewater into potable water that complies with Philippine National Standards for Drinking Water (PNSDW). This technology represents a closed-loop system that is not dependent on rainfall and is a significant step away from Angat Dam dependency.
As of March 31, 2025, approximately 83.42% (2400 MLD) of Maynilad’s raw water originated from the Angat Dam, approximately 15.64% originated from Laguna Lake, and the remaining 0.94% was sourced from the Imus River, Tullahan River, deep wells and treated effluents from Maynilad’s water reclamation facilities (WRFs). To address potential water supply shortages, MWSS is developing a new water source – the Kaliwa Dam Project -- which MWSS expects to be completed by 2028. It is anticipated that Kaliwa Dam will add 300 MLD to Maynilad’s water supply.
Pollution Prevention:
The Company’s WRFs use a combination of conventional and advanced treatment technologies. These include waste stabilization ponds, aeration, conventional activated sludge, sequential batch reactor, moving biofilm reactor and modified Ludzack-Ettinger (anoxic and aerobic zones) processes. While the treated effluents are compliant with the national General Effluent Standards for parameters such as biochemical oxygen demand, chemical oxygen demand, oil and grease, the DENR issued stricter effluent standards in June 2021 that mandated the removal of nutrients such as nitrates and phosphates, and imposed tighter limits on fecal coliform and ammonia. To meet these updated discharge requirements, several WRFs will require upgrades, primarily through the addition of anoxic treatment processes. These upgrades have been incorporated into a Compliance Action Plan (CAP) that was agreed with the DENR (and when applicable, with the Laguna Lake Development Authority) and are included in the 2023-2027 CAPEX plan. The WRFs are expected to achieve full compliance with the new standards by 2028. Furthermore, monitoring results confirm that baseline surface water quality already exceeds the regulatory standards prior to receiving Maynilad’s effluent. Progress on compliance action plan will be a part of the monitoring reports submitted to IFC (part of the contract conditions).
The dry sludge cake generated from the WRFs, commonly known as biosolids, is hauled by a DENR and Department of Health (DOH)-accredited third-party service provider. The biosolids are processed at composting facilities where they are converted into soil conditioners and given to farmers, or processed at the Company’s BioHub to be converted into “Bio-bricks” that can be used in construction At water treatment plants (WTPs), the sludge cake is considered as non-hazardous waste and is either disposed of at landfills or used for construction or backfilling. Maynilad’s desludging trucks are regularly maintained by a third-party provider in accordance with vehicle specifications and a prescribed maintenance schedule.
Air Emissions, Ambient Noise, and Odor:
Maynilad is managing air emissions and odors in its WRFs. Each plant is equipped with an odor treatment system at the pre-treatment stage, bioaerosol formation is reduced by a low aeration rate and diffused aeration. Paranaque WRF is also equipped with biogas collection and flaring system. The construction of new WRFs and WTPs is associated with both point source and fugitive air emissions, typical for construction projects, but these are readily mitigated. Maynilad EPC contractors follow national regulations and best industry practices and regularly monitor air quality at the construction site and along its perimeter.
Hazardous Chemicals Management:
Maynilad utilizes different forms of chlorine for disinfection processes including chlorine gas and sodium hypochlorite liquid. In addition, Maynilad laboratory utilizes minimal quantities of chemicals for water testing and monitoring including acids (like hydrochloric, sulfuric, and nitric), bases (like sodium hydroxide), and various toxic substances such as cyanide, arsenic, and mercury compounds. Maynilad manages hazardous chemicals in accordance with good industry practice and regulatory requirements. Chlorine systems are equipped with safety features, including alarms, automatic shutoff valves and containment units and scrubber systems. Chlorine tanks are stored away from any organic materials and are protected from moisture to prevent reactions. All hazardous chemicals are handled following strict safety procedures outlined in the Material Safety Datasheets (posted on site) and in compliance with specific legal requirements such as Priority Chemical List certificates, Chemical Control Orders, Executive Order No. 502 on Explosive Substances, List of Essential Precursors (RA 9165 Dangerous Drugs Act/ PDEA) and Fertilizers and Pesticides Authority regulations. Maynilad secures and regularly updates the requisite permits for its hazardous chemicals used in its operations.
PS 4 – Community Health, Safety and Security
Community Health and Safety:
Maynilad’s water quality complies with Philippine National Standards for Drinking Water (PNSDW). In 2023 and 2024, 100% of samples from the distribution system met bacteriological standards, while 99.94% and 99.92%, respectively, complied with the physical and chemical standards. In both years, all samples taken from the plant outlet also complied with the bacteriological and physico-chemical standards of the PNSDW. However, Maynilad is dependent on water sources such as Laguna Lake and fluctuations in raw water quality occasionally result in water service interruptions.
Maynilad has process laboratories monitoring the water quality at the plant outlet and a Central Water Laboratory that conducts regular sampling and analysis across the entire water system. This includes the raw water source, treatment plant outlets, the distribution network (including service reservoirs and customers taps) as well as effluents from WRFs and their receiving bodies of water. These laboratories are accredited by both the DOH and the DENR and are certified under ISO 17025:2017 which sets the general requirements for the competence of testing and calibration laboratories.
During construction activities, nearby communities may experience temporary minor construction-related impacts such as dust, noise, vibration, traffic disruptions and limited access. Once operational, the facilities may generate noise from standard equipment including pumps, generators, compressors, air handling systems, and moving vehicles. To mitigate the impact, Maynilad designs its facilities with safety buffer zones in line with the Building Code of the Philippines, or as specified in the local Comprehensive Land Use Plans issued by the City Planning and Development Offices. Noise exposure is further reduced through the installation of noise barriers, mufflers, silencers, and acoustic enclosures for equipment. In addition, the updated ESMS (ESAP #1), will incorporate community health and safety protocols, traffic management plans and ongoing stakeholder engagement. These measures ensure that potential impacts on the surrounding communities are managed and minimized.
Infrastructure and Equipment Design and Safety:
Maynilad’s WRF and WTP sites and adjoining areas are prone to flooding. At the design stage, Maynilad utilizes a disaster risk model to inform the need for flood mitigation measures to minimize impacts on both the project and the surrounding communities. WRFs are equipped with stormwater management systems.
Security Force Management:
Maynilad’s security service is provided by a company certified by the Philippine National Police. Our contracts include clear provisions on rules of engagement, the Code of Conduct, and strict compliance with labor and human rights standards. All personnel undergo thorough background checks and psychological evaluations before deployment. They must have valid licenses and receive training in basic security procedures, emergency response, human rights, and prevention of Gender-Based Violence (GBV) prevention. For the safety of the community, security personal are equipped appropriately, but are not armed.
PS5 – Land Acquisition and Involuntary Resettlement
Maynilad acquires land for the new projects and network expansion (WRFs, WTPs, conveyance systems, pumping stations) by negotiating with landowners either directly or using private third-party valuation companies that negotiate with landowners on behalf of Maynilad. Under its legislative franchise granted by the Congress, Maynilad is granted the right to expropriate lands, although it is deemed a measure of last resort. To meet its expansion plans, Maynilad has prepared a preliminary list of lands to be acquired up until 2037. For 2025, Maynilad has identified 10 parcels of land that need to be acquired. As future facilities are in densely populated areas, potential impacts range from temporary disruption and physical and economic displacement and loss of livelihoods.
Maynilad follows an operations procedure for land acquisition in accordance with prevailing country laws and regulations. It currently coordinates with the local government agencies to manage relocation of the informal settlers. Going forward, Maynilad will (i) review previously acquired land to confirm statutory compliance and identify any gross violations of PS5 objectives; and (ii) manage any displacement impacts arising from ongoing land dependencies from the time of IFC’s involvement in compliance with PS5 requirements (ESAP#8). In addition, Maynilad will develop a formal policy in line with PS5 and require all future land acquisitions to comply with IFC PS requirements (ESAP #9).
