In 2009, IFC made an equity investment in Amalgamated Plantations Private Limited (APPL). APPL is the second largest producer and supplier of tea in India. APPL employs over 28,000 permanent workers and over 23,000 temporary workers. There are approximately 155,000 people living on APPL’s 25 tea plantations.

In February 2013, three local NGOs filed a complaint on behalf of tea workers working and living in the company’s tea plantation areas. The complaint highlights issues at three plantations concerning labor conditions, including long hours, unpaid compensation, poor hygiene, health problems, and restricted freedom of association. Additionally, it questions a worker share-buying program, alleging that workers were pressured into purchasing shares without adequate information on the risks.

In November 2013, the case was transferred to the compliance function for appraisal.

In February 2014, CAO completed its Compliance Appraisal Report for the Tata Tea – 02 complaint, with the decision that the issues raised in the complaint merited further investigation.

For purposes of the compliance investigation, the Tata Tea 01 and 02 cases were merged after appraisal.

In November 2016, CAO published its combined Compliance Investigation Report. CAO's investigation found several non-compliance issues with IFC's assessment and management of environmental and social (E&S) risks related to their investment. Despite the potential for significant development impact, IFC's pre-investment E&S review was inadequate, leading to poorly detailed mitigation measures that failed to address key risks. During supervision, IFC did not ensure compliance with its Performance Standards, leaving E&S issues raised by complainants unresolved. The investigation also identified specific non-compliance in IFC’s handling of living and working conditions on plantations, use of banned pesticides, information disclosure, consultation, and response to security incidents.

In response to CAO's compliance investigation, IFC acknowledged that APPL was implementing an Action Plan to address issues in human health, worker safety, housing, and sanitation. IFC committed to: (a) commissioning a third-party annual audit and worker perception survey for APPL's 25 estates; (b) updating its legal opinion on APPL's compliance with national minimum wage laws; and (c) ensuring the Action Plan was disclosed to and consulted with workers.

CAO Monitoring Reports

In January 2019, CAO published its First Compliance Monitoring Report, indicating that APPL reported some progress on the Action Plan. However, complainants claimed that workers were not consulted and expressed concerns about the progress and quality of implementation. CAO reviewed project documentation, spoke with IFC staff, complainant representatives, and the IFC client. The 2019 monitoring report concluded that IFC's supervision was limited and did not satisfactorily address CAO's non-compliance findings. CAO remained concerned that IFC's supervision lacked the necessary information to assess client compliance with Performance Standards, leaving IFC without assurance that compliance was on track.

In May 2024, CAO published a Second Monitoring Report, noting some progress in implementing the Environmental and Social Action Plan (ESAP), but highlighted that critical infrastructure improvements, such as new or repaired houses and sanitation, are still incomplete and lack identified financial resources. As a result, CAO decided to keep the case open.

CAO’s Omnibus Monitoring Report which includes the monitoring report for this case, is available in English.