Global financiers, UK supermarkets and an Italian leather supplier have supported deforestation, land-grabbing and the use of slave labour in Brazil by funding and stocking products from the Brazilian meat giant JBS, an investigation claimed on Friday.
Financial institutions mentioned in the investigation’s report were HSBC, Barclays, Santander, Deutsche Bank, BlackRock and JP Morgan. The report said the institutions had “for years funnelled billions of dollars to JBS and continue to do so – while at the same time pledging to remove deforestation from their portfolios”.
The report noted that Barclays facilitated a bond deal for JBS worth almost $1bn last year and said the bank “has continually done business with [JBS] over multiple years despite numerous Global Witness reports on the company”. The report further found that between “September and October of last year, investment companies controlled by Deutsche Bank, HSBC, Santander, BlackRock and JP Morgan” held shares worth more than $293m in JBS.
The supermarkets selling products that used JBS beef, which were checked in February this year, were named as Sainsbury’s, Iceland and Asda. The report named the Italian leather supplier, Gruppo Mastrotto, as a buyer of JBS skins.
Global Witness, which conducted the investigation, said its findings came “as deforestation reaches record levels” and while the “dismantling of environmental policies and the weakening of environmental agencies under [Brazil’s president, Jair] Bolsonaro have been highlighted as key risks that may push the Amazon to an irreversible tipping point, with devastating consequences for Indigenous peoples and local communities, the global climate and biodiversity”.
The investigation highlighted two different types of JBS supply chain issue, direct and indirect. In the direct supply chain the report found JBS sourcing cattle “from 144 ranches in the Amazon state of Pará that contained over 10,000 football pitches of illegal Amazon clearance, contrary to its legal no-deforestation obligations”.
The report said that in the indirect supply chain JBS had “failed to monitor a further 1,600 ranches” which it said were linked to 57,000 football pitches worth of both legal and illegal deforestation.
Responding to the allegations in the report, Global Witness said JBS denied the claim that all the 144 direct supply ranches were non-compliant with its no-deforestation policy.
In a statement to the Guardian, JBS said it had blocked one of the direct suppliers in Pará “as soon as we received the NGO allegations of further fraudulent activity”. The statement went on to say JBS had a “zero-tolerance policy for illegal deforestation, land-grabbing, slave labour or human rights abuses associated with our supply chains”.
JBS said it respected its “own responsible procurement and NGO and state-agreed due diligence monitoring protocols at all times” and had used “the best available official data to assess all potential suppliers across an area three times larger than the UK, daily for the past 10 anni, and … immediately blocked any non-compliant farms”.
JBS has committed to monitor its entire supply chain by 2025, including problematic indirect suppliers, but says that, despite its requests, the Brazilian government has not made available some of the records which are necessary. In collaboration with the Bureau of Investigative Journalism and Repórter Brasil, the Guardian previously exposed links to illegal deforestation in the JBS supply chains. The company went on to reorganise and to make a pledge to reach net zero emissions by 2040.
Responding to the report’s claims that it stocked JBS beef products, a Sainsbury’s spokesperson said the “link between cattle farming and the destruction of ecosystems like the Amazon, the Cerrado and the Pantanal is a complex issue, which we take extremely seriously”. It added that, despite efforts to address the problems, “not enough progress has been made” and, as a result “we no longer offer fresh own-brand corned beef products from Brazil. We have also committed to stop sourcing any own-brand corned beef from Brazil so that we can ensure our product does not contribute to deforestation.”
Asda said in an email that it “does not source any of its products from the supplier named in this investigation”. The link in the report between Asda and JBS was made on the basis of Asda stocking Exeter corned beef. Asda said in an email to the Guardian that it no longer stocked Exeter products.
A Santander spokesperson told the Guardian it “is committed to protecting the Amazon and operates strict policies which govern our financing activity in the region”. It added that it expected “beef processing clients in the Amazon to have a fully traceable supply chain that is deforestation-free by 2025, including indirect suppliers of cattle, as a prerequisite for granting credit. We believe this is the most ambitious lending standard of any bank in the region.”
A Deutsche Bank spokesperson told the Guardian that it did not “knowingly finance activities that result in the clearing of primary forests, involve illegal logging or conversion of high conservation value, high carbon stocks forests or peat lands. Where we work with conglomerates, we make a significant effort to ensure our financing is only directed to activities that are in line with our policies.”
HSBC referred the Guardian to its response in the report which said its “asset management business held shares in the beef giant on behalf of others” and that it had no influence over the decision to invest in JBS.
BlackRock similarly pointed the Guardian to its responses in the report which said it had engaged with “the company to seek improved compliance with its commitments” and that its “voting record at JBS’s annual shareholders meeting” showed it “objected to the company’s poor oversight of risk management processes, including on its sustainability performance”.
JP Morgan told the Guardian that it declined to comment on the allegations.
Barclays declined to comment to the Guardian but told Global Witness that it was committed to helping its “corporate clients achieve zero net deforestation”.
Gruppo Mastrotto told Global Witness that while it admitted purchasing from JBS’s tannery in Pará the purchase volumes were small and that it had since stopped buying from JBS. Iceland meanwhile told Global Witness that it engaged with its suppliers to ensure they sourced their beef responsibly.