608333 - CnC Natura VERT

Who We Are
Who We Are

IFC is the largest global development institution focused on the private sector in developing countries. By encouraging growth, IFC advances economic development, creates jobs and improves the lives of people.
More About Us
About IFC

Our Leadership

Development Partners
Accountability

Learn more about accountability
Annual Report

Download the Report
What We Do
What We Do

IFC advances economic development and improves the lives of people by encouraging the growth of the private sector in developing countries. We achieve this by investing in impactful projects, mobilizing other investors, and sharing expertise.
What We Do Overview
SOLUTIONS

Our products and services
OUR PRIORITIES

Climate Business

Fragile & Conflict Afflicted Situations

Gender

Mobilizing Private Capital

Sustainability
SECTORS & EXPERTISE

Agribusiness & Forestry

Creative Industries

Education

Financial Institutions

Funds

Health

Infrastructure

Manufacturing

Public-Private Partnerships

Tourism, Retail & Property

Trade & Supply Chain Finance

Venture Capital

Working Upstream
Where We Work
Where We Work

As the largest global development institution focused on the private sector, IFC operates in more than 100 countries around the globe. We apply lessons learned in one region to solve problems in another.
Overview
By Region

Africa

East Asia and Pacific

Europe

Latin America and the Caribbean

Middle East and Central Asia

South Asia
Our Impact
Our Impact

Our impact improves lives. IFC brings a clear set of advantages to the world’s most challenging markets. Including a history of innovation, a global mandate, and a determination to achieve measurable development impact.
Our Impact Overview
PRINCIPLES & MEASUREMENT

Impact Investing at IFC

Measuring and Monitoring (AIMM)

Evaluation

Sustainable Development Goals (SDGs)

Owned by 186 member countries and consistently rated AAA/Aaa. IFC aims to achieve our mission of promoting development by providing debt and equity to the private sector, through a range of benchmark and bespoke products.

For Partners

For Investors

Get in Touch

Summary of Investment Information

Project Number

608333

Country

Brazil

Region

Latin America and the Caribbean

Environmental Category

FI-2 - Limited

Status

Active

Last Updated Date

Nov 4, 2024

Industry

Manufacturing

Sector

C-B - Water, Wastewater and District Heating & Cooling

Project Description

The project seeks to collaborate with VERT (a Brazilian securitization company) and Natura Cosmeticos S.A. (a Brazilian cosmetics company) to structure a financial mechanism called Amazonia Viva (or "Mechanism") to support agroextractivist cooperatives and associations ("Sociobiodiversity Supplier Organizations") in the Brazilian Legal Amazon (the "Project"). The Project will be implemented through the structuring of two financial vehicles: (i) A credit vehicle (commercial and concessional capital): 3-year bullet Certificate of Agribusiness Receivable ("CRA") managed by VERT with a total of $1.9M in senior, subordinated mezzanine and subordinated junior tranches to finance the working capital of Natura's Sociobiodiversity Supplier Organizations and in the future the supply chain of other offtakers. (ii) An Enabling Conditions Facility, also called "ECF" (philanthropic capital): in partnership with Natura and managed by the Brazilian Biodiversity Fund ("Funbio") to provide technical assistance to the agroextractivist cooperatives/associations and support other initiatives in the territories, such as in conservation and environmental regeneration, that play a complementary role to the credit vehicle. IFC will also provide guidance on E&S topics to VERT to further develop VERT's Environmental and Social Management System (ESMS).

Sponsor / Cost / Location

Development Impact

The project will support a CRA structure connecting agroextractivist associations/cooperatives, institutional investors and Natura as offtaker. This structure is expected to be replicated with additional agroextractivist cooperatives/associations, institutional investors and offtakers, meeting IFC's Performance Standards and channeling resources for climate finance at scale. IFC's investment will support the development of suppliers, reducing pressure for deforestation and strengthening local supply chains. IFC's investment will promote the adoption of environmental and social management to include the application of IFC Performance Standards, which is expected to increase oversight.

E&S Category Rationale / Risks and Mitigation

The Project consists of a pilot capital markets vehicle for VERT, a Brazilian securitization company, to support agroextractivist cooperatives/associations in the Brazilian Amazon region with provision of working capital allowing for future scalability of the mechanism for similar socioenvironmental investments in the region. The Mechanism comprises (i) a Credit Vehicle, managed by VERT, that will consist of a 3-year bullet Certificate of Agribusiness Receivable ("CRA") to provide credit to Natura's sociobiodiversity supplier organizations and is foreseen to include other offtakers in the future; and, (ii) a Philanthropic Vehicle, managed by Funbio, to strengthen those suppliers and their territories. Although the presence of agroextractivist cooperatives/associations (low-impact and sustainable way to commercialize non-timber forest products) deters deforestation and promotes conservation of biodiversity, the Project poses significant Environmental and Social (E&S) challenges considering suppliers being family and micro sized, and E&S risks associated with the particularities of the Amazon region. The E&S risks and impacts associated with this Project are expected to be medium to high nature, and therefore the Project has been categorized as FI-2 in accordance with IFC's Sustainability Policy. To mitigate these risks, the transaction will exclude sub-borrowers involved in coal-related activities, activities in the IFC Exclusion List, or higher E&S risks that may include a) involuntary resettlement; b) risk of adverse impacts on indigenous peoples; c) significant risks to or impacts on the environment, community health and safety, biodiversity, and cultural heritage; or d) significant occupational health and safety risks. IFC's applicable E&S requirements for this Project will include the IFC Exclusion List, applicable host country laws and regulations and the IFC Performance Standards, as applicable.

The key E&S risks and impacts of the Project derive from the client's capacity to maintain its management system to identify and manage the potential environmental and social risks associated with land use change/deforestation; forced/child labor in the supply chain; occupational health and safety in extractive and agricultural activities, conflicts over land and rights of Indigenous People/traditional communities in the Amazon region. As part of the Project, the client will: (i) enhance its E&S management system to include application of the IFC Performance Standards; (ii) hire an external consultant to assist with E&S policies and procedures enhancement; (iii) nominate and hire an E&S Officer; (iv) implement staff training; (v) establish a grievance mechanism for third-party concerns; and, (v) submit a periodic report to IFC.

VERT adopted an Environmental and Social Management System (ESMS), which includes a procedure for evaluating and monitoring clients. This methodology involves: 1.) screening to excluded non-eligible sectors; 2.) screening and identification of high-risk areas for additional environmental and social due diligence; 3.) conducting reputational and contextual risk analysis; 4.) E&S risk categorization with high-risk projects being escalated for further review; and 5.) continuous monitoring of the portfolio. For high E&S risk projects, VERT conducts a socio environmental assessment with a detailed E&S risk analysis and corrective action plan as needed. For this pilot, which is exclusively focused on the Natura's supply chain, VERT will rely on Natura's existing ESMS, as well as on the Union for Ethical Bio Trade ("UEBT") certification adopted by Natura for its sociobiodiversity supply chain, while it enhances its own ESMS to enable it to scale up the project. Natura has a comprehensive system to track and mitigate E&S risks and a dedicated team that manages the relationship with suppliers. The UEBT certification validates the process and provides additional comfort regarding sustainable practices.

Type of Action Timeframe

S.no	Title	Anticipated Completion Date
1	Enhance its Environmental and Social Management System ("ESMS") to encompass the targeted sub-project in the Brazilian Legal Amazon	12 months after signing
2	Hire an external consultant to assist with ESMS enhancement	Condition for signing
3	Nominate and hire an E&S Officer	3 months after signing
4	Implement staff training	12 months after signing
5	Establish a grievance mechanism for third-party concerns	Within 6 months of signing

Contacts

For Inquiries About the Project, Contact

VERT
Martha de Sa
CEO
martha@vert-capital.com
Rua Cardeal Arcoverde, 2365 - (11th floor) - Pinheiros, Sao Paulo - Brazil
https://www.vert-capital.com/
+5511981555111

For Inquiries and Comments About IFC, Contact

General IFC Inquiries
IFC Communications
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
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.

Projects

Summary of Investment Information

Project Description

Sponsor / Cost / Location

Development Impact

E&S Category Rationale / Risks and Mitigation

Similar Projects

Contacts

Projects

Summary of Investment Information

Project Description

Sponsor / Cost / Location

Project Sponsor and Major Shareholders of Project Company

Total Project Cost and Amount and Nature of IFC's Investment

Location of Project and Description of Site

Development Impact

Anticipated Impact Measurement & Monitoring (AIMM) Assessment

IFC's Role and Additionality

E&S Category Rationale / Risks and Mitigation

Environmental & Social Categorization Rationale / Key Risks & Potential Impacts

Financial Intermediary Sub-Project Disclosure

Environmental & Social Management System (ESMS)

Mitigation Measures / Environmental & Social Action Plan (ESAP)

Press-Release

Related Environmental Document

Similar Projects

Contacts

Information on E&S Complaints and Grievance Mechanisms

Disclaimer