Climate Finance Day: Financial Actors Called to Act Against Soy-Related Deforestation

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Briefing by Canopée Forests Vivantes, Mighty Earth, Reclaim Finance and SumOfUs

PARIS — Hundreds of financial players meeting today at the Palais Brongniart in Paris for Climate Finance Day (1) will be welcomed by NGO activists calling on them to stop being complicit in the misdeeds linked to soy production in Brazil. In a note outlining the devastating impacts of the sector on climate and biodiversity, they set out the measures to be adopted by banks, insurers and investors to force traders to change their practices and ensure “zero deforestation” of soya.

“We are here to warn about the impacts of soy cultivation, one of the main causes of deforestation in South America. Driven by the demand for the meat and dairy products we consume, its production has more than doubled in 10 years. This has dramatic consequences on certain ecosystems such as the Cerrado” says Klervi Le Guenic, campaign officer at Canopée Forêts Vivantes.

The Cerrado is now the frontier for the expansion of soy cultivation and one of the most threatened ecosystems on the planet. 50% of its original area has already been destroyed. Its disappearance would be a disaster for the climate and biodiversity as it stores the equivalent of 13.7 billion tonnes of carbon dioxide (CO2) and is home to 5% of the world’s biodiversity.

“The protection of forests and biodiversity is becoming a major concern for financial players, at least in their speeches. In reality, their policies to prevent the impacts of deforestation and conversion of natural ecosystems are deficient if not simply lacking. Today, we are calling on them to go beyond the principles of intention to adopt concrete and specific measures to stop the conversion of natural ecosystems in Brazil” adds Lucie Pinson, founder and director of Reclaim Finance.

As shown in a note published today by Canopée Forests Vivantes, Mighty Earth, Reclaim Finance and SumOfUs, the key to the problem lies in the respect of “zero deforestation” commitments by soy traders and in particular by 4 companies that control 56% of the world soy trade: ABCD or ADM (for Archer Daniels Midland), Bunge, Cargill and Louis Dreyfus. 9 NGOs wrote to 11 French financial actors in September to call on them to make their financial services to traders conditional on compliance with three measures (2), including a halt to the marketing of soya from land converted before January 1 2020.

“Cargill and Bunge are two of the three major soybean companies that are destroying forests and other ecosystems in Brazil. Without conditioning financial services to these companies on a zero-deforestation policy and practice, BNP Paribas, Crédit Agricole, BPCE and other financial institutions risk being complicit in this destruction and face the “Devoir de Vigilance” law” said Etelle Higonnet, Campaign Director at Mighty Earth.

“Only five financial actors have responded to our letter, and while some have indicated a willingness to do more on soya, none have committed to cutting off services to traders who continue their destructive practices. The first victims of soya are the local and indigenous populations. They cannot be with us today because of the health crisis, but we are determined to provide them with our international support for as long as it is needed” concludes Leyla Larbi, SumOfUs’ Campaigner.