Forests

JBS Sets Dubious Record with “Sustainable” Bond

JBS Sets Dubious Record with “Sustainable” Bond

WASHINGTON, DC – On Wednesday, meat giant JBS issued a billion-dollar “sustainability-linked” bond. In response, Mighty Earth CEO and Founder Glenn Hurowitz said:

“This bond is probably the greatest bastardization of the term ‘sustainability’ in financial history, and that’s saying something.”

“It’s one of the most destructive companies in the world telling investors it deserves billions of ‘sustainability’ dollars to finance 14 more years of deforestation.

“JBS remains a company that continues to sell meat linked to deforestation, even though there are more than a billion acres of land where deforestation-free agricultural production is possible. They could choose to be a leader in the global transition to a deforestation-free future, but instead they’ve chosen to conduct sustainability by press release.

“Any investor that buys JBS’s sustainable bond will be complicit in the forest destruction and displacement of Indigenous communities they drive.”

Background

• JBS is Brazil’s largest cattle company, and its activities have been tied to deforestation, habitat destruction and climate change.

• In March, the company announced it would a “commitment to achieve net-zero greenhouse gas (GHG) emissions by 2040,” including a pledge to “achieve zero deforestation across its global supply chain by 2035.” Advocates charged that the commitment was woefully inadequate for such a climate-intensive company and in fact amounted to a commitment to 14 more years of forest destruction.

• In April, Mighty Earth released its newest analysis of deforestation data, which found that JBS was the worst-scoring meatpacker and company overall. It has been linked to 100,000 hectares of clearance the past two years – an area larger than all of Berlin. 75 percent of this clearance occurred in protected areas, making it potentially illegal under Brazilian law.

• The new bond issued today by JBS does not seem to be labelled as a formal ESG bond or Green Bond. Rather, the term “sustainability-linked” implies that interest rates will be tied to sustainability targets – though JSB does not provide information about who or what body will make that determination. There does not seem to be any commitment that the financing will be used for sustainability activities.

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FOR IMMEDIATE RELEASE

Wednesday, December 1, 2021

CONTACT:
Joel Finkelstein

+1.202.285.0113 | [email protected]

by Mighty Earth

Five things that will determine the success of COP26 Leaders’ Pledge to Protect Forests

Five things that will determine the success of COP26 Leaders’ Pledge to Protect Forests

November 3, 2021

The announcement at COP26 of a new political commitment and global fund to protect the world’s forests heralds an unprecedented moment to begin reversing decades of deforestation across the planet. Signatories to the statement – which include Brazil, Russia, Indonesia, and the Democratic Republic of Congo, as well as the EU and USA – between them account for 85% of the world’s remaining forests.

Along with a promise to halt and reverse deforestation by 2030, the statement also announced a $19.2bn fund (comprised of both public and private money) to tackle the problem.

However, political pledges to end deforestation have been seen before; notably the 2014 New York Declaration on Forests. Sadly, the world has continued to lose forests at an alarming rate since that time. So, what needs to happen now for political puff to translate into real action on the ground to protect forests around the world?

Here are five things that will determine the fate of world leaders’ promise to halt deforestation by 2030.

• Enacting laws and resourcing law enforcement

Many of the world’s largest and most precious remaining forests are found in countries that either have inadequate laws to protect threatened ecosystems, or where such laws exist on paper only and are not enforced. This situation is compounded by corruption and cronyism, with many of the most notorious loggers in forest-rich countries being people with close financial and political ties to those in power. Conserving remaining forests in these countries will largely come down to changing the “risk vs reward” equation, i.e. by increasing enforcement and raising the level of legal jeopardy for the paymasters of those who wield the chainsaws.

• Protecting Indigenous land and forest rights

Thousands of Indigenous communities across the planet rely directly on forest ecosystems for their livelihoods and spiritual identity. At the same time, Indigenous Peoples’ play a vital role in managing and protecting forests. According to a UN report released in March of 2021, deforestation in Latin America is up to 50% lower in the territories of Indigenous communities than elsewhere. However, despite several international agreements codifying the rights of Indigenous Peoples, their territories continue to come under attack around the world from loggers and private militias seeking to displace them and grab their land. It is therefore vital that countries do more to protect, respect and fulfill the rights of Indigenous communities if they are to meet their objectives of halting and reversing deforestation.

• Climate finance additionality

When giant sums of money meant to save the planet are bandied about at international events such as COP26, it can be easy to get swept away in the hype. But it is important to understand the fine print, and to examine the track record of such pledges. At the Paris climate summit, the world’s richest countries agreed to provide $100 billion a year to poorer nations by 2020 in order to help them adapt to and mitigate climate impacts. Yet on the eve of the Glasgow COP, leaders of the world’s richest countries admitted that they had failed to deliver on this promise.

While the existing commitments remain unfulfilled, there is also a question of whether money pledged under this new initiative to halt deforestation (including to support Indigenous communities) will provide additional funds to those already promised, or be retrofitted within pre-existing unmet pledges. Developing countries are also concerned about whether the funds will come out of already overstretched – and in the UK’s case, shrinking – international aid budgets, reducing support for other vital activities. This question of “additionality” is crucial for bringing poorer nations on board with forest protection commitments.

• Closing the market

While protecting trees in countries with large intact forest areas is of paramount importance (including the financing of that), it is also essential to “delink” the consumption habits of rich importing nations from ecological destruction around the world. A number of commodities imported by OECD countries – including beef, soy, palm oil, cocoa, coffee, maize and rubber – are grown in tropical environments, where their production is often directly linked to the clearcutting of forests. It is therefore up to the governments in regions such as Europe, North America and East Asia to enact and enforce strong laws that prevent imported goods linked to deforestation from entering their markets.

• Accelerating industry action

Over recent years, investigations by groups like Mighty Earth and other NGOs have created growing media and consumer awareness about deforestation linked to tropical commodities such palm oil, soy, cocoa and rubber. This has put the industries responsible for producing, trading and selling these products under increasing pressure to take action. In some cases, companies have come together to develop “no deforestation, no exploitation” policies and obligations for their suppliers.

However, progress on implementing these commitments has generally been slow. Companies that produce, buy and sell tropical commodities must therefore redouble their efforts to ensure their pledges are realized on the ground, and develop effective joint monitoring mechanisms to ensure compliance. Industry efforts must also widen to address rogue companies selling within so-called “leakage markets”; i.e. countries and jurisdictions where exporters of goods linked to deforestation can still find a welcome haven for their products.

By pursuing these five key strategies, governments, companies, investors, consumers and civil society can capitalize on the welcome political momentum that has gathered behind the vital task of saving the restoring the world’s remaining forests.

by Mighty Earth

ANALYSIS: Major Breakthrough in Meat Sustainability as Supermarkets Pledge to Cease Purchases Tied to Deforestation

Major Breakthrough in Meat Sustainability as Supermarkets Pledge to Cease Purchases Tied to Deforestation

As the world’s eyes look to Glasgow for climate action, huge change may be coming right in the meat aisle. Leading British and European supermarket chains representing more than 50,000 supermarkets around the world earlier this month sent a clear and unprecedented message to the meat companies responsible for enormous deforestation: change the way you do business, or you’re cut off.

The companies pledged not to purchase meat or dairy raised on soy animal feed sold by companies connected to deforestation that occurred after August, 2020. Europe imports typically imports more than 30 million metric tons of soybeans and soymeal every year, primarily for animal feed. This soy has caused more deforestation than any other commodity imported into the EU and UK from 2005-2017.

The supermarket chains that are part of the commitment are members of the Retail Soy Group - Aldi South, Aldi Nord, Ahold Delhaize, Coop, ASDA, Waitrose, M&S, Sainsbury’s, Lidl, Migros, and Woolworth’s. These chains also are looking at ways to reduce consumption of meat altogether by increasing sales of plant-based and other sustainable proteins.

Now the question becomes whether this coalition of some of the world’s largest retailers will actually implement this commitment, or try to pull a bait and switch on their customers.

What Happened

On October 5^th, the Retail Soy Group laid out a new industry road map to stop industrial deforestation driven by growing soy for animal feed. The Group represents major commercial chains like Ahold Delhaize, Aldi South, Aldi North, Asda, Co-op (UK and Switzerland), Lidl, Marks & Spencer, Migros, Morrisons, Sainsbury’s, Tesco and Waitrose & Partners – which taken together operate nearly 50,000 supermarkets, provide jobs for hundreds of thousands of employees, and bring in revenue worth hundreds of billions of dollars.

This commitment is the first of its kind at this scale, and could be a huge deal for forests and for the planet. That’s because enormous swaths of land in Latin America are destroyed to grow the soybeans used to feed chickens, pigs and cows.

70 percent of this destruction is concentrated in just one critical biome – the Cerrado in Brazil – which holds some 5 percent of the world’s biodiversity and some 13.7 billion tons of carbon dioxide in its immense root system. Half of the Cerrado – an area the size of France, Germany, Belgium and the Netherlands combined – has already been destroyed.

The Commitment Say the Right Things

Right now the roadmap is just words on paper, but they’re the right words. Specifically, it says that:

• Retailers will cut-off agribusiness traders from lucrative markets within 14 months if they continue to buy animal feed from deforesters. Until now, traders like Cargill and Bunge have refused to agree to dicscontinue traders engaged in deforestation – but 50,000 supermarkets speak loudly.
• Retailers will impose a cut-off date of August 2020 after which they will not accept embedded soy from either legal or illegal conversation of native ecosystems. And, they will cascade these requirements to their direct and indirect suppliers while imposing clauses in supplier contracts.
• Retailers will apply these stipulations at the group level, which means suppliers won’t be able to sell ‘clean supply’ in one part of their supply chain while continuing to support deforestation in another.
• Retailers will create strategies that acknowledge reducing dependence on soy means finding pathways to alternative proteins, meat reduction and non-soy animal feed.
• Critically, the road map finally turns its back on achieving deforestation-free supply chains through certification, credits or offsets– no deforestation means no deforestation.

But Does it Matter?

If the commitments are actually implemented, and if they’re more than just words on paper. We think three tests will tell the tale:

• First: Will supermarket companies embed these principles and stipulations in supplier contracts? Up to now, asking nicely has proven futile – last year, over 160 retailers wrote a letter to large traders in Brazil asking them to accept the principle of a cut-off date and transparency, but the traders defied them. Instead, we need commercial action – backed up by robust monitoring and evaluation – to actually force change by rewarding clean suppliers at a group level and sanctioning others until they clean up, too. These kind of efforts have been so successful that deforestation for palm oil has been reduced more than 90% in Southeast Asia.
• Second: How seriously will supermarket companies handle non-compliance? The roadmap acknowledges the need for commercial penalties, hut also stipulates that buyers should engage and support the supplier to come up with a time-bound plan to address the problem. This sounds solutions-oriented, but in fact our experience shows that companies can become trapped in an endless cycle of engagement over non-compliance that doesn’t bring real change. The Retail Soy Group members need to be crystal clear that non-compliance with the cut-off date, transparency and group-level responsibility principles will result in commercial consequences – such as suspension of contracts or dropping of volumes. This too is easier if these stipulations are written right into the contracts.
• Third: Will supermarket companies get serious about alternative proteins? Less meat consumption reduces demand for industrial animal feed and therefore reduces pressure on land. Any genuine strategy from retailers which aims to end deforestation must include offering consumers better choices. That can include giving more shelf space to vegetables, fruit and plant proteins and setting meat and dairy reduction targets, and increasing the share of plant-based food in the average shopping basket.

Mighty Earth will be watching closely and applying these three tests as the Retail Soy Group moves forward with its roadmap. If taken seriously, this could mark a transformative moment for global agribusiness – and global forests.

by Mighty Earth

Mighty Earth: Glasgow's $12 billion for forests great news, but just a start

FOR IMMEDIATE RELEASE

2 November 2021

Contact:

Joel Finkelstein | 202.285.0113 | [email protected]

MIGHTY EARTH on GLASGOW DEFORESTATION ACTIONS

Glenn Hurowitz Founder and CEO, Mighty Earth

“$12 billion to protect and restore the world’s forests is a welcome boost for nature conservation, but it is still paltry compared to either the need or the investment happening in the energy sector. Nature based climate solutions represent 37% of the solution, and until now have received just two percent of total climate finance.

“Climate policymakers are still indulging in an energy fetish that is blinding them to the outsized potential for forests, mangroves, and grasslands to suck extra carbon out of the atmosphere. Sure, we need to go big on energy, transportation, and industrial decarbonization – but we need to go at least as big when it comes in investing in the natural climate solutions all around us.”

On the source of the finance commitment:

“It’s remarkable that philanthropy is providing such a large share of this pledge, when governments and the private sector have vastly more resources. The battle to stop the collapse of the natural systems that underpin life on Earth shouldn’t depend so disproportionately on charity.”

On other upcoming deforestation decisions:

“The UK, US, and European Union are all considering new legislation to ban the import of commodities linked to deforestation. Big ag interests are aggressively lobbying for some giant loopholes. We hope Glasgow is a springboard to go from talking about action on forests to making deforestation illegal once and for all.”

On some noticeably absent investors:

“It’s great to see several large investors pledging to curtail financing deforestation, but several of the biggest bankrollers of deforestation like BlackRock, Vanguard and State Street are notably absent. Notorious forest destroyers like JBS and Bunge just shouldn’t have access to mainstream capital markets to finance the bulldozing of the world’s last rainforests.”

On the missing meat sector:

“The meat industry drives more deforestation and climate pollution than the entire global transportation sector, but is missing entirely from the pledge. It’s not surprising given that the giant meat companies that supply the UK and other markets like Cargill and JBS have resisted calls from customers and financiers alike to shift their development to the Earth’s 1.6 billion acres of previously deforested lands. It’s time for Tesco and other supermarkets to stop putting up with their suppliers’ continued efforts to tear down everything the world is calling for when it comes to conservation.”

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ABOUT GLENN HUROWITZ

Glenn Hurowitz is a globally recognized leader and campaigner on forests, agriculture, and climate change.

Glenn Hurowitz is the founder and CEO of Mighty Earth, a global environmental organization. Glenn leads campaigns to protect forests, conserve oceans, and solve climate change, and is an internationally recognized expert on forests, agriculture, and climate change. Under his leadership, Mighty Earth has achieved transformative forest, climate, and human rights policies from the world’s biggest emitting industries – including major contributions to driving a 90% reduction in deforestation for palm oil, industry-wide action to end deforestation and land-grabbing in the rubber and cocoa industries, and billions of dollars in new clean energy investments. In addition to advocacy, Mighty Earth monitors tends of millions of acres of forests globally as part of its Rapid Response satellite monitoring and supply chain analysis program. Glenn previously co-founded Chain Reaction Research, which provides major financial institutions with in-depth risk analysis of companies’ sustainability risk; served as Managing Director of Waxman Strategies, and chaired the Forest Heroes campaign, which won the Benny Award from the Business Ethics Network for itssuccesses in transforming global agriculture.

Glenn has worked extensively in politics, and is the author of the critically-acclaimed book Fear and Courage in the Democratic Party, and his writing has appeared in The New York Times, The Atlantic, The Nation, Politico, The American Prospect, and The Singapore Straits Times, among others. He’s appeared on many international media outlets, including CNN, Bloomberg, BBC, MSNBC, FOX, CBS, and NPR. He is a graduate of the Green Corps fellowship and Yale University. 

by Mighty Earth