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 Policy:
The Company has developed a formal E&S Policy as part of its ESMS, which includes commitment to regulatory compliance, pollution prevention, resource efficiency, occupational health and safety, supply chain responsibility, and human rights. The policy also outlines commitments to stakeholder engagement, grievance management, and continuous improvement of E&S performance. However, while the policy framework is aligned with IFC Performance Standards, its communication to external stakeholders and consistent implementation across all facilities, including franchise and partner-operated centers, remains limited. Further strengthening is required in relation to compliance and permit management, like tracking of conditions and renewals, standardized implementation of EHS procedures, oversight of franchise and third-party operations, and consistent application of grievance and incident reporting mechanisms.
Environmental Social Management System
The Company has developed an Environmental and Social Management System (ESMS) developed in line with IFC Performance Standards and other relevant international good industry practice, comprising an E&S Policy and supporting procedures, plans, and tools for managing environmental, health and safety (EHS), labour, and operational risks. The ESMS includes provisions for facility screening, occupational health and safety management, incident reporting, emergency preparedness and response, waste and chemical management, and stakeholder engagement. These systems are intended to support identification and management of E&S risks across laboratory operations, collection centres, and associated field and logistics activities.
The ESMS identifies key operational risks relevant to the Company’s activities, including occupational health and safety risks associated with laboratory and diagnostic services, biomedical waste management, chemical handling, radiation safety, and labour and working conditions. The system also includes procedures applicable to franchise-operated collection centres, hospital-based/leased laboratories, and third-party logistics, reflecting the distributed nature of the Company’s business model. However, while labor and working condition risks are addressed at a general level, the ESMS does not explicitly identify, assess, or manage risks related to gender based violence, sexual exploitation, abuse, and harassment (GBVH/SEAH) and child safeguarding, nor does it integrate GBVH considerations into its risk assessment, site screening, or risk mitigation processes. Risk categorization and site screening processes are defined within the ESMS; however, their implementation across facilities is not yet fully operationalized. In practice, facilities are largely managed under a common approach, with limited differentiation based on activity type or risk profile (e.g., laboratories, radiology units, collection centres, and transport functions). Structured, risk-based site selection and due diligence processes are not consistently evidenced across all locations, particularly for franchise-operated and leased facilities. Implementation of the ESMS across the Company’s geographically dispersed operations is at an evolving stage, with opportunities to strengthen risk-based application, site-level accountability, and oversight of franchise-operated, leased, and third-party activities (see ESAP #1). Monitoring systems, including inspections, training records, incident reporting, and follow-up actions, are defined but need to be uniformly maintained at all locations.
Integration of fire and life safety (FLS) requirements within the ESMS is also under development. While regulatory approvals (e.g., Fire NOCs) are in place, systematic assessment of compliance with FLS design and operational requirements, including verification of conditions attached to approvals and periodic monitoring, needs to be strengthened across the network.
Oversight of franchise-operated collection centres, hospital-based/leased laboratories, and third-party logistics requires further strengthening, with opportunities to further formalize E&S performance monitoring, contractual requirements, and audit mechanisms across these operations.
While the ESMS includes provisions relevant to sample collection and laboratory operations, system-level controls for sample transport, including those associated with riders and field-based staff, are not yet fully defined or consistently implemented. This includes aspects such as field-level occupational health and safety, infection prevention, safe sample handling and transport, chain-of-custody, and management of transport-related incidents.
The ESMS includes a grievance redressal mechanism which is accessible to internal employees; however, it is not adequately accessible or standardized (except through publicly available contact details of the Company) for external stakeholders, including patients, households visited by field staff, franchise workers, and other third party personnel. The mechanism does not provide anonymous reporting options, does not reflect survivor centered principles for handling GBV related complaints, and is not effectively communicated to third party workers. In addition, awareness and consistent application of ESMS procedures across employees, franchise partners, and third party workers varies across locations, indicating scope of improvement in training, communication, and effective implementation.
Under ESAP #1, the Company will update and implement its ESMS to address the above aspects, including strengthening of risk-based management, including on GBVH and child safeguarding, formalization of roles and responsibilities, enhancement of monitoring and incident management systems, and improved oversight of franchise-operated facilities, third-party logistics, and field-based operations. Within twelve (12) months of implementation of the updated ESMS, the Company will engage an independent consultant to verify implementation and compliance of the ESMS and to develop and implement any corrective action plan identified through the review.
Identification of Risks and Impacts
The Company has established processes within its Environmental and Social Management System (ESMS) to identify E&S risks associated with its business acquisitions and operations including, laboratory services, collection centres, radiology units, and related logistics activities. Risk identification is based on standard operating procedures, site screening checklists, and operational controls addressing key areas such as occupational health and safety, biomedical waste management, chemical handling and storage, radiation safety, and labor & working conditions. While processes for risk identification are defined in the ESMS, their application in the company operations across the Company’s geographically dispersed operations is not yet consistent. In particular, the use of site screening checklists and risk identification tools across laboratory locations, collection centres, and franchise-operated facilities is not uniformly evidenced. The ESMS also applies E&S risk identification checklists during site selection and operations of laboratory locations and associated facilities.
The Company undertakes environmental and social due diligence (ESDD) in the context of business acquisitions to identify potential E&S risks & liabilities associated with target entities and corrective action plan. However, while ESDD has been conducted for two recent acquisitions, recommended mitigation measures are yet to be fully implemented and the Company is in the process of updating its ESMS to reflect the learnings from the ESDD process. As part of ESAP #1, the Company will implement the pending corrective action plan recommended by the ESDD and strengthen the application of related risk identification checklists and operational procedures in their ESMS, including enhancement of monitoring and reporting mechanisms.
With respect to regulatory requirements, the Company has identified applicable environmental, health and safety, and labour regulations relevant to its operations and maintains valid statutory approvals, including biomedical waste authorization, consent to operate, clinical establishment registrations, and radiation-related approvals. A legal compliance register is in place to track the status of applicable requirements. However, there is scope for improvement for a few locations, including tracking of permit conditions, ensuring renewal timelines, and approvals for back-up power generators, groundwater use, operations at leased or franchise-operated facilities, and compliance requirements related to third-party logistics (e.g., rider permits and vehicle insurance). In addition, operationalization of regulatory compliance tracking, including site-level verification and monitoring across all facilities (including franchise-operated and leased locations), is at an evolving stage. Under ESAP#2, Company will engage a competent third-party agency, to undertake an E&S compliance review for a representative sample of facilities and develop a time-bound corrective action plan, as required, that will be implemented across all facilities covering major business.
Management Program:
The Company has developed management programs to address E&S risks identified through its ESMS and risk identification processes (refer sections above). These are supported by facility-level tools such as compliance registers, operational checklists, and monitoring formats applied at laboratory locations.
Available documentation indicates that certain elements such as tracking of biomedical waste disposal, relevant regulatory approvals, and worker health parameters are being implemented at facility level, demonstrating initial operational uptake of defined controls. However, these practices are to be more standardized and consistently applied across all facilities.
Management programs related to franchise-operated collection centres, hospital-based/leased laboratories, and third-party logistics (including riders) are defined at the corporate level but require further operationalization; The translation into formal contractual requirements, performance monitoring systems, and periodic audits is however limited. In addition, integration of supplier and vendor requirements into a structured supply chain management approach is at an early stage. Further strengthening is required to ensure that management programs are implemented in a risk-based and consistent manner across the Company’s dispersed operations, including clearer definition of performance indicators, systematic tracking of corrective actions, and alignment between identified risks and corresponding mitigation measures.These gaps will be addressed through ESAP #1 mentioned above.
Organizational Capacity and Competency:
The Chief Financial Officer (CFO), also handles the ESG function. Human resource function covers payroll and labor compliance and learning & development. Business unit leadership is in place for key verticals, including Celara and Medicentre. The ESMS assigns responsibility for environmental, health and safety (EHS) management at the corporate level, with the ESG function positioned within the CFO function.
At present, EHS management is primarily overseen by qualified and full time ESG resource at the corporate level. Operational support for E&S aspects is provided by laboratory teams and administrative personnel; however, formal allocation of E&S roles & responsibilities as well as reporting hierarchies across facilities has not been defined. Given the Company’s presence in multiple locations across geographies including franchise-operated centres, hospital-based/leased laboratories, and field-based staff (e.g., phlebotomists and riders) the current organizational structure has limited ability to ensure consistent implementation, site-level monitoring, and follow-up of E&S requirements across all locations. Coordination between central ESG person and laboratory operations, logistics, and field teams for implementation of ESMS is evolving and will be further strengthened. Training and awareness on E&S aspects are undertaken; however, consistency in coverage, documentation, and reach across all categories of workers, including third-party and franchise personnel, is variable.
As part of ESAP #3, the Company will strengthen its organizational capacity by establishing an appropriate EHS structure commensurate with the scale and geographical spread of operations, including appointment of additional regional EHS personnel, designation of focal persons at major laboratories, and strengthening coordination mechanisms across operational and support functions.
Monitoring & Reporting: The ESMS sets out processes for monitoring and review of E&S performance through inspections, incident reporting, maintenance of training and operational records, compliance tracking, and periodic review of operational controls across laboratories, collection centres, and associated activities (refer ESMS section above). Currently, monitoring at the facility level is limited to selected operational parameters, such as biomedical waste generation and disposal, and maintenance of basic compliance records and does not cover broader EHS, labor, and regulatory compliance aspects is limited and not consistently standardized across locations.
At the corporate level, periodic ESG reporting and tracking are limited to select indicators (e.g., training programs, certification status, and certain ESG initiatives) and do not provide a comprehensive view of E&S performance across all operations. Key gaps between ESMS provisions and implementation include(i) limited operationalization of regulatory compliance tracking, including verification of permit conditions and renewal timelines across all facilities;(ii) limited monitoring and reporting of incidents, near-misses, and corrective actions; (iii) absence of a formalized process for periodic reporting of E&S performance and risks to senior management and (iv) limited monitoring and reporting of E&S performance of third-party arrangements, including franchise-operated centers, logistics providers (e.g., riders), and suppliers, with no structured mechanism for periodic review or verification of compliance.. As part of ESAP #1, the Company will also strengthen its monitoring and review systems to align with ESMS requirements, including standardization of monitoring indicators, establishment of site-level and corporate-level reporting protocols, and formalization of processes for tracking and reporting of incidents, corrective actions, and E&S performance to senior management.
PS2: Labor and Working Conditions
Human Resource Policies and Procedures
Redcliffe has a staff strength of around 2500 on-roll staff members, hired as regular employees, consultants, on-contract employees, and trainees. Nearly one-fourth of the employees are women. Additionally, Redcliffe engages approximately 380 third party employees as riders, housekeeping staff and security guards. These are located across the operations in India. HR department is centralized at corporate office in Noida, with one HR personal located in each of the two cities – Udaipur and Bangalore that have relatively larger workforce.
Company has established Human Resource policies for on-roll employees, covering the aspects of employment and working conditions. These policies have been developed on human rights, equal opportunity, diversity & inclusion, hiring, leave, Gender Based Violence and Harassment (GBVH) & Prevention of Sexual Harassment (POSH), remuneration, grievance management, OHS and data protection. All policies are communicated to employees at the time of induction, and available on company’s web-portal and mobile applications. However, Redcliffe’s policies need to be better operationalized for patient and community facing contexts, and in particular the application of GBVH/POSH measures to patients and home based services needs improvement. The Grievance Redress Policy is in place but needs to be updated to include a provision for anonymous reporting, and to cover third party employees. Further, Redcliffe needs to operationalise clear, stand-alone policies on child labour, child safeguarding, forced labour, freedom of association and retrenchment. To address the updates identified, the company shall develop and operationalize these policies, including child safeguarding policy, aligned with IFC PS2 and applicable statutory requirements, with specific provisions applicable to patient and community facing operations, including home based services, to meet the requirements of ESAP#4, and communicate the policies to all employees through existing channels.
Working Conditions and Terms of Employment
Redcliffe has developed standard template for employment contracts to the employees. These are issued to all employees at the time of their recruitment. The employment letters define the key terms, rules and regulations for working with the company. While most of the terms & conditions align with the applicable laws, certain clauses regarding retention of employees are required to be updated to meet IFC PS2 and statutory requirements. The company shall revise these clauses in the letters and also inform existing employees. (ESAP#)
Redcliffe has multiple mechanisms to capture employee attendance through mobile application, punch card and GPS enabled system. The data is used for payroll processing and company ensures to pay to timely monthly salaries to all employees. Wages rates are determined in compliance with the applicable minimum wages; as per the company’s wages policy, gaps (if any) with respect to minimum wages are corrected immediately in the next pay-cycle.. The salary structure has several components in relation to deductions on account of security, refine salary, CMS amount, CS penalty etc., which need to be substantiated by formal policies and processes.
As per ESAP#5, Redcliffe shall document and implement clear policies on the structure of wages, including all allowances and deductions. All wage-related policies (especially on deductions) shall be fair to employees and must align with the country’s laws.
Workers’ Organizations
The company does not have a documented policy on ‘freedom of association’. There is no union in the company, it was informed during consultations with management and employees that there has been no such attempt by any employees. Under ESAP #4, the company will also develop a policy on :
Retrenchment
Company has not reported any event of workers’ retrenchment in the past. If such a need arises in future, the company shall comply with the applicable legislative requirements and good industry practices. Under ESAP #4, the company will also develop a policy on retrenchment.
Grievance Mechanism
Under the Grievance Redressal Policy, Redcliffe established grievance redress mechanism (GRM) for on-roll employees. The GRM defines its scope and objectives and includes a structured complaints handling process, with defined procedures for submission, escalation, and resolution, including an escalation matrix and indicative turnaround timelines at each stage. A designated committee has been established to oversee the functioning and implementation of the mechanism and to review and address complaints in accordance with the defined process. However, the GRM needs to be made adequately accessible and standardized (except through publicly available contact details of the Company) for external stakeholders, including patients, households visited by field staff, franchise workers, and other third party personnel. Further, the GRM needs to be updated to provide for anonymous reporting for incidents. To address these shortcomings, the company shall develop and implement survivor centered procedures for the confidential, safe, and appropriate management of GBV/SEAH related grievances, including the establishment of anonymous reporting options, and ensure that the GRM is accessible, standardized, and effectively communicated to all workers and external stakeholders, including contractors, franchise workers, patients, and households engaged through home based services. (ESAP#6)
Gender-based Violence and Harassment
Redcliffe has formulated separate policies on POSH and GBVH. Taken together, these policies address key legal and procedural requirements, including complaint intake, step wise processes for resolution and settlement, appeal mechanisms, defined timelines, and roles and responsibilities, supported by region specific Internal Complaints Committees (ICCs). Worker consultations indicated general awareness of these policies. However, the current policies are largely limited to internal employee contexts and focus primarily on procedural compliance, and do not fully align with IFC expectations for a comprehensive GBVH framework. In particular, the policies do not adequately cover patient and community facing operations, including home based sample collection; do not explicitly apply to third party, contract, or franchise workers; and do not fully incorporate survivor centered principles such as confidentiality, non retaliation, safe handling of GBV related complaints, anonymous reporting options, and access to appropriate support services. To meet IFC expectations, the company shall revise and operationalize its POSH and GBVH policies to adopt a gender inclusive, GBVH focused approach applicable across all work related contexts, including interactions with patients, households, and communities, and establish specific safeguards for higher risk activities. (ESAP#6)
Occupational Health and Safety:
The Company has established an Occupational Health and Safety (OHS) framework as part of its ESMS, including an OHS Policy and supporting plans covering hazard identification and risk assessment (HIRA), biological and chemical safety, fire and electrical safety, emergency preparedness, and worker training. These provisions are applicable for all categories of employees across laboratories and collection centres.
The ESMS identifies key occupational risks associated with diagnostic operations, , certain operational risk areas are not covered, including risks associated with laboratory use of cold storage and refrigeration equipment (e.g., sample storage freezers and cold rooms), as well as field-based activities involving sample collection and transport by phlebotomists and riders, for which risks related to road safety, fatigue, and working conditions are not explicitly addressed.
The ESMS outlines a combination of engineering controls (e.g., fire protection systems and electrical safety measures), administrative controls (e.g., standard operating procedures, training, and supervision), and personal protective equipment (PPE) to manage occupational risks. However, gaps were identified with regards to the implementation of these controls across operations in owned & franchised, facilities.
Specific risks in areas such as fire and life safety were observed across operational facilities. While the statutory approvals such as Fire NOCs generally are in place, site observations and available audit reports indicate scope for improvement in the electrical safety arrangements, fire protection systems, and emergency preparedness measures.
A past fire incident at one of the laboratory facilities, attributed to electrical load, highlighted areas of improvement. Corrective actions remain in progress, and the Company has committed plans to shift operations to a compliant leased building for the main laboratory.
While the ESMS includes guidance for incident reporting and investigation, coverage, analysis and reporting of incidents related to field-based workers are not evidenced. Monitoring of OHS performance is primarily focused on selected facility-level parameters, with limited standardization, trend analysis, and coverage of third-party and field-based operations.
As part of updating and implementing the ESMS under ESAP #1, the Company will:(i) integrate risk-specific procedures and controls for currently uncovered activities, including cold storage operations and field-based logistics (phlebotomists and riders), covering road safety, fatigue, and working conditions;(ii) strengthen the OHS framework to ensure consistent application of engineering, administrative, and PPE controls across all facilities, including COCO, FOFO, hospital-based/leased laboratories, and third-party workers;(iii) develop and implement a fire and life safety framework aligned with National Building Code (NBC) Part IV and applicable electrical safety requirements, and apply this framework to the selection of new facilities as well as to existing facilities where critical gaps are identified through compliance audit. (iv) strengthen incident management systems, including reporting, root cause analysis, corrective action tracking, and management reporting; and (v) implement structured OHS training programs for all categories of workers, including third-party and franchise personnel.
Workers Engaged by Third Parties
Redcliffe utilizes the services of third-party employees primarily for the transportation of samples & materials, housekeeping and security services. The company has contracted few external agencies for availing such services across the locations of operations. Redcliffe needs to have more clear oversight over the aspects of OHS and compliance performance by these contractors. As part of the business model, all the collection centers are outsourced as franchisees. These collection centers are branded as Redcliffe centers and operate as per the company’s guidelines on quality, services, waste management aspects. Redcliffe has documented Supply Chain management plan (including contractor management) and Franchise Management Plan that gives a framework to oversee the E&S performance of the contractors and franchisees. However, company needs to strengthen the monitoring of labor law compliances and implementation of safe working conditions by the third parties also.
As per ESAP#7, Redcliffe will update and strengthen both these plans to adhere and implement these with all the third-party contractors and collection centers covering franchises with major business and risk perception.
Supply chain
Redcliffe has developed supply chain management plan that includes the aspects of screening a new vendor on compliances, including E&S, contract agreements, implementation & monitoring, and documentation. The plan further identifies the categories of vendors in the supply chain and the roles & responsibilities for the implementation of this plan. E&S checklists have been developed for screening vendors, and another checklist for regular monitoring of vendors; these checklists are in process of implementation. As per ESAP #7, Redcliffe will screen and evaluate the vendors covering major transactions using these checklists and document the reports.
PS3: Resource Efficiency and Pollution Prevention
The Company’s operations primarily involve diagnostic laboratory services, collection centres, and associated logistics activities, which are not resource-intensive compared to industrial operations. Resource consumption is mainly limited to electricity for laboratory equipment and refrigeration, water use for sanitation and cleaning, and consumables used in diagnostic processes.
The Company has established procedures under its ESMS for management of biomedical waste, chemicals, and general laboratory operations. Biomedical waste is segregated, stored, and disposed of through authorized vendors in accordance with applicable regulatory requirements, and these requirements are also extended to franchise-operated (FOFO) collection centres. However, while monitoring and disposal arrangements are generally in place at Company-operated laboratories, oversight and verification of compliance at FOFO locations is limited. In addition, site observations indicated instances where waste segregation practices need strengthening with defined procedures, indicating the need for strengthened implementation and monitoring across all facilities. The Company engages licensed third-party vendors for collection, transport, and disposal of biomedical waste.
Resource efficiency measures, including monitoring and benchmarking of energy and water consumption across facilities, are limited and need to be consistently tracked at the corporate level. Greenhouse gas (GHG) emissions associated with the Company’s operations are estimated at approximately 2,468 tCO2e per annum, based on electricity consumption and fuel use.
The Company’s operations generate limited air emissions; however, localized emissions may arise from diesel generator (DG) sets at certain facilities. Management of such emissions, including permitting and monitoring, needs to be consistently implemented across all locations. Wastewater generated from laboratory operations is treated prior to discharge, including through disinfection (e.g., hypochlorite treatment) and, where applicable, through effluent treatment systems (ETPs), before being discharged into municipal drainage systems.
As part of updating and implementing the ESMS under ESAP #1, the Company will strengthen its resource efficiency and pollution prevention management by: (i) establishing procedures for monitoring and verification of biomedical waste management across all facilities, including FOFO centres, and ensuring consistent segregation practices; (ii) strengthening oversight of third-party vendors, including verification of downstream waste handling; (iii) implementing basic tracking of energy and water consumption across facilities; and (iv) ensuring compliance monitoring of DG emissions and hazardous materials management across all locations.
PS4: Community Health and Safety
The Company’s operations comprise diagnostic laboratories, collection centres, radiology units, and associated logistics activities. Community health and safety risks are generally limited and are primarily associated with the handling, storage, and transport of biological samples and hazardous materials, as well as the movement of field-based staff and third-party logistics (refer PS1, PS2, and PS3). While the ESMS includes general provisions relevant to occupational health and safety, waste management, and emergency response, specific controls addressing community-facing risks particularly for sample transport and field-based activities are not fully defined or consistently implemented.
Transport of samples from collection centres and smaller cities to central laboratories is, in some cases, undertaken through third-party passenger transport systems (e.g., intercity buses). Standardized procedures for packaging, labeling, chain-of-custody, and engagement of such transport providers are yet to be developed to avoid risks of accidental spillage and local exposure during transit.
Field-based operations rely on phlebotomists, and riders typically use their own vehicles for sample collection and transport. A structured system for verification of vehicle condition, validity of permits and insurance, and monitoring of driver safety practices is yet to be established, to avoid risks related to road safety and transport-related incidents, as well as potential community exposure during movement of biological samples.
Community health considerations also arise from biomedical waste management practices (refer PS3). While waste is generally managed through authorized vendors, inconsistent segregation practices and limited oversight of franchise-operated (FOFO) centres may pose localized risks if not adequately controlled.
With respect to facility-related risks, operations are largely conducted from leased premises (refer PS2). Although statutory approvals such as Fire NOCs are generally in place, implementation and maintenance of fire and life safety systems needs further strengthening at certain locations to avoid potential risks to patients and visitors accessing these facilities.
The ESMS includes provisions for emergency preparedness and grievance management; however, accessibility and awareness of grievance mechanisms for external stakeholders, including patients and households visited by field staff, are variable, and structured stakeholder engagement processes for community-facing risks are limited.
Security risks associated with the Company’s operations are considered low, given the non-sensitive and service-oriented nature of activities.
As part of updating and implementing the ESMS under ESAP #1, the Company will (i) develop and implement procedures for safe packaging, handling, and transport of biological samples, including chain-of-custody and controls for third-party transport;(ii) establish minimum requirements for vehicles and drivers used by phlebotomists, riders, and other field staff, including verification of documentation, vehicle condition, and safe driving practices;(iii) strengthen controls for field-based operations and biomedical waste management at all facilities, including FOFO centres (cross-refer PS3); (iv) enhance emergency preparedness and grievance mechanisms for community-facing risks.
As part of ESAP #2, findings from the independent E&S compliance audit will be implemented to address community health and safety risks across facilities and associated operations.
