BNDES

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</div><div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">THE BRAZILIAN AMAZON</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">A few years ago, deforestation in the Amazon was declining, partly thanks to government action. But that progress is being undone under the rule of far-right President Jair <b>Bolsonaro, with cattle ranching the biggest culprit,</b> according to numerous industry studies.</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">
</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">The three largest beef companies in the Brazilian Amazon, <b style="background-color: rgb(255, 204, 102);">JBS S.A</b>., Marfrig Global, and Minerva Foods, account for more than 45% of the region’s cattle-slaughtering capacity. All three have committed to measures that should help protect the forest. Yet their supply chain is tainted by deforestation – and famous names in finance help keep them afloat.</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);"><b>
</b></div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);"><b>JBS, the world’s biggest meatpacker, has a history of buying animals from deforested areas.</b> <span style="background-color: rgb(255, 255, 102);">A decade ago, responding to pressure from Greenpeace, JBS signed an agreement not to buy cattle from suppliers that had deforested land after October 2009. They also vowed not to source cattle from suppliers that used slave labor or infringed on indigenous communities’ lands.</span></div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);"><span style="background-color: rgb(255, 255, 102);">
</span></div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);"><span style="background-color: rgb(255, 255, 102);">Finally, JBS committed never to purchase cattle from suppliers embargoed by the Brazilian Institute of the Environment and Renewable Natural Resources (Ibama) for illegal deforestation, nor from suppliers that raised, reared, or fattened cattle on land overlapping with protected areas. In 2009, JBS became a party to a similar agreement with the Federal Prosecutor’s Office in the Amazonian state of Pará.<b> Since then, however, the company has made a mockery of these commitments:</b></span></div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">
</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">In 2015, JBS was accused by the Brazilian Federal Police of having bought hundreds of cattle from the mother of an alleged land-grabber described by the police as the “largest deforester of the Amazon”. The suspected land-grabber has been tried and is awaiting verdict. JBS said it has blocked the sourcing of cattle from the land-grabber’s mother and claimed that auditing had shown the company was over 99% compliant with its Greenpeace commitment.</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">
</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);"><b>In 2017, Ibama discovered two JBS slaughterhouses had bought 49,468 cattle from embargoed areas, for which the company was fined 24.7 million reais, almost $8 million at a 2017 conversion rate</b>. Global Witness estimates these cattle purchases may have required up to 38,000 hectares of deforestation. JBS denied the purchasing claims, saying it does not buy animals from farms involved in deforestation of native forests or areas embargoed by Ibama.</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">
</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">Last year, the Amazonian state of Pará published an audit of JBS that found breaches of its commitments covering almost 20% of its 2016 cattle purchases. Global Witness estimates the cattle<b> JBS bought that year from ranchers responsible for deforestation may have required an area the size of 65,000 football pitches</b>. JBS said they had been hindered by the lack of detail on the criteria for analysis and by discrepancies in the databases of public sector institutions. It said it had selected an auditor with a "conservative" view in the cases where there were doubts about the information. </div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">
</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">An investigation carried out by Repórter Brasil, the Guardian and the Bureau of Investigative Journalism in July alleged the company was still purchasing cattle from embargoed areas. JBS denied this claim.</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">
</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">JBS told Global Witness the issues raised about the company’s environmental policies make “no sense” because it had “implemented rigorous systems and controls” and “does not purchase from farms involved in deforestation”.</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);"><span style="background-color: rgb(255, 255, 102);">
</span></div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);"><span style="background-color: rgb(255, 255, 102);">Given these transgressions, it might be surprising JBS can attract mainstream financing at all. In fact, it enjoys support from some of the world’s wealthiest banks and investment managers. After a family-owned holding company that is the largest shareholder, its second-largest investor is <b>BNDES, the biggest development bank in the Americas.</b> BNDES held over $2.7 billion of JBS stock as of April 2019.</span></div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">
</div><div style="font-family: "Times New Roman"; font-size: large; background-color: rgb(255, 255, 255);">It is perhaps unsurprising Brazil’s development bank would aid the expansion of the country’s biggest companies. (BNDES did not respond to Global Witness’s inquiries.) </div></div>