The Group recognises that its operations have both direct and indirect impact on the environment. An Environment and Social Policy has been established which sets out the Company’s approach on this matter. With fewer than 40 employees at Georgia Capital level, as a company we have a relatively small direct impact in terms of the environment and other sustainability issues. While across our businesses, the most direct impact on the environment is created by our Housing Development, Hospitality and Commercial Real Estate, Water Utility and Renewable Energy businesses.
Environmental consideration is an integral part of our Housing Development business, managed by m2. m2 delivers environmentally conscious products whilst being aware of the immense importance of buildings with energy efficient designs for sustainable development; new buildings present an opportunity to achieve energy savings over the long term. m2 reduces waste and pollution by using energy-efficient building materials which lead to a significant reduction in the use of electricity.
Aiming at increasing the efficient use of energy, water and materials, m2 installs energy-efficient lighting systems and uses low emission window glass and other modern insulation materials to cover the façade of the buildings. The Directorate General for Neighbourhood and Enlargement Negotiations, European Commission and Green for Growth Fund (GGF) Director, visited m2 large-scale energy-efficient project and during the visit, examined the measures that m2 is able to implement in the buildings: improved building insulation, modern boilers and appliances, and better insulated windows and doors. For the 801 apartments constructed as part of this initiative, the total
expected annual savings of CO2 are equal to planting 210,000 trees each year. This project was financed by the International Finance Corporation (IFC) and Green for Growth Fund (GGF) and supported by the EU. GGF also provided technical assistance to conduct energy audits and identify the most efficient manner to meet high energy standards. m2 develops more green spaces providing universal access to safe, green and public spaces in all projects.
In 2019, m2, together with the Tbilisi City Hall Environmental Protection Service, planted about 500 trees on the right and left banks of the river Mtkvari in the frame of the landscaping campaign. The participants in the campaign landscaped an additional territory of 1 hectare in the city.
Air quality is an immediate and acute problem in Georgian cities. To increase awareness of climate change and lead to a better living, m2 promotes the use of electric vehicles. m2 is the general partner of the start-up company E-space and funds the establishment of infrastructure for electric vehicles across the country (Tbilisi, Batumi, Kutaisi, Rustavi, Kvareli and Telavi) through the “More Oxyge for the City” campaign aiming to install 100 EV (electric vehicle) chargers in Georgia. EV chargers will be gradually installed in each residential complex and gifted to the residents.
Water utility and renewable energy businesses, managed by GGU, are in compliance with the current Georgian Environmental legislation, as well as environmental monitoring and control procedures. GGU’s environmental activities strongly and directly support the Georgian Government with the implementation of a national obligation under the EU Association Agreement. Furthermore, GGU’s environmental activities directly address UN Sustainable Development Goals under the 2030 Agenda for Sustainable Development, adopted by all United Nations Member States in 2015. The UN Sustainable Development Goals address the global challenges the company faces, including those related to poverty, inequality, climate, environmental degradation, prosperity, peace and justice. It is important that each goal and target is achieved by 2030. GGU is also strongly committed to introducing sustainable water management practices and carrying out water utility business operations that consider the principles of green economy, which targets increasing the country’s welfare with minimum environmental impact and maximum resource efficiency. Since sustainable water management encompasses maximisation of resource efficiency, GGU’s urban water management includes the production and treatment of water resources, as well as reduction in energy and material resource consumption and lower emission levels related to Water Utility operations. In order to improve efficiency, GGU invests in the upgrading of ageing infrastructure, introduces innovative technologies and implements continuous training of staff, as well as awareness-raising campaigns. GGU’s specific investments for resource efficiency maximisation include the following:
- improvement of worn-out water distribution infrastructure;
- installation of pressure regulators, with corresponding data loggers, and development of their live monitoring systems at 100 different locations throughout the city;
- hydro-modelling, which helps in minimising the energy required for extracting and distributing water;
- development of major water-loss identification mechanisms and carrying out respective repair works;
- installing new smart meters to the customer base; and
- carrying out social campaigns for educating the younger generation about responsible water consumption.
Furthermore, GGU has specific targets for decreasing its own electricity consumption for its water utility business as part of the overall KPIs set for management team. By making the investments listed above, GGU has successfully managed to decrease the self-consumed electricity consumption throughout last several years and from consumption level of 239 million KWh in 2017, GGU reached 174 million KWh in 2019. GGU intends to maintain self-produced electricity consumption in the range of 170-175KWh over the next three years.
Our water utility business is currently implementing an Environmental and Social Management System (ESMS) in accordance with the roadmap schedule presented in the Environmental and Social Policy Framework, adopted by the business in 2016, which is also in compliance with the Georgian legislation and the IFC performance standards (Environmental, Health and Safety guidelines for Water and Sanitation). The Environmental and Social Policy Statement declares that the company is committed to conduct business and provide services in a thoughtful, responsible way, with a view to preventing pollution and safeguarding the natural and social environment. It highlights that the company is dedicated to the continuous improvement of operational performance in order to reduce any adverse environmental and social impact. The Environmental and Social Policy Framework consists of a combination of Environmental and Social Policy Statement, legal and regulatory review, overview of GGU’s activities and environmental impacts, description of management system including various management plans, procedures and practices, description of the monitoring programme and the stakeholders engagement process.
In the framework of the ESMS, an environmental and social audit of the GGU was performed. The environmental and social audit report covered the environmental topics, mainly associated with water treatment: water distribution, sanitation (sewerage system) and wastewater treatment and discharge, as well as occupational health and safety topics related to accidents and injuries, chemical exposure and noise. To manage the risks associated with GGU’s business, the business has elaborated ESMS procedures and topical management plans, which are being implemented according to the Environmental and Social Action Plan (ESAP) in the set timeframe. Additionally, ESMS will facilitate the process of obtaining the ISO14000 standard for environmental management and the ISO26000 standard for social responsibility for all companies under the GGU.
Currently, ESMS is fully introduced at GGU. This strongly supports the organisation to enhance its environmental performance, and also to manage its environmental responsibilities in a systematic manner. In January 2020, the water utility business was certified as meeting the requirement and scope of registration – ISO14001: 2015. Similar certification process for obtaining ISO14001: 2015 for Gardabani WWTP started in February 2020.
It is recommended, that each company within the GGU group achieves the mentioned standard. Besides, the perfection of environmental performance, ISO14001:2015 will support GGU’s sustainable financing. In line with the EU classification system for environmentally sustainable economic activities (Taxonomy), in regard to the EU Green Bond Standard (EU GBS), the company will need to be Taxonomy aligned in order to be qualified as an eligible issuer of the bond. According to the Taxonomy Technical Report, a minimum requirement is the implementation and adherence to a recognised environmental management system (ISO 14001, EMAS, or equivalent).
The water utility business understands well the complexity of water management issues, which are separated into distinct topics such as Economics, Water Quality, and the Environment. In order to effectively manage drinking water security, the business invested in comprehensive researches for the development of the Integrated Water Management Plan for the Tbilisi Reservoir. In April 2019, the first part of Integrated Water Management Plan for the Tbilisi Reservoir was published. The document
was developed by Kocks Consult GmbH with co-financing from KFW/DEG (Deutsche Investitions-und EntwicklungsgesellschaftmbH). Active collaboration with the Tbilisi City Hall, the Tbilisi City Council and other stakeholders around the Tbilisi Reservoir management is on-going. As a result, a final “Integrated Water Management Plan” will be elaborated as a policy document, which will ensure high quality drinking water and sustainable use of the reservoir in general.
GGU’s various implemented projects have a direct positive impact on national and regional environments. In particular, after the rehabilitation of Gardabani WWTP, treated wastewater quality discharged into the Mtkvari River meets all applicable norms and regulations. As a result of the improved wastewater treatment process, water quality in the transboundary Mtkvari River will significantly improve, which will also support the Government of Georgia to implement international environmental agreements. In October 2019, Early Warning System (EWS) for Zhinvali HPP was successfully tested and launched. The area under the responsibility of the water utility business corresponds to the 15km downstream in the Zhinvali Dam. In order to protect population and environment, the EWS was implemented in this area. Other than drinking water supply and power generation, Zhinvali Dam plays a key role in controlling floods and other geo-hazards. It is built as a safe structure, complying with strict standards. Zhinvali HPP EWS consists of: a) high accuracy hydrological and meteorological data monitoring system, b) the warning system, covering the area that gets flooded by a warning signal within a relevant time, and c) the notification system, informing the first responders of an emergency via voice and text message.
In order to respect all the rules and instruction, and to perform regular testing and continuous maintenance of the equipment, special training for EWS management team was conducted. Zhinvali HPP EWS enables the water utility business to leverage best practices, innovative methodologies and existing assets to share actionable early warnings and build sustainability for water and climate information.
Projects implemented by our renewable energy business are also in compliance with local and international environmental standards and legislation. In 2018, the environmental and social management system (ESMS) was introduced, which is applicable to all types of renewable projects. In general, for the projects which are at the development stage, the business elaborates Environmental and Social Impact Assessment (ESIA) documentation, which also includes a scoping report and, if needed, a Resettlement Policy Framework (RFP) and a respective Resettlement Action
The renewable energy business’s Environmental and Social Policy Framework and the ESMS is based on the following principles: no pollution of water, soil and air (including dust and noise). In order to identify the arrangements necessary to prevent pollution of water, air and soil, the Pollution Prevention and Control Plan (PPCP) was developed and adopted by the group of companies at GGU and their contractors in compliance with the IFC PS3 and the WB General EHS Guidelines. The PPCP consists of the following components: Wastewater and Storm-water Management; Spill Prevention and Control; Hazardous Materials Storage and Handling; Air Emissions Management; and Dust Control and Noise Management.
Since the GGU’s business is very much dependent on such climate elements as precipitation, wind speed and air temperature, the business’s development will be affected by the climate change. Current climate changes in Georgia are assessed based on the observation data of hydro meteorological network. The prognostic scenarios for the periods of 2021-2050 and 2071-2100 were compiled using Regional Climate Model RegCM4. GGU is strongly committed to actively contributing to limiting climate change through its Environmental Policy, procedures and implementation of Environmental Management Plans. Water, Energy and Resources Management Plans were developed and adopted at corporate and site-specific levels. The objective of the plan is to ensure efficient use of water, energy and resources during construction and operation of the proposed development, thereby reducing resource consumption and greenhouse gas emissions.
GHG’s medical waste management recordkeeping standards remain in line with national legislative requirements. GHG personnel are responsible for registering the information on produced hazardous waste on the state platform and filling out waste registration and transportation forms. To further reduce risks and maintain regulatory compliance, GHG regularly conducts internal trainings on waste management procedures. At each of the company’s hospitals, there is a special storage room set up to store waste before final disposal. To prevent human or environmental harm, GHG clinics collect and dispose of medical and biological waste through a specialised outsourced service.
For waste collection, GHG uses plastic bags or containers that have sufficient strength and are secured with staples. Steam sterilisation is used to decontaminate biological and bio hazardous waste, including blood. All used sharp objects are placed in labelled, hermetically sealed single-use containers made of hard plastic. Waste is collected from GHG’s sites daily, or twice a day when required. The maximum onsite storage time is 24 hours. To ensure reliability of their contractors, GHG regularly examines monthly reports and imposes penalties if necessary. In total, GHG hospitals generated 682 tonnes of medical waste in 2019, compared to 600 tonnes in 2018.
The beer production process releases additional carbon dioxide (CO2) and wastewater that directly contribute to environment pollution and climate change. The emission implications on communities, agriculture and the availability of raw materials are complex and challenging. The beer business has responsibly reduced these implications:
- by constructing a CO2 recovery plant, which captures the carbon dioxide released during the beer production process;
- by constructing a wastewater treatment plant, that cleans wastewater chemically, biologically and physically to obtain ecologically safe wastewater.
As for direct environmental impact, we believe that the impact of the insurance businesses is not significant. Nevertheless, there are a number of measures in place within the business to reduce electricity, paper, water and fuel consumption.
The Group has in place a Code of Ethics, as well as policies which relate to environmental matters, employees, social matters, our respect for human rights and anti-corruption and bribery.
Copies of these polices can be found here.