Provision of up to EUR 120 million senior loan to the German retail chain Schwarz Group (Schwarz, or the Group), including up to EUR 70 million for investments in Greece and up to EUR 50 million in Moldova.
The proceeds of the loan will be used to support the 2020-2021 investment programme of the Group focusing on the development of Lidl stores in Greece and Kaufland stores in Moldova.
ETI score: 70
The transition impact of the transaction will be derived from:
- Inclusive (primary): the project will develop and deliver training programmes targeting young people in Greece and implement a dedicated recruitment and integration programme for disabled workers in Moldova.
- Green (secondary): the project will support the Group in (1) improving its climate corporate governance and (2) increasing the sustainability standards of its new supermarkets in Greece and Moldova through the installation of best practice resource efficiency technologies and international green building certification.
LIDL HELLAS AND SIA OE
Lidl Hellas & SIA O.E., Kaufland SRL, 100% subsidiaries of the Group
EBRD Finance Summary
Total Project Cost
Sources of additionality are related to standard-setting and helping projects and clients achieve higher standards: The Bank provides expertise on higher environmental standards and on energy and resource efficiency measures above 'business as usual'. The Bank is also able to provide non-financial guidance to the Group to increase access to economic opportunities for youth and disabled workers.
Environmental and Social Summary
Categorised B. The Project has been categorised B under the 2014 Environmental and Social Policy. The environmental and social impacts associated with the construction and operation of retail stores in Greece and Moldova are readily identified and managed. Environmental and social due diligence was undertaken by ESD based on information provided by Kaufland headquarters, a visit of a retail store in Chisinau for Moldova, and previous due diligence and monitoring outcomes for Greece. Previous due diligence in various countries has demonstrated Lidl's and Kaufland's capacity and systems to manage environment, health, safety and labour issues in the development and operation of stores in compliance with the Bank's PRs. Due diligence for the proposed project in Moldova demonstrated capacity of the Kaufland team to manage E&S issues at a national level and did not identify any areas of material non-compliance. However a few requirements related to labour conditions, energy efficiency and contractor supervision will have to be implemented. The E&S due diligence in Greece did not identify any gap with the PRs.
The scope of the ESDD in Moldova covered environmental and social management at national level. All permits for the construction and operation of the seven stores are obtained or in the process of being obtained. Kaufland requests every contractor to sign a Code of Conduct, which covers non-discrimination, forced labour and child labour, freedom of association, wages and overtime, occupational health and safety, protection of the environment, and corruption. Kaufland's human resources policies are found in the "Internal Regulations" document, and are aligned with PR2. Kaufland is planning to organise election of worker representatives and negotiate a collective agreement in the next three years, and an employee satisfaction survey will be conducted yearly (starting in 2020). The visit to the store in Chisinau suggested that working conditions are adequate and employees are generally satisfied. Kaufland's environmental management and resource efficiency is well integrated in key activities such as store design and construction, and is generally in line with PR3. There is a plan to get ISO50001 certification and EDGE certification for all stores in Moldova. During the construction works, Kaufland hires a company specialised in occupational health and safety to monitor the works. The plots for the new stores are purchased from Developers, who are responsible for supplying land that is free of any legal liabilities (including environmental legacies). Most of the plots are in previous industrial sites and located in urban areas. A grievance mechanism and a reclamation register are in place (same mechanism).
The scope of the ESDD in Greece covered environmental and social management at national level, and was based on the outcomes of the due diligence of the previous transaction with Lidl Greece and their 2019 Annual Environmental and Social report. Lidl Greece policies and environmental and social management system will continue to apply to the construction and operation phases of this Project (including for instance the Construction Agreement covering Health and Safety and the Code of Conduct).
The Bank's environmental and social monitoring will continue to rely primarily on annual reporting, while reserving the possibility of undertaking site visits if necessary.
Technical Cooperation and Grant Financing
Company Contact Information
Schwarz Dienstleistung KG
Sekretariat Finanzen Stiftsbergstr. 1 74172 Neckarsulm Germany
PSD last updated
21 Jan 2020
Further information regarding the EBRD’s approach to measuring transition impact is available here.
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Environmental and Social Policy (ESP)
The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”. The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social 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 additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from 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 activities of the Bank 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 Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.
OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to email@example.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. 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 sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.
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Independent Project Accountability Mechanism (IPAM)
If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. 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 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; how to submit a Request for review; or contact IPAM via email firstname.lastname@example.org to get guidance and more information on IPAM and how to submit a request.