Provision of EUR 40 million senior loan to German retail chain, Schwarz Group (Schwarz, or the Group).
- Support energy efficiency improvements and refurbishment of selected Lidl supermarkets in Greece.
- Support the construction of three new green stores, promoting Lidl's green store concept and supporting deployment of best available technologies for resource efficiency.
ETI score: 64
Transition impact of the transaction will be derived from:
- applying advanced industry standards of energy efficiency and resource management across various operations, e.g. green building standards, logistics, and sustainable retail practices in Greece;
- support towards implementation of the Group's plastic waste strategy, in particular through encouraging packaging waste reduction and innovation along food value chains, cooperation with the Group in the economies where the EBRD invests.
- working with the Group and relevant stakeholders in Greece towards increasing the awareness about food waste and decreasing levels of food waste.
LIDL HELLAS AND SIA OE
Lidl Hellas & SIA O.E., a 100% subsidiary of the Group
EBRD Finance Summary
Total Project Cost
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, refurbishment and operation of retail stores and warehouses are readily identified and managed.
Environmental and social due diligence was undertaken by ESD based on information provided by Lidl Hellas at headquarters in Thessaloniki. Further, information was reviewed about past performance of existing Kaufland and Lidl investments in Poland, Romania and Bulgaria, related annual reporting and labour audits undertaken in 2008 (covering Poland), 2009 and 2013 (both covering Romania and Bulgaria), and in 2017 in Poland.
Previous due diligence 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 demonstrated capacity of the Lidl Hellas team to manage E&S issues at a national level.
The scope of the ESDD covered environmental and social management at Greek level. No material non-compliances were identified during the due diligence with regards to EBRD PRs, including with regards to labour and working conditions (PR2). ESD reviewed documentation provided by Lidl Hellas, mainly pertaining to environmental and resource efficiency matters, human resources management, and health and safety. Additional information requested following the site visit was provided to ESD.
Lidl has a Code of Conduct in place that equally applies to its own operations, its contractors and its suppliers. Lidl is a member of the joint initiative "Business Social Compliance Initiative" (BSCI) within the framework of the European Foreign Trade Association, which aims to improve the core social standards practiced by its Business Partners across all countries. There is a CSR team in place and Lidl's Sustainable Development Strategy is based on the UN-Sustainable Development Goals.
Greek suppliers represent 60% of Lidl Hella's suppliers. Detailed E&S standards for suppliers and contractors are planned to be developed at mid-term. The Code of Conduct covers labour and working conditions, and requests each Contractual Partner to agree to implement the same social and environmental standards.
Lidl Hellas is certified as Top Employer Greece 2018 and Top Employer Europe 2018, following an independent research of HR management and employee conditions. A grievance mechanism is in place for Lidl employees and the visit to two stores in Thessaloniki suggested that working conditions are adequate and employees are generally satisfied.
Lidl Hellas' approach to 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 by end 2018. Projects to reduce plastic and food waste are under consideration. All stores and warehouses in Greece will get EDGE certification (Green Buildings) by end 2019.
An Occupational Safety Risk Assessment study is performed for each store. Regular health and safety inspections are conducted by the State Authorities at stores and warehouses.
Lidl disclosed its first CSR report in 2017 and is planning to publish one every 2 years. The report covers monitoring of environmental performance, stakeholder engagement, CSR programs implementation, etc.
Lidl Hellas has stood out as one of the most sustainable companies in Greece according to the Corporate Responsibility Institute and the rating criteria of the Corporate Responsibility Index. It also implements for the third consecutive year a socio-economic impact report in cooperation with Ernst and Young to reveal the value added in the entire value chain and the contribution to the country's GDP, tax revenues, job opportunities, society, environment, stakeholders and Greek suppliers.
It is also scheduled to execute the first Social Return on Investment (SROI) report to reflect the social value of its investment for supporting the Center of Hospitality for Children and their Families in Attica.
The E&S due diligence did not identify any areas of material non-compliance, but based on interviews and in the context of the number of new stores to be built in the coming years, it is recommended that additional efforts be undertaken to strengthen health and safety performance in-house and increase supervision of construction contractors in this area as well.
Annual reporting on environment and social matters to date has been variable and improvements in the scope and content of such reports will be required. It is recommended that the development of reporting guidelines for country operations be built on to achieve such improvements and that a centralized quality assurance for reporting to EBRD be established to ensure consistency across EBRD's investments in the Schwarz Group. Predicated on such improvements, 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 D-74172 Neckarsulm Germany
EBRD financing has supported Schwarz Group's investment in energy efficient buildings and the roll out of the "Green Store Concept" in Greece. Since August 2018, Lidl Hellas has successfully completed the refurbishment and modernisation of a number of its existing stores using green innovative technologies and is on track with its expansion plan, adding new green stores in the Company's portfolio. The Project ensured adherence to strict environmental, energy-efficiency and social standards. The Company is continuing with the upgrade of its entire building stock, with its entire stock expected to be EDGE certified. As part of the Transition Impact, the Project facilitated Lidl Hellas participation in the policy dialogue for the food loss and waste, by supporting the issuance of the newly published food waste study of EBRD for Greece and promoting EBRD's Food Waste Initiative.
PSD last updated
20 Nov 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.
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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.
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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.