ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) Development and Investment Bank of Türkiye (TKYB) Turkiye Industrial Emissions Reduction Project P180762 Draft ENVIRONMENTAL and SOCIAL COMMITMENT PLAN (ESCP) January 2024 1|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN 1. Development and Investment Bank of Türkiye (TKYB or the Borrower) shall implement the Türkiye Emission Reduction (P180762) Project (the Project) as set out in the Loan Agreement. The International Bank for Reconstruction and Development (Bank) has agreed to provide financing for the Project, as set out in the referred agreement. 2. The Borrower shall ensure that the Project is carried out in accordance with the Environmental and Social Standards (ESSs) and this Environmental and Social Commitment Plan (ESCP), in a manner acceptable to the World Bank. The ESCP is a part of the Loan Agreement. Unless otherwise defined in this ESCP, capitalized terms used in this ESCP have the meanings ascribed to them in the referred agreement. 3. Without limitation to the foregoing, this ESCP sets out material measures and actions that the Borrower shall carry out or cause to be carried out, including, as applicable, the timeframes of the actions and measures, institutional, staffing, training, monitoring and reporting arrangements, and grievance management. The ESCP also sets out the environmental and social (E&S) instruments that shall be adopted and implemented under the Project, all of which shall be subject to prior consultation and disclosure, consistent with the ESS, and in form and substance, and in a manner acceptable to the World Bank. Once adopted, said E&S instruments may be revised from time to time with prior written agreement by the World Bank. 4. As agreed by the Bank and the Borrower, this ESCP will be revised from time to time if necessary, during Project implementation, to reflect adaptive management of Project changes and unforeseen circumstances or in response to Project performance. In such circumstances, the Borrower and the d Bank agree to update the ESCP to reflect these changes through an exchange of letters signed between theBank and the Borrower, represented by the Head of Sustainability and Environmental Social Impact Management Department in the Project Implementation Unit of TKYB. The Borrower shall promptly disclose the updated ESCP. 2|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY MONITORING AND REPORTING A REGULAR REPORTING Submit -semi-annual reports to the TKYB Project Implementation Prepare and submit to the Bank regular monitoring reports on the environmental, Bank throughout the Project Unit (PIU) social, health and safety (ESHS) performance of the Project, including but not implementation, commencing six limited to the implementation of the ESCP, status of preparation and months after the Effective Date. Submit implementation of E&S documents required under the ESCP, stakeholder each report to the Bank by no later than engagement activities, performance of the grievance mechanism(s). thirty (30) days after the end of each reporting period. B INCIDENTS AND ACCIDENTS Notify the Bank by no later than 48 hours TKYB PIU (i) Promptly notify the Bank of any incident or accident related to the after learning of the incident or accident. Project which has, or is likely to have, a significant adverse effect on the environment, the affected communities, the public or workers, including, inter alia, cases of sexual exploitation and abuse (SEA), sexual harassment (SH), and accidents that result in death, serious or multiple injury such as chemical spillage or fire. Provide sufficient detail regarding the scope, severity, and possible causes of the incident or accident, indicating immediate measures taken or that are planned to be taken to address it, and any information provided by sub-borrower, as appropriate. TKYB shall submit an incident report, including RCA, precautions and compensation measures taken within a (ii) Require sub-borrowers to provide sufficient detail regarding the timeframe acceptable to the Bank. incident or accident, findings of the Root Cause Analysis (RCA), indicating immediate measures or corrective actions taken or that are planned to be taken to address it, compensation paid, and any information provided by any contractor and supervision consultant, as appropriate. C OPERATIONS MANUAL By the Effective Date of the Loan TKYB PIU Development and adoption of Project Operations Manual that details screening, Agreement monitoring and reporting of substantial and moderate risk sub-projects in line with Bank’s ESSs ESS 1: ASSESSMENT AND MANAGEMENT OF ENVIRONMENTAL AND SOCIAL RISKS AND IMPACTS 3|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY 1.1 ORGANIZATIONAL STRUCTURE Hire or appoint the referenced TKYB Establish and maintain the capacity of the Project Implementation Team with full- specialists prior to the Effective Date of time qualified staff and resources to support management and monitoring of E&S the Loan Agreement risks by appointing, including, specifically, – one environmental specialist, one social specialist, and one Grievance Redress Mechanism (GRM) and stakeholder engagement (SE) management and monitoring expert; additional staff shall be Maintain all specified staff positions, recruited as may be needed. and appoint qualified staff to said positions for the duration of Project Ensure that above-mentioned staff remain on assigned duty until end of Project implementation. implementation. 4|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) 1.2 ENVIRONMENTAL AND SOCIAL ASSESSMENT TKYB PIU The Borrower shall apply TKYB’s Environmental and Social Management System (ESMS) to this Project, in a manner satisfactory to the Bank, consistent with the requirements of ESS9, as further detailed in action 9.1 below. Before approval of each respective Subproject TKYB PIU shall cause each As part of the Borrower’s Subproject approval process, the Borrower shall conduct Mitigation measures contained in the respective Sub-borrower E&S due diligence review of each proposed Sub-borrower, in accordance with the ESAP documents to be implemented Project Operations Manual and TKYB ESMS, with full consideration of the Exclusion throughout the Project. List, relevant national laws as confirmed by the Bank, ESSs and eligibility criteria, and where applicable, E&S action plans (ESAP) shall be developed to address identified gaps following the due diligence review. (i) Each sub-borrower prepares, discloses and implements site-specific E&S Documents for sub-projects in line with TKYB ESMS. The Borrower ensures said integration by each Sub-borrower before relevant (ii) For each sub-project, E&S requirements set forth in the E&S Sub-borrower completes the tendering Documents shall be integrated in the implementation process for the respective contract. documents for sub-projects through inclusions of relevant provisions in Bidding/tender documents or Contracts if already signed between the Sub-Borrower and respective Contractors as the case may be; Any potential investment rated as having High (Category A in TKYB ESMS) In cases of on-going contracts, E&S environmental and/or social risk; or in case of existing contract if the integration clauses will be required to TKYB PIU shall cause each declaration of E&S compliance with TKYB ESMS is not accepted by TKYB be included prior to approval of the respective Sub-borrower then the sub-borrower shall not be eligible for financing under the Project. respective subprojects. In the case of on-going contracts, the For the first two Sub-loans, , submit for World Bank prior review and approval of sub-borrower will submit a declaration the ESDD for each respective Sub-project prepared by TKYB. for compliance of the contractor with the E&S requirements as per TKYB ESMS. 5|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY Before the Borrower’s disbursement of Loan proceeds to the respective Sub- borrower for the financing of the first two Sub-loans under the Project. 1.3 MANAGEMENT TOOLS AND INSTRUMENTS Throughout Project implementation. TKYB PIU Implement the TKYB’s corporate ESMS adopted by the TKYB. Screen any proposed sub-project in accordance with the TKYB’s corporate ESMS , the Exclusion List (as defined in the Loan Agreement), including exclusion of high risk (Category A in TKYB ESMS) Sub-project investments for financing 1.4 MANAGEMENT OF CONTRACTORS Prior to each Sub-bororwer’s signing of TKYB PIU If any contractors will be required for works, the Borrower shall require and contracts with contractors under the ensure that each Sub-borrower incorporates the relevant aspects of the ESCP, ahd respective Sub-project. the relevant E&S Documents and/or plans, and the Labor Management Procedures, into the ESHS specifications of the procurement documents with contractors. Thereafter, ensure that the contractors comply with the ESHS specifications of their respective contracts. Ensure incorporation of site-specific ESMPs into construction and/or installation contracts. Require Sub-borrowers to ensure implementation of site-specific mitigation Throughout Project Implementation measures by contractors as per respective ESMPs. ESS 2: LABOR AND WORKING CONDITIONS 6|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY 2.1 LABOR MANAGEMENT PROCEDURES Implement and monitor ESS2 TKYB PIU Maintain and implement, and cause Sub-borrowers to maintain and implement, requirement throughout Project Project labour and working conditions consistent with national legislation and implementation and report through ESS2, that include, inter alia, the following requirements: semi-annual progress reports. ▪ Ensure that Project Workers, as defined under ESS2, will be hired, promoted and their employment, where needed, terminated based on principles of non-discrimination and equal opportunity, no-harassment, and freedom of association; ▪ Ensure that all Project Workers are provided with information and documentation that is clear and understandable regarding their terms and conditions of employment, their rights under national labor and employment laws (including their rights related to hours of work, payment of wages and deductions, overtime, benefits such as periods of rest and leave, written notice of termination and details of severance payments, as well as those arising from the requirements of ESS2); ▪ Ensure the adoption of appropriate occupational health and safety (OHS) measures, in line with ESS2, at the work place (no matter their locations and including without limitation on field assignments), which shall consider, inter alia, an assessment of the potential OHS risks associated with the tasks to be carried out and include mitigation measures, such as protocols for protection against communicable diseases (i.e. Covid-19, etc.) as issued by the Ministry of Health, WHO, and the Bank; ▪ Ensure the adoption of a code of conduct that sets out measures against practices related with sexual exploitation and abuse/sexual harassment (SEA/SH) in the workplace, including the dissemination of the referral services available in the country to respond to such behaviors; ▪ Prohibit and ban child labor as well as forced labor, per ESS2 requirements and applicable national laws; ▪ Applicable requirements for contractors, subcontractors, and supervising firms; and Report on compliance with these labor management procedures as part of the reports to be submitted under action A above. 7|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY 2.2 GRIEVANCE MECHANISM FOR PROJECT WORKERS Grievance mechanism operational TKYB PIU Establish, maintain, and operate, and cause each Sub-borrower to establish, Within 30 days following the Effective maintain and operate, an accessible GRM for Project workers, in line with national Date of the Loan Agreement and labor law and consistent with ESS2 and ESS10. maintained throughout Project implementation. Report semi-annually through Project Progress Reports 2.3 GENDER Implement and monitor gender equality TKYB PIU Prioritize enterprises with special programs about the gender equality programs for management and sensitivity throughout sub-loans; require enterprises to have gender action plans in place and/or actively Project implementation; and report aim to sensitivity about the equality with TKYB's gender tool and assessment. through semi-annual progress reports 2.4 OCCUPATIONAL HEALTH AND SAFETY (OHS) MEASURES After the Effective Date of the Loan TKYB PIU Cause Sub-borrowers to prepare, adopt, and implement occupational health and Agreement, and before commencement safety (OHS) measures specified in sub-project specific ESMP and relevant of any civil/installation works by each documents. respective Sub-borrower, continuing throughout Project implementation. Maintain on each Sub-borrower, the responsibility of applying national law on OHS and relevant regulations. ESS 3: RESOURCE EFFICIENCY AND POLLUTION PREVENTION AND MANAGEMENT 8|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBILE ENTITY/AUTHORITY 3.1 RESOURCE EFFICIENCY AND POLLUTION PREVENTION AND MANAGEMENT (a) Prior to each Sub-borrower’s TKYB PIU… Cause each Sub-borrower to include resource efficiency and pollution prevention tendering of works for the and management measures into the Sub-project specific E&S documents to be respective Sub-project, or prepared under action 1.2 above. (b) if tendering has been completed, by no later than 30 days after confirming eligibility, Monitoring and Verification (M&V) over a period of 12 months after cause the respective Sub- commissioning of the equipment installation and facility construction, so that air borrower to incorporate the pollutants and GHG emission will be verified. Project-level emissions reductions requirements of the E&S (i.e., those driven by the sub-loans) will be separately tracked and reported by the Documents in the contracts sub-borrower annually. with its contractors, and to provide each respective contractor the E&S documents to ensure that the conditions included in the documents are applied at sub-project site. . Throughout the Project and reported through semi-annual progress reports. Project-level emissions reductions shall be separately followed and reported by each Sub-borrower semi-annually. ESS 4: COMMUNITY HEALTH AND SAFETY 9|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) 4.1 COMMUNITY HEALTH AND SAFETY Sub-project specific ESA documents TKYB PIU As part of the E&S due diligence (ESDD) to be conducted by the TKYB for each acceptable to the Bank to be prepared Sub-borrower under action 1.2 above, ESS4 shall be applied within the scope of and disclosed prior to tendering of TKYB’sESMS, as relevant. works for each sub-project, or if tendering has been completed already, the ESA documents will be supplied to Prepare, adopt, and implement measures and action to assess and manage the contractor to ensure that the specific risks and impacts to the community arising from sub-project activities, conditions included in the documents and include measures in the E&S documents to be prepared under action 1.2 are applied at sub-project site. above, in accordance with the TKYB’s corporate ESMS. Mitigation measures contained in the sub-project specific ESA documents to be implemented throughout the project reported through semi-annual progress reports. ESS 5: LAND ACQUISITION, RESTRICTIONS ON LAND USE AND INVOLUNTARY RESETTLEMENT 5.1 Not Relevant to the Project This standard is not anticipated to be The Project shall not finance any activities which may cause restrictions on land relevant within the scope of this use, land acquisition and/or physical relocation. project. No land acquisition to construct new facility or install equipment financed under sub-project; any new facility or installation should be adjacent to the existing facility in land owned by it and result in emission reductions of the existing facility. ESS 6: BIODIVERSITY CONSERVATION AND SUSTAINABLE MANAGEMENT OF LIVING NATURAL RESOURCES 6.1 Not Relevant to the Project ESS 7: INDIGENOUS PEOPLES/SUB-SAHARAN AFRICAN HISTORICALLY UNDERSERVED TRADITIONAL LOCAL COMMUNITIES 7.1 Not Relevant to the Project This standard is not relevant. There are no known Indigenous Peoples in Türkiye which fit the definition of the ESS7. ESS 8: CULTURAL HERITAGE 10 | P a g e ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) 8.1 CHANCE FINDS Sub-project specific E&S documents TKYB PIU Require sub-projects to Prepare, adopt, and implement the chance finds acceptable to the Bank to be prepared procedure described in the sub-project-specific E&S Documents developed for the and disclosed prior to tendering of sub-project under action 1.2 above. works for each sub-project, or if tendering has been completed already, the ESA documents will be supplied to the contractor to ensure that the conditions included in the documents are applied at sub-project site. Implementation of chance find procedures included in the E&S documents in each case of a chance find throughout the Project, and reported through semi-annual progress reports. ESS 9: FINANCIAL INTERMEDIARIES 9.1 ENVIRONMENTAL AND SOCIAL MANAGEMENT SYSTEM (ESMS) TKYB PIU TKYB ESMS shall be fully utilized for this Project. TKYB ESMS to be maintained and operated , throughout Project The Borrower shall implement an Environmental and Social management implementation. System (ESMS) satisfactory to the Bank. The ESMS shall include documents and procedures to ensure that its investment activities are, in the opinion of the Bank, compliant with the Exclusion List defined in the Loan Agreement, relevant national laws as confirmed by the Bank, the Environmental and Social Standards and the Subproject eligibility criteria as set forth in the Loan Agreement, which Complementary instruments to be shall all be acceptable to the Bank. maintained and operated throughout project implementation. Communicate in advance and agree with World Bank, a ny change to TKYB’s ESMS, should such a situation arise. Implement complementary instruments (such as SEP) or any amendments in the corporate ESMS. 11 | P a g e ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) 9.2 EXCLUSIONS Screen Subprojects before determining TKYB PIU Exclude sub- projects that can have significant risks or impacts on the whether they are eligible to receive environment, community health and safety, labor and working conditions, support from the Project. biodiversity or cultural heritage (which are currently considered as Category A per TKYB ESMS),. 9.3 FI ORGANIZATIONAL CAPACITY All defined experts prior to the Effective TKYB PIU Establish and maintain an organizational capacity and competency for Date and throughout Project implementing the corporate ESMS with clearly defined roles and responsibilities Implementation described under action 1.1. 9.4 SENIOR MANAGEMENT REPRESENTATIVE Prior to the Effective Date and throughout TKYB PIU Designate a senior management representative to have overall accountability Project implementation for environmental and social performance of FI subprojects. 9.5 APPLICABLE E&S STANDARDS Throughout the Project implementation TKYB PIU Apply TKYB’s ESMSs to moderate and substantial risk sub-projects (category B- and category B+ according to TKYB’s E&S risk categorization) within the scope of this project. Apply national laws to the low risk sub-projects (category C according to TKYB’s E&S risk categorization), where the sub-projects are likely to have minimal or no adverse E&S risks and impacts. ESS 10: STAKEHOLDER ENGAGEMENT AND INFORMATION DISCLOSURE 10.1 STAKEHOLDER ENGAGEMENT PLAN PREPARATION AND IMPLEMENTATION SEP to be implemented and updated TKYB PIU Preparing a Project specific Stakeholder Engagement Plan in accordance with throughout the Project. the ESF. Staff assignment – Prior to the Effective Maintain and Implement project SEP. Date and retention throughout Project implementation. 12 | P a g e ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) 10.2 PROJECT GRIEVANCE MECHANISM TKYB Level - Prior to theEffective Date TKYB PIU Develop, adopt, maintain and operate a grievance mechanism, as described in the SEP. Reporting –semi-annually in progress Assign staff to manage and monitor project grievances. reports. Ensure timely resolution, response and reporting of grievances for each sub- project. 10.3 CITIZEN ENGAGEMENT Prior to the Effective Date of each of the TKYB PIU Sub-project specific SEP will integrate proposed citizen engagement activities Subproject and indicators. Collect feedback from beneficiary enterprises as part of the semi-annual Reporting –semi-annually in progress progress reports from the Project beneficiaries. reports. Conduct specific KPI investigation upon the completion of the sub-loan disbursement to beneficiaries. The summary of KPI results will be shared with The follow-up latest situation of the beneficiaries and with the Bank in semi-annuall progress reports. specific KPI with the Monitoring Periods 13 | P a g e