Massive fires continue to burn in the Amazon rainforest, and the investors are getting restless.
Now, a coalition of 230 investment funds managing more than US$16 trillion in assets worldwide is considering different ways to confront the crisis.
The funds include such powerhouses as the California Public Employees’ Retirement System, China Asset Management and Mitsubishi Banking Corporation — the fifth largest bank in the world.
They’ve signed on to a statement that condemns the Brazilian policies and businesses that are behind the fires — and which in turn drive deforestation and climate change.
And looming behind their discontent is the threat of boycotts and other economic measures that would punish Brazil’s inaction.
The worst offenders in Brazil are the producers of agricultural commodities — such as beef and palm oil.
Ranchers and plantation owners deliberately start the majority of the fires in the Amazon, in order to clear the land for industrial-scale production.
While many global food corporations claim to be concerned about deforestation, a recent report by Ceres, an an American nonprofit that advocates for sustainable business practices, found that only 21 of 484 such businesses are actually confronting the issue within their supply chains.
That may be changing, as a chorus of voices are calling for boycotts of Brazilian products.
For example, VF Corporation — the parent of the sporting-goods retailers Timberland and North Face, and the popular youth-oriented clothing brand Vans — will no longer buy Brazilian leather because of the link between cattle ranching and deforestation.
Fashion merchandisers H&M also vowed to boycott Brazilian leather — a commodity that brought $1.4 billion into the country in 2018.
Yet boycotts don’t always have the desired impacts.
In 2009, after Nike, Walmart and other companies threatened to boycott Brazilian beef due to rampant deforestation, a coalition of Brazilian beef processors vowed to mend their ways — and the threatened boycott was called off.
Yet a report in the Los Angeles Times found that 10 years later that the fires and their impacts are worse then ever, highlighting the lack of political will within Brazil to confront the problem.
Sources: Mongabay, Supply Chain Dive, Los Angeles Times, Business Insider
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