Investment funds managing nearly $ 4 trillion in assets on Tuesday called on Brazil to stop deforestation in the Amazon. They thus evoke the “risk” that their loss of biodiversity and greenhouse gas emissions pose to their portfolios. "We are concerned about the financial impact that deforestation and the violation of the rights of indigenous peoples could have on our customers," they wrote in an open letter.
These managers from Europe, Asia and South America express their fears that the government of Jair Bolsonaro is using the Covid-19 crisis to push for environmental deregulation which could "threaten the survival of the Amazon" . Because the containment measures decided across the planet to curb the Covid-19 pandemic could lead to a global drop in CO2 emissions, but an increase in deforestation could on the contrary increase Brazil's share in these emissions.
Significant increase in deforestation
Environmentalists fear 2020 will be the most devastating year in history for the Amazon rainforest. It could be worse than 2019 when the resurgence of fires shocked the world. According to data collected by satellite by the National Institute for Space Research (INPE), 829 km2 of Amazon rainforest was deforested in May, 12% more than last year. Since the beginning of the year, deforestation has reached more than 2,000 km2, 34% more than in the same period of 2019.
Environmentalists accuse President Jair Bolsonaro's government of promoting deforestation by calling for legalization of agriculture or mining activities in protected areas.
"Systemic risks to our portfolio"
The managers of the twenty or so funds that signed the open letter therefore call on the Brazilian government to "make a clear commitment" to reduce deforestation and protect the rights of indigenous peoples.
Among the signatories are the British LGPS Central, the French Comgest or the Norwegian pension fund KLP. "As financial institutions, we consider deforestation, with its impacts on biodiversity and climate change, as systemic risks to our portfolio," they insist.
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- Deforestation
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