Environmental and Social Policies. Sustainability is not an ?add-on? for Malawi Mangoes; it is what its business model is based on. In order to operationalize this vision, Malawi Mangoes made a conscious decision at the outset to design and build a state-of-the-art processing facility based on lessons learned and best practices from more than 100 fruit processing facilities around the world, establish partnerships with equipment suppliers with highest technical and resource efficiency specifications, and mainstream food safety management requirements in the plant?s lay-out. Based on these stringent requirements, the facility is now in the completion phase for Global Food Safety Initiative/British Retail Consortium (BRC) and HACCP certification and is committed to certification for Sure-Good-Fair (SGF) - SGF is a German-based non-profit organization pioneering industrial self-control in the fruit juice industry ? as well as Halal and Kosher certifications. All certifications are expected to be completed by June 2014. Pasteurization process at the processing plant is also independently verified by the National Food Laboratory. In addition to these industry standards, MM will implement customer specific food safety standards (e.g. Coke, Innocent, Froosh). Malawi Mangoes adopted the Rainforest Alliance (RFA) standard on its plantations in order to mainstream sustainable agriculture practices. Inclusive of RFA requirements is a 30% set-aside of farm areas for biodiversity protection and maintenance of ecosystem services. This will make Malawi Mangoes the only organization on the African continent to have RA certified banana and mango. MM intends to be RFA certified for all its farms. Organic production is being sought for 2015. Global Gap certification may be sought as MM takes on more fresh activities in the future, but this is not a requirement for the processing sector. 

Existing environmental, OHS, Food Safety and Social related policies encompass a mix of internally (e.g. Staff Handbook and Occupational Health and Safety) and externally (sector standard related, e.g. HACCP/Food Management and Rainforest) drafted Policies. Going forward, as set forth in the ESAP, Malawi Mangoes will develop, approve and implement its own set of corporate EHS policies which will include; i) reference to performance-based requirements based on Malawi?s laws and regulations, IFC Performance Standards, applicable WBG EHS Guidelines, HACCP and RFA requirements; ii) defining an accountability framework (ref. E&S team) in its organogram for its effective implementation; iii) ensuring a communication strategy to all employees, suppliers and partners (e.g. out growers and communities); and, iv) ensuring internal/external audit for assessing their effectiveness, including meeting quantifiable performance targets and indicators. 

Environmental and Social Assessment and Management System. In accordance with Malawi?s Environmental Management Act (EMA) of 1996 and EIA Guidelines (1997), Malawi Mangoes has commissioned the preparation of quality Environmental and Social Impact Assessment Reports for its processing facility (Salima) and farms (Matumba and Dzuwa). Approval of these studies and associated EIA certificate were issued respectively on February 14, 2012, November 23rd, 2011 (Matumba) and April 10, 2014 (Dzuwa) by MoE. Terms and conditions of these certificates included: (i) effective implementation of the Environmental Management Plans (EMPs) during construction and operations phases (ref. main mitigation measures recommended during operations included, among others, solid and hazardous waste management, provision of safe working conditions to workers, efficient use of water resources, monitoring of liquid effluents through the construction of a waste water treatment (WWT) plant, Integrated Pest Management (IPM), Emergency Preparedness  and Response Plan, monitoring of air emissions from boilers and generators, Biodiversity plan, and establishment of an Environmental and Safety Management Unit); (ii) regularly report to the MoE on the environmental and social performance of each operation; (iii) notify MoE about occurrences of unforeseen events; (iv) joint field monitoring between MoE and Malawi Mangoes; and, (v) undertake environmental audits and report audit results to MoE on a bi-annual basis. Malawi Mangoes has not been able to provide to IFC during field appraisal any supporting documentation of on-going progress as it related to points (i), (ii), (iii), (iv) and (v). This maybe explains by early operational phase of all assets. 

Going forward, as set forth in the ESAP, Malawi Mangoes will establish a matrix format to review and update compliance status for all its existing operations (plant, Matumba and Dzuwa farms) and future ones (e.g., Nyu Nyu), including supporting evidence of meeting MoE, Water Resources Board (WRB) and OHS certificate?s Terms and Conditions, implementation of the ESIA?s Environmental Management Plans (EMPs) at all sites, implementation of HACCP and Rainforest Alliance? Principles and Criteria (P&C), and will present to IFC, for review and approval, a consolidated report on all these mitigation measures, progress/completion status and corrective action plan (CAP) with defined timetable for effective implementation, including center of responsibilities and budgetary allocations for all sites.  Once the policies and procedures are finalized for Matumba Farm and the Processing Facility, it will become formality to roll out these policies and procedures to new sites. 

Malawi Mangoes has received permits for water abstraction from 16 boreholes at Matumba farm from the WRB on September 23rd, 2013. Supporting evidence has been provided during appraisal. Water at the processing plant is sourced from Central Region Water Board and does not require any water extraction right per se. Water right extraction for Dzuwa and Nyu Nyu farms will be sourced from Lake Malawi. Authorization and/or non-objection from other riparian countries of Lake Malawi (ref. Tanzania, Mozambique) and/or regional lake authority is not required. As per the letter of the Ministry of Irrigation and Water Development of April 25th, 2014, water abstraction from Lake Malawi is governed by the 2013 Water Resources Act and the approving entity is the National Water Resources Authority. Certificate of Registration of a Workplace, under the Occupational Safety, Health and Welfare Act (1997), has been issued for the processing plant for the period of January 22, 2014 till January 30th, 2015. Supporting evidence has been provided during appraisal. Certificate from the Ministry of Health will also be required for the on-site health clinic at the processing plant. Malawi Mangoes will process all applications for relevant licenses and certification, e.g. food license and Building Occupation Certificate, as needed. 

EHS Management Programs. Malawi Mangoes has demonstrated high-level management commitment to establish the foundation of a comprehensive environmental and social management system applying to all its operations. In addition to the draft EHS policies mentioned above, MM is committed to undertake systematic risk identification and impact assessment (done through the Malawian? environmental assessment process) as well as timely implementation of environmental, OHS and social management procedures and programs/plans from sector-based standards (ref. BRC/HACCP/food safety and RFA/agronomic practices). IFC appraisal team was informed that BRC/HACCP audit was scheduled by early July 2014 at the processing plant while the RFA audit for Matumba farm is scheduled by end of June 2014. BRC audit initially scheduled in May 2014 was delayed in order to ensure the following:  to mainstream other client requirements within the scope of BRC audit, to complete the FDA validation and challenge testing of pasteurization equipment, to ensure a comprehensive gap analysis against OHSAS18001 and ISO 22001 and to ensure the inclusion of HACCP within the scope of BRC certification. Standard Operating Procedures (SOPs) are 95% completed for HACCP, and 80% completed for the RFA standard. Appraisal findings revealed some tangible and measurable implementation progress on numerous mitigations measures outlined in ESIA?s EMPs (e.g. soil/water conservation, Integrated Pest Management, biodiversity set-aside). This being said, MM recognized that overall completion progress for a comprehensive and integrated EHS management system is at 40%. 

As such, as set forth in the ESAP, Malawi Mangoes will strengthen its EHS management framework through development and/or review of its own set of EHS policies, as mentioned above, and finalize the development and implementation of SOPs and annual EHS management plans - consistent with ISO 14001, OHSAS 18001, HACCP/ISO22001 and Rainforest Alliance P&Cs. Furthermore, this integrated management system will be in compliance with the structure of IFC?s PS1 requirements and compliant with applicable WBG General and Sector-specific EHS Guidelines. 

Organizational structure and technical capacity. Malawi Mangoes has established a very solid EHS team to meet its EHS requirements. Mr. Athanasios Mandis, Director of Technical Affairs and graduate from Tropical Agricultural Engineering has been a key resource-person in ensuring excellent quality control of the ESIA studies as well as being central in progress achieved so far by MM in developing HACCP and RFA?s SOPs. His technical expertise as lead auditor for juice processing plants has been critical in the excellent progress that MM has reached in such a short-time frame. Ms. Elizabeth Maneya, recently named Director of Planning, Procurement and Compliance will take over the overall EHS compliance of MM processing and farming operations. She will be supported at farm level by Ms. Gloria Kasongo, Farm Sustainability Coordinator, who has 6 assistants to support implementation of RFA requirements at Matumba Farm. As Dzuwa and Nyu Nyu farms will be coming into operation in the next few months (after rainy season), she will be assign another team of assistants with overall EHS requirements, including RFA?s P&C. Factory processing manager, farms managers/supervisors, farm irrigation team as well as yet to be established Environmental, OHS, Food Safety and Farm Committees will also be involved in meeting MM?s EHS policy commitment and overall performance. Ms. Maneya reports directly to MM?s Managing Directors to ensure that internal EHS audit?s findings are effectively and timely addressed through annual work plan review and budgetary allocations. 

Training. As the processing plant of Malawi Mangoes has yet to enter its full operation while its Matumba farm has been established less than 18 months ago, progress in EHS training is relatively limited so far. IFC?s appraisal team was informed that training on OHS related issues has started at the farm, including handling of chainsaw (extension officers) and plant protection products (CPP). At the processing plant, HACCP awareness and good hygiene practices session have also started. An OHS consultant has undertaken a workplace risk assessment at the farm and the processing facility manager will undertake similar OHS risk assessment at the plant. These risk assessment reports will be critical in establishing training plans. MM has not provided to the IFC team any supporting evidence of a comprehensive 2014/2015 training plan at plant and farms, as required to effectively implement its EHS policies? objectives and plans. Going forward, as set forth in the ESAP, upon completion of the integrated EHS Management System?s policies, procedures and plans, MM will define a comprehensive and multi-year training plan, for IFC review and approval, including center of responsibilities and budgetary allocation for its staffs (permanent and seasonal) and contractors at the plant and farms? operations in order to support effective implementation of its EHS management system and procedures, including EIA?s EMPs, IFC?s ESAP requirements, HACCP/ISO22001 and RFA?s P&C compliance at plant and farms.  

Monitoring and Reporting. Malawi Mangoes has not yet defined and/or implemented a comprehensive corporate EHS monitoring and reporting system procedure, including a report format. Malawi Mangoes has made such a commitment during IFC?s due diligence as these are all requirements inherent to the voluntary standards it is aiming to adhere to. Once the foundation of the Integrated EHS Management System is designed and implemented by end 2014, MM will devote increasing interest into this monitoring/reporting as it is a requirement for IFC, HACCP, Rainforest Alliance and off-takers to demonstrate continuous improvement in EHS performance, productivity and resource efficiency (water and energy). In addition, off-takers of MM?s products will also undertake third-party audits, against industry standards, as well as annual inspections from various Malawi?s ministries (e.g. environment, labor, etc.). The IFC team was informed that MM hold Management Review meetings twice a year while there is formal monthly management review on internal audits, including EHS. Going forward, as set forth in the ESAP, MM will define a comprehensive set of Key Performance Indicators (KPIs) in order to monitor on a monthly/annual basis the following EHS parameters: a) Safety ? Lost Time Incidence Frequency Rate (LTIFR), Accident Free Days; b) Sustainability ? Carbon (kg/ton), Water Usage (kiloliters/ton) at processing and farm operations, Energy Usage (kWh/ton), wastewater monitoring effluents, noise, air emissions parameters from boiler, use of Crop Protection Products (CPPs) and fertilizers; c) Staff ? Retention/turnover and training days. 

In addition, the EHS coordinator will define an integrated EHS report format and based on critical EHS key performance indicators (e.g., compliance with Malawi legal and regulatory requirements, including Certificate?s Terms and Conditions, EHS management system progress report and certification (ref. HACCP and RFA), energy and water consumption and efficiency; air emissions (NOx, SOx, particulates), including GHG emissions; noise levels and management, solid and hazardous waste management and disposal, effluent discharges from the WWT unit, compliance with national OHS requirements, including accident rates (lost-time accidents); customers and community complaints, supplier performance and community engagement activities. The company will also report annually to relevant Malawian authorities, off-takers and IFC as part of the Annual Monitoring Report (AMR). Based on information provided during appraisal, Malawi Mangoes did not incur over the last two years any material regulatory penalties, fines or sanctions for contraventions or non-compliance with statutory obligations, as well as not reported any fatalities at any of its plant/farming operations.

Emergency Preparedness and Response. Malawi Mangoes? operation at the processing plant and farming operations could be associated with fire and explosion, including diesel reservoirs and coal storage for the boilers and gensets, as well as numerous other dangers (e.g. CPP spill at farms). As the plant is yet to be fully commissioned, MM is in the process of finalizing the Internal Operational Procedure (IOP) for an emergency preparedness and response plan. It is committed to obtain all fire certificates and/or going through necessary fire audits at all sites. Several consultancy firms have already been contacted to perform fire drills as well as 1st aid training sessions which will cover all MM operational departments. During the site visit at the plant and farms, visual observation of installation of a fire prevention system, including fire hydrant and hose and extinguishers in accordance with Malawi standards, was noted. Dedicated water reservoir in case of fire at processing plant was also sighted. When the OHS Committee at plant and farms will be established, this entity will have the responsibility over fire prevention, response and training. A fire brigade will be established at all sites and coordination with Malawi Defense Force will be established (Salima being a small town and having no fire brigade per se). Extinguishers are available at the farm operations (especially at diesel tanks, pumping house, and at control pest products storage). Evacuation plan and fire accident meeting points have implemented at the processing plant and awareness raising on these will be part of the fire training curriculum. Going forwards, as set forth in the ESAP, MM will provide IFC, for review and approval; i) the Internal Operational Procedure for emergency preparedness and response for all sites; ii) fire prevention procedure and certificate for all sites; and iii) OHS Committee role and responsibility in emergency response, including fire brigade composition at all sites and annual emergency/fire training. 

Stakeholder Engagement Plan. During the preparation process of the EIA Studies at all sites, and in accordance with the Malawian?s environmental assessment process, Malawi Mangoes has undertaken stakeholder consultation in order to verify suitability of project site, land allocation granting in accordance with legal and procedures of the Government of Malawi, mitigation measures to be included into project design and benefits of the project. District Commissioner and its team (agriculture, environment, forestry, water resources officers, etc.) as well as villagers from surrounding communities welcomed the project as a source of alternative livelihoods and employment opportunities. List of stakeholders consulted and summary of comments are found in the Annexes of each ESIA?s Study. In addition, comprehensive consultation has taken place during the land leasing process on a willing lessor-willing lessee for Salima plant, and Matumba, Dzuwa and Nyu Nyu Farms) as per the Guidelines of the Ministry of Lands, Housing and Urban Development / Green Belt Initiative (GBI) on conversion of customary land to public land. Progress report received during field appraisal validated this informed consultation and participation from project affected peoples. To demonstrate its corporate commitment toward harmonious relationships with surrounding villages, and in accordance with standards requirements (e.g. Rainforest Alliance), Malawi Mangoes has drafted a Social Responsibility Policy which objectives is to outline its commitment to compliance with Malawi Labor Laws and International Labor Organizations (ILO), provision of job opportunities for the communities around its operations and ensuring conducive and safe working environment, including on-site health clinics in case of injuries. Procedures of MM?s on-going stakeholder engagement, including meeting minutes, were not available during site appraisal. Minutes should be kept as part of the SEP.

IFC appraisal findings considered that the stakeholder engagement demonstrated by Malawi Mangoes has thus far been appropriate considering the risks and impacts of the proposed plant and farming operations. However, this stakeholder engagement needs to be strengthened and formalized to meet the social risks and challenges, especially at the farm level. As set forth in the ESAP, Malawi Mangoes will prepare a combined Stakeholder Engagement Plan and Community Relation Plan for all its sites, in accordance with IFC?s Performance Standard1 (PS1), including identification of stakeholders, determination of their level of interest and influence in the project (by importance and relevance), establishment of appropriate methods for engaging each group, and identifying strategic and forward looking programs and activities to support and partner with affected communities. MM should also recruit or assign a community liaison officer at each operational site. The objective of the plan will be to strategically manage engagement and relations with project stakeholders and locally affected communities on a medium-long term basis.