Republic of Tunisia Innovative Startups and SMEs Project (P167380) ENVIRONMENTAL and SOCIAL COMMITMENT PLAN (ESCP) [04/29/2019] The Republic of Tunisia Innovative Startups and SMEs Project (P146387) ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN 1. The Republic of Tunisia (the Borrower) is planning to implement the Innovative Startups and SMEs Project (the Project) with the involvement of “Caisse de Depots et de Consignation� (the Project Implementing Entity or the CDC). The International Bank for Reconstruction and Development has agreed to provide financing for the Project. 2. The Borrower shall ensure that CDC, will implement material measures and actions so that the Project is implemented in accordance with the World Bank Environmental and Social Standards (ESSs). This Environmental and Social Commitment Plan (ESCP) sets out a summary of the material measures and actions. 3. Where the ESCP refers to specific plans or other documents, whether they have already been prepared or are to be developed, the ESCP requires compliance with all provisions of such plans or other documents. In particular, the ESCP requires compliance with the provisions set out in the Project’s Stakeholder Engagement Plan (SEP) developed by the CDC, the CDC’s the Labor Management Procedures (LMP, and the ESMSs and LMPs to be prepared by Anava Fund of Funds and the Innovatech Co-Investment Fund1, both managed by Smart Capital fund management company, and by the Child Funds. 4. The table below summarizes the material measures and actions that are required as well as the timing of the material measures and actions. The Borrower is responsible for compliance with all requirements of the ESCP even when implementation of specific measures and actions is conducted by the CDC. 5. Implementation of the material measures and actions set out in this ESCP will be monitored and reported to the Bank by the Borrower as required by the ESCP and the conditions of the legal agreements, and the Bank will monitor and assess progress and completion of the material measures and actions throughout implementation of the Project. 6. As agreed by the Bank and the Borrower, this ESCP may be revised from time to time during Project implementation, to reflect adaptive management of Project changes and unforeseen circumstances or in response to assessment of Project performance conducted under the ESCP itself. In such circumstances, the Borrower will agree to the changes with the Bank and will update the ESCP to reflect such 1 All measures and actions which are under the responsibility of the Anava Fund of Funds and the Innovatech Co-Investment Fund included in this ESCP will be the responsibility of Smart Capital, the management company responsible for managing the two funds. changes. Agreement on changes to the ESCP will be documented through the exchange of letters signed between the Bank and the Borrower. The Borrower will promptly disclose the updated ESCP. 7. Where Project changes, unforeseen circumstances, or Project performance result in changes to the risks and impacts during Project implementation, the Borrower shall provide additional funds, if needed, to implement actions and measures to address such risks and impacts. TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed ESCP Monitoring and Reporting REGULAR REPORTING CDC Prepare and submit regular monitoring reports on the implementation of Six-monthly the ESCP. throughout Project implementation as part of Project progress reports. INCIDENTS AND ACCIDENTS NOTIFICATION CDC In case of occurrence of an incident or accident related or having an Promptly after taking impact on the Project which has, or are likely to have, a significant notice of the incident adverse effect on the environment, the affected communities, the public or accident. or workers, the CDC shall: TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed (a) as soon as reasonably practicable, but no later than ten (10) calendar days after the occurrence of such incident of accident, inform the Bank by any electronic means of its nature, or circumstance and any effect or impact resulting or likely to result there from; (b) as soon as reasonably practicable, but no later than thirty (30) days after such incident or accident, provide the Bank with a summary report that includes a description of the incident or accident, and the measures, if any, that the Borrower is taking or plans to take to address it and to prevent any future similar event; and (c) keep the Bank informed of the on-going implementation of the said measures and plans. SUMMARY ASSESSMENT ESS 1: ASSESSMENT AND MANAGEMENT OF ENVIRONMENTAL AND SOCIAL RISKS AND IMPACTS 1.1 ORGANIZATIONAL STRUCTURE: 1.1.2 Smart Capital (the fund manager of the Anava Fund of Fund and Condition of Innovatech Co-Investment Fund) will designate a senior management Investment of the CDC representative to have overall accountability for environmental and into Anava Fund of social performance. The representatives of senior management will Fund and Innovatech designate an E&S focal point to be responsible of day to day Co-Investment Fund implementation of the ESMS TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed Condition of Investment of the 1.1.3 The Child Funds that will receive investments from Anava Fund of Anava Fund of Funds Funds will each designate a senior management representative to have into the Child Funds overall accountability for environmental and social performance. The representatives of senior management will designate an E&S focal point to be responsible of day to day implementation of the ESMS. The CDC, Anava Fund of Fund, Child Funds and the Innovatech Co- Investment Fund will maintain their respective organizational structure as necessary throughout Project implementation. 1.2 ENVIRONMENTAL AND SOCIAL ASSESSMENT, MANAGEMENT TOOLS AND INSTRUMENTS: 1.2.1 CDC will incorporate into the Project Operations Manual a clear By negotiations CDC May 8, 2019 process and structure for E&S due diligence and supervision of the Responsible FIs under the Project, which will include at a minimum the following elements: a. Applicable E&S requirements (including the Exclusion List as specified in the Bank Financing Agreement) b. E&S due diligence process to ensure that FIs under the project develop and implement their ESMS c. Clear parameters for assessing adequacy of the Responsible FIs’ ESMS TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed d. Procedures for supervision of the E&S performance of the Responsible FIs e. Procedures for periodic monitoring of E&S risks and impacts at the level of start-ups and SMEs to ensure the FIs’ ESMS is operational and effective f. Provisions for incorporating E&S requirements into financing agreements with the Responsible FIs g. Requirements and templates for E&S reporting for the Responsible FIs h. CDC staffing arrangements, capacity and responsibilities i. Arrangements for CDC’s annual E&S reporting to the World Bank 1.3 CAPACITY BUIDING PLAN: CDC will prepare an E&S Capacity Building Before Investment of CDC Plan that shall include clear timeframe and budget for building capacity the CDC into Anava and enhancing ESRM systems of Anava Fund of Funds, Child Funds and Fund of Fund and Innovatech Co-Investment Fund. Innovatech Co- Investment Fund 1.4 NON-INVESTMENT ACTIVITIES: CDC and Smart Capital (Anava Fund of During project CDC and Smart Capital Funds and Innovatech Co-Investment Fund management company) will implementation as prepare requirements and TORs for non-investment activities which will appropriate incorporate relevant references to E&S Standards. TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed 1.5 Reporting by FIs 1.5.1 REPORTING TO CDC: Smart Capital will submit annual E&S Annually Smart Capital performance reports for the Anava Fund of Funds and Innovatech Co- Investment Fund to the CDC within 45 days after end of the calendar year 1.5.2 REPORTING TO WB: CDC will submit annual E&S performance CDC reports to the World Bank within 60 days after end of the calendar year Annually ESS 2: LABOR AND WORKING CONDITIONS Labor Management Procedures: CDC will implement its institutional Recurrent obligation CDC Labor Management Procedures including Occupational Health and Safety throughout Project (OHS) measures and related measures on emergency preparedness and implementation response and grievance mechanisms for its own workforce Smart Capital (fund management company of the Anava Fund of Funds Preparation of LMP is Smart Capital and Innovatech Co-Investment Fund) will prepare and implement Labor a condition of Management Procedures for its own workforce in accordance with ESS2 investment by the including Occupational Health and Safety (OHS) measures and related CDC into Anava Fund measures on emergency preparedness and response) and grievance of Funds and mechanisms for their own workforce. Innovatech Co- Investment Fund. Once prepared, implementation is a recurrent obligation TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed during project implementation. All Child Funds that will receive funds for investments from Anava Fund Preparation of LMP is All Child Funds of Funds will prepare and implement Labor Management Procedures for a condition of receiving financing for their own workforce in accordance with ESS2 including Occupational Investment of Anava investments from Health and Safety (OHS) measures (and related measures on emergency Fund of Funds into the Anava Fund of Funds preparedness and response) and grievance mechanisms for their own Child Funds. Once workforce. prepared, implementation is a recurrent obligation during project implementation ESS 3: RESOURCE EFFICIENCY AND POLLUTION PREVENTION AND MANAGEMENT Measures and Actions to be included if related risks materialize during implementation ESS 4: COMMUNITY HEALTH AND SAFETY Measures and Actions to be included if related risks materialize during implementation ESS 5: LAND ACQUISITION, RESTRICTIONS ON LAND USE AND INVOLUNTARY RESETTLEMENT Measures and Actions to be included if related risks materialize during implementation TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed ESS 6: BIODIVERSITY CONSERVATION AND SUSTAINABLE MANAGEMENT OF LIVING NATURAL RESOURCES Measures and Actions to be included if related risks materialize during implementation ESS 7: INDIGENOUS PEOPLES/SUB-SAHARAN AFRICAN HISTORICALLY UNDERSERVED TRADITIONAL LOCAL COMMUNITIES Measures and Actions to be included if related risks materialize during implementation ESS 8: CULTURAL HERITAGE Measures and Actions to be included if related risks materialize during implementation ESS 9: FINANCIAL INTERMEDIARIES ESMSs 1.2.2 Smart Capital will develop for the Anava Fund of Funds an Condition of Smart Capital institutional ESMS appropriate to its function as a wholesale financial Investment of the CDC intermediary and, as needed, link it in the Project Operations Manual. It into Anava Fund of will provide a clear process and structure for E&S due diligence and Fund supervision of the child funds it will invest in, which will include at a minimum the following elements: a. Applicable E&S requirements (including the Exclusion List as specified in the Bank Financing Agreement b. E&S due diligence process to ensure that Child Funds develop and implement their ESMS TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed c. Clear parameters for assessing adequacy of the Child Funds’ ESMS (e.g. adequacy of the E&S policies and procedures, completeness applicable E&S requirements, staffing, technical capacity, reporting arrangements, adequacy of investment documentation maintained) d. Procedures for supervision of the E&S performance of the Child Funds e. Procedures for periodic monitoring of E&S risks and impacts at the level of start-ups and SMEs to ensure the Child Funds’ ESMS are operational and effective f. Provisions for incorporating E&S requirements into investments in Child Funds g. Requirements and templates for E&S reporting for the Child Funds h. Fund of Fund manager staffing arrangements, capacity and responsibilities i. Provisions for revision of policies and procedures under the ESMS in case E&S requirements of new investors need to be integrated j. Arrangements for Fund of Funds’ E&S reporting to the CDC TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed All Child Funds receiving financing for investments from Anava Fund of Condition of All Child Funds Funds will develop and implement an ESMS acceptable to the World Bank investment by Anava receiving investments and approved by its senior management or Board of Directors, as Fund of Fund into the from Anava Fund of appropriate, and will disclose relevant parts of their ESMS on their Child Funds Funds website Smart Capital will develop and implement an ESMS for the Innovatech Condition of Smart Capital Co-Investment Fund that is acceptable to the World Bank and approved investment by the by its senior management or Board of Directors, as appropriate, and will CDC into the disclose relevant parts of the ESMS on its website Innovatech Co- Investment Fund Smart Capital will formally endorse and adopt at its senior management Condition of Smart Capital level the E&S Capacity Building Plan prepared by CDC for building investment by the capacity and enhancing ESRM systems of Anava Fund of Funds, Child CDC into Anava Fund Funds and Innovatech Co-Investment Fund. of Funds and the Innovatech Co- Investment Fund FI ORGANIZATIONAL CAPACITY AND SENIOR MANAGEMENT REPRESENTATIVE Smart Capital (fund manager of the Anava Fund of Fund and Innovatech Condition of Smart Capital Co-Investment Fund) will designate a senior management representative investment by the to have overall accountability for environmental and social performance. CDC into Anava Fund The representatives of senior management will designate an E&S focal of Funds and point to be responsible of day to day implementation of the ESMS TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed Innovatech Co- Investment Fund The Child Funds that will receive investments from Anava Fund of Funds will each designate a senior management representative to have overall Condition of Child Funds that accountability for environmental and social performance. The investment by the receive investments representative of senior management will designate an E&S focal point to Anava Fund of Fund from Anava Fund of be responsible of day to day implementation of the ESMS. into the Child Funds Fund Anava Fund of Fund and Innovatech Co-Investment Fund (Smart Capital) Recurrent obligation Smart Capital and and Child Funds will each maintain their respective organizational throughout Project Child Funds structure as necessary throughout Project implementation. implementation ESS 10: Stakeholder Engagement and Information Disclosure CDC will implement the Stakeholder Engagement Plan for the Project, Recurrent CDC including arrangements for grievance mechanism. Once Anava Fund of Funds and Innovatech Co-Investment Fund are Condition of CDC established, the CDC will update and disclose the Stakeholder investment by the Engagement Plan to confirm roles and responsibilities of responsible CDC into Anava Fund financial intermediaries in the Stakeholder Engagement Plan for the of Funds and Project. TUNISIA INNOVATIVE START-UPS AND SMEs PROJECT DRAFT ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN DATE: 4/29/2019 Summary of the Material Measures and Actions to Mitigate the Timeframe Responsibility / Date of Completion Project’s Potential Environmental and Social Risks and Impacts Authority and Resources/Funding Committed Innovatech Co- Investment Fund The CDC will thereafter implement updated Stakeholder Engagement Recurrent obligation Plan throughout project implementation. throughout Project implementation