43468 - GWFP Sofitex2019

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Summary of Investment Information

Project Number

43468

Company Name

GWFP BURKINA FASO COTTON

Date SPI Disclosed

Jan 21, 2020

Country

Burkina Faso

Region

Africa

Projected Board Date

Feb 20, 2020

Environmental Category

FI-1 - Significant

Status

Completed

Last Updated Date

Jun 12, 2021

Department

Regional Industry - MAS ME & Africa

Industry

Agribusiness and Forestry

Previous Events

Approved : Sep 21, 2010
Signed : Feb 24, 2020
Invested : Mar 10, 2020

Sector

Natural Fibers (Cotton, Sisal, Jute, etc.)

Project Description

The Project is a funded risk participation for up to EUR 10 million by IFC in a EUR 45million one-year offshore secured pre-export facility provided by Societe Generale to finance the purchase of seed cotton and provide working capital to a cotton company in Burkina Faso.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	50.0
Loan	150.0
Equity

Development Impact

The most significant, expected project-level outcome is continued access to markets and finance for over 32,889 farmers and increases in productivity for 1,557 farmers. Beyond the project, IFC anticipates the investment will increase integration and resilience in the cotton sector in Burkina Faso, a low income/IDA country, through capacity building and demonstration and replication effects.

IFC's additionality will come in three forms (i) knowledge, innovation and capacity building through advisory services to smallholder farmers; (ii) standard-setting with regards to reducing / eliminating child labor; and (iii) non-commercial risk mitigation, including trusted partnerships with a commercial bank, especially since this project will follow previous engagements of IFC in the cotton sector in Burkina Faso.

E&S Category Rationale / Risks and Mitigation

The project has been categorized as FI-1 in accordance with IFC's Policy on Environmental and Social Sustainability. The project will support a single obligor through Societe Generale and there are significant environmental and social (E&S) risks associated with the obligor's activities including harmful child labor and biodiversity loss; the project is thus considered high risk. The applicable E&S requirements for this project are the IFC Exclusion List, National Laws, and the IFC Performance Standards.

The main reputational risks associated with this project relate to the occurrence of child labor issues in the cotton supply chain. Other E&S risks associated with the activities of the obligor relate to biodiversity conservation,waste management, effluent treatment, air emissions, and disposal of hazardous materials. As a financial intermediary, Societe Generale has a well-established E&S policy and implementation procedures to manage theE&S risks associated with its lending activities. The obligor also has an E&S officer and an Environmental andSocial Management System (ESMS) outlining the procedures, responsibilities and tools for managing the E&S risks and impacts associated with its business activities. The obligor also has a stakeholder engagement plan that identifies key stakeholders and ongoing information and communications plans relating to the cotton sector in the country. The obligor continues to implement actions related to combating child labor in the cotton regions where it operates and undertakes random monitoring visits to suppliers’ farms to ensure harmful child labor issues are not found within their supply chain. To reduce biodiversity risks the government has designated and publicized protected areas where no cultivation activities can be carried out.

An E&S action plan (ESAP) has been developed to address improvement areas related the obligor’s ESMS and monitoring/auditing of child labor issues in the supply chain. Societe Generale, as the facility agent for the transaction, and IFC will monitor the reporting by the obligor of the implementation of the ESAP items which in turn will help the obligor evolve its practices with respect to its supply chain.

Contacts

For Inquiries About the Project, Contact

Societe Generale
Media Relations

FR-RELATIONS-MEDIA@SOCGEN.COM
17 Cours Valmy 92800 Puteaux France
https://wholesale.banking.societegenerale.com/en/contact/

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Fax: 202-974-4384

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

Task Title and Description	Completion Date
Improvement of the obligor's Environmental and Social Management System	August 2020
Reduction/elimination of the worst forms of child labor in the obligor's supply chain through auditing and active engagement with the suppliers.	August 2020

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