People’s Republic of Bangladesh Sustainable Micro-enterprise and Resilient Transformation (SMART) Project (P178996) Draft ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) February 2023 1|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN 1. The People’s Republic of Bangladesh (the Recipient) will implement the Sustainable Micro-enterprise and Resilient Transformation (SMART) Project (the Project), with the involvement of the Palli Karma-Sahayak Foundation (PKSF), as set out in the Financing Agreement and Project Agreement. The International Development Association (World Bank) has agreed to provide financing for the Project (P178996), as set out in the referred agreements. 2. The Recipient 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 Subsidiary Loan and Grant Agreement (SLGA) and the Project Agreement. Unless otherwise defined in this ESCP, capitalized terms used in this ESCP have the meanings ascribed to them in the referred agreements. 3. Without limitation to the foregoing, this ESCP sets out material measures and actions that the Recipient 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 World Bank and the Recipient, 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 People’s Republic of Bangladesh through PKSF and the World Bank agree to update the ESCP to reflect these changes through an exchange of letters signed between the World Bank and the Recipient, Additional Managing Director (AMD) of Palli Karma-Sahayak Foundation (PKSF) under Finance Institution Division. The Recipient shall promptly disclose the updated ESCP. 2|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) – Sustainable Micro-enterprise and Resilient Transformation (SMART) Project MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBLE ENTITY MONITORING AND REPORTING A REGULAR REPORTING Submit half yearly (every six-month) Project Management Unit Prepare and submit to the World Bank regular monitoring reports on the environmental, report to the World Bank throughout (PMU) of PKSF social, health and safety (ESHS) performance of the Project, including but not limited to Project implementation (commencing the implementation of the ESCP, status of preparation and implementation of E&S after the Effective Date). Submit each instruments required under the ESCP, stakeholder engagement activities, functioning of report to the World Bank no later than the grievance mechanism(s), ; and development and finalization of institutional 60 days after the end of each reporting mechanism to update, adopt and implement the Environmental and Social Management period. System (ESMS). Monitoring reports will be submitted as per World Bank and PKSF agreed template. B INCIDENTS AND ACCIDENTS Notify the World Bank no later than 48 PMU Promptly notify the World Bank of any incident or accident related to the Project which hours after learning of the incident or has, or is likely to have, a significant adverse effect on the environment, the affected accident. 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 Provide subsequent report to the World multiple injury, serious mismanagement of in handling waste, security breach etc. Bank within ten (10) days from the Provide sufficient detail regarding the scope, severity, and possible causes of the incident reporting. incident or accident, indicating immediate measures taken or that are planned to be taken to address it, and any information provided by any Partner Organization (PO) and Micro Enterprise (ME), as appropriate. Subsequently, at the World Bank’s request, compile a report on the incident or accident and propose any measures to address it and prevent its recurrence based on the reports submitted by POs and MEs. C PARTNER ORGANIZATIONS’ MONTHLY REPORTS The monthly reports submitted to the PMU, POs, MEs. . PKSF shall require POs to provide monthly monitoring reports to PKSF on ESHS PKSF by the POs shall, upon request of performance in accordance with the metrics specified in the respective bidding the World Bank, be shared in the form documents, sub-project proposals and contracts, and submit such reports to the World of a consolidated report as annexes to Bank every 6 months based on reports submitted by POs. the six-monthly reports to be submitted under action A above. D NOTIFICATIONS RELATING TO DAAB COMPLIANCE REVIEW OF CONTRACTOR No later than 7 days after the issuance PMU COMPLIANCE WITH SEA/SH PREVENTION AND RESPONSE OBLIGATIONS or receipt, as applicable, of the relevant Notify the World Bank of any referral submitted to the Dispute Avoidance and document (i.e., referral to the DAAB, Adjudication Board (DAAB) to initiate a process of compliance review in relation to a issuance of DAAB decision, Notice of PO/ME’s obligations to prevent and respond to sexual exploitation and abuse (SEA), Dissatisfaction, notice of and/or sexual harassment (SH) specified in the respective works contract with such commencement of emergency/full PO/ME; and, in the event of any such referral, notify the World Bank of: (i) the DAAB’s arbitration, emergency/full arbitration decision on such referral; (ii) the PO’s Notice of Dissatisfaction, if any, with such DAAB order, as applicable). 3|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) – Sustainable Micro-enterprise and Resilient Transformation (SMART) Project MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBLE ENTITY decision; (iii) any notification received on the commencement of an emergency arbitration proceeding or full arbitration proceeding in relation to the DAAB’s decision; and (iv) the resulting emergency arbitration order and/or full arbitration order, if any. ESS 1: ASSESSMENT AND MANAGEMENT OF ENVIRONMENTAL AND SOCIAL RISKS AND IMPACTS 1.1 ORGANIZATIONAL STRUCTURE a) Within three months of GoB a) PKSF a) Establish and maintain a PMU at PKSF level, with qualified staff and resources to approval. support management of ESHS risks and impacts of the Project, including one b) POs. Environmental Specialist, one Social and Gender Specialist and two E&S Program b) Within three (03) months of Officer. Until recruitment, in the interim period Environmental and Social Specialists contract awarded by the PMU. of the ongoing Sustainable Enterprise Project will support E&S management and Recruitment of the E&S Officer at implementation of this Project. PO level will be completed within three (03) months of the award of contract. b) Establish an Environment and Climate Change Unit (ECCU) at PO level during the project period, with one E&S Officer who has experience in dealing with E&S related Retain the Environment and Social activities. Team of PMU and E&S Officer at each PO-ECCU level for the entire period of Project implementation. 1.2 ENVIRONMENTAL AND SOCIAL INSTRUMENTS a) Update the existing ESMS prior to a) PKSF a) Update, adopt, and implement, the existing ESMS of PKSF for SMART, consistent Board approval. Maintain and with the relevant ESSs. implement the ESMS throughout b) PMU, POs and MEs Project implementation. c) PMU, POs and MEs b) Prepare sub-project specific ESMPs based on the screening outcomes. Activities b) E&S Screening and preparation of identified in the exclusion list set out in the ESMS will be ineligible to receive ESMP to be completed prior to financing under the Project. implementation of the sub- projects. c) Cause POs and MEs to adopt and implement the subproject ESMPs as set out in the ESMS. c) Adopt sub-project ESMPs prior to the carrying out of sub-project that requires the adoption of such ESMP. Once adopted, implement the respective ESMP throughout Project implementation. 4|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) – Sustainable Micro-enterprise and Resilient Transformation (SMART) Project MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBLE ENTITY 1.3 MANAGEMENT OF POs As part of the preparation of PMU Incorporate the relevant aspects of the ESCP, including ensuring that the POs/MEs procurement documents and respective comply with the ESHS specifications of their respective contracts including, inter alia, contracts. the relevant E&S instruments identified during E&S screening, ESMS and code of conduct, into the ESHS specifications of the procurement documents and contracts with Supervise POs/MEs throughout Project POs/MEs , as appropriate. implementation. 1.4 TECHNICAL ASSISTANCE During preparation of the bidding PMU Ensure that the consultancies, studies, capacity building, training, and any other documents and throughout the Project technical assistance under the Project, are caried out in accordance with terms of implementation. reference acceptable to the World Bank, that are consistent with the ESSs. Thereafter ensure that the outputs of such activities comply with the terms of reference. ESS 2: LABOR AND WORKING CONDITIONS 2.1 LABOR MANAGEMENT PROCEDURES Adopt the LMP outlined in the ESMS PMU, POs, MEs. Prepare, adopt and implement, and cause to be implemented by POs and MEs, the Labor prior to engaging workers and Management Procedures (LMP) as part of the ESMS for the Project, including, inter alia, thereafter implement the LMP provisions on working conditions, management of workers relationships, occupational throughout Project implementation. health and safety (including personal protective equipment, and emergency preparedness and response), code of conduct (including relating to SEA and SH), forced labor, child labor, grievance arrangements for Project workers , and applicable requirements for contractors, subcontractors of sub-projects and/or POs/MEs as required. 2.2 GRIEVANCE MECHANISM FOR PROJECT WORKERS Project level GRC will be formed within PMU, POs, MEs. Establish and operate a grievance mechanism (also responsive to SEA/SH) for the Project three months of the project GoB as described in the ESMS. approval once PMU is formed. The • Local level GRC for all sub-projects existing Sustainable Enterprise Project GRM will be utilized by the SMART • Project level GRC at PMU project until the project level GRM is formed. The GRC at the local level will be established before commencement of sub-project activities and thereafter maintained and operated throughout Project implementation. ESS 3: RESOURCE EFFICIENCY AND POLLUTION PREVENTION AND MANAGEMENT 3.1 WASTE MANAGEMENT PLAN As per ESMS before implementation of PMU, POs Implement the screening mechanism and exclusion list (which is a part of updated PKSF any sub-project. ESMS) to verify that sub-projects meet the eligibility criteria and ensure that such sub- projects will not adversely impact the environment and the people, consistent with ESS3. 5|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) – Sustainable Micro-enterprise and Resilient Transformation (SMART) Project MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBLE ENTITY Adopt and implement waste management measures as set out in the ESMS and sub Same timeframe as for the adoption of PMU, POs. project ESMP, if required. Update bidding documents and subproject ESMPs to include the subproject ESMPs. required waste management mitigation measures as applicable, consistent with ESS3. Throughout Project implementation. 3.2 RESOURCE EFFICIENCY AND POLLUTION PREVENTION AND MANAGEMENT PMU, POs, MEs. Incorporate resource efficiency, pollution prevention and pest management measures in the ESMPs to be prepared under action 1.2 above. Same timeframe as for the adoption of the subproject ESMPs. Throughout Project implementation. ESS 4: COMMUNITY HEALTH AND SAFETY 4.1 TRAFFIC AND ROAD SAFETY PMU, POs, MEs Adopt and implement measures to manage traffic and road safety risks as set out in the Same timeframe as for the adoption of ESMS and sub-project ESMPs to be prepared under action 1.2 above. the subproject ESMPs. Throughout Project implementation. 4.2 COMMUNITY HEALTH AND SAFETY Same timeframe as for the adoption of PMU, POs, MEs. Assess and manage specific risks and impacts to the community arising from Project the subproject ESMPs. activities including, inter alia, wastes, noise, and air emission from the production activities of MEs that may impact community health and safety and include mitigation Throughout Project implementation. measures in the subproject ESMPs to be prepared in accordance to the ESMS. 4.3 SEA AND SH RISKS Adopt the GBV/SEA/SH Action Plan PMU before undertaking Project activities Update, adopt and implement the Gender and SEA/SH section of the ESMS, to assess that pose SEA/SH risks, and therefore and manage the risks of SEA and SH. As per ESMS develop Project specific GBV/SEA/SH implement the GBV/SEA/SH Action Plan Action Plan. throughout Project implementation. Gender and SEA/SH section of the ESMS will be finalized prior to Board approval of the Project and GBV/SEA/SH Action Plan will be developed within one month of PMU formation. ESS 5: LAND ACQUISITION, RESTRICTIONS ON LAND USE AND INVOLUNTARY RESETTLEMENT 5.1 RESETTLEMENT POLICY FRAMEWORK Not relevant for this Project. 6|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) – Sustainable Micro-enterprise and Resilient Transformation (SMART) Project MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBLE ENTITY Not relevant for this Project. ESS 6: BIODIVERSITY CONSERVATION AND SUSTAINABLE MANAGEMENT OF LIVING NATURAL RESOURCES 6.1 BIODIVERSITY RISKS AND IMPACTS Not relevant for this Project. This ESS6 is currently not relevant. PKSF ESMS will include an exclusion list so that potential business/microenterprise that may adversely affect biodiversity and living natural resources are not funded. ESS 7: INDIGENOUS PEOPLES/SUB-SAHARAN AFRICAN HISTORICALLY UNDERSERVED TRADITIONAL LOCAL COMMUNITIES 7.1 TRIBAL PEOPLES PLANNING FRAMEWORK Update and adopt the IPPF section of PKSF Adopt and implement an Indigenous Peoples Framework (IPPF) as part of the ESMS of the ESMS before Board approval of the PKSF to be updated consistent with ESS7. Project, and thereafter implement the PMU and POs IPPF over the Project period. 7.2 TRIBAL PEOPLES PLAN Same timeframe as for the adoption of PMU and POs Adopt and implement a Tribal Peoples Plan for each activity under the Project for which the subproject ESMPs. a Tribal Peoples Plan is required as set out in the ESMS. Throughout Project implementation. 7.3 GRIEVANCE MECHANISM Establish the grievance mechanism PMU and POs Prepare, adopt, and implement the arrangements for the grievance mechanism for before commencing sub-project indigenous people as set out in the IPPF and the IPP. activities . ESS 8: CULTURAL HERITAGE 8.1 CULTURAL HERITAGE RISKS AND IMPACTS Before commencing sub-project PMU and POs Adopt and implement mitigation measures applicable to cultural heritage sites as activities. outlined in the PKSF ESMS. 8.2 CHANCE FINDS Same timeframe as for the adoption of PMU and POs Describe and implement the chance find procedure in the ESMS and as part of the the subproject ESMPs. subproject ESMP, if required. Implement the chance find procedures throughout Project implementation. ESS 9: FINANCIAL INTERMEDIARIES 9.1 ENVIRONMENTAL AND SOCIAL MANAGEMENT SYSTEM (ESMS) Update the existing ESMS prior to Board PKSF Update, maintain, and implement the existing ESMS to identify, assess, manage, and Approval. monitor the environmental and social risks and impacts of PKSF subprojects. The ESMS shall include, inter alia, the following elements: Once updated, maintain and implement the ESMS throughout Project • Identification of the PKSF subprojects that may receive support from the Project. implementation. • An environmental and social policy endorsed by PKSF senior management, including] [specify any details on the E&S policy that may be relevant. 7|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) – Sustainable Micro-enterprise and Resilient Transformation (SMART) Project MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBLE ENTITY • Clearly defined procedures for the identification, assessment and management of the environmental and social risks and impacts of PKSF subprojects, in accordance with ESS9, including, inter alia, stakeholder engagement and disclosure requirements applicable to subprojects. • Exclusion list with the activities/ subprojects that are not eligible for financing, • An organizational capacity and competency for implementing the ESMS with clearly defined roles and responsibilities. • Monitoring and reporting of environmental performance of subprojects and the effectiveness of the updated ESMS. • Incidents and accidents notification and subsequent reporting requirements as set out in action B above. • An external communications mechanism, including measures to respond to public enquiries and concerns in a timely manner. • Disclose a summary of each of the elements of the ESMS through the relevant website. In line with above the ESMS will be updated based on the recommendations provided by WB E&S team. The major recommendations are: (i) Develop a ES policy statement to assess and manage ES risks and impacts endorsed by the senior management; (ii) Define roles and responsibilities of PKSF ECCU, POs and MEs for E&S management (iii) Enhance the capacity of the ECCU); (iv) Develop training policy and training plan for staffs on E&S issues and develop a complete training manual/ curriculum including audio visual presentations; (v) Clear description of relevant national laws and their adoption in the ESMS; (vi) Align the risk categorization system of existing ESMS for both environmental and social risks with national/ ESF risks rating (four instead of three); (vii) Detail description of reporting requirement, channel and frequency of reporting and person responsible; (viii) Develop an ES checklist on beneficiary screening mechanism and format (including women, people with disability and the vulnerable). Finalize and implement the updated ESMS 9.2 EXCLUSIONS Screen activities/ subprojects before PMU and POs. Screen all proposed activities/subproject against the exclusion list set out in the ESMS. determining whether they are eligible Activities that involve the following characteristics will be ineligible for support under to receive support from the Project. SMART: • Poses any direct or indirect discriminatory criteria for selection of MEs • Causes severe impacts and risks on private land, residential or commercial establishments 8|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) – Sustainable Micro-enterprise and Resilient Transformation (SMART) Project MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBLE ENTITY • Affect mosques, temples, graveyards, cremation grounds, and other places/objects that are of religious and cultural significance • May significantly restrict access to common property resources and livelihood activities of groups and communities • Leads to permanent flooding or water logging of water courses • Leads to permanent pollution of surface water or groundwater resources • Leads to increased human-wildlife conflicts • Activities located within any forest area • Entail construction/re-construction of dam • Any activity adversely affecting bio-diversity, natural habitat and critical habitat 9.3 FI ORGANIZATIONAL CAPACITY Within first year of SMART Project PMU Establish and maintain capacity and competency at PKSF for implementing the ESMS at implementation. the institutional level with clearly defined roles and responsibilities. 9.4 SENIOR MANAGEMENT REPRESENTATIVE Within 30 days of GOB approval. PKSF, PMU Designate a senior management representative of PKSF to have overall accountability for environmental and social performance of PO subprojects that receive support from the Project. ESS 10: STAKEHOLDER ENGAGEMENT AND INFORMATION DISCLOSURE 10.1 STAKEHOLDER ENGAGEMENT PLAN PREPARATION AND IMPLEMENTATION Update the SEP as part of the ESMS for PKSF Update, adopt and implement Stakeholder Engagement Plan (SEP) as set out in the SMART before Board approval and updated ESMS for the Project, consistent with ESS10, which shall include measures to, thereafter implement the SEP inter alia, provide stakeholders with timely, relevant, understandable, and accessible throughout Project implementation. information, and consult with them in a culturally appropriate manner, which is free of manipulation, interference, coercion, discrimination and intimidation. 10.2 PROJECT GRIEVANCE MECHANISM Establish the project level grievance PMU Establish, publicize, maintain, and operate an accessible grievance mechanism, to mechanism before commencement of receive and facilitate resolution of concerns and grievances in relation to the Project, Project activities, and thereafter promptly and effectively, in a transparent manner that is culturally appropriate and maintain and operate the mechanism readily accessible to all Project-affected parties, at no cost and without retribution, throughout Project implementation. including concerns and grievances filed anonymously, in a manner consistent with ESS10 and PKSF ESMS. 9|Page ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) – Sustainable Micro-enterprise and Resilient Transformation (SMART) Project MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBLE ENTITY The grievance mechanism shall be equipped to receive, register, and facilitate the resolution of SEA/SH complaints, including through the referral of survivors to relevant gender-based violence service providers, all in a safe, confidential, and survivor-centered manner. CAPACITY SUPPORT CS1 1. PKSF needs to develop training plan for PKSF staff, PO and MEs on E&S issues and 1. Within six months after GoB 1. PMU with the support of develop a complete training manual/ curriculum including audio visual presentations. approval. WB E&S team. This ESCP proposes a preliminary training plan This plan will be adopted to meet needs during Project implementation. 2. PMU with the support of 2. Within six months after GoB WB E&S team. 2. Training on PKSF ESMS, WB ESF and the 10 ESSs—including preparation of ESMP and approval. the targeted groups are Personnel directly related with project at the PMU and POs level 3. POs with the support of 3. Within six months after GoB PMU 3. Training on issues related to COVID-19 approval. If needed quarterly thereafter throughout the Project Implementation. 4. POs with the support of 4. Training on Labor and Working Conditions PMU 4. Within six months after GoB 5. Training on Grievance Redress Mechanism approval. 5. POs with the support of PMU 6. Training on GBV/SEA/SH 5. Within six months after GoB approval. and once in every year 6. POs with the support of thereafter throughout the Project PMU. implementation. 6. Within six months after GoB approval. and once in every year thereafter throughout the Project implementation. CS2 Occupational Health and Safety Within six months after GoB approval. POs with the PMU and once in every six months Workplace risk management thereafter. Prevention of accidents at work sites Health and safety rules 10 | P a g e ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP) – Sustainable Micro-enterprise and Resilient Transformation (SMART) Project MATERIAL MEASURES AND ACTIONS TIMEFRAME RESPONSIBLE ENTITY Preparedness and response to emergency situations 11 | P a g e