THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) CHINA: HENAN GREEN AGRICULTURE FINANCING FUND PROJECT ENVIRONMENTAL and SOCIAL COMMITMENT PLAN (ESCP) (Final) Henan Agriculture Development Financing Investment Corporation November 20, 2019 1|Page THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN 1. Henan Agriculture Development Financing Investment Corporation (HADFIC) will implement the China Henan Green Agriculture Financing Fund Project (the Project), with the involvement of the Ministry of Finance and National Development and Reform Commission. The World Bank (the Bank) has agreed to provide financing for the Project. 2. HADFIC will implement material measures and actions so that the Project is implemented in accordance with the Environmental and Social Standards (ESSs). This Environmental and Social Commitment Plan (ESCP) sets out material measures and actions, any specific documents or plans, as well as the timing for each of these. 3. HADFIC will also comply with the provisions of any other environmental and social (E&S) documents required under the ESF and referred to in this ESCP, such as Environmental and Social Management System (ESMS), Environmental and Social Impact Assessment (EISA), Environmental and Social Management Plan (ESMP), Resettlement Action Plans (RAP), Ethnic Minority Development Plan Plans (EMDPs), Stakeholder Engagement Plans (SEP) and Labor Management Procedure (LMP), and the timelines specified in those E&S documents. 4. HADFIC is responsible for compliance with all requirements of the ESCP even when implementation of specific measures and actions is conducted by the Ministry, agency or unit referenced in 1. above. 5. Implementation of the material measures and actions set out in this ESCP will be monitored and reported to the Bank by HADFIC as required by the ESCP and the conditions of the legal agreement, and the Bank will monitor and assess progress and completion of the material measures and actions throughout implementation of the Project. 6. As agreed by the Bank and HADFIC, this ESCP may be revised from time to time during Project implementation, to reflect adaptive management of Project changes and unforeseen circumstances or in response to assessment of Project performance conducted under the ESCP itself. In such circumstances, HADFIC will agree to the changes with the Bank and will update the ESCP to reflect such changes. Agreement on changes to the ESCP will be documented through the exchange of letters signed between the Bank and the HADFIC. The HADFIC will promptly disclose the updated ESCP. 7. Where Project changes, unforeseen circumstances, or Project performance result in changes to the risks and impacts during Project implementation, the HADFIC shall provide additional funds, if needed, to implement actions and measures to address such risks and impacts, which may include risks and impacts that are relevant to the Project, such as environmental, health, and safety impacts, labor influx, gender- based violence. 2|Page THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP): VERSION 2.0 – July 2019 MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY MONITORING AND REPORTING REGULAR REPORTING HADFIC, following the requirements of the ESS9, will prepare and submit Semi-annually throughout the project A HADFIC semi-annual environmental and social monitoring reports to the Bank to lifecycle show status of compliance with the ESMS and ESCP. INCIDENTS AND ACCIDENTS HADFIC will immediately notify the World Bank of any environmental and social accidents/incidents which have, or are likely to have, Notify the World Bank within 48 hours significant adverse effect on the environment, the affected after learning of the incidents/accidents communities, the public or workers. B HADFIC As requested by the Bank, HADFIC should provide a subsequent report Provide a subsequent report within a with sufficient details regarding the incident or accident, and indicating timeframe acceptable to the World Bank as immediate measures taken or that are planned to be taken to address it requested and prevent its recurrence, and any information provided by any contractor and supervising entity, as appropriate. HADFIC shall keep the World Bank timely informed of the increase of environmental and social risk profile of subprojects and apply relevant Once the risk profile of a subproject C requirements of the ESSs in a manner agreed with the World Bank, as HADFIC increases significantly set out in the ESMS. HADFIC will monitor the measures and actions agreed, and report to the World Bank as appropriate. ESS 1: ASSESSMENT AND MANAGEMENT OF ENVIRONMENTAL AND SOCIAL RISKS AND IMPACTS ORGANIZATIONAL STRUCTURE HADFIC will establish and maintain the ESMS for the Project throughout the life of the Project, which will be applied to all subprojects under the By project appraisal and maintained 1.1 HADFIC Green Agriculture Fund (GAF), the sub-funds, and the challenge funds throughout the project life (as part of TA component). Please also refer to 9.2 and 9.3 in this ESCP for HADFIC’s specific institutional enhancement commitments. ORGANIZATIONAL STRUCTURE 1.2 HADFIC will establish a dedicated GAF Management Unit for the whole Prior to loan effectiveness HADFIC process of fund management of the Green Agriculture Fund as a portfolio. 3|Page THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP): VERSION 2.0 – July 2019 MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY MANAGEMENT TOOLS AND INSTRUMENTS HADFIC will carry out exclusion against the exclusionary criteria and carry 1.3 out environmental and social risk screening for all candidate sub-projects, Prior to sub-projects identification meeting HADFIC in order to classify the category of sub-projects per the ESMS. Subproject environmental and social risk classification report will be prepared by HADFIC. The environmental and social risks screening of subprojects should be 1.4 sent to the World Bank for prior subproject approval until HADFIC has Prior to sub-projects investment approval HADFIC demonstrated the capacity to screen adequately on its own. HADFIC will ensure the compliance of environmental and social impacts assessment for all sub-projects according to the ESMS. Appropriate E&S documents will be included as part of investment application package to 1.5 be cleared by HADFIC (subject to spot check by the World Bank Task Prior to sub-projects investment approval HADFIC and its subproject enterprises Team) following the ESMS. For subprojects with substantial or high risks, such documents may include EIA, SIA, ESMP, RAP, EMDP etc. as indicated in the ESMS and relevant annexes. For a subproject involving facilities and/or business activities that already exist or are under construction, the subproject enterprises will undertake 1.6 an environmental and social impact and risk compliance audit, and Prior to sub-projects investment approval HADFIC submit the environmental and social due diligence report to HADFIC for clearance before the subproject is approved. All sub-projects will be prepared and implemented in compliance with relevant environmental and social national laws and regulations and obtain all relevant approvals and permits from different governmental agencies in time. 1.7 In addition, where a subproject involves resettlement (unless the risks or Prior to sub-projects investment approval HADFIC and its subproject enterprises impacts of such resettlement are minor), adverse risks or impacts on Indigenous Peoples or significant risks or impacts on the environment, community health and safety, labor and working conditions, biodiversity or cultural heritage, the relevant requirements of the ESSs are applied 4|Page THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP): VERSION 2.0 – July 2019 MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY The E&S documents for the first three High or Substantial sub-projects representative of the typology of the sub-projects will be submitted to 1.8 the World Bank for prior review and clearance. The World Bank review Prior to sub-projects investment approval HADFIC and its subproject enterprises will continue if it is found that quality is low and/or HADFIC has capacity issues in implementing the ESMS. MANAGEMENT OF CONTRACTORS Prior to the preparation of procurement HADFIC will ensure its subproject enterprises integrate the labor documents. 1.9 management procedures as set out in ESMS into the procurement Subproject enterprises Supervision on contractors throughout documents with contractors, thereafter to ensure that the contractors project implementation comply with the ESHS specifications of their respective contracts. ESS 2: LABOR AND WORKING CONDITIONS LABOR MANAGEMENT PROCEDURES 2.1 HADFIC maintains staff management procedures consistent with national Throughout project cycle HADFIC law and ESS2. The subproject enterprises should establish and maintain a labor management procedure consistent with ESMS and ESS2 for the Establish the labor management procedure 2.2 subprojects that involve significant risks or impacts on labor and working before investment approval and maintain it Subproject enterprises conditions. The labor management procedure should be in place before throughout sub-project cycle subproject approval and maintained throughout the lifecycle. HADFIC will ensure the labor management requirements of subproject enterprises consistent with national law, and labor management 2.3 At investment agreement signing stage HADFIC and its subproject enterprises procedure set in ESMS and ESS2 in the investment agreements for sub- projects. GRIEVANCE MECHANISM FOR PROJECT WORKERS Prior to engaging project workers and 2.4 HADFIC and its subproject enterprises will establish, maintain, and maintained throughout Project HADFIC and its subproject enterprises operate a functioning grievance mechanism for project workers, as implementation described in the ESMS and consistent with ESS2 and local contexts. OCCUPATIONAL HEALTH AND SAFETY (OHS) MEASURES At investment agreement signing stage and 2.5 HADFIC and its subproject enterprises will prepare, adopt, and throughout sub-project implementation Subproject enterprises implement occupational, health and safety (OHS) measures, as described process in the ESMS and consistent with ESS2 and the regulatory requirements. 5|Page THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP): VERSION 2.0 – July 2019 MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY ESS 3: RESOURCE EFFICIENCY AND POLLUTION PREVENTION AND MANAGEMENT HADFIC will ensure incorporation of pollution control compliance At investment agreement signing stage and requirements in investment agreements for sub-projects, i.e. 3.1 throughout sub-project implementation HADFIC and its subproject enterprises compliance with applicable emission standards and mitigation measures process as developed in relevant E&S documents. ESS 4: COMMUNITY HEALTH AND SAFETY HADFIC will ensure sub-projects meet any applicable health and safety assessment requirements in compliance with national laws/regulations 4.1 Prior to sub-projects investment approval Subproject enterprises as well as World Bank Group Environmental, Health and Safety (EHS) requirements at investment approval stage. HADFIC will ensure the subproject enterprises to develop and At investment agreement signing stage and 4.2 implement traffic safety management plan to manage the road safety throughout sub-project implementation Subproject enterprises risks and impacts. process Any sub-projects involving toxic and hazardous materials and wastes 4.3 Prior to sub-projects investment approval Subproject enterprises should prepare an Emergency Preparedness and Response Plan. ESS 5: LAND ACQUISITION, RESTRICTIONS ON LAND USE AND INVOLUNTARY RESETTLEMENT HADFIC will ensure that all sub-projects with potential land acquisition and resettlement will follow the provision of Resettlement Policy Framework (RPF) adopted as part of ESMS. Based on environmental and social risk screening, for those sub-projects with minor land acquisition 5.1 impacts (If no physical displacement is involved and less than 10% of their Prior to investment approval Subproject enterprises productive assets will be lost), they need to follow national laws and regulations by obtaining relevant land acquisition approval and making proper compensations with affected people and communities in full and in time. 6|Page THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP): VERSION 2.0 – July 2019 MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY RESETTLEMENT PLANS: For those sub-projects with moderate to significant environmental and social impacts that affected households will be physical displaced or lose 5.2 more than 10% of their production assets, individual resettlement plans Prior to investment approval Subproject enterprises will be prepared by the subproject enterprises according to RPF. The completed resettlement plans will be included as part of investment document package to be reviewed by HADFIC and the World Bank following the ESMS. LEASING OF LAND USE RIGHT: When a subproject involves leasing of land use rights, (i) The agreements of leasing of land use rights should be signed Prior to investment approval with farmers’ consent, with verification by the sub project 5.3 enterprises; and Subproject enterprises (ii) The proposed measures for mitigating potential risks and Throughout the subproject lifecycle strengthening the implementation procedures of leasing of land use rights should be taken by the subproject enterprises as set out in the ESMS as appropriate. RESETTLEMENT DUE DILIGENCE REVIEW REPORT: The due diligence should generally review prior resettlement within a 5.4 time frame of approximately three years prior to subproject request for Prior to subproject approval Subproject enterprises financing, but will consider the context of specific subprojects and significance of prior resettlement on a case by case basis. ESS 6: BIODIVERSITY CONSERVATION AND SUSTAINABLE MANAGEMENT OF LIVING NATURAL RESOURCES BIODIVERSITY RISKS AND IMPACTS: If any activity would bring significant impacts on natural habitats as 6.1 defined by ESS6, then HADFIC would rate the subproject as Substantial Prior to sub-projects investment approval Subproject enterprises (or High) risk and apply the requirements of ESS6. No subproject will be financed if identified with direct or indirect (e.g. through supply chains) impacts on critical natural habitats. ESS 7: INDIGENOUS PEOPLES/SUB-SAHARAN AFRICAN HISTORICALLY UNDERSERVED TRADITIONAL LOCAL COMMUNITIES 7|Page THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP): VERSION 2.0 – July 2019 MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY HADFIC will ensure that all sub-projects with potential negative impacts on ethnic concentrated communities will follow the provision of EMDF 7.1 adopted as part of ESMS. Based on environmental and social risk Prior to subproject identification meeting Subproject enterprises screening, HADFIC will determine if proposed sub-project will have negative impacts on ethnic minority communities. INDIGENOUS PEOPLES PLAN: For those sub-projects which have negative impacts on ethnic minority communities, based on provisions of EMDF, individual EMDP will be prepared based on extensive consultations with affected individuals and 7.2 communities by sub-project enterprises and sub-project management Prior to sub-projects investment approval Subproject enterprises teams from HADFIC. The completed EMDP will be included as part of investment document package to be reviewed by HADFIC, subject to spot check by the World Bank. The subproject(s) should obtain the free, prior and informed consent from affected ethnic minorities if the circumstances as set out in the ESS7 apply to the subproject(s). ESS 8: CULTURAL HERITAGE CHANCE FINDS: At investment agreement signing stage and 8.1 HADFIC requires compliance with chance-finds procedures by sub- throughout sub-project implementation Subproject enterprises projects. process For any subprojects screened for substantial risks and impacts on cultural At investment agreement signing stage and 8.2 heritage, the ESS8 of the ESF will be applied and a cultural heritage throughout sub-project implementation Subproject enterprises management plan will be developed to stipulate relevant mitigation. process ESS 9: FINANCIAL INTERMEDIARIES ESMS Rolling-out: HADFIC will formally approve and roll out its environmental and social By project approval and maintained 9.1 management policy and procedures in the form of corporate operation HADFIC throughout the Project lifecycle regulation document, which will be updated, maintained and implemented throughout the project cycle. 8|Page THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP): VERSION 2.0 – July 2019 MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY FI ORGANIZATIONAL CAPACITY: HADFIC will ensure proper institutional arrangement for implementation of ESMS, which includes (i) Establishing the dedicated GAF Management Unit responsible for whole process operation of project fund management; (ii) Recruiting one full-time environmental specialist and one full- time social management specialist in the Risk Control Unit for daily implementation of ESMS during project implementation; (iii) Assigning one full-time environmental and social liaison person in the GAF Management Unit for coordination with the World By project appraisal and maintained it 9.2 HADFIC Bank and other internal/external stakeholders on the matters throughout the project life cycle of environmental and social risk management; (iv) Hiring one qualified external social expert and one environmental expert with at least 10 years of relevant experience to provide appropriate implementation support; and (v) Carrying out E&S management capacity training among HADFIC staff and relevant sub-project enterprises following the environmental and social management capacity enhancement action plan. SENIOR MANAGEMENT REPRESENTATIVE 9.3 HADFIC will designate a senior management representative to have Prior to loan effectiveness HADFIC overall accountability for environmental and social performance of subprojects. ESS 10: STAKEHOLDER ENGAGEMENT AND INFORMATION DISCLOSURE HADFIC will establish a special column on its official website to disclose 10.1 project information, including EIAs, ESMS, SEP, E&S monitoring report, Immediate after loan effectiveness HADFIC subproject RAPs and EMDPs if any, and so on. HADFIC will Disclose the ESMS on its website and permit the Bank to 10.2 By project appraisal HADFIC disclose on the Bank’s external website. 9|Page THE WORLD BANK - ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP): VERSION 2.0 – July 2019 MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY HADFIC will prepare and disclose an overall project SEP on HADFIC’s 10.3 website and permit the World Bank to disclose on the Bank’s external By project appraisal HADFIC website. Unless a subproject is determined that there is no environmental and Prior to sub-projects investment approval 10.4 social risk, a SEP will be developed and implemented throughout sub- HADFIC and its subproject enterprises, and throughout the ssubproject lifecycle project lifecycle. PROJECT GRIEVANCE MECHANISM: Develop and implement the arrangements for the grievance mechanism By project appraisal and throughout the 10.5 for the project at corporate level and for all subproject. Subproject level project lifecycle HADFIC and its subproject enterprises grievance redress mechanism should be set up before the subproject Before subproject investment approval investment approval. CAPACITY SUPPORT (TRAINING) HADFIC will develop the environmental and social management capacity enhancement action plan as part of the ESMS to increase the capacity of CS1 By project appraisal HADFIC relevant management staff in HADFIC, external E&S experts, and the subproject enterprises, etc. for effective operation of the ESMS. HADFIC will implement environmental and social management capacity enhancement action plan per the agreed timelines to HADFIC’s senior Immediate after project approval and CS2 management and internal staff of GAF Management Unit, Risk Control HADFIC throughout the project life cycle (as needed) Unit and other units as needed, external E&S experts and the subproject enterprises, etc. 10 | P a g e