Founded by Mr. Byju Raveendran in 2011, Think & Learn Private Limited ("Byju's" or the "company" - byjus.com/
) started as an offline test prep provider for management, engineering and the Indian Civil Services exams, which later expanded into brick and mortar based coaching for school students. Since the launch of its application "The learning app" in August 2015, the company has moved from classroom to app based leaning, Accordingly, Byju's now follows a self-paced learning methodology using a mix of immersive learning videos, assessments and testing customized to each student's pace and style of learning, delivered through the app, which has seen close to 4 million downloads till April 2016. The offline/brick and mortar coaching has been phased out since June 2015. The company now has a team of about 800 employees, most of whom are involved in content, media and technology development and are based at the three offices of company in Bengaluru in Karnataka.The proposed investment is an equity investment of upto $15 million in the company for expansion of its education services offering, further technology development and pursue inorganic growth opportunities ("the project"). In the near future, the company aims to use its strong technology platform to foray into international markets to provide K-12 educational content and bringing in revenues from the export of educational services (i.e. developing content for other countries' curricula).
OVERVIEW OF IFC'S SCOPE OF REVIEW
Considering that this is a human resources (HR) based operation, IFC's review of this investment consisted of reviewing the company's operations, with a focus on HR policies vis-r-vis the requirements of the IFC Performance Standards (PSs). Also, company's provisions on fire safety and emergency response were reviewed. The appraisal included desk review of the relevant information provided by the company and discussion with the company's senior management.
IDENTIFIED APPLICABLE PERFORMANCE STANDARDS**
While all Performance Standards are applicable to this investment, IFC's environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards.PS 1 - Assessment and Management of Environmental and Social Risks and ImpactsPS 2 - Labor and working conditionsIf IFC's investment proceeds, IFC will periodically review the the project's ongoing compliance with the Performance Standards
There are no physical assets (apart from the company's offices/-development centers located in leased buildings) and the company's current operations are and future operations are expected to be mainly related to online content and technology development. Hence, the issues and risks envisaged by Performance Standard (PS) 3: Resource Efficiency and Pollution Prevention, PS4: Community Health, Safety and Security, PS5: Land Acquisition and Involuntary Resettlement, PS6: Biodiversity Conservation and Sustainable Natural Resource Management, PS7: Indigenous Peoples and PS8: Cultural Heritage are not expected for this investment.
ENVIRONMENTAL AND SOCIAL CATEGORIZATION AND RATIONALE
This is a Category B project according to IFC's Policy on Environmental and Social Sustainability because key E&S risks and issues related to this project are limited and are mainly related to development of human resource policies in compliance with IFC Performance Standard (PS) 2 and development and implementation on an emergency response plan.
**Information on IFC's Policy and Performance Standards on Environmental and Social Sustainability can be found at www.ifc.org/sustainability
ENVIRONMENTAL AND SOCIAL MITIGATION MEASURES
IFC's appraisal considered the environmental and social management planning process and documentation for the project and gaps, if any, between these and IFC's requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable period of time, are summarized in the paragraphs that follow and (if applicable) in an agreed Environmental and Social Action Plan (ESAP). Through the implementation of these measures, the project is expected to be designed and operated in accordance with Performance Standards objectives.
PS 1: ASSESSMENT AND MANAGEMENT OF ENVIRONMENTAL AND SOCIAL RISKS AND IMPACTS
Identification of E&S Risks and Impacts: Considering the company operations, E&S risks are limited to safety of employees at the office and HR related risks and impacts.Policy: The company has a HR manual (discussed in PS2 below), which includes a code of conduct. As part of the code of conduct, the company has committed to importance of healthy and safe work environment and good working conditions.Organizational Capacity: The company has a HR organization headed by Head - HR Manager and has specific teams on recruitment (headed by a technical person), payroll, induction, training and development, performance management, and administration and facilities.Emergency Preparedness and Response: Byju's three offices are located in leased buildings. The company ensures that all offices taken on lease are provided (by the owners) with required fire safety infrastructure. The current offices have fire hydrant, sprinklers, fire extinguishers, smoke detectors and fire alarm systems, which are maintained by the building owners.Currently, the company has not developed an emergency response plan for its offices. Also, no training/mock drills are reported to be conducted. As per the ESAP, the company will develop emergency response plans for all its offices and shall conduct regular trainings and mock fire drills.Monitoring & Reporting: Regular reports are submitted to the relevant authorities on HR issues as per applicable legal requirements.
PS 2: LABOR AND WORKING CONDITIONS
The company has a total workforce of abour 800 staff (approximately 40% woment employees) and as part of the expansion plans, the workforce is expected to increase to 1800 by FY 2021. No third party employees are involved in company's operations.HR policy, working conditions and terms of employment: The company has a documented HR policies manual which mainly covers operational issues like salary structure and deductions, recruitment and selection, office hours, etc. Also, the HR manual has a code of conduct which covers confidentiality, health and safety, media interactions, gifts and donations etc. The manual is shared in the joining kit and policies are communicated during the induction process. All employees have a written appointment letter from the company explaining the working conditions and terms of employment; and their salaries are paid through the bank accounts.As per the ESAP, the company will align and document its policies in line with the PS2 requirements and document specific policies on various aspects covered under PS2 including, freedom of association, grievance mechanism and retrenchment. The same will be communicated to the employees e.g. through intranet, displays and/or awareness sessions.Non-discrimination: Byju's recruitment and selection policy includes a commitment to non-discrimination and having a fair, transparent and merit based selection.Freedom of association and grievance mechanism: Currently there is no staff union at the company. However, the company does not restrict formation of employee unions and will document a policy as part of the HR manual on the same.Also, as part of the ESAP, the company will develop a grievance mechanism aligned with PS2 requirements and make it accessible to all employees and also create awareness among employees about this mechanism. The mechanism will allow employees to raise grievances anonymously.The company has a significant number of women staff members. Therefore, in line with the applicable regulatory requirements, the company will formulate and implement a prevention of sexual harassment policy and constitute a specific committee to handle any sexual harassment related complaints. The policy will be communicated to the employees through displays and awareness sessions.Prevention of child labor and forced and bonded labor: Considering the operations and nature of the workforce, no child or forced and bonded labor is expected at the company's operations. The company's HR manual has specific policies on child labor (no employment of child labor and collection of age proofs) and forced and bonded labor.Occupational Health and Safety (OHS): Considering the type of operations, there are no significant OHS risks or impacts. The company designs its offices with modern facilities to reduce fatigue and improve productivity as per the nature of the business. The office equipment is ergonomically designed to minimize work related disorders bycontinuous exposure to computer systems etc., Also, offices are provided with canteen and other facilities for short -breaks and for recreation and encourages its employees to participate in sports/cultural activities.