To reduce working capital shortages brought on by the COVID-19 pandemic to RZD group.
The project would support JSC “Russian Railways” (“RZD”) against adverse effects of the COVID-19 pandemic. The loan, which is being financed under AIIB’s COVID-19 Crisis Recovery Facility (Facility), will help cover working capital needs complementing other funding sources.
AIIB’s Environmental and Social Policy (ESP) applies to this free-standing Project. The Project is designed to support RZD’s operational continuity, and the use of the loan’s proceeds will be restricted to financing payroll across RZD operations. Consequently, the Project has been placed in Category C as it is not presenting any new environmental or social risks and is not expected to have adverse environment and social (E&S) impacts.
While this Project is limited to payroll expenses, and does not cover RZD’s broader activities, it is noted that in order to address the significant E&S risks and impacts induced by its broader activities, RZD has published a Policy on labor, environmental protection and industrial and fire safety, defined environmental targets, established a comprehensive labor management system, defined responsibilities and allocated substantial resources to E&S management.
RZD established the COVID Situation Centre in April 2020 to coordinate a COVID-19 response across its own organization, and with regional situation centers, authorities and external organizations, ensure the diffusion of information, oversee the implementation of the response measures, and monitor their effectiveness as well as infection cases among employees for reporting to RZD management. RZD took practical measures ranging from changing work patterns to remote working for office workers, distribution of personal protective equipment to all personnel exposed to risk of infection in accordance with recommendations of the relevant authorities, disinfecting of all surfaces and where possible, such as in modern railway carriages, of circulated air, COVID-19 testing for employees, and temperature checking for all passengers, etc.
RZD discloses its environmental policy and programs in summary in English and in Russian and its social policies, in particular employment and gender related policies, in summary in English and in Russian on its website. RZD issues an annual Sustainability Report in accordance with the international Global Reporting Initiative (GRI) standard. Since the Project will not induce any new and/or significant environmental and social risk or impact, no Project-specific environmental and social disclosure will be required besides continued annual reporting to acceptable standards. RZD discloses contact details where it can be reached for inquiries or complaints, as well as an Anti-Corruption Hotline that can also be used for filing any complaint on RZD, including its E&S performance.
Under the Project, RZD will monitor and report to AIIB on RZD’s resilience in maintaining its headcount during the COVID-19 crisis, maintaining the quality of employment of its personnel and minimizing the exposure to and effects of the COVID-19 virus on its personnel. Relevant information on COVID-19 response will be included in the upcoming Sustainability Reports for as long as relevant during the tenor of the loan.
Victor Salgado
Senior Portfolio Management Officer
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