About Skyline SACCO Society

Skyline SACCO Society is a financial cooperative institution regulated by SASRA, committed to supporting the economic and social welfare of its members. The SACCO provides financial services such as savings, loans, and investments with a focus on sustainable development that respects both environmental and social responsibilities.

Skyline SACCO Society Environmental and Social Policy (E&S Policy)

Purpose and Objectives

The purpose of this Environmental and Social Policy is to provide a comprehensive framework for incorporating environmental and social considerations into the decision-making processes of Skyline SACCO Society. This policy is aligned with the KDC Wholesale Lending Policy and the World Bank Environmental and Social Standards.

The policy aims to:

1. Ensure that all projects financed by Skyline SACCO contribute to positive environmental and social outcomes.
2. Mitigate potential risks to the environment and society, ensuring that financed projects are sustainable, equitable, and do not cause harm to the community or ecosystem.

Scope

This policy applies to all projects that are funded, facilitated, or supported through lending by Skyline SACCO Society.

It covers all geographic regions where SACCO operates and encompasses all sectors of financing, such as infrastructure, agriculture, renewable energy, and community development.

Environmental and Social Commitments

Skyline SACCO Society is committed to:

1. Environmental Stewardship: Ensuring that projects financed by the SACCO contribute to environmental sustainability, minimize adverse environmental impacts, and promote the conservation of natural resources.
2. Social Equity and Inclusion: Promoting the rights and well-being of vulnerable groups such as women, children, marginalized communities, and workers. All projects financed by the SACCO will respect human rights and aim to improve social outcomes.
3. Stakeholder Engagement and Transparency: Engaging stakeholders, including local communities, civil society organizations, and other affected parties, through meaningful consultation and ensuring transparency in decision-making processes.
4. Compliance with Standards: Aligning operations with national regulations, the KDC Wholesale Lending Policy, and the World Bank’s Environmental and Social Standards (ESS).

Environmental and Social Reference Framework

National Laws and Regulations

All subproject activities financed and supported under KDC funds must comply with the relevant national regulatory requirements. This includes environmental and social regulations that apply within the country or region of operation.

Exclusion List

The Exclusion List, included in the Annex, identifies activities that Skyline SACCO will not finance. These include:

• Activities that cause physical or economic displacement.
• Activities with adverse impacts on biodiversity or cultural heritage.
• Activities involving illegal trade or practices that violate fundamental workers’ rights.

World Bank’s Environmental and Social Standards

Projects financed under Skyline SACCO’s framework will follow the World Bank’s Environmental and Social Standards (ESS), which include the following:

• ESS 1: Assessment and management of environmental and social risks and impacts.
• ESS 2: Labor and working conditions.
• ESS 3: Resource efficiency and pollution prevention and management.
• ESS 4: Community health and safety.
• ESS 5: Land acquisition, restrictions on land use, and involuntary resettlement.
• ESS 6: Biodiversity conservation and sustainable management of living natural resources.
• ESS 7: Indigenous Peoples/Sub-Saharan African Historically Underserved Traditional Local Communities.
• ESS 8: Cultural heritage.
• ESS 9: Financial intermediaries.
• ESS 10: Stakeholder engagement and information disclosure.

Additionally, the World Bank Group General Environmental, Health and Safety Guidelines and sector-specific EHS Guidelines will be followed.

Environmental and Social Procedures

The Environmental and Social Procedures provide the steps for identifying, managing, and mitigating potential environmental and social risks in subprojects.

Step 1: Initial Screening and Subproject Categorization

Each subproject will undergo an initial screening process and will be categorized based on its potential environmental and social impacts:

• Category A: Projects with significant adverse environmental or social impacts that are diverse, irreversible, or unprecedented.
• Category B: Projects with limited adverse environmental or social impacts that are site- specific and can be mitigated.
• Category C: Projects with minimal or no adverse impacts.
• Category FI: Investments made through financial intermediaries.

Step 2: Environmental and Social Due Diligence

Skyline SACCO will conduct a thorough due diligence process for each subproject to assess potential environmental and social risks, and ensure that these are addressed appropriately.

Step 3: Legal Agreements

Legal agreements for each subproject will include Environmental and Social Action Plan (ESAP) provisions to ensure the implementation of the Environmental and Social Management Plan (ESMP) and ongoing compliance with the applicable standards.

Step 4: Stakeholder Consultation

Skyline SACCO will advise members to engage in meaningful consultation with stakeholders, especially affected communities, and document the process and outcomes as part of the Social Impact Assessment (SIA) and Stakeholder Engagement Plan (SEP).

Environmental and Social Supervision

Once a subproject is in the portfolio, Skyline SACCO Society will actively monitor it’s environmental and social performance to ensure ongoing compliance with the World Bank’s Environmental and Social Framework (ESF) and the conditions set out in the subproject’s approval.

Annex

Exclusion List

List of Activities that Skyline SACCO will not finance:

1. Activities resulting in permanent or temporary physical or economic displacement.
2. Activities with adverse impacts on biodiversity or living natural resources.
3. Activities impacting cultural heritage as defined under ESS8.
4. Activities that lead to long-term, irreversible, and/or irreversible risks.
5. Illegal trade or activities that violate national or international law.
6. Production or trade in banned or phased-out pesticides/herbicides.
7. Activities that violate workers’ fundamental rights, including forced labor, child labor, or discrimination.
8. Activities that involve lands claimed by indigenous peoples without informed consent.
9. Any activities excluded under the Environmental and Social Management Framework (ESMF) for the project.

By adopting this Environmental and Social Policy, Skyline SACCO Society ensures that all its projects and investments are environmentally sound, socially responsible, and aligned with both national regulations and the global standards set by the World Bank’s Environmental and Social Standards.