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Al-Jebrini

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This Environmental and Social Review Summary (ESRS) is prepared by IFC to disclose its findings and
recommendations related to environmental and social considerations regarding potential investments. Its purpose 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 ESRS is of adequate quality for release to the public, but has not necessarily
independently verified all of the project information therein. The ESRS may be periodically updated after publication.
Board dates are estimates only and this document should not be construed as presuming the outcome of the Board
Directors’ decision. The following ESRS is disclosed in accordance with IFC's Access to Information Policy (AIP) that
went into effect on January 1, 2012.

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Environmental & Social Review Summary

Project Number Company Name Date ESRS Disclosed

41853 AL-JEBRINI DAIRY AND FOOD Nov 16, 2019
INDUSTRIES COMPANY

Country Region Last Updated Date

West Bank and Gaza Middle East

Environmental Category Status Previous Events

B Pending Disbursement Approved : Mar 30, 2020
Signed: Jun 25, 2020

Sector Industry Department

Dairy Products Agribusiness and Forestry Regional Industry MAS MCT

Project Description
  The proposed investment is up to US$10 million Loan (EUR8.6 million) to Al-Jebrini Company for Dairy and Food
Industry and its subsidiaries and affiliated companies (together “Al-Jebrini” or the “Company”). The Company
produces and distributes a wide range of staple and value add products including yogurt, milk, juice, salads and dips
such as hummus, cheese and pudding. The products are distributed in West Bank and Gaza Strip.

Through the proposed investment, IFC will support the Company’s expansion plan consisting of: (a) expanding its
salad production capacity by establishing a new factory in Al-Dahrya; (b) constructing warehouses and distribution
centers in Ramallah, Nablus and Gaza; and (c) increasing the capacity of the Company’s biogas facility in Al-Dahrya
(collectively, the “Project”).

The Company’s facility is currently located in Hebron, Al-Ramah area, on an area of 12.500m². The expansion of the
salad production lines is planned in a new facility, to be constructed (8,000m²) on a site of 15,000m² adjacent to the
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facilities of subsidiary Pal Farm Company and affiliate Energy for Future Generation (“E.F.G.”) Company for Alternative
Energy in Al-Dahryah area (25km south of Hebron). All utilities networks (water, electricity, telecom) and access roads
have been constructed by the municipality.  The E.F.G. Company for Alternative Energy is adjacent to the dairy farm
and produces renewable energy and biofertilizers (liquid and solid) from organic residues (manure and food waste)
through anaerobic digestion using a combined heat and power unit. Its current production capacity reaches 370kWh
with expansion possibility up to 1MW. The electrical power is evacuated and sold to the local grid. The Company can
currently not use the energy generated by E.F.G. due to lack of a license which is being processed.

The warehouse of Ramallah is under construction (90% completed, start operations planned in February 2019). The
land for Nablus warehouse (11,000m²) has been purchased and construction will start in mid-2019 (completion
planned June 2020). All sites for the facilities, farm, and warehouses are owned by the Company. The Gaza
warehouse is rented. The Company’s transportation fleet includes 20 small cars and 70 trucks of either 35 tons or 10-
30 tons.

                                                 

Overview of IFC's Scope of Review

 IFC’s E&S appraisal took place on January 20-24, 2019. The scope of the appraisal included assessing the
Company’s competency and capacity to ensure compliance of its existing and planned operations with IFC’s
Performance Standards (PSs); the World Bank Group (WBG) Environment Health and Safety (EHS) General Guidelines
and Industry Sector EHS Guidelines (Dairy Processing; Food and Beverage Processing; Mammalian Livestock
Production), and Palestinian National Authority (PNA) legal and regulatory requirements.

The review included meetings, site visits, and review of documents. Meetings were held with the CEO; the Executive
Manager; the Quality Assurance (QA), Research & Development (R&D) Manager; the Human Resources (HR) Manager;
the Occupational Health and Safety (OHS) Officer; the Corporate Social Responsibility (CSR) and Public Relations (PR)
Officer; the Marketing Manager; the Operations & Maintenance (O&M) Engineer at the E.F.G. biogas power plant;
farmer at the Pal Farm Company; and farmer at one supplying dairy farm.

Assessed sites: the Company’s food processing facilities in Hebron; the facilities of Pal Farm Company and E.F.G.
Company for Alternative Energy in Al-Dahryah area (25km south of Hebron); the Pal Group Company’s warehouses in
Hebron (Beit Einoun) (newly constructed, 5000m²) and Ramallah (under construction, 90% completed); and one
supplying dairy farm Southwest of Hebron.

Review of documentation included: Environmental Impact Assessment biogas plant (2013); Safety and Emergency
Report biogas plant (2013); Training Program anaerobic digester of the biogas plant (2013); HR Policy; training
materials and plan on OHS Procedures; Emergency and Evacuation Plan; CIP Process and Line of Central Unit;
Accident Rate Report; Hazard Analysis Critical Control Point (HACCP) Cheese Production line; ISO Certifications;
supplier/vendor evaluation criteria; Palestinian Labor Law.

                                                  

E & S Project Categorization and Applicable Standard

Identified Applicable Performance Standards

While all Performance Standards are applicable to this investment, IFC’s environmental and social due diligence
indicates that the investment will have impacts which must be managed in a manner consistent with the following
Performance Standards

PS 1 - Assessment and Management of Environmental and Social Risks and Impacts

PS 2 - Labor and Working Conditions

PS 3 - Resource Efficiency and Pollution Prevention

PS 4 - Community Health, Safety and Security

     Impacts linked to PS5: Land Acquisition and Involuntary Resettlement are not expected since all the land for the
existing and planned facilities were acquired through market transactions Impacts linked to PS 6: Biodiversity
existing and planned facilities were acquired through market transactions. Impacts linked to PS 6:  Biodiversity
Conservation and Sustainable Management of Living Natural Resources are not expected since none of the facilities
are in natural/critical habitat. Impacts linked to PS7: Indigenous People are not expected since there is no presence
of indigenous people within the Company’s operational footprint. Impacts linked to PS8: Cultural Heritage are not
expected since there is no presence of known cultural assets or artifacts within the Company’s operational footprint.
The group will assess and manage any issues related to PS5, PS7, and PS8, as needed, as part of its E&S
management system (ESMS).

                                              

Environmental and Social Categorization and Rationale

   This project involves expanding of Al-Jebrini’s operations in Palestine by expanding existing production lines, adding
warehouses, and expanding the existing biogas plant. This is a Category B project based on IFC’s Policy on
Environmental and Social Sustainability. The E&S risks and impacts associated with this project are limited, site-
specific, and can be readily addressed through generally accepted mitigation measures described in this document
and the attached Environmental and Social Action Plan (ESAP).

Key E&S issues, risks, and areas of improvement for this investment are: (i) compliance with applicable PNA legal and
regulatory requirements, including securing all necessary operational permits for factories, warehouses, and farm; (ii)
effectiveness of management competency and capacity to implement the integrated EHS/labor/food safety
management systems; (iii) emergency preparedness and response plan, especially Life and Fire Safety (L&FS); (iv)
resource (energy/water) efficiency and effluent management, point source air emissions, waste management; (v)
water sustainability, access and extraction; and (vi) supply chain risk assessment and management.

                                                

**Information on IFC's Policy and Performance Standards on Environmental and Social Sustainability can be found at
www.ifc.org/sustainability
Environmental and Social Mitigation Measures

Environmental and Social Mitigation Measures

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 Policies

Al-Jebrini’s commitments to sustainability are driven by customer food safety requirements and resource efficiency
due to general utilities scarcity in the West Bank. The Company is developing strategic policies to install best
practices for EHS, reflected in procedures and instructions, to be adopted and implemented by all staff members,
contractors, and suppliers. The Company is implementing a Food Safety Management System to international
standards (ISO 22000 and HACCP) which is under the accreditation and certification process (an ISO 22000 external
audit is planned within 6 months). It also initiated very strong steps for GLOBAL G.A.P. implementation, but so far
certification could not proceed due to lack of accredited suppliers of forage and some other raw materials.

As set forth in ESAP #1 below, the Company will develop and implement an overarching E&S and OHS policy defining
the objectives and principles that guide the Company to achieve sound environmental and social (E&S) performance
to comply with the applicable laws and regulations of the PNA and IFC’s Performance Standards, applicable WBG
(EHS) General Guidelines and Industry Sector Guidelines. The policy will be communicated to all levels of the
organization, and entities the Company has management control over.

Identification of Risks and Impacts

Identification of Risks and Impacts

The Company identifies E&S risks and impacts in accordance with national regulations. They had an EIA conducted
for the E.F.G. Company biogas plant (2013), resulting in an E&S Management and Monitoring Plan (ESMMP), with
risks and mitigation measures adequately identified. The construction of warehouses and food processing factory
are not subjected to ESIA under the Palestinian Environmental Assessment Policy (PEAP). Resource Efficiency and
Pollution Prevention issues have been identified by international experts as part of the SwitchMed initiative (2015-
2017) and the MENA STAR project (2016-2018) on ISO 14046 (Water Footprint), with mitigation being implemented
(see below).

Management System and Programs

The Company operates its facilities in compliance with regulations of the PNA, Environment Quality Authority (EQA),
Palestinian Energy Authority (PEA), Ministry of Social Affairs, Ministry of Health, Palestinian Standards Institution
(PSI), Ministry of Agriculture, and the Palestinian Civil Defense. The Company is certificated by the PSI for its
compliance to the Palestinian Standard for Product Quality (PS 15-1997). The Company is implementing several
management programs, including resource efficiency programs, an updated HR policy, a documented Emergency and
Evacuation Plan, a Food Safety Management System, Biogas plant ESMMP, and a supplier/vendor evaluation system.

Also, the Company commits to continuously improving its supply chain, in a way that ensures proper flow and
optimum level of performance and quality of materials, goods, products and services, and is planning to establish a
variety of management systems under an integrated umbrella including Quality Management (ISO 9001), OHS (ISO
45001), Risk Management (ISO 31000), Environmental Management (ISO 14001), Energy Management (ISO 50001),
Social Responsibility (ISO 26000), and Good Manufacturing Practices (GMP) for Food Industry. The Company is
committed to obtain these ISO certificates over the next 3 years as part of their strategic plan.

Although the Company has several elements of an environmental and social management system (ESMS) it still
needs to improve integration and implement an ESMS with Standard Operating Procedures (SOPs) that consolidate
the different aspects of the E&S and OHS standards and requirements for Good International Industry Practice (GIIP).
As set forth in ESAP #1, in accordance with IFC’s Performance Standard 1, the Company will set up an integrated
ESMS, which will be appropriate to the nature and scale of its operations and commensurate with the level of E&S,
OHS risks and impacts for each facility. This ESMS will apply to existing and future operations. It will include the
following aspects: EHS policy; identification of risks and impacts based on local requirements and IFC PSs; manual of
procedures and work instructions related to the management of E&S issues; management programs including
relevant mitigation measures defined in E&S impact assessment (ESIA) studies and/or voluntary standards (i.e.
Global G.A.P.); organizational capacity and competency (inclusive of periodic monitoring and supervision of
contractors); training requirements to facilitate the implementation of the ESMS; emergency preparedness and
response; stakeholder engagement process and community grievance mechanism; supply chain risk screening and
management procedure; and EHS monitoring plan and review.

Organizational Capacity and Competency

The Company has established capacity within different qualified committees which include representatives of top
management and managers/directors of relevant units, including QA, R&D, OHS, HR, CSR and PR, Sales, Maintenance,
Production, Procurement, Warehouse management, Financial, and Marketing. The number of direct involved staff is
estimated by the Company to be (12), although this is not reflected in the Company’s organizational structure. The
OHS Officer was sponsored by the Company to achieve an OHS Bachelor’s degree at Palestine PolyTechnic University
and several other trainings including on ISO 14046 Water Footprint. Although this capacity is adequate for supporting
the administration of the existing system, further capacity will be required to implement an ESMS aligned with IFC
PSs. As set forth in ESAP #2, the Company will expand the role and responsibilities of the OHS officer to cover all E&S
aspects and who will be responsible for  implementation of the ESMS (including oversight on OHS throughout the
Group companies, contractors, and primary suppliers); coordination and oversight for new facility construction and
for mandatory reporting to the national authorities, group shareholders and customers; creating an E&S function to
build capacity of the existing committees at each subsidiary/affiliate and supplier where the Company has
management control over. As required, this function shall also be responsible for setting the terms of reference and
supporting the formation of a board level sustainability committee.

Emergency Preparedness and Response

Within the Company, emergency response planning and procedures are integrated with OHS and placed under direct
monitoring, control and supervision of the OHS officer, with one emergency responsible person assigned per unit. The
Emergency and Evacuation Plan does not cover all types of emergencies yet focuses mainly on life and fire safety
(L&FS); it does not include community health and safety. It includes floor plans with location of fire detectors and fire
extinguishers, instructions for using the remotely controlled and smart phone connected central alarm device which
links smoke detectors, fire and sound alarms distributed across all sections and locations. All employees receive
emergency response training including L&FS and first aid training. Safety is verified, and fire drills conducted bi-
annually by the Palestinian Civil Defense, with safety certificates issued annually. At the Company’s facility in Hebron,
a private company for public safety inspects the L&FS devices.

As set forth in ESAP #1 (above), the ESMS will include a documented and continuously updated emergency
preparedness and response system, including identification of all areas where emergency situations may occur,
impacted communities/individuals, response procedures, provision of equipment and resources, communication, and
periodic training.

EHS Monitoring and Review

While the Company conducts E&S monitoring, evaluation, and reporting for business operation purposes, it does not
implement a corporate wide E&S monitoring and reporting process. Their focus is on reporting compliance to
Palestinian Standards, HACCP/ISO, SwitchMED, MENA STAR, GMP for Food Industry. For SwitchMED program
purposes, air emissions monitoring (H2S, CO, NH3, NO2, SO2, VOC) was done for 2017, with the results for 2018
pending. This is measured by the Palestine Polytechnic University who visits once annually and makes calculations
based on the monitoring data. Data monitored include: waste types and quantities for the production facility in
Hebron only (annual), utility consumption (LPG, fuel oil, electricity, water use) (annual), accident reporting and
evaluation with breakdown per facility (annual), records on training (annual), grievance records, records of supplier
audits for food safety/quality (quarterly), and HACCP audits (bi-annual). Water quality is being monitored internally/by
the Palestinian Ministry of Health to ensure production and quality requirements are met. Workplace measurements
are compliant with national Palestinian laws and regulations. The process of collecting and reporting additional E&S
data (including air emissions and workplace measurements) is planned with the support of the Palestinian National
Center for Occupational Safety, Health and Environmental Protection (COSHEP) as well as the Renewable Energy and
Environment Research Unit (REERU) at the Palestine Polytechnic University (PPU). No systematic records of
workplace monitoring, point source emissions, nor waste water are available. The current approach will be
supplemented and re-enforced to ensure all data is effectively captured, reviewed and evaluated, including the
contractors’ and primary suppliers’ activities.

External Communications and Grievance Mechanisms

The Company has in place an adequate procedure for external communications that include: (1) a complaints box at
the office of the Security officers to receive and register external communications from the public in addition to
accessible top managers, (2) a procedure to screen and assess issues raised and define how to address them, and
(3) a procedure to provide, track, and document responses. In addition, the Company maintains good relations with
the families living adjacently to the factory in Hebron, e.g. providing them with water in case of (frequent) water
network cuts.

                                               

PS 2: Labor and Working Conditions

 Human Resources Policies and Procedures

The Company level HR policy is based on the PNA Labor Law (no. 7/2000). This HR policy includes: (i) general rules,
(ii) use of company’s resources and equipment, (iii) working conditions and terms of employment, (iv) minimum
training and competency needs, (v) salaries and remunerations, (vi) hours of work and overtime, (vii) benefits
including annual leave entitlements and sick and special leave, (viii) work injuries and insurance at work related to
prevention and safety, (ix) duties and prohibitions with violations and penalties, and (x) grievances. Although the HR
policy is broadly compliant to PS2 requirements, it does not explicitly include the right to freedom of association, non-
discrimination, child/forced labor, requirements for workers engaged by third parties and supply chain workers. There
i l li it id f t l f f lh t A t f th i ESAP #3 th
is also no explicit evidence of zero tolerance for proven cases of sexual harassment. As set forth in ESAP #3, the
Company will revise its HR policies and procedures to include provisions on right to freedom of association, non-
discrimination, child/forced labor, workers engaged by third parties and supply chain workers. The employment terms
and conditions will be amended to include a zero-tolerance for proven cases of sexual harassment or gender-based
violence and a mechanism including the expertise to handle sexual harassment cases. Also, the Company will review
the employee handbook, in accordance with national regulations, specifying statutory entitlements and make this
publication available to all workers (including seasonal workers) on signing of employment agreements.

Working Conditions, Terms of Employment, and Management of Worker Relationship

At the time of the site visit, the Company employs 551 full-time and 9 part-time workers, of which 140 office workers
(33% female) and 420 laborers (43% female). Contractors employ approximately 50 workers of which about 25%
female. Contractors’ jobs include security, marketing and promotion, housekeeping and cleaning with staff numbers
changing according to the work needs. The Company’s visited subsidiaries’ and affiliates’ terms of employment and
working conditions are broadly compliant with PS 2. The sighted working conditions within the factory, warehouses,
biogas plant, and farm are considered as reasonable, with all workers receiving a copy (in Arabic) of signed
agreement stating terms and conditions. Workers’ salaries are compliant to Palestinian regulations including
minimum wage.
Terms of employment are aligned with national labor regulation. All workers are issued a contract of employment in
Arabic that includes a statement of the job description, the agreed salary, type of contract (fixed-term or indefinite),
performance of particular work, probation period (max 90 days), benefits, leave and holidays. All workers are required
to work six days per week, eight hours per day (with 0.5-hour break), with the factory operating at two day-shifts of
eight hours and one night-shift of seven hours as per the PNA Labor Law (7/2000). One extra day-shift is added in
summer to respond to additional demand. All new workers receive extensive orientation including training on food
hygiene needs and safe working. The Company does not accept any employees who are less than 18 years old as
minimum, and carrying a Palestinian national ID. The Company provides transport to/from work to all workers in
response to a grievance on workers’ difficulties of arriving at work due to traffic delays. No employment handbook is
issued to the workers with all data explained verbally, including any amendments to the terms and conditions. See
ESAP #3.

Workers’ Organization

Although the right to freedom of association and collective bargaining is not included in the HR Policy, it was stated
that the Company is committed to apply the PNA Laws and bylaws (No. 7/2000) which insures the right of workers
and labors to join labor unions and bargain collectively for their wages and other work-related rights and issues. The
HR Manager estimates that 50% of the employees is member of the Labor Union. See ESAP #3.

Non-Discrimination and Equal Opportunity

Although the HR policy stipulates that employment in the Company is open to all individuals, and that the Company is
committed to apply the PNA Laws and bylaws (No. 7/2000) which insures non-discrimination and equal opportunity,
the latter principles are further not explicitly included in the HR Policy. Gender specific wash room facilities were
present. Also, female-focused measures have been observed, e.g. adjusted working hours to align with school hours.
See ESAP #3.

Grievance Mechanism

The Company’s HR policy insures the right to file a written grievance through a formal mechanism accessible to all
workers, including: (1) an allocated box to receive (anonymous) notices, (2) a procedure to screen and assess issues
raised and define how to address them by the responsible officers, and (3) a procedure to provide, track, and
document responses with response to the result of the submitted complaint within 3 days at maximum. Accessibility
of this mechanism to contractors’ workers is not included in the HR policy. See ESAP #3.

Occupational Health and Safety

The OHS policies and procedures are not aligned with PS2 requirements for the full scope of operations conducted
under the Company.

At the Al-Jebrini Company for Dairy and Food Industries, identification and management of OHS risks is conducted
th h th OHS Offi Hi ibiliti i l d (i) OHS (ii) L&FS (iii) hi f t (i ) t i i d d
through the OHS Officer. His responsibilities include: (i) OHS; (ii) L&FS; (iii) machinery safety; (iv) training needs; and
(v) food safety. The Company distributes guidance including attention boards and signposts inside the facilities and
keeps a limited OHS Manual with instructions to comply with OHS measures and standards, as directly supervised by
the OHS Officer. Equipment operation manuals are within reach of the supervisors. Non-compliance with these
measures is recorded and subjected to penalties as specified in the HR Policy. OHS training (based on ISO 45001) is
part of the induction training package for a new employee, with at least annual refresher training, based on needs
identification after evaluation. Accident statistics have decreased consistently since 2016 but continue to be at very
high levels for the type of industry. No workplace monitoring is being done. The Company keeps accident reporting,
but does not include near miss accident reporting process and accident reporting of contractors. Most injuries are
bruises and fractures due to machine misuse and falling. Training records are kept (training sessions in 2018 at the
factory, farm and biogas plant served 190 employers). The Company uses different Personal Protective Equipment
(PPE) according to the nature of work department and unit, including: glasses, welding eye protection, face masks,
shoes, vests, special coats, safety belts, knee protection, ear protection, gloves, helmet. PPE was observed to be used
in the facility in Hebron.

At the farm of the Pal Farm Company, OHS conditions are supervised by the Quality, Research & Development
Manager of the Al-Jebrini Company for Dairy and Food Industries. No hazardous waste disposal area, no emergency
eye wash station, no material data safety sheets (MSDS), no inventory cards, and no warning labels highlighting
minimum required safety standards were present. Poor maintenance of L&FS equipment was observed.

At the biogas plant of E.F.G. Company for Alternative Energy (adjacent to the farm), it was noted that no PPE was
being used (e.g. gas detection devices), no evacuation plans, some warning signs poorly maintained, no logbook on
cleaning, inspection, and maintenance of the equipment available on the site.

As part of the ESAP #4, the Company will revise and strengthen OHS practices and procedures, with associated
corrective measures to ensure that housekeeping rules, workplace conditions, accident rate and recording thereof will
be improved.

Workers Engaged by Third Parties

The Company engages third party contractors for construction purposes, maintenance of equipment, and
aggregators/traders to supply material inputs into the production facilities. The Company signs contracts with third
party contractors complying with national labor laws and E&S policies, and with the Company’s policies, to insure the
mutual commitment of both parties. From reviewing the contracts and audit checklists, the contract specifications
mainly relate to criteria serving the production business of the Company, related to quality, price, and delivery time.
There is no documented process in place to support monitoring of contractor OHS or labor performance. As part of
the ESAP #5, the company will include OHS, labor and environmental criteria into the contractor’s contract templates
to be implemented for renewed/future contracts with contractors and will monitor compliance through the ESMS.

Supply Chain

The Company maintains a supply chain that includes in Palestine: seven primary milk suppliers (6 dairy farms
(average 300-400 cows) and its own farm Pal Farm Company (1400 cows in free stalls, producing 20 tons of milk
daily, covering 20% of the raw milk supply)), hummus and sugar suppliers. Imported raw materials include: butter,
cheese, hummus, forage, tahini. Forage and silage are currently imported from Israel, and the Company plans to start
producing forage crops near their farm. Primary raw materials include raw milk (97.1%), sugar (0.9%), tahini (0.8%),
flavors (0.6%), and powder milk (0.5%).

The Company seeks to maintain long term relationships with their suppliers, who are selected based on quality, price,
and delivery time. The agreement and accreditation of suppliers is enacted with a declaration of commitment,
Certificate of Analysis and Materials Safety Data Sheets (MSDS) to be provided by the suppliers, all mainly focused on
food safety and quality of products. An evaluation and monitoring system is being implemented. No Supplier’s Code
of Conduct has been developed, but suppliers need to sign a declaration of commitment. The Company provides
extension services (technical support) to the 6 dairy farms to monitor and improve quality of milk. Even though child
labor is possible in Palestine (from a contextual risk analysis), the Company’s suppliers are required to comply with
PNA Labor Law, which prohibits dangerous work for minors, and child labor under the age of 15 years, with the
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Company’s age limit set at 18 years. There is however a risk of safety issues for supply chain workers with poor
observance of OHS measures, in particular in the dairy farms. As set forth in ESAP #6, the Company shall develop a
supply chain code of conduct and procedure in line with IFC’s supply chain requirements related to PS2, which will
include: (i) mapping of all primary suppliers and  risk prioritization; (ii) include in procurement contract specific E&S
requirements to screen out child/forced labor, unsafe working conditions, and guarantee that supplies are from land
classified by PNA for agricultural purposes, with updated contract templates to be implemented for renewed/future
contracts with suppliers; and (iii) monitoring and reporting.

                                                  

PS 3: Resource Efficiency and Pollution Prevention

Resource Efficiency

The Company is implementing several resource efficiency programs (e.g. SwitchMED and MENA STAR) to reduce
water and energy consumption, save materials, maximize utilization of by-products (whey), enhancing Heat Recovery
Ratio (HRR) of equipment. Anticipated annual savings for the SwitchMED program include 230k m³ water and 1,289
MWh energy with annual reduction of 962t CO2 emissions and 218k m³ waste water. Some selected SwitchMED
Good Housekeeping Measures (GHK) are being implemented including replacement of a boiler burner, energy efficient
lighting, and replacement of a chiller. Also, the Company is establishing an Enterprise Resource Planning (ERP)
System, based on which all processes and operations will be fully automated for easy monitoring and evaluation of
enterprise performance.

Energy

Total electricity consumption is estimated at 3.547 million kilowatt hour (kWh) per annum (no breakdown per facility
or production line available). This is exclusive of the electricity produced by the generator running on diesel: the
generator is used only for emergency, i.e. on average of 4-6 hours per month. For the new facility planned in Al-
Dahryah area, projected electricity consumption has not been calculated however is expected to be 40-50% of the
current consumption. Based on current annual production capacity of 58,400 tonnes per annum (t.p.a) (dairy
products) and 3,650 t.p.a (salads), energy consumption per liter or kilogram equates to 0.057kWh, which is below the
industry benchmark for similar products as stated in the IFC EHS Guidelines for Dairy Processing/Food and Beverage
Processing demonstrating the Company’s efficient energy management.

Water Consumption

Water is supplied to the Company’s facility in Hebron via the municipal network and reservoirs with a capacity of
30,000 m³ that are being filled with water trucked in by the Palestinian Water Authority as well as rainwater collection.
This rainwater is treated and filtered to be suitable for use in food industries for cleaning operations. Water quality is
monitored through laboratory tests carried out by the Palestinian Ministry of Health as well as internal laboratory
tests. There are no underground sources/wells being exploited (no license). This situation will remain the same with
the future factory.

The Company consumes 312,000m³ water per annum, around 1,000m³ per day (no breakdown per production line
available). Water consumption averages 5m³ per ton of dairy products/salads produced, which is exceeding the
industry benchmark for dairy products as stated in the IFC EHS Guidelines for Diary Processing, and within the range
of industry benchmarks stated in the IFC EHS Guidelines for Food and Beverage Processing. As part of the
Company’s resource efficiency programs, it is planned to improve the Cleaning-in-Place (CIP) operations, through re-
using water for pre-rinsing and intermediate cleaning, which is assessed to reduce water consumption by at least
167,860m3/year. Also, water from chillers and pasteurizers is collected and recycled for cleaning water. As set forth
in ESAP #7, the Company will conduct a water efficiency review of its operations and develop a water efficiency plan
with the targets aligned with WBG EHS Guidelines’ levels, especially within the context of water scarcity in the
Palestinian territories.

GHG Emissions

Based on fuel consumption data (LPG and diesel), total estimated energy consumption for the group in a 12-month
period, and livestock at the dairy farm (1,400 heads), the estimated GHG emissions levels was 6.372 tons of CO2-
equivalent per year, which is below the threshold value for the client to quantify GHG emissions.
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Air Emissions and Ambient Air Quality

Air emissions at the Company are generated through combustion and processing. Point source emissions include:
ventilation outlets, furnace stacks, 3 boiler stacks running on LPG, and 1 energy generator running on diesel. Other
emissions are generated through transportation activities and chemical materials. The emissions at the factory are
being controlled through hoods, fans, filters, dosing pumps and Good House Keeping (GHK) measures. Air emissions
(only from the 3 boilers and the generator) are being monitored and evaluated with measured parameters including
hydrogen sulfide, carbon monoxide, ammonia, nitrogen dioxide, sulfur dioxide, and Volatile Organic Compounds
(VOC). Monitoring results indicate zero emission of ammonia, nitrogen dioxide and VOC, and emissions of carbon
monoxide, sulfur dioxide found to be well above international standards (WHO, NAAQS, EU). This monitoring informs
further measures to be taken as part of the SwitchMED Initiative, e.g. replacing equipment, establishing GHK
measures, and energy efficient lighting (total CO2 emissions reduction by 963 t/year). The biogas plant and
warehouses are not being monitored. The cows’ manure is collected to produce renewable energy in the biogas plant
based on anaerobic digestion. The Company expressed its intentions to improve its monitoring of CO2 emissions and

other parameters with support of the Palestinian National Center for Occupational Safety, Health and Environmental
Protection (COSHEP) as well as Renewable Energy and Environment Research Unit (REERU) at Palestine Polytechnic
University (PPU).

Waste Water Treatment

While water efficiency and re-use of by-products (e.g. whey) is part of the resource efficiency measures, limited
information was provided on the treatment of industrial process waste water. It was stated that pre-treatment of
process water is done in an automated way through removing solid waste, reducing BOD and COD levels by adding
chemicals, circulating caustic soda and alkaline, rinsing, dosing of acid. The effluent is tested before being
discharged in the public sewage system, however monitoring data of effluent quality are not available. Compliance
with European Commission (EC) Integrated Pollution Prevention and Control (IPPC) Best Available Techniques (BAT’s
and Benchmarks) for Food, Drinks and Milk industries was stated, but no review of sampled effluent monitoring was
shared. Also, new facility is planned to include a Waste Water Treatment Plant (WWTP) which is subject to
conducting an ESIA under the PEAP. The client plans to include the WWTP in the Master Plan and provide the WWTP
flowchart, details of treatment method, discharge point and efficiency results by Sept-Oct 2019. As set forth in ESAP
#8, the Company will implement a WWTP and align performance with WBG EHS Guidelines levels:  review the current
waste water treatment in current facility and provide monitoring data on effluent quality, possibly design mitigation
measures; hire a company to undertake the design of the WWTP in the new production facility including CAPEX with
released effluents to comply with WBG EHS Guidelines’ standards; and implement the WWTP.

Solid Waste Management

The Company generates different types of solid wastes (including aluminum covers, plastic, carton, labels, safety
clothes, and pallets) amounting to over 1,000 t.p.a. Within the local Palestinian context of limited available
technologies, the waste is disposed in landfills. The Company has established some waste reducing measures as
part of the SwitchMED initiative. Also, expired food products are collected to be mixed with the manure in the
anaerobic digester for the biogas plant. Also, the suppliers of packaging materials recollect and separate packaging
materials, clean them and re-use them for packaging non-food (e.g. detergents). Compression of these materials is
done in the Company’s factory. The Company is exploring further options to reduce waste stream and enhance re-use
of by-products.

Hazardous Materials Management

Hazardous materials in the form of pesticides, cleaning agents, cooling agents are used at the operations. In the
facility in Hebron, these hazardous materials are properly managed based on strict procedures under the direct
supervision of the OHS Officer and Production Manager to guarantee safe use within the facilities, underpinned by
regulations and restrictions through documented procedures and work instructions. Hazardous materials were
observed to be stored in a designated and appropriately designed room, and accompanied by their related technical
information, MSDS and their purpose of use. The room was locked, under video-surveillance (including by Israeli
authorities remotely) and accessible only for authorized persons No separate hazardous waste collection has been
authorities remotely), and accessible only for authorized persons. No separate hazardous waste collection has been
observed.

At the Pal Farm Company, no well designated storage for chemicals and medication was available with chemicals
stored both in an office room and outside in the stables. Refrigerant gases used include: R22, R410a, R407c, R420,
R470. Ammonia (R717) is not reported. R22 is being used on limited basis with the Company planning to phase it out
and replace it in the next two years. The Company will avoid the use of chemicals and hazardous materials subject to
international phase out and bans due to their high toxicity to living organisms, environmental persistence, potential
for bioaccumulation, or potential for depletion of the ozone layer. As set forth in ESAP #9, the Company will establish
a chemical warehouse at the Pal Farm Company in line with GIIP including WBG EHS Guidelines taking into account
compatibility of the chemicals to be stored together. As set forth in ESAP #10, the Company will replace R22 with a
recognized industry alternative and upgrade its production equipment to use an acceptable substitute.

                                                   

PS 4: Community Health, Safety and Security

Community Health and Safety

The Company’s facility in Hebron is located in a residential area, with about 12 families living adjacent to the factory.
The Group maintains good relations with these families and has a functional grievance mechanism in place. All three
warehouses are located in industrial areas relatively isolated from residential settlement. The Hebron warehouse is
located in Palestinian Area B-zone. The site of the Pal Farm Company, the biogas plant and the new factory is in a
remote location with limited impact on surrounding communities. Community health and safety is not addressed in
the Emergency and Evacuation Plan. See ESAP #1.

Security Personnel

On a daily basis, about 15 unarmed security staff are employed at the factory, warehouses and farms (3 day-shifts of
2pp; 3 night-shifts of 2pp). Their role focuses on: controlling entrance and exit of individuals or goods, with ID
inspection and security checks of materials; guiding guests; ensuring smooth traffic; coordination of official events.
Continuous tracking and communication with top management is maintained. In special occasions with increased
security needs (e.g. festivals/events), the number of private security personnel may
increase                                                   
Stakeholder Engagement

Stakeholder Engagement

The Company maintains a website and uses social media to disclose product information and receive consumers’
feedback. Upon request, the factory facilities can be visited. The Company engages with the local communities to
source workers and material inputs maintaining good relationships in doing so. The Group also maintains an
extensive CSR program. Grievances can be submitted anonymously directly to the factory and are handled by
management. There are no reports of community complaints regarding the Group and no obvious community issues
noted during the appraisal. The Group is proactive in engagement with the communities where it operates, including
through its community development efforts. As set forth in ESAP #1, as part of its Integrated ESMS, the Company will
implement a Stakeholder Engagement Plan and Community Engagement Mechanism in line with PS1.

                                                   

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.

In addition, Affected Communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the
i d d bili h i f IFC Th CAO i d d dd l i f l ff db
independent accountability mechanism for IFC. The CAO is mandated to address complaints from people affected by
IFC-supported business activities in a manner that is fair, objective, and constructive, with the goal of improving
environmental and social project outcomes and fostering greater public accountability of IFC.

Independent of IFC management and reporting directly to the World Bank Group President, the CAO works to resolve
complaints using a flexible, problem-solving approach through its dispute resolution arm and oversees project-level
audits of IFC's environmental and social performance through its compliance arm.

Complaints may relate to any aspect of IFC-supported business activities that is within the mandate of the CAO. They
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-financed business activity. Complaints can be submitted to the CAO in
writing to the address below:

Compliance Advisor Ombudsman

International Finance Corporation
2121 Pennsylvania Avenue NW

Room F10K-242

Washington, DC 20433 USA

Tel: 1 202 458 1973

Fax: 1 202 522 7400

E-mail: cao@worldbankgroup.org

The CAO receives and addresses complaints in accordance with the criteria set out in its Operational Guidelines
which are available at: www.cao-ombudsman.org

Broad Community Support

IFC's Determination of BCS

Broad Community Support is not applicable for this project.

Environmental & Social Action Plan

Environmental & Social Action Plan

Al-Jebrini(41853) Appraisal Disclosure Snapshot – Version 2

Anticipated
Description Completion
Date
In accordance with IFC’s Performance Standard 1, set
up an integrated E&S Management System,
appropriate to the nature and scale of the Company’s
operations and commensurate with the level
of E&S,
OHS risks and impacts for each facility, and applying
to existing and future operations. It will
include: EHS
policy; identification of risks and impacts based on
local requirements and IFC PSs;
manual of
procedures and work instructions related to the
management of E&S issues;
15-May-
management programs
including relevant mitigation measures defined in
E&S impact assessment
2020
(ESIA) studies and/or
voluntary standards (i.e. Global G.A.P.);
organizational capacity and
competency (inclusive of
periodic monitoring and supervision of contractors);
training requirements
to facilitate the implementation
of the ESMS; emergency preparedness and response;
stakeholder
engagement process and community
grievance mechanism; supply chain risk screening
and
management procedure (see ESAP action #6);
and EHS monitoring plan and review.

In accordance with IFC’s Performance Standard 1, set

up an integrated E&S Management System,
appropriate to the nature and scale of the Company’s
operations and commensurate with the level
f E&S OHS i k di t f h f ilit d l i t i ti df t ti It ill
of E&S,
OHS risks and impacts for each facility, and applying
to existing and future operations. It will
Al-Jebrini(41853) Appraisal Disclosure Snapshot – Version 2
include: EHS
policy; identification of risks and impacts based on
local requirements and IFC PSs;
manual of procedures and work instructions related to the
management of E&S issues; Anticipated
Description 15-Nov-
Completion
management programs
including relevant mitigation measures defined in
E&S impact assessment
2021
Date
(ESIA) studies and/or
voluntary standards (i.e. Global G.A.P.);
organizational capacity and
competency (inclusive of
periodic monitoring and supervision of contractors);
training requirements
to facilitate the implementation
of the ESMS; emergency preparedness and response;
stakeholder
engagement process and community
grievance mechanism; supply chain risk screening
and
management procedure (see ESAP action #8 and
#9); and EHS monitoring plan and review.

Expand the role and responsibilities of the OHS

officer to cover all E&S aspects including: (i)
overseeing implementation of the ESMS (including
oversight on OHS throughout the Group
companies,
contractors, and primary suppliers); (ii) coordination
and oversight for new facility
15-May-
construction and for
mandatory reporting to the national authorities, group
shareholders and
2020
customers; (iii) creating an E&S
function to build capacity of the existing committees
at each
subsidiary/affiliate and supplier where the
Company has management control over; (iv) setting
the
terms of reference and supporting the formation of
a board level sustainability committee.

Revise HR policies and procedures to include

provisions on (i) right to freedom of association, (ii)
non-discrimination, (iii) child/forced labor, (iv)
workers engaged by third parties, (v) supply chain
workers, and (vi) zero-tolerance for proven cases of
sexual harassment or gender-based violence
15-Nov-
and a
mechanism including the expertise to handle sexual
harassment cases. In addition, review the
2020
employee
handbook, in accordance with national regulations, specifying statutory entitlements and
make this
publication available to all workers (including
seasonal workers) on signing of
employment
agreements.

Revise and strengthen OHS practices and procedures,

with associated corrective measures to
15-Nov-
ensure that
housekeeping rules, workplace conditions, accident
rate and recording thereof will be
2020
improved.

Update existing procedures / templates for future

contractor’s contracts to include OHS, labor and
15-May-
environmental criteria and to monitor compliance
through the ESMS with updated contract
2020
templates
applicable to contract renewals / new contracts

Update existing procedures / templates for future

contractor’s contracts to include OHS, labor and
15-Nov-
environmental criteria and to monitor compliance
through the ESMS with updated contract
2020
templates
applicable to contract renewals / new contracts

Develop a supply chain code of conduct and

procedure in line with IFC’s supply chain
requirements
related to PS2 which will include: (i)
mapping of all primary suppliers and risk
prioritization; (ii)
15-May-
procurement contracts including
specific E&S requirements to screen out child/forced
labor, unsafe
2020
working conditions, and guarantee that
all plantation supplies are from land classified by
PNA for
agricultural purposes; and (iii) monitoring
and reporting.

Develop a supply chain code of conduct and

procedure in line with IFC’s supply chain
requirements
related to PS2 which will include: (i)
mapping of all primary suppliers and risk
prioritization; (ii)
15-Nov-
procurement contracts including
specific E&S requirements to screen out child/forced
labor, unsafe
2021
working conditions, and guarantee that
all plantation supplies are from land classified by
PNA for
agricultural purposes; and (iii) monitoring
and reporting.

Conduct a water efficiency review of the Company’s

operations and develop a water efficiency plan
15-May-
with
the targets aligned with WBG EHS Guidelines’
levels, especially within the context of water
2020
scarcity
in the Palestinian territories.

Align waste water treatment with WBG EHS

Guideline levels: A) Review the waste water
treatment in
current facility and provide monitoring
data on effluent quality, possibly design mitigation
measures; 15-May-
 B) Hire Company to undertake design of
WWTP
Al-Jebrini(41853) in the new
Appraisal production
Disclosure facility–including
CAPEX
Snapshot Version 2 with 2020
released effluents to comply with WBG
EHS Guidelines’ standards; C) Implement WWTP
Anticipated
Align waste water treatment with WBG EHS
Guideline
Description
levels: A) Review the waste water
treatment in Completion
current facility and provide monitoring
data on effluent quality, possibly design mitigation
measures; 15-Aug-
Date
B) Hire Company to undertake design of
WWTP in the new production facility including
CAPEX with 2020
released effluents to comply with WBG
EHS Guidelines’ standards; C) Implement WWTP

Align waste water treatment with WBG EHS

Guideline levels: A) Review the waste water
treatment in
current facility and provide monitoring
data on effluent quality, possibly design mitigation
measures; 15-Nov-
B) Hire Company to undertake design of
WWTP in the new production facility including
CAPEX with 2021
released effluents to comply with WBG
EHS Guidelines’ standards; C) Implement WWTP

Establish a chemical warehouse at the Pal Farm

Company in line with GIIP including WBG EHS 15-Nov-
Guidelines taking into account compatibility of the
chemicals to be stored together 2020

Replace R22 with a recognized industry alternative

and upgrade its production equipment to use an 15-Nov-
acceptable substitute. 2021

Related SII
Summary of Investment Information (SII)

Client Documentation

No related documents.