Defacto (f. Project De Jure III)

Overview
Project Summary Document
Environmental and Social Documentation
Procurement
Complaints

Overview

EBRD has purchased a minority stake in DeFacto Perakende Ticaret A.S. ("DeFacto" or the "Company"), a global apparel retailer based in Türkiye with operations in more than 90 countries. The Bank's equity investment amounted to USD 59 million.

Project ID 53938

Status Signed

Location

Türkiye

Business Sector

Manufacturing and Services

Notice Type

Private

Project timeline

Exploratory
Passed Concept Review
Passed Structure Review
Passed Final Review
Board Approved
Signed
Implementing
Completed

Company Contact Information

Onder Senol
Onder.Senol@defacto.com.tr
+90 212 7051212
+90 212 8865129
www.defacto.com.tr
DeFacto Plaza Basın Ekspres Yolu Bahariye Cad. No.31 34303 Halkali Kucukcekmece / Istanbul

Project ID 53938

Status Signed

Location

Türkiye

Business Sector

Manufacturing and Services

Notice Type

Private

Approval Date

15 Nov 2022

Disclosure date

19 Jan 2023

As permitted by paragraph 2.6 of Section III of the Access to Information Policy, disclosure of this PSD was deferred in accordance with paragraph 1.4.4 of the Directive on Access to Information.

Defacto (f. Project De Jure III) (Turkish) (PDF, 0.08MB)

Project description

Project objectives

The Project will support the international growth of the Company and promote economic inclusion and gender equality.

Transition impact

ETI Score:67

expected transition impact of the Project will stem from its contribution to the Integrated and Inclusive qualities, namely supporting the Company to (i) expand into new international markets in addition to expanding its footprint in existing export markets in the EBRD region and, (ii) upgrade its HR policies and practices to better recruit, train and retain workers with disabilities, increasing their share from 3% to 5% across its manufacturing, retail and front-office operations.

Client information

DEFACTO PERAKENDE TICARET AS

DeFacto is a global apparel retailer established in Türkiye with operations in more than 90 countries across 5 continents. The Company has over 300 domestic and 200 international stores, employing over 15,000 people. The Company's product offering is affordable apparel across a broad range of categories (men, women, kids, accessories and footwear).

EBRD Finance Summary

USD 59,000,000.00

Additionality

The expected additionality stems from the following sources: (i) Risk mitigation: EBRD's engagement provides comfort and reassurance for the Company's expansion plans and, (ii) Standard-setting: EBRD will provide technical support on improving HR policies and practices towards disabled workers alongside expertise on gender inclusion.

Environmental & Social Summary

Category B (2019 ESP). Due diligence was carried out as part of the Project Appraisal and confirmed that the environmental and social risks associated with an equity investment into this garment manufacturing, distribution and retail company are site specific; are well understood by the client and the Bank; and can be mitigated using standard industry good practice. The client has a well-developed EHSS risk management framework and has the capacity and capability to operate in line with the Bank's Performance Requirements. The due diligence was carried out over an extended period of time and has shown that the client has maintained the high standard of EHSS risk management, including risk assessments of suppliers and service providers through the supply chain.

The Bank's due diligence included a detailed review of the Sustainability Reporting that is published by the Company; discussions and Q&A with the Company management and key staff responsible for EHSS issues; and a series of site visits to retail outlets in Istanbul, the main distribution centre in Kapakli, and the two garment manufacturing plants in Sivas. The assessment process also included a review of the historic development of the expansion and amendment of the corporate EHSS standards; and future plans for further enhancement of EHSS performance.

The company's policies and procedures are aligned with the Bank's PRs, although continued alignment and review of these processes will be included in an updated ESAP which has been agreed with the client. Of particular note in terms of recent developments, the company has significantly expanded its efforts in recycling, both of packaging and product, enhancing its performance in terms of the concept of Circular Economy. The other notable change is in respect to the management of supply chain risk. The client has now developed an independently audited programme whereby all suppliers must qualify onto the programme, and maintain that qualification, through demonstration of assessment of supply chain risks throughout the chain to source where possible.

As stated, an updated ESAP will allow the client to remain in compliance with the PRs going forward and remain in front of the developing knowledge of supply chain issues.

Technical Cooperation and Grant Financing

The Project will enable the Company to access EBRD's technical support and expertise on improving HR policies and practices in order to recruit, train and retain a greater number of disabled workers in order to fulfil its human resources-related ambitions and business goals. TC of up to EUR 70,000 will be provided under the Gender and Economic Inclusion TC Framework, drawing on funding secured from EBRD's Special Shareholder Fund, for development and implementation of a Disability Inclusion Action Plan to align HR improvements at the company level with international best practice standards. A client cost contribution of 15 percent has been agreed.

Company Contact Information

Onder Senol
Onder.Senol@defacto.com.tr
+90 212 7051212
+90 212 8865129
www.defacto.com.tr
DeFacto Plaza Basın Ekspres Yolu Bahariye Cad. No.31 34303 Halkali Kucukcekmece / Istanbul

PSD last updated

19 Jan 2023

Understanding transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with the EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and its associated Environmental and Social Requirements (ESRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”. The ESP and the ESRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation, and to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about the environmental and social (E&S) performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD also requires its clients to disclose information, as appropriate, about the risks and impacts of projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all of the Bank's activities in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The EBRD believes that identifying and resolving issues in the project assessment and approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts andhelps to monitor integrity risks in projects post-investment.

OCCO is further responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, either within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. OCCO will follow-up all matters reported. It will review all matters reported. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP, which entered into force on 1 January 2025, sets out how the EBRD discloses information and consults with its stakeholders to promote better awareness and understanding of its strategies, policies and operations. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (for example, through the client’s project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the mechanism is: to support dialogue between project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or the project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate and how to submit a Request for review. Alternatively, contact IPAM by email at ipam@ebrd.com for guidance and more information on IPAM and how to submit a request.

Environmental and Social Documentation is not available for this project.

Selected procurement notices related to this project may be shown below. Further procurement opportunities related to this and other projects, if available, maybe be viewed in the EBRD Procurement Portal.

The EBRD's Environmental and Social Policy (ESP), Access to Information policy (AIP) and Project Accountability Policy (PAP) enable sound and sustainable development in its projects. The Independent Project Accountability Mechanism (IPAM) deals with complaints about environmental, social and disclosure matters related to the Bank’s investments.

No complaints about this project have been made so far.

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Defacto (f. Project De Jure III)

Overview

Project timeline

Company Contact Information

Project description

Project objectives

Transition impact

Client information

EBRD Finance Summary

Additionality

Environmental & Social Summary

Technical Cooperation and Grant Financing

Company Contact Information

PSD last updated

Understanding transition

Business opportunities

General enquiries

Environmental and Social Policy (ESP)

Integrity and compliance

Access to Information Policy (AIP)

Independent Project Accountability Mechanism (IPAM)