Overview

USAID SEGAR is seeking an institution for an Environmental and Social Due Diligence Assessment for Project Rattan in Katingan District, Central Kalimantan.  This assignment is based on the anticipated USAID additional budget and is subject to SEGAR contract modification, which potentially starts in December 2023 through March 2024, and is engaged through a fixed-price subcontractor agreement.  Application Code: RFP 050.

Context

USAID Sustainable Environmental Governance Across Regions (SEGAR) is a five-year Activity designed to advance Indonesia´s development objectives in balancing biodiversity conservation and sustainable land use with inclusive economic and livelihoods development. USAID SEGAR works collaboratively with multi actors in the twelve targeted subnational jurisdictions to improve the management of high conservation values (HCV) and high carbon stock (HCS) areas.

USAID SEGAR works with private sector stakeholders to strengthen their environmental, social and governance (ESG) focus and practices in natural resource-based commodity supply chains. ADM Capital Asia Climate-Smart Landscape Fund (ACLF) is a program launched by Asia Debt Management Capital Hong Kong Limited (ADMC) with the aims to finance SMEs that achieve both financial and sustainability returns. ACLF incorporates several blended finance instruments and will lend to SMEs engaged in sustainable agriculture production, land regeneration and forest protection.

ACLF plans to provide loans to a potential borrower, PT Harmoni Usaha Indonesia (“PT HUI” or the “Borrower”) manufacturing companies founded in 2017 focusing on the production of handicrafts using sustainable raw materials, including rattan. The ACLF loan will allow the company to expand certified handicraft production, control raw materials to decouple from deforestation risk, expand collaboration with local communities on weaving and raw material sourcing and meet customer demand for Forest Stewardship Council (FSC)-certified products to become a more vertically integrated business. To expand operations to Katingan – Central Kalimantan, PT HUI has entered into a rattan supply collaboration with P2RK. The project will also ensure the protection of HCV and HCS in the sourcing areas through adopting FSC certification, incorporating NDPE commit training programs for communities, and developing Sustainable Sourcing Procedures. To ensure that PT HUI and P2RK’s expansion plans and business models run according to the desired goals and targets, ACLF needs technical assistance support for two main issues, namely Environmental and Social (E&S) Risk Mitigation and Forest Management and Addressing Production and Capacity Issues. ACLF, PT HUI, and P2RK will collaborate with USAID SEGAR for this technical assistance.

The requested services are to support ADMC investment decision and follow-up approach by independently assessing and verifying the Project against the reference framework elaborated in Section 3, including the IFC Performance Standards; identifying compliance gaps, necessary mitigation and follow-up actions, to be detailed in a timebound and costed Environmental Social Action Plan. Particular attention should be paid to areas of conservation (HCV/HCS) and potential biodiversity net gain, as well as any sensitive community and IP aspects relative to the Katingan social forestry area.

Deliverables

• Deliverable 1– Findings on ESG risks based on IFC PS assessment & ESAP– shortly after the site visits, the Consultant will provide a report focusing on findings and identified risks, impacts, gaps, and opportunities according to IFC PS. The ESG DD report, including the Environment & Social Action Plan (ESAP) for the Borrower, will be communicated and submitted to ACLF. The expected completion date is January 14, 2024.
• Deliverable 2– Free, Prior, and Informed Consent (FPIC) and Supply Chain ESG Risks Assessment – The consultant will carry out FPIC and thorough supply chain ESG risk assessment, including reviewing Borrower’s supply chain partners such as third-party operators/suppliers, farmer organizations, home weavers, and others deemed relevant. Where compliance gaps with the Reference Framework and/or opportunities for value addition through E&S improvements have been identified. The expected completion date is February 23, 2023.

Location of Work

• Yogyakarta
• Tangerang
• Katingan, Central Kalimantan

Key Tasks / Stages

• Reviewing and assessing the Company’s environmental and social programs, management systems, and implementation. Benchmark them against the IFC PS, with specific gap analysis and reference to the standards/documentation regarding environmental, health, safety and social (EHSS) management. This item contributes to Deliverable 1.
• Understand the Use of Proceeds from ADMC lending and the risks and compliance needs relevant to each one.  This item contributes to Deliverable 1.
• Review processes, procedures and the Company’s institutional capacity to manage environmental and social risks and impacts by Good International Industry Practice (GIIP), as defined by the IFC Performance Standards and the World Bank Group EHS Guidelines (both General and Industry Sector guidelines.).  This item contributes to Deliverable 1.
• Assess the capacity of the Company to operate following GIIP, identifying gaps in compliance and recommending remediating actions as necessary with implementation prioritisation and within a timebound framework, providing estimated costings where relevant. Prepare ESG DD report.  This item contributes to Deliverable 1.
• Reviewing and, where necessary, recommending improvements to any Environmental and Social Management System and related relevant policies and the proposed environmental and social management plans for the Project, recommending strategies for developing these where needed.  This item contributes to Deliverable 1.
• Site visits (described below) to assess the implementation of the Company’s environmental and social management systems and plans that will cover its supply chains and the adequacy of the Company’s management practices against the Reference Framework. This item contributes to Deliverables 1 and 2.
• Identify opportunities for value addition through environmental and social improvements and initiatives.  This item contributes to Deliverable 1.
• Prepare an Environmental and Social Action Plan (ESAP) describing the actions to be implemented to achieve compliance with the Reference Framework within a reasonable timeline. Use ADM Capital ACLF template framework for ESAP and KPIs development.  This item contributes to Deliverable 1.
• Conduct a review to identify from publicly available media sources if there are any potential environmental and/or social issues, including NGO attention/campaigns, communities in the surrounding areas of the targeted locations of the project, or items that may lead to reputational risks to the Company and/or ADMC. This item contributes to Deliverable 2.
• Legality assessment on Rattan Gardens owned by the smallholders supplied to PT HUI. Including the compliance assessment for Non-timber Forest Product (NTFP) cultivation. This item contributes to Deliverable 2.
• Conduct Free, Prior, and Informed Consent (FPIC) to the rattan farmer communities. Identified risks at smallholder organisations and communities.  This item contributes to Deliverable 2.
• Work with the company and ADMC ACLF to establish project-level KPIs for the transaction that reflect the ESAP. There will also be a requirement for standard, fund and project-level KPIs that ACLF will provide to the company.  This item contributes to Deliverables 1 and 2.
• Establish an IFC PS category for the project.  This item contributes to Deliverable 1.

Qualifications

• Institutions that have experience in carrying out Environmental and Social Due Diligence Assessment.
• Experience in working with international donor organizations, or with government authorities at the provincial/district/national level.
• Experience in designing and implementing consultation/discussion, analysis, report writing, and auditing processes.
• English literacy is an advantage.

Basis of Award

The award will be made to a responsible offeror whose offer follows the RFP instructions, meets the eligibility requirements, and is determined via a trade-off analysis to be the best value based on the application of the following evaluation criteria. The relative importance of each individual criterion is indicated by the number of points below:

• Technical – 25 points: Responsiveness to the technical specifications and requirements.
• Delivery – 20 points: The confirmation and ability to meet the targeted deliverables.
• Key Personnel – 30 points: The proposed CV of key personnel.
• Price – 25 points: The overall cost presented in the offer.

Proposal Submission

Please submit your Proposal to SEGAR-Recruit@chemonics.com with the subject line “RFP 050 –  Institution Name”. The proposal must consist of the following documents:

• Company Profile
• Technical Proposal
• Financial Proposal
• CV of each proposed key personnel
• Company establishment deed
• Statement Letter of Tax Obligatory (PKP / Non-PKP)
• Tax ID and its establishment letter (SKT)

The proposal will be reviewed on a rolling basis, which means that the review process will take place continuously as proposals are received. This approach allows for prompt evaluation and potential immediate awarding of the project, ensuring efficient and timely implementation.