STANDARD OPERATING PROCEDURE (SOP)

ON
ENVIRONMENT, HEALTH & SAFETY AND SOCIAL
RISK MANAGEMENT (EHSSRM) SYSTEM OF CUSTOMER

Version No: 01
Date: 15/03/2022
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List of Abbreviation
SOP Standard Operating Procedure
WBD Wholesale Banking Division
CBD Commercial Banking Division
EHSSRM Environment, Health & Safety and Social Risk Management
IFC International Finance Corporation
BERC Bangladesh Energy Regulatory Commission
FSCD Fire Service and Civil Defense
DoE Department of Environment
HR Human Resource
RM Relationship Manager
CAD Credit Administration Department
CRM Credit Risk Management
GCRO Group Chief Risk Officer
CAP Corrective Action Plan

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Table of Contents
Purpose 04

Scope 04

Introduction of EHSS Risk Management System 04

Procedure of Evaluating, Reporting and Monitoring of EHSS risk of

05
Customers

Detailed Operating Procedure 06-10

Annexures.

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Purpose
The purpose of this SOP is to describe the EHSSRM system that will be adopted by MTB for its
customer. This SOP describes the procedure for evaluating and reporting of Environment,
Health & Safety and Social risk of the customer and how it will be monitored. Additionally the
SOP also outlines the factory inspection procedure, post inspection activity and monitoring
method and frequency.

Scope
This SOP applies to all existing and new customer of WBD and CBD client of MTB.

Introduction of EHSS Risk Management System

MTB introduces EHSS risk management system of its customer as a part of its commitment to
make substantial contribution to safe workplace as financier by being a driver of progress and
prosperity in its own supply chain and being responsible in how it does business and who it
does business with. The Bank combines Guidelines on Environmental & Social Risk
Management (ESRM) for Banks and Financial Institutions in Bangladesh By Bangladesh Bank
and EH&S guideline of IFC to ensures that it can fulfill its commitment as a responsible
financier. The Environment, Health & Safety and Social risks are categorized into some key
performance indicators.

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Procedure of Evaluating, Reporting and Monitoring of EHSS risk of

Customers
The following process flow diagram shows the standard operating procedure that will be
followed in evaluating, reporting and monitoring of EHSS risk of the customers.

The following diagram shows important decision steps associated with the standard operating
procedure-

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Detailed Operating Procedure

i. Initial Inspection of Customer’s Facility
a) Pre Inspection activity: The RM shall schedule the visit by communicating with
the customer(s) at least 15 days prior to the inspection. A checklist (LIST-A) will
be prepared with customer’s present documentation status with the following-
(Available/Not Available/Not Required) documents including but not limited to-
 Building Permit
 Fire License
 Boiler License
 Boiler Operator License
 BERC License
 ABC License for Engineer or Electrician
 Fire Drill from FSCD
 Fire Safety Training certificate of worker from FSCD.
 DoE Certificate
 Factory License
 Trade License
 Layout Plan Permit
 Electrical safety training program
 Hot Work Permit and Policy
 Housekeeping Policy.
 HR Policy
Once the checklist is prepared and appointment with customer is confirmed, RM
will arrange an inspection in customer’s Facility. The inspection will be
conducted by the Inspection & Monitoring team of CAD.
b) Conducting the inspection: On the scheduled date, member(s) of inspection and
monitoring team will conduct an on-site inspection. The RM shall ensure that the
available documents from LIST-A, are kept on-site either in original form or in
photocopy. The on-site inspection will be conducted to collect data for risk
assessment. The data collection method includes-Document verification, On-site
data, Physical inspection, Workers and management interview, previous records,
third party inspection reports etc.

ii. Data Analysis & Preservation

After the inspection, the inspection team will collect the data and pictorial evidence
for further analysis and preservation. The customer(s) will receive maximum 7
(Seven) working days after the date of inspection to submit any documents that
were missing/not found during the inspection. Once the data are analyzed the

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resulting information will be used for risk assessment of the customer. All the data
and documents collected during the inspection will be preserved by CAD for further
reference.

iii. Risk Assessment & Categorization

The risk assessment tool will be filled up by the data collected during the on-site
inspection. The required remarks and note will be added along with the final EHSS
risk category. The risk category and required summary reports will be shared.
The risk values will be distributed as such-

The risk assessment tool will be developed considering the following factors-
 Regulatory requirements has been given highest priority followed by operational
risk.
 If there is such risk where there is possibility for residual risk even after control
measures are taken, adequate value has been provided for effective control
measures to make the Facility “Low risk”, However, full value has been assigned
only when the risk is being eliminated from source.
 For some cases, where any control measures taken which is greater than the
regulatory requirement and reduce other associated risks, has been provided
with additional value. For example- addressable fire alarm system, Sprinkler
system on a low rise building.

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 Some values has been added for starting of remediation work or safety
arrangements.
 Special emphasis has been provided on Life and fire safety, and Labor and
working condition.
 Quantitative risk assessment has been preferred instead on qualitative risk
assessment.

The following methodology will be used for the calculation of Facility EHSS risk value
and subsequent categorization-

 If any of the indicator type average is equal or less than 20%, and/or Facility avg.
score is less than 20%, the Facility will be defined as high risk.
 If avg. Facility score is between 21%-49%, and/or indicator average of
Occupational and Community H&S is below 40% and/or Key performance
indicator of Labor & Working condition is below 40%, the result will be
“Increased Risk”.
 The Facility will be “Low Risk” only when all indicator type avg. value will be at
least 80%.
 For avg. Facility score between 50%-79% and not having any of the condition
stated above, the Facility EHSS category will be “Moderate Risk”.

Once the risk assessment is completed, an initial Facility screening report will be
submitted to RM and CRM division for further screening.

iv. Initial Report for Facility Screening

A report based on the risk assessment will be circulated by the inspection team to
RM and CRM, and Sustainability finance department for initial Facility screening and
further proceedings. The content of the report should include-
 Facility Description
 Risk Categorization
 Full risk assessment conducted in risk assessment tool.
 Major Risks- Description, Status
 Note from inspectors.

v. Facility Screening
Based on the risk categorization the Facility shall be screened in the following way-
 For Low risk and Moderate risk Facility, the Facility will be screened further
for the other financing conditions.
 For Increased risk the Facility will be referred to GCRO for final decision.
 All High risk facility will be referred to Board for final decision.

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vi. Time bound report preparation

Once the Facility completes screening and selected for financing, a report will be
prepared with time bound corrective action plan. The content of report shall
include-
 General Information of the Client.
 Observations
 Recommendations
 Timeline
 Pictorial evidence of issue (If applicable)
 Remark/Notes

An Example of report prepared with corrective action plan.

The corrective action plan will be send to customer for agreement. Once agreed the
report will be preserved and will be used for monitoring and follow-up inspection.

vii. Monitoring of CAP

Once the loan is disbursed, the RM will sent the Corrective Action Plan to the
customer to take necessary actions. Each month customers will send a copy of their
Corrective Action Plan to the RM by putting the status of their present corrective
action on the remarks. The RM will then send it to CAD for further review.

viii. Follow-up Inspections

Follow-up inspections by Inspection and Monitoring will be arranged to the
customer’s facility to verify the progress of CAP. The frequency of the follow-up
inspection as reasonably practicable will be based on the risk categorization on the
initial risk assessment-

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Once the follow-up inspection completed, the follow-up report will be prepared
citing the progress of the customer on their corrective action.

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Annexures
Annexure-A Key Questions

Environmental Safety
Performance Indicator: ES Management System

a. Is there any documented Environmental Policy?

b. Does the Client has all valid permits AND has not faced any legal claims or any serious
environmental/social incident in last three years?
c. Does the client have robust/ adequate Environmental and Social Management system (ESMS)?
d. Does the project is free from any local stakeholder grievances, media or non-governmental
organization (NGO) campaigns over E&S issues?
e. Does the project have a documented plan for dealing with emergencies that may have an
environmental significance?
f. Does the project have procedures to report on environmental incidents, accidents & emergency
situations and followed it with implementing corrective actions?
g. Does the project have adequate spill clean-up and containment equipment easily available?

Performance Indicator: Air Pollution

a. Does the project is free from any regulatory requirement of official approval for emissions to
air?
b. Does the authorized limits and conditions from the official approval for emissions are being
met?
c. Does point source emissions are regularly monitored and results are documented?
d. Is the site free of products which could give rise to uncontained dust, VOCs and fibers (e.g.
asbestos)?
e. Are recovery/recycling devices used when working on refrigeration/air conditioner equipment
containing ODS (Ozone Depleting Substances)?
f. Does fugitive sources or/and mobile sources of air emissions are present and not being
monitored?

Performance Indicator: Water Conservation

a. Does the site monitor the amount of water consumption in its operation and has a established
programmed for water conservation?
b. Does there a system for storm/rainwater harvesting and use?

Performance Indicator: Water Discharges

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a. Does the project is free from any regulatory requirement of official approval/treatment to
discharge liquid effluent to ground, surface water or to underground watercourses?
b. Does the authorized limits and conditions from the official approval for discharges are being
met?
c. Does discharge sample records and discharge monitoring reports are documented?
d. Are all liquid discharges and free water (i.e. rain water pool) free from unusual water conditions
(such as obvious oily sheen, discoloration. etc.)?
e. Is all drainage from site well maintained and routed to authorized discharge points?

Performance Indicator: Waste Disposal

a. Does the project is free from any regulatory requirement of legal authorizations licenses for
storing and handling waste?
b. Does the project has a defined and adequate waste handling mechanism in the project
operation?
c. Is there any documented list/inventory of all the waste generated and details of where waste
are finally disposed of?

Performance Indicator: Hazardous Material Management

a. Does the site is free from generating hazardous waste?

b. Does there is a system to monitor and document usage, volumes and disposal of any hazardous
waste generated?
c. Is there a programmed to eliminate, or if not possible reduce the use of hazardous substances?
d. Is there an up-to-date list of the hazardous substances on site, plus information on handling,
disposal, MSDS etc. available?
e. Are all hazardous waste containers are properly labelled with an adequate description of waste?

Performance Indicator: Land Contamination

a. Does the project free from any evidence of land contamination because of activities such as
leakages, spills, improper storage of waste, toxic effluent discharge?

Assessment of Occupational & Community H&S

Performance Indicator: Structural Safety of Project Infrastructure

a. Does heavy oscillating, rotating or alternating equipment that causes substantial vibration to the
structure located in a dedicated buildings or structurally isolated sections that it designed for?
b. No structural crack and/or stress in load bearing members that were visible?
c. Does the Project Infrastructure has a building permit from the appropriate authority?

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d. Does the Project Infrastructure has a detailed engineering assessment done (Either in design
phase or Post by a reputed engineering farm?

Performance Indicator: Life and Fire Safety (L&FS)

a. The properties of main construction material with which the project infrastructure has been
constructed-
b. Does the building is provided with any fire detection & alarm system?
c. Does the building is provided with any water based fire suppression system?
d. Does the building is provided with adequate fire extinguishers?
e. Does extinguishers are checked and maintained properly?
f. Does Fire license available?
g. Are Fire drills are done on a regular basis?
h. Is there any Hot work policy present and hot work permits are taken accordingly?
i. Are fuses, circuit breakers and other electrical devices correctly rated for the circuit they
protect?
j. Are electrical equipment parts which normally produce arcs, sparks, flames, or molten metal
enclosed and separated from all combustible materials?
k. Does all energized equipment are grounded properly?
l. Are exposed wiring and cords with frayed or deteriorated insulation has been observed?
m. Does Light fixtures without protective covers (otherwise known as naked lights) are restricted in
storage areas
n. Is the use of temporary wiring (including multi-plug, extension cord in place of permanent wiring
strictly prohibited?
o. Does smoking is restricted inside the building?
p. Egress doors are-
q. Does egress/exit is adequate based on occupant load, travel distance and common path of
travels?
r. Does emergency exit enclosures, discharge passageway and discharge area are free from fire
and smoke and being protected by fire rated assemblies?
s. Does exits and egress path are free from obstruction and storages?
t. Does emergency light and exit signs are provided?
u. Is there any fire safety pre-planning available?
v. Does evacuation plans are provided near each exits?
w. Does the combustible storage are separated from production areas?

Performance Indicator: Emergency Preparedness and Response

a. Does workers are being trained or communicated on what to do during an event of Emergency?
(Training, Posters etc.)

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b. Is there any public announcing (PA) system or community notification system present for
emergency notification?
c. Is there any provision for First Aid?
d. Is there any list of emergency contacts including internal and external resources (nearby medical
facilities, fire services, ambulance services etc.) are posted in a clear and easily visible area?
e. Is there a safe and adequate assembly point provided for workers and staffs in the event of an
emergency?
f. Is there adequate access to the site for the emergency services has been provided and is always
kept clear?

Performance Indicator: Communication and Training

a. Is there any provision to provide OHS orientation training to all new employees to ensure they
are apprised of the basic site rules of work at / on the site and of personal protection and
preventing injury to fellow employees?
b. Is there any Electrical safety training program for the electricians?
c. Does CPR instructions are hanged near all electrical installations (LT panel, MDB, FDB, DB, SDB)
at visible location?
d. Is there any fire safety training program for the workers?

Performance Indicator: Workplace Welfare Facility

a. Is there adequate lavatories and/or showers are present for all employees in the facility?
b. Does on-site observation confirms that the workplace is designed with optimum noise,
temperature, and with adequate light, air and ventilation?
c. Does employees are provided with a separate and clean place for eating?
d. Does employees are provided with adequate supplies of potable drinking water?

Performance Indicator: Physical Hazards (Work Place & Work Equipment)

a. Does the workplace is free from all kinds of Physical hazards including (Rotating and moving
equipment, Noise, Vibration, Radiation, Extreme workplace temperature, working at height,
working in a confined space, mechanical and non-mechanical machinery hazards )?
b. Does control measures are taken and is adequate with the outcome of risk assessment?
c. Does the control measures are monitored regularly?
d. Does Accidents, Near misses are recorded and investigated?
e. Does adequate and appropriate PPE are available to workers?

Performance Indicator: Biological Hazards

a. Does the workplace is free from all kinds of Biological hazards?

b. Does control measures are taken and is adequate with the outcome of risk assessment?

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c. Does the control measures are monitored regularly?

d. Is contingency plan in place in an event of accidental exposure?
e. Does all legal and regulatory requirements are maintained during handling, storage and disposal
of wastes?

Performance Indicator: Chemical Hazards

a. Does MSDS (Material Safety Data Sheet) or SDS (Safety Data sheet) are present for all the
chemicals used/stored
b. Does Chemicals used/stored are adequately classified and labelled (Preferably in line with GHS-
Globally Harmonized System)?
c. Is there any suitable and sufficient health risk assessment has been conducted for the chemicals
used?
d. Is control measures are taken and is adequate with the outcome of risk assessment?
e. Does the control measures are monitored regularly?
f. Does all legal and regulatory requirements are maintained during handling, storage and disposal
of wastes?

Performance Indicator: Disease Prevention

a. Does there any surveillance and active screening procedure to identify communicable and
vector-borne diseases among the employees?
b. Does there an established guideline for monitoring the circulation and migration of such
diseases to the community level?
c. Is control measures are in place to prevent the disease spread?
d. Does there any program available for educating project personnel and area residents on risks,
prevention and available treatment?
e. Does the project supports and promote any public health campaign taken by local authorities
including immunization?

Social Risk

Performance Indicator: Labor & Working Conditions

a. Does a written policy exist at the company addressing its approach in managing its employees
and various aspect of employment?
b. Does a written employment contract is used for permanent employees?
c. Does a grievance mechanism is present and addressed without any retributions?

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d. Are ages of all employees checked prior to hiring?

e. Does on-site observation confirms that there is no underage employee found on site?
f. Does worker interviews, documentation and employee contract confirm that identification
cards, passports, certificates are not held as a condition of employment?
g. Does worker interviews and documentations confirms that no forced, bonded, or involuntary
prison labor used at the site?
h. Are minimum wages as per regulation paid?
i. Does the project maintains records for wages, payment and attendance?
j. Does interviews, attendance, and other documents confirms that employees working not more
than 60 hours in a week and/or more than 10 days continually without any day off?
k. Are employees free to join unions/association (and that of their choice)?
l. Does worker interviews, complain records, employee records and other documentations
confirms that no corporal punishment, mental or physical coercion or physical abuse occurred at
the facility in the past three years?
m. Does equal pay for equal work given?
n. Does policy, worker interviews, complain records, employee records and other documentations
confirms that no discriminatory practices (e.g.. Sexual harassment, gender discrimination,
restriction on practice of religion) occurred at the facility in the past three years?
o. Does policy, interviews, employee records, and other documentations confirms that no women
dismissed when found pregnant?

Performance Indicator: Land Acquisition and Resettlement

a. Is the project free from physical and/or economic displacement of local community?
b. Does there adequate evidence to confirm that adequate consideration has been taken for
feasible alternative project designs to avoid or minimize physical and/or economic
displacement, while balancing environmental, social, and financial costs and benefits, paying
particular attention to impacts on the poor and vulnerable ?
c. Does the displaced community were resettled and properly compensated?

Performance Indicator: Indigenous People

a. Does the Indigenous Peoples are free from any adverse impact resulting from the company’s
operations?
b. In the event of any adverse impact, FPIC (Free, Prior, and Informed Consent) of the Affected
Communities of Indigenous Peoples are taken in certain circumstances described in paragraphs
13–17 of IFC Performance Standard 7.
c. Does there adequate evidence to confirm that possible alternatives to avoid adverse impacts on
affected communities of Indigenous peoples have been explored? And on unavoidable
situations, the client have minimized, restored, and/or compensated for these impacts in a
culturally appropriate manner commensurate with the nature and scale of such impacts and the
vulnerability of the Affected Communities of Indigenous Peoples.

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Performance Indicator: Cultural Heritage

a. Is the project located in an area where no adverse impact on cultural heritage objects, sites and
structures (e.g. arte facts, archeological sites, graves, and sacred forests) can be found?

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