MAJ INVEST EQUITY
SOUTHEAST ASIA II K/S
CSR Report 2015
Maj Invest Equity Southeast Asia II K/S | Gammeltorv 18, 1457 København K | Tel. +45 33 38 73 00 | www.majinvest.com | CVR 36 44 49 83
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MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
TABLE OF CONTENTS
INTRODUCTION4
The Fund’s approach to CSR
4
CSR Reporting and implementation
4
RESULTS5
CONCLUSION6
APPENDIX 1
Berrybenka7
Action Plan
9
APPENDIX 2
International standards
25
APPENDIX 3
Responsible Investment Policy for Maj Invest Southeast Asia II K/S
26
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MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
Introduction
The purpose of this report is to present the CSR status of the portfolio companies of Maj Invest Equity Southeast Asia
II K/S (SEA II or the Fund) during 2015. This is the first CSR Report of the Fund.
According to the Limited Partnership Agreement for Maj Invest Equity Southeast Asia II K/S, all investments must
be made in accordance with the Responsible Investment Policy of the Fund, see Appendix 3.
This policy is based on the internationally recognised principles of the UN Principles for Responsible Investment
(UN PRI) constituting the framework for the environmental, social and governance (ESG) requirements for the
Fund. Additionally, the Fund promotes the UN Global Compact principles with the addition of good corporate governance and animal welfare.
THE FUND’S CSR APPROACH
The Fund’s CSR approach is based on the cooperation with joint owners of the Fund’s portfolio companies. As part
of the due diligence process prior to investing, the Fund assesses the CSR status of the company in target, and based
on the assessment a CSR Action Plan is developed in accordance with relevant local legislation and international
standards. Additionally, a CSR appendix is in most cases an integrated part of the shareholders’ agreement between
the Fund and the additional owners of the company.
The portfolio companies are required to complete the actions in accordance with the CSR Action Plan as decided
at the time of investment and during the investment period. The Fund’s representative on the company’s Board of
Directors monitors the efforts and results continuously. If necessary, the Fund may require that external specialists assist the company with the implementation of the CSR Action Plan.
The first priority is that the portfolio companies of SEA II are in compliance with all local legal and regulatory requirements regarding CSR at any time. Further, the second priority is that the portfolio companies shall work towards being in compliance with relevant international CSR standards, and that these international standards shall
be used as benchmarks.
CSR REPORTING AND IMPLEMENTATION
According to the Fund’s Responsible Investment Policy, an annual CSR Status Report shall be prepared by the directors of each portfolio company describing the current CSR status of the company. The 2015 CSR Report and Action Plan is based on the CSR assessment carried out by the Sustainability Consultance PT. ERM Indonesia (ERM).
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
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Results
The Fund has invested in one company at year-end 2015, the Indonesian e-commerce company PT. Berrybenka (Berrybenka or the company). It is the first time for Berrybenka to be assessed by a consultancy company on CSR, and
the e-commerce company has been very co-operative in its approach to the CSR assessment. The standards for the
assessment include a number of Indonesian regulations and the internationally recognised IFC Performance Standards (International Finance Corporation). The IFC Performance Standards are explained further in Appendix 2.
The audit carried out in September 2015 by ERM identified a number of key issues with a level of priority ranging
from low to high.
„„ 8 issues of low priority were identified during the assessment of which 2 were related to national legislation
and 6 to the IFC Performance Standards.
„„ 1 issue of medium priority was identified which was related to the IFC Performance Standards, and
„„ 10 issues of high priority were identified of which 4 were related to national legislation and 6 to the IFC Performance Standards.
The areas in need of improvement are the management of environmental and social risks and impacts; resource
efficiency and pollution prevention as well as labour and working conditions. The issues with high priority concern the establishment of an Environmental Management and Monitoring Programme, the formation of a Health
and Safety Committee, the handling of waste and the placement, the maintenance of fire extinguishers, an emergency response plan, an update of the HR policy, the availability of a grievance mechanism and the identification
of potential hazards to workers and the provision of a first aid kit. All the identified issues are described in the Action Plan Appendix 1, including a description of the assessment approach.
Due to the issues identified during the assessment, the overall CSR compliance of Berrybenka is medium.
A CSR overview of the Fund is shown in the table below:
Campany name
Sector
CSR focus areas
Level of overall
CSR compliance
„„ Management of environmental and social risks
PT. Berrybenka
E-commerce
and impacts
„„ Resource efficiency and pollution prevention
„„ Labour and working conditions
Medium
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MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
Conclusion
CSR management and implementation is a moving target where companies on an ongoing basis have to revise
their policies and action plans in accordance with national and international standards. The Fund is committed
to working with the portfolio companies on a long-term basis to improve their CSR performance, but it is also important to acknowledge that immediate changes can be difficult to achieve in frontier markets where CSR is a relatively new concept.
The table on the previous page shows a rating of the company on CSR issues based on the CSR audit. As the table indicates Berrybenka is rated medium in terms of overall CSR compliance. As such, the CSR compliance of the portfolio company of 2015 is considered satisfactory, but in 2016, Maj Invest will continue to work with the company to
implement relevant measures to improve their CSR policies and approach.
If you require any further information about the Fund’s CSR policy and implementation, please do not hesitate to
contact us.
Copenhagen, 16 March 2016
Kasper Svarrer
Domingo Alonso
Regitze Makwarth Olsen
Partner
Partner
Manager - Sustainability Manager
Maj Invest Holding A/S
Maj Invest Vietnam Maj Invest Holding A/S
[email protected]
Management Consultancy LLC [email protected]
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
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APPENDIX 1
Berrybenka
COMPANY OVERVIEW
Berrybenka (the company) is a leading fashion e-commerce business based in Indonesia and was founded in 2012.
The company operates Berrybenka.com; an online shopping site renowned for fashion and beauty in Indonesia
with a concept similar to department stores. Berrybenka sells more than 1,000 local and international brands, including the company’s in-house label.
To support its operation and production Berrybenka has a head office in Jakarta. The head office consists of approximately 180 employees and serves as a center for marketing, customer services and control of company operations. The head office occupies 3 floors located in Slipi Tower, West Jakarta, Indonesia. The company also utilises a
4,500m2 warehouse that employs approximately 120 workers responsible for quality assurance and control, packaging and shipping. The warehouse is located in a complex in Serpong, Tangerang and is rented from a third party.
LEGAL FRAME AND INTERNATIONAL STANDARDS
The applicable standards for this assessment which have been adopted by ERM include:
Relevant Indonesian Legislation
„„ Indonesian Government Regulation No. 47 / 2012 on Corporate Environmental and Social Responsibility
„„ Republic of Indonesia Act No. 13/2003 on Labor
„„ Ministry of Environmental Regulation No. 13 Year 2010 regarding Environmental Management and Monitoring Program
„„ Republic of Indonesia Law No. 18 of 2008 on Waste Management
„„ Government Regulation No. 101 Year 2014 on Hazardous Waste Management
„„ Regulation of the Minister of Manpower and Transmigration No. PER.04 /MEN / 1980 on the Terms of Installation and Maintenance of Fire Extinguisher
„„ Ministry of Manpower Decree No. PER-04/MEN/1987 Regarding the Health and Safety Committee.
IFC Performance Standards 2012
No.
Performance Standards
Applicable
1.
PS 1: Assessment and Management of Environmen-

Non-Applicable
tal and Social Risks and Impacts
2.
PS 2: Labor and Working Conditions

3.
PS 3: Resource Efficiency and Pollution Prevention

4.
PS 4: Community Health, Safety, and Security

5.
PS 5: Land Acquisition and Involuntary Resettlement

6.
PS 6: Biodiversity Conservation and Sustainable

Management of Living Natural Resources
7.
PS 7: Indigenous Peoples

8.
PS 8: Cultural Heritage

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MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
APPROACH
A high level desk based screening of available documentation on CSR (environmental, social and health & safety)
matters relating to the project was undertaken by ERM. This included reviewing Berrybenka’s company profile
and the 2015 – 2017 Human Resources Procedure which encompasses aspects of terms of employment, promotions
and career development, working hours, leave, grievance resolution, wages and bonus, health insurance and working dismissal.
Additionally, a one day site visit was conducted to the company head office and warehouse to undertake observations and interviews with key environment, safety and human resources personnel. Key personnel interviewed
during the site visit included:
„„ Putri C. Sari - Human Resource Manager. Responsible for handling all issues concerning workers and at the
present also in charge for public relations
„„ Lily Ismiyati – Operation Manager. Responsible for all operation and management of Berrybenka warehouse
„„ Workers in the warehouse
The assessment centred around four areas: assessment and management of environmental and social risks and
impacts; ressource efficiency and pollution prevention; labour and working conditions and corporate social responsibility.
ACTION PLAN
Based on the findings discovered during the assessment an Action Plan has been developed. The Action Plan including a categorisation of urgency and a timeline is presented in the tables on the following pages.
Requirement Summary
Findings Summary
Any working company or
place with 100 employees
or more must have a Health
and Safety Committee.
Ministry of Manpower
Decree No. PER-04/
MEN/1987 regarding
Health and Safety Committee.
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Any business and/or activities that do not have significant impacts to the environment must have an
Environmental Management and Monitoring Program.
Ministry of Environmental Regulation No.
13 Year 2010 regarding
Environmental Management and Monitoring Program
Berrybenka employs a total of approximately 300 employees (180 employees in the
head office and 120 employees
in the warehouse). However,
Berrybenka does not have a
Health and Safety Committee
in place.
Berrybenka is unaware of any
environmental documents
(such as Environmental Management and Monitoring Program – UKL/UPL) that the
warehouse or the owner of
the warehouse complex might
have.
Assessment and Management of Environmental and Social Risks and Impacts
Scope/Reference
High
Level of priority
Berrybenka to form a Health and Safety High
Committee both in the main office and
warehouse. The committee is a collaboration between employer and employee
to develop co-operation and effective
participation in implementing health
and safety.
Berrybenka shall also conduct monitoring and measurement of the management programs.
Once Berrybenka has obtained permits
and environmental documents from
the warehouse complex management,
Berrybenka shall conduct management
programs as stated in the permit and
document.
Berrybenka shall liaise with the warehouse complex management to obtain
environmental documents and ensure
that the requirements stated in the documents are met by the warehouse.
Recommendation/Action Plan
Table 1: Alignment with the Applicable National Regulations & Recommendation
ACTION PLAN
To be commenced immediately
To be commenced immediately
Timeline
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
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Requirement Summary
Waste generated at the main
office is managed and by the
building management. While,
waste generated at the warehouse is managed by a third
party.
Waste generated at Berrybenka’s main office and warehouse is generally domestic
non-hazardous waste such as
food packaging, food scrap,
plastic, and paper.
Findings Summary
Berrybenka shall segregate their waste
in accordance with the types of waste
generated. Berrybenka shall also maintain records of waste generation.
Berrybenka shall comply with Law No.
18 Year 2008 regarding Waste Management that states that everyone shall reduce and handle waste in a way that is
environmentally sound.
Recommendation/Action Plan
Berrybenka shall ensure the disposal of
hazardous waste (such as used batteries
and lamps) is in accordance with GovBerrybenka does not segregate ernment Regulation No. 101 Year 2014.
their waste. There is also no
Every business and/or activrecord regarding waste genBerrybenka shall ensure that the two
ities that generate hazarderation. It was also reported
drums left by the previous tenant are
ous waste must conduct hazthat there are some hazardous not kept any longer on the site.
ardous waste management.
wastes such as used batteries and used lamps disposed
Berrybenka shall engage a third party
together with the domestic
to dispose the drums and ensure that
waste.
the third party holds a valid permit to
manage hazardous waste.
There were two drums found
outside the warehouse which
contained old materials which
are suspected to be hazardous waste. The site claims that
these drums were left behind
by the previous tenant.
Everyone who produces
waste shall reduce and handle waste in a way that is environmentally sound.
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Government Regulation No. 101 Year 2014
on Hazardous Waste
Management
Republic of Indonesia
Law No 18 of 2008 on
Waste Management
Resource Efficiency and Pollution Prevention
Scope/Reference
High
Level of priority
To be commenced immediately
Timeline
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MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
Requirement Summary
Signage is required to be
provided above the fire extinguishers with height of
1.25 m from the floor. It is
also required that the distance between each fire extinguisher shall not exceed
15 m. Fire extinguishers
Minister of Labor and
Transmigration Regulation No. 04 of 1980 regarding Requirements
of Installment and
Maintenance of Fire
Extinguisher.
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Act No.13 of 2003 is the umbrella law for the labor and
workforce requirements in
Indonesia. Key points and
requirements of this Act are
summarized as follows:
„„ Company should have a
written working agreement which clearly states
the rights and obligations
of both parties to avoid
any disputes during the
tenure of employment.
„„ Compa ny should not
employ children aged less
than 18.
„„ Non-Discrimination and
Equal Opportunity
„„ Freedom for workers to
form a workers’ organization.
„„ Company should have an
internal grievance mechanism for its workers.
Act Number 13 of 2003
on Labor and Workforce Management.
Labor and Working Conditions
Scope/Reference
CO2 fire extinguishers were
being used on both the main
office and warehouse. In the
main office, fire extinguishers
are only found in the hallway.
There are no fire extinguishers located inside the office.
Human resources procedure
for the year of 2015 – 2017 has
been established to fit with
the size and type of the company. The procedure encompasses aspects of terms of employment, promotions and
career development, working
hours, leave, grievance resolution, wages and bonus, health
insurance and working dismissal.
Findings Summary
Berrybenka shall ensure compliance to
the Minister of Labor and Transmigration Regulation No. 04 of 1980 regarding Requirements of Instalment and
Maintenance of Fire Extinguishers.
The Operation of PT. Berrybenka is in
compliance with Act No. 13 of 2003 on
Labor and Workforce Management.
However the company is to ensure the
Human Resources Policies are readily
and easily accessible to all workers.
Recommendation/Action Plan
High
Low
Level of priority
To be commenced immediately
As required
Timeline
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
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Signage above the fire extinguishers are not provided.
Fire extinguishers are located in several places in the
warehouse. Some fire extinguishers were found to be inaccessible because they were
blocked by other objects such
as shelves. Some fire extinguishers were also found with
no signage above them.
containing CO2 can be
placed with a distance between the base of fire extinguishers not less than 15
cm from the floor. Maintenance of fire extinguishers
must be conducted twice a
year.
The regulation on Corporate Social Responsibility requires all companies
to engage in the natural resources business to conduct
corporate social and environmental responsibility
(CSR) activities.
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Indonesian Government Regulation No. 47
/ 2012 on Corporate Environmental and Social
Responsibility
Considering the scale, size
and nature of the company,
there was no indication of
communities affected by the
operation of Berrybenka both
in the head office and the
warehouse. Therefore at present Berrybenka does not have
a social investment program
or conduct any CSR activities.
All social activities are related to its internal employees
in the form of regular outings
and team building.
Fire extinguishers in the main
office and warehouse are
mounted too high on the wall.
There is also no evidence of
maintenance.
Findings Summary
Requirement Summary
Corporate Social Responsibility
Scope/Reference
The company has complied with the requirement of Indonesian Regulation
No.47 / 2012 on CSR. However, depending on the company’s ability and availability of resources, CSR activities can
be conducted to targeted communities
such as school children, university students, specific local communities or to
its core customers.
Recommendation/Action Plan
Low
Level of priority
As required
Timeline
12
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
Requirement Summary
Findings Summary
Recommendation/Action Plan
The company should have
a written process or procedure outlining how they
will assess the environmental and social risks and
impacts in PS1-8, as applicable, and in accordance
with national law.
Para 7 – 12 on Identification of Risks and Impacts
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
The company has an E&S
policy which at a minimum
states:
„„ Compliance with applicable laws and regulations;
„„ Personnel to ensure conformance with the policy;
and
„„ Endorsement by senior
management.
Para 6 on Policy
Berrybenka does not have a
written process or procedure
to assess their environmental
and social risks and impacts.
(risks and impact internal
worker and company assets)
Considering the scale, size
and nature of the company,
there were no indication of
communities affected by
the operation of Berrybenka
both in the head office and
the warehouse. Observation
found there were no communities living adjacent to the
warehouse as the location is
in a complex devoted for warehouse activities from various
company.
Berrybenka does not have an
E&S policy suitable to the nature and size of the company.
Berrybenka shall establish and maintain a process or procedure to identify
and assess their environmental and social risks and impacts.
Berrybenka shall develop an E&S policy that specifies that the company will
comply with applicable E&S under IFC
PS 1. The policy should also indicate
personnel within the company’s organization to ensure conformance to the
policy. Berrybenka must communicate
the policy to all levels of its organization.
Performance Standard 1: Assessment and Management of Environmental and Social Risks and Impacts
Scope/Reference
Table 2: Alignment with the Applicable IFC Performance Standards & Recommendation
Low
Low
Level of priority
Within
the next 3
months
Within
the next 3
months
Timeline
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
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Requirement Summary
Findings Summary
Recommendation/Action Plan
The company should define
and communicate responsibilities and authorities for
the implementation of the
ESMS. The company also
requires a written job description for E&S responsibilities and organizational
chart including E&S staff.
Paras 17-19 on Organizational Capacity and
Competency
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
The company may have
some routine on-going E&S
requirements (e.g. measure parameters in water
outfall once/month, etc.)
and one-off or non-routine requirements (e.g. install dust collection system)
originating from permits,
legal arrangements, public commitments, or mitigation measures. The management program(s) is the
written system that ensures
that all of these requirements are consistently completed on time.
Paras 13 – 16 on Management Programs
Berrybenka does not have
written job descriptions for
E&S responsibilities or an organizational chart including
E&S staff.
Berrybenka does not have any
E&S requirements originating
from permits (such as Environmental Permit) or environmental documents (such as
Environmental Management
and Monitoring Program –
UKL/UPL required under national legislation Ministry of
Environmental Regulation No.
13 Year 2010 regarding Environmental Management and
Monitoring Program due to
the site’s unawareness of such
requirements.
This is required by the national regulation as stated in
Table 1 above.
High
Level of priority
After developing the ESMS, Berrybenka Low
must define and communicate responsibilities and authorities for its implementation.
Berrybenka shall obtain the relevant
permits and environmental documents
from the warehouse complex management. Then the site shall conduct management programs as stated in the permit and document.
Performance Standard 1: Assessment and Management of Environmental and Social Risks and Impacts
Scope/Reference
Within
the next 3
months
To be commenced immediately
Timeline
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MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
Requirement Summary
Findings Summary
The company should have
written procedures on
how they will monitor and
measure the management
program to know if it is
working and also to inform
Senior Management.
Stakeholder engagement
is the basis for building
strong relationships that
are essential for the successful management of a
project’s environment and
social impacts. This may
include stakeholder analysis and planning, disclosure and dissemination of
information, consultation
and participation, grievance
Paras 22 – 24 on Monitoring and Review
Paras 25 – 36 Stakeholder Engagement
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Where the project involves
specifically identified physical elements, aspects and
facilities that are likely to
generate impacts, the ESMS
will establish and maintain an emergency preparedness and response system so that the client will
be prepared to respond to
accidental and emergency
situation.
Paras 20 – 21 on Emergency Preparedness
and Response
Based on interviews with the
HR manager, to date Berrybenka does not have social investment program
Considering the scale, size
and nature of the company,
there was no indication of
communities affected by the
operation of Berrybenka both
in the head office and the
warehouse.
Berrybenka does not have
written procedures on how
to monitor and measure the
management program as required by the Environmental
Management and Monitoring
Program (UKL/UPL).
Based on observations both
at the head office and warehouse, the biggest hazard to
the assets of the company is
the event of a fire. At the present both the head office and
warehouse have not established an emergency preparedness and response system.
Both locations have not established fire escape routes.
Assessment and Management of Environmental and Social Risks and Impacts
Scope/Reference
Depending on the company’s ability
and availability of resources, CSR activities can be conducted to targeted
communities such as school children,
university students, specific local communities or to its core customers.
Berrybenka shall obtain the UKL/UPL
document from the warehouse complex
management. Then the site shall monitor and measure the management programs as stated in the permit and document.
Berrybenka to develop an Emergency
Preparedness and Response Plan. Berrybenka shall ensure that there are resources to implement the plan. The
plan must also be reviewed, updated,
and staff trained periodically.
Recommendation/Action Plan
Low
High
High
Level of priority
As required
To be commenced immediately
To be commenced immediately
Timeline
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
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mechanisms and ongoing
reporting to Affected Communities. The nature, frequency and level of effort
will be commensurate with
the project’s risk and adverse impacts.
Requirement Summary
Where the client is party
to a collective bargaining
agreement with a worker’s
organisation, such agreement will be respected.
Paras 10 -12 on Working Conditions and
Terms of Employment.
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
The client/company will
adopt and implement a human resources policy appropriate to its size and
work force that sets out its
approach to managing employees consistent with the
requirements of this Performance Standard and national law.
Paras 8 – 9 on Human
Resources Policies and
Procedures
Findings Summary
All social activities conducted
by Berrybenka are related to
its internal employees in the
form of regular outings and
team buildings.
or conduct CSR activities.
Berrybenka implement fair
and transparent employee recruitment through a series of
tests and interviews. Employment opportunities
Human resources procedure
for the year of 2015 – 2017 has
been established to fit with
the size and type of the company. The procedure encompasses aspects of terms of employment, promotions and
career development, working
hours, leave, grievance resolution, wages and bonus, health
insurance and working dismissal.
Performance Standard 2: Labor and Working Conditions
Scope/Reference
No significant issues noted, assuming
national law and international practices is followed
The Company to ensure the Human Resources Policies are readily and easily
accessible to all workers.
„„ Non-Discrimination; and
„„ Freedom for workers to form a workers’ organization to fit the size and
scale of the company.
Even though there are no significant issues in terms of working conditions,
there are a number of requirements under the national Law / Number 13 of
2003 on Labor and Workforce Management which are not specifically mentioned and therefore need to be established within the procedure, namely:
Recommendation/Action Plan
-
High
Level of priority
-
To be commenced immediately
Timeline
16
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
are also openly informed
through various social media
such as jobsdb.com
Where such agreements do
not exist, or do not address
working conditions and
terms of employment, the
client will provide responsible working conditions
and terms of employment.
All workers are provided with
health insurance, at least the
minimum salary / wages and
days of leave in compliance
with Indonesia law and regulations.
It is understood that up to June
2015 all employees of Berrybenka were permanent workers. All workers are provided
with a written and agreed
contract document between
worker and the company. Beyond June 2015, Berrybenka
will hire semi-permanent /
contract workers with a minimum contract time of 6
months but this is limited to
customer service personnel.
Findings Summary
Requirement Summary
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Scope/Reference
Recommendation/Action Plan
Level of priority
Timeline
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In countries where national
law recognises workers’
rights to form and to join
workers’ organisations of
their choosing without interference and to bargain
collectively, the client will
comply with national law.
The client will not make
employment decisions on
the basis of personal characteristics unrelated to inherent job requirements.
The client will base the employment relationship on
the principle of equal opportunity and fair treatment, and will not discriminate with respect to
aspects of the employment
relationship, including recruitment and hiring, compensation (including wages
and benefits), working conditions and terms of employment, access to training, promotion, termination
of employment or retirement, and discipline.
Paras 13 & 14 on Workers’ Organizations
Paras 15 – 17 on NonDiscrimination and
Equal Opportunity
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Requirement Summary
Scope/Reference
No indication of discrimination or an unequal opportunity observed within this
company regarding gender,
worker recruitment, career
development, working overtime or benefits provided.
Considering the nature and
scale of the company, at the
present time the workers do
not have the need to establish
a workers’ organization even
though based on the number
of employees and under the
national law they are eligible
and have the right to form one.
Workers are open to express
their aspirations, concerns,
ideas or suggestions directly
to the management.
Findings Summary
Company to continue to ensure all
workers are informed on worker rights
to include non-discrimination, equal
opportunity, career development and
working benefits.
The Company to continue to provide
the freedom for employees to form a
workers’ organization even though at
the current stage the workers are not
considering to form any workers’ organization.
Recommendation/Action Plan
Low
Low
Level of priority
As required
and at the
time a new
employee
joins the
company.
Lifetime of
the company
Timeline
18
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
The client will provide a
grievance mechanism for
workers (and their organisations, where they exist) to
raise workplace concerns.
The client will inform the
workers of the grievance
mechanism at the time of
recruitment and make it
easily accessible to them.
Para 20 on Grievance
Mechanism
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Prior to implementing any
collective dismissals the
client will carry out an
analysis of alternatives to
retrenchment. A retrenchment plan will be developed and implemented to
reduce the adverse impacts
of retrenchment on workers.
Requirement Summary
Paras 18 – 19 on Retrenchment
Scope/Reference
Based on interviews with
workers and HR departments
all workers have an open and
easy access to the management to raise grievances or
concerns in formal and nonformal channels. However
not all workers are aware of
the grievance resolution procedure established within the
human resources policies /
procedure.
A grievance resolution procedure has been established
within the Human Resources
Policies / Procedure, although
there was no evidence of past
grievances raised by the workers.
It is understood that the company does not implement collective dismissals of worker.
Findings Summary
Company to document / log any future
grievances may arise from the workers.
Company to ensure the grievance procedure is disclosed to all workers and
easily accessible.
No significant issues noted, assuming
national law and international practices is followed.
Recommendation/Action Plan
Medium
-
Level of priority
To be commenced immediately
-
Timeline
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
19
The client will not employ
children in a manner that
is economically exploitative, or is likely to be hazardous or to interfere with
the child’s education, or to
be harmful to the child’s
health or physical, mental,
spiritual, moral, or social
development.
The client will not employ
forced labour, which consists of any work or service
not voluntarily performed
that is exacted from an individual under threat of
force or penalty.
The client will provide a
safe and healthy work environment, taking into account inherent risk in its
particular sector and specific hazards in the client’s
work areas.
Para 20 on Protecting
the workforce; Child
Labor
Para 22 on Forced Labor
Para 23 on Occupational Health & Safety
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Requirement Summary
Scope/Reference
Berrybenka has not taken
steps to identify potential hazards to workers and prevent
accidents, injury, and disease. Berrybenka also has not
provided any occupational
health and safety training to
its workers. There is no documentation on occupational
accidents, diseases, and incidents.
Moreover, there is no emergency response plan in both
the main office and warehouse, nor evacuation route.
No indication of forced labor
observed at any level of the
workforce within the company.
No indication of child labor
observed at any level of the
workforce within the company.
Findings Summary
Berrybenka to provide first aid kits as a
means of quick relief for handling work
related minor accidents both at headquarters and in the warehouse.
Berrybenka to develop an emergency
response plan, then implement it in the
daily activities both in the main office
and warehouse.
Berrybenka to identify potential hazards to workers and prevent accidents,
injury, and disease.
No significant issues noted, assuming
national Law / Act Number 13 of 2003
on Labor and Workforce Management
and international practices IFC PS 2 on
Labor and Working Conditions is followed.
No significant issues noted, assuming
national Law / Act Number 13 of 2003
on Labor and Workforce Management.
and international practices IFC PS 2 on
Labor and Working Conditions is followed.
Recommendation/Action Plan
High
-
-
Level of priority
To be commenced immediately
-
-
Timeline
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With respect to contracted
workers the client will take
commercially reasonable
efforts to ascertain that the
third parties who engage
these workers are reputable
and legitimate enterprises
and have appropriate management systems to operate
in a manner consistent with
the requirements of this
Performance Standard (except for 18-19 and 27-29).
Requirement Summary
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Para 24 – 26 on Workers Engaged by Third
Parties
Scope/Reference
Berrybenka uses third parties to supply its security staff
in the warehouse area, based
on observation and interviews
there was no indication of violations to the requirements of
PS2 Performance Standard.
Both the head office and warehouse were not equipped with
minimum first aid medication
for emergency use / purposes.
Water sprinklers and smoke
detectors were observed all
over the main office areas.
However, there is no evidence
of maintenance.
It is reported that the building
management where the main
office is located has never conducted any fire drills nor provided any information regarding emergency response plan.
There is also no identified
muster point.
Findings Summary
No specific recommendations.
Recommendation/Action Plan
-
Level of priority
-
Timeline
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
21
Findings Summary
With respect to contracted
Not applicable.
workers the client will take
commercially reasonable
efforts to ascertain that the
third parties who engage
these workers are reputable
and legitimate enterprises
and have appropriate management systems to operate
in a manner consistent with
the requirements of this
Performance Standard (except for 18-19 and 27-29).
Requirement Summary
Not applicable
Not applicable
When the project is a potentially significant consumer
of water, in addition to applying the resource efficiency requirements of this
Performance Standard, the
client shall adopt measures
that avoid or reduce water
usage so that the project’s
water consumption does
not have significant adverse
impacts upon others.
Paras 6 on Resource Efficiency
Paras 7-8 on Green
House Gasses
Para 9 on Water Consumption
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Not applicable
Paras 4-5 General EHS GL
Water is used only for toilet
purposes both in the head office and warehouse.
There were no indications
of the use of large volumes
of water for the company operational activities (product reception, packaging and
shipping).
Performance Standard 3: Resource Efficiency and Pollution Prevention
Para 27 – 29 on Supply
Chain
Scope/Reference
No specific recommendation
-
Recommendation/Action Plan
-
-
Level of priority
-
-
Timeline
22
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
The company should apply
an analysis and hierarchical approach of avoidance,
reduction, recovery, reuse,
and environmentally sound
disposal to the management of hazardous and nonhazardous wastes.
Requirement Summary
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Para 12 on Waste
Paras 10-11 on Pollution Prevention
Scope/Reference
Berrybenka shall ensure the disposal
of hazardous waste (such as used batteries and lamps) is in accordance with
Government Regulation No. 101 Year
2014 regarding Hazardous Waste Management.
Berrybenka shall segregate their waste
in accordance with the types of waste
generated. Berrybenka shall also maintain records of waste generation.
Recommendation/Action Plan
There were two drums found
outside the warehouse which
contained old materials which
are suspected to be hazardous waste. The site claims that
these drums were left behind
by the previous tenant.
Berrybenka shall ensure that the two
drums left by the previous tenant are
Berrybenka does not segregate not kept any longer on the site.
their waste. There is also no
Berrybenka shall engage a third party
record regarding waste gento dispose the drums and ensure that
eration. It was also reported
the third party holds a valid permit to
that there are some hazardmanage hazardous waste.
ous waste such as used batteries and used lamps disposed
together with the domestic
waste.
Waste generated at the main
office is managed and by the
building management. While,
waste generated at the warehouse is managed by a third
party.
Waste generated at Berrybenka’s main office and warehouse is generally domestic
non-hazardous waste such as
food packaging, food scrap,
plastic, and paper.
Findings Summary
High
Level of priority
To be commenced immediately
Timeline
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
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The client will avoid or,
when avoidance is not possible, minimise and control
the release of hazardous
materials. The production,
transportation, handling,
storage and use for project activities should be assessed.
Not applicable
Para 13 on Hazardous
Materials Management
Para 14 – 17 Pesticide
Use and Management.
Based on observation to the
head office and warehouse,
there were no indications of
the use of hazardous materials
for the operation of the company.
Findings Summary
Recommendation/Action Plan
Source: Environmental Resources Management
CSR Assessment Indonesia - ESDD
Not applicable
Performance Standard 8: Cultural Heritage
Not applicable
Performance Standard 7: Indigenous People
Not applicable
Performance Standard 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources
Not applicable
Performance Standard 5: Land Acquisition and Involuntary Resettlement
Not applicable
Performance Standard 4: Community Health, Safety and Security
Requirement Summary
Scope/Reference
-
Level of priority
-
Timeline
24
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25
APPENDIX 2
International CSR Standards
1. IFC PERFORMANCE STANDARDS
www.ifc.org
The IFC Performance Standards articulates IFC’s strategic commitment to sustainable development. The Performance Standards are originally directed towards IFC’s clients, providing guidance on how to identify risks and
impacts as a way of doing business in a sustainable way. The Performance Standards may be and are widely used
by other (financial) institutions as a reference to managing environmental and social risks and impacts to enhance
development opportunities. The eigh Performance Standards are:
Performance Standard 1: Assessment and Management of Environmental and Social Risks and Impacts
Performance Standard 2: Labor and Working Conditions
Performance Standard 3: Resource Efficiency and Pollution Prevention
Performance Standard 4: Community Health, Safety, and Security
Performance Standard 5: Land Acquisition and Involuntary Resettlement
Performance Standard 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources
Performance Standard 7: Indigenous Peoples
Performance Standard 8: Cultural Heritage
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APPENDIX 3
Responsible Investment Policy
1. Scope
The Responsible Investment Policy is the framework for the environmental, social and governance (ESG) requirements for Maj Invest Equity Southeast Asia II (the Fund) managed by Maj Invest Equity (the Manager). The Fund
incorporates ESG criteria into the investment decision-making and ownership practices that directly influence
portfolio companies to enhance performance in these areas.
The Fund’s definition of responsible investment is aligned with that of UNPRI:
“Responsible investment is an approach to investment that explicitly acknowledges the relevance to the investor of
environmental, social and governance factors, and of the long-term health and stability of the market as a whole. It
recognises that the gen-eration of long-term sustainable returns is dependent on stable, well-functioning and wellgoverned social, environmental and economic systems.” 1
The base of the work with responsible investment is the UN principles for responsible investment:
Principle 1: We will incorporate ESG issues into investment analysis and decision-making processes.
Principle 2: We will be active owners and incorporate ESG issues into our ownership policies and practices.
Principle 3: We will seek appropriate disclosure on ESG issues by the entities in which we invest.
Principle 4: We will promote acceptance and implementation of the Principles within the investment industry.
Principle 5: We will work together to enhance our effectiveness in implementing the Principles.
Principle 6: We will each report on our activities and progress towards implementing the Principles.
2. Commitment to responsible investment
The Fund is committed to work with portfolio companies to reduce ESG risks and contribute to sustainable development, adding value to the portfolio companies and enhancing business opportunities. The Fund will support the
portfolio companies to continuously work towards achieving long term results within ESG factors, and the Fund
will encourage such activities to be anchored in the business plan.
The Fund promotes the UN Global Compact 2 principles, with the addition of good corporate governance and animal welfare:
„„ Supporting and respecting the protection of internationally proclaimed human rights.
„„ Upholding the freedom of association and the effective recognition of the right to collective bargaining; the
elimination of all forms of forced and compulsory labour; the effective abolition of child labour; and the elimination of discrimination in respect of employment and occupation.
1 www.unpri.org
2 www.unglobalcompact.org
MAJ INVEST EQUITY SOUTHEAST ASIA II K/S • CSR REPORT 2015
27
„„ Supporting a precautionary approach to environmental challenges; undertaking initiatives to promote greater environmental responsibility; and encouraging the development and diffusion of environmentally friendly technologies.
„„ Securing good corporate governance, including anti-corruption, anti-fraud and transparency.
„„ Ensuring good animal welfare, including proper treatment of animals used in food production, for other commercial purposes or for testing.
Exclusion list
The Fund will not invest in companies engaged in activities set out in IFC’s exclusion list and EDFI’s/IFU’s exclusion list3.
3. Approach to working with ESG
The Fund requires portfolio companies to comply with national regulations and leg-islation in the country in which
they operate, and work towards implementing relevant international standards. The Fund will only invest in companies if potential ESG risks are, or will be addressed in an appropriate way.
The international standards are based on UN, OECD, IFC and ILO conventions, declarations, agreements and principles. Standards could include the IFC Performance Standards, the IFC EHS Guidelines or other credible, globally
or regionally recognised standards that encourage continual improvements. For portfolio companies in sectors for
which IFC EHS guidelines exist, these guidelines are the appropriate benchmark.
Risks, impacts and mitigation measures related to each investment are assessed, consid-ering factors such as the
sector, technology, location, host country regulations, climatic conditions and cultural issues. This process identifies the significant issues that are rele-vant for the portfolio companies, and an assessment is made of the extent
to which in-ternational standards shall be implemented.
An Action Plan with a reasonable time schedule to meet these standards and comply with the Fund’s responsible investment requirements is elaborated, as appropriate for each portfolio company. The Action Plan must be approved
by the Manager, and an integral part of the Action Plan is an annual Responsible Investment Status Report that shall
be submitted to the Manager, providing a clear status on ESG compliance. Such report must also include a notification of the occurrence of any social, labour, health and safety, se-curity or environmental accident or circumstances and measures being taken to address them. Serious incidents must be reported to the Manager immediately.
The Fund monitors each portfolio company’s ESG activities through Board participa-tion, visits, annual reports
and dialogue, with reference to the agreed Action Plan and the Fund’s responsible investment principles adopted
from the UN Global Compact. If a portfolio company is in serious breach, the Manager will engage in dialog with
management and other shareholders and strongly encourage compliance. As a last resort the Fund can consider to
divest from the portfolio company.
4. Responsible Investment requirements for portfolio companies
To implement the Fund’s Responsible Investment Policy, the Fund requires portfolio companies to:
„„ Operate in compliance with relevant national regulations and legislation, and if this is not the case by the time
of the Fund’s investment, the company must commit to an Action Plan with mitigation measures.
3 www.ifc.org, or www.ifu.dk
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„„ Work towards compliance with international standards for significant issues iden-tified during due diligence,
„„ Adopt a written responsible investment policy based on the Fund’s responsible investment principles adopted
from the UN Global Compact, and the Fund will strive to include this in the shareholders agreement.
„„ Appoint a person with overall responsibility for responsible investment, including the management of activities and resources and delegation of tasks with reference to the Action Plan
„„ Prepare an annual Responsible Investment Status Report that provides a status on sustainability issues, including the implementation of the action plan, for discus-sion and approval by their board of directors or similar
governance body. This report can be elaborated by a third party. A copy of the report must be sent to the Manager.
5. Management System
The Manager has assigned a senior manager as responsible for the formulation and implementation of the Fund’s
Responsible Investment Policy. Relevant staff of the Manager will contribute to this effort. In most cases, and for
medium and high risk portfolio companies, suitably qualified ESG experts will contribute to the due diligence
and development of an Action Plan, together with the monitoring and formulation of an annual Responsible Investment Status Report.
6. Information and reporting to the Limited Partners
If an incident occurs in one of the Fund’s portfolio companies with serious breach of the Fund’s ESG requirements,
the Manager will inform the Limited Partners about the nature of the breach and planned mitigation measures.
Upon request from the Limited Partners, the Manager will make ESG information available to Limited Partners
and arrange that the Limited Partners can make a visit to overview the ESG initiatives the portfolio companies.
The Limited Partners will visit the portfolio company together with the Manager, and visits shall be scheduled in
accordance with the portfolio company.
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MAJ INVEST EQUITY SOUTHEAST ASIA II K/S
Gammeltorv 18
DK-1457 Copenhagen K
Tel. +45 33 38 73 00
www.majinvest.com