Inplast S.A

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Project Number: 
AR3858A-01
Expected Consideration Date by the Board: 
06/17/2008
Date Posted: 
05/15/2008
Company: 
Grupo Inplast S.A.
Sector: 
Construction, Materials, and Fixtures
Location: 
Argentina and Brazil
Scope Objective: 

Grupo Inplast is making investments to remain at the forefront with the products it manufactures. The group is also seeking to consolidate its position after several years of rapid growth posted by its subsidiaries in Argentina (Bandex S.A.) and Brazil (Braspack S.A.). Bandex grew by investing heavily in new infrastructure, facilities, machinery, and equipment. Braspack also made significant capital investments over the past few years, primarily for the purchase of fixed assets from Spain for its PVC product plant. Most of these investments were financed by short-term debt because there are few sources of long-term debt on reasonable terms.

 

With this proposed operation, the IIC will help the company improve its financial profile, the term matching of its borrowings and long-term investments, and its debt repayment schedule. The resulting decrease in the company’s financial costs will free up resources for reinvesting in its plans for growth.

 

Environmental Review: 

Classification: This is a Category III project according to IIC’s environmental review procedure because it could produce certain effects that may be avoided or mitigated by following generally recognized performance standards, guidelines, or design criteria. The main environmental and labor considerations related to the project include liquid effluent management, air emissions, solid waste management, fire safety, personal safety, and emergency response. The group has three plants: two in Argentina and one in Brazil. The plants in Argentina, in Buenos Aires and San Luis provinces, are ISO 9001:2000 certified. The San Luis plant is also ISO 14001:2004 certified. The group is working on completing the entire certification process for its three plants.

Liquid Effluents. The group’s plants produce no environmentally harmful complex industrial effluents because most of the processes are dry (extrusion and thermoforming). Some of the processes use cooling water, but it is recirculated in closed circuits instead of being discharged. What effluents there are come from the employee restrooms.

Other liquid waste generated during the industrial process (lubricants) is sent to authorized recycling plants.

 

Solid Waste Management. The thermoforming process produces a considerable volume of scrap. Almost all of this material is recovered by shredding and extrusion. The percentage of recycled raw material that can be mixed with virgin raw material is high enough to use all of the scrap produced when the containers are formed. A very small percentage of the scrap is discarded because it is contaminated (swept off the floor) and is picked up by authorized companies along with other solid waste, such as discarded packing materials.

Air Emissions. The company has replaced chlorofluorocarbons with butane for making polystyrene foam in order to avoid emitting ozone-depleting gases. The use of butane does not pose a direct risk for workers’ health nor for the environment. However, it does increase the risk of fire and necessitates other safety measures. The company takes gas measurements at its plants.

The plants have diesel and natural gas generators to produce electricity during blackouts or brownouts.

 

Fire Safety, Personal Safety, and Emergency Response. All the industrial plants have fire detection and firefighting systems according to the specific needs of each area and the products stored there. All of the plants have a water-based firefighting system. There are also safety brigades who train regularly with the fire department.

 

The company has manuals that set out its environmental management and risk prevention policies, implementation plans, and monitoring procedures. There are group-based accident prevention incentive programs.

 

Labor Practices. Inplast complies with national labor laws. Mandatory core labor standards include social security benefits, freedom of association, organization of workers’ unions, prohibition of forced labor and exploitative and abusive child labor, and nondiscrimination in the workplace. Approximately 50% of Bandex’s employees belong to the Unión de Obreros y Empleados del Plástico labor union.

Control and Follow-Up. Inplast shall develop an Environmental Management Plan (EMP) to ensure compliance with domestic regulations and the IIC’s environmental and workplace health and safety guidelines. The EMP shall provide for a yearly report on solid waste management; health, occupational safety, and emergency response training; and accident reporting.

ADDENDUM

LEPI Ltda. (LEPI) is a Uruguayan company, part of Argentina’s Grupo Inplast, that imports and distributes plastic containers in Uruguay for the food industry. The company has a single warehouse for storing its products, from which they are distributed to the end customer. It also has vehicles for distributing the products.

Environmental Review:

Environmental and Labor Issues:

This is a category B project according to the IIC’s Environment and Social Sustainability Policy because it could have certain effects that may be avoided or mitigated by following generally recognized performance standards, guidelines, or design criteria. The main environmental and labor considerations related to the project are: efficient resource use and pollution prevention, workplace and labor conditions, and community health and safety.

Waste Management: The company does not generate significant waste, as it simply imports and stores products but does not process them. However, any waste from packaging materials (plastic, cardboard, wood) is turned over to recyclers. Products that are defective or no longer usable are destroyed and utilized as raw material for the manufacture of other plastic goods.

Personal Safety and Emergency Response: LEPI distributes plastic containers that pose a medium-level environmental risk from the standpoint of fire hazards. The company warehouse has a fire detection and alarm system and a pressurized sprinkler network licensed by the National Department of Firefighters (Dirección Nacional de Bomberos). The fire detection system has smoke detectors and optical barriers, in addition to manual pushbutton alarms. The electricity supply is separate.

Labor Practices: The company complies with domestic labor laws. Core labor standards include social security contributions and health insurance benefits, freedom of association, organization of workers’ unions, prohibition of forced labor, elimination of exploitative and abusive child labor, and nondiscrimination in the workplace. LEPI employees do not belong to a labor union. In accordance with Uruguayan law, workers and their dependents receive medical coverage through the National Health Fund (FONASA), as well as insurance against workplace accidents and occupational illnesses.

Monitoring and Reporting: Grupo Inplast companies shall prepare an Environmental Management Plan (EMP) to ensure compliance with domestic regulations and the IIC’s environmental and workplace safety and health guidelines. The actions stipulated in the EMP include implementation of an emergency response and fire prevention plan. The EMP that is implemented shall extend to LEPI and include the preparation of an annual progress report on the main aspects of the plan.