Nordea AM Drops JBS Over Deforestation, Corruption, Worker -- Update
28 Luglio 2020 - 7:34PM
Dow Jones News
By Dieter Holger and Paulo Trevisani
Nordea Asset Management dropped Brazilian meat giant JBS SA from
all its funds this month over concerns stemming from the company's
handling of deforestation, corruption charges and employee health
and safety amid the coronavirus pandemic.
The Helsinki, Finland-based money manager made the decision
"after a period of engagement with the company, where we did not
feel that we were seeing the response that we were looking for,"
Eric Pedersen, head of responsible investments at Nordea Asset
Management, told The Wall Street Journal on Tuesday.
Mr. Pedersen said the investment firm, which has some 223
billion euros ($261.8 billion) under management, pulled around
EUR40 million from JBS following a separate decision last year to
not buy more into the company.
The move comes as JBS continues to face allegations of fueling
deforestation by purchasing cattle from protected lands in the
Amazon rainforest. In June, nonprofit Greenpeace said that
JBS--along with other Brazilian meat producers--had bought cattle
from a farm that sourced the animals from another ranch in a
protected reserve in the Mato Grosso region.
Under Brazilian law, deforestation is largely forbidden and
meatpackers must ensure that they slaughter cattle coming from
ranches with a clean environmental record, but it is difficult for
companies to guarantee there hasn't been so called "cattle
laundering" where cows spend time in illegal pastures before moving
to legal ones.
JBS said in an emailed response to questions that it wasn't
given the opportunity to demonstrate to Nordea "its total
commitment to the transparency of its relationships and the
sustainability of its operations."
"JBS maintains a consistent compliance program," it said, adding
that it is "totally committed to eradicating deforestation
throughout its supply chain."
Brazil's powerful agroindustry has pressured the government of
President Jair Bolsonaro to fight deforestation more efficiently
and polish the country's deteriorating environmental credentials in
coveted export markets and among investors.
The government has responded that it's committed to protecting
the Amazon, but wants to do so by fostering, instead of pushing
back, private-sector activity in the region.
Environmental prosecutor Daniel Azeredo said Nordea's is the
first reaction of this kind to mounting accusations of Brazilian
food exporters not protecting the country's rainforest.
"We will only reduce deforestation if we're able to completely
track" cattle rearing in the Amazon, he said.
Mr. Pedersen said the decision to exclude JBS is significant
because it changes the holdings of all of the firm's funds instead
of just those dedicated to sustainability.
"While our specifically [environmental, social and
governance]-focused funds would in any case avoid companies with
these types of exposure, this move is part of raising the bar for
our remaining funds, so that our wider client base can remain
comfortable with the level of sustainability risk in their
investments," he said, adding that specific ESG portfolios
currently make up around 30% of the firm's managed investments.
Write to Dieter Holger at dieter.holger@wsj.com;
@dieterholger
Write to Paulo Trevisani at paulo.trevisani@wsj.com;
@ptrevisani
(END) Dow Jones Newswires
July 28, 2020 13:19 ET (17:19 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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