Sustainability Promises Fall Short: JBS’ Emissions Goals Under Scrutiny
The world’s largest meatpacker, JBS, made headlines in 2021 with its ambitious commitment to cut or offset all its emissions by 2040 and end illegal deforestation across its supply chain. However, nearly four years later, the company’s global chief sustainability officer, Jason Weller, has downplayed the pledge, calling it an “aspiration” rather than a promise.
A Lack of Accountability
Despite JBS’ bold claims, investors have failed to hold the company accountable for its environmental commitments. In the past five years, no shareholder proposals have been put forward regarding the environment, and few have voted against the company’s management on any issue. Moreover, sustainability questions have been scarce on earnings calls. Meanwhile, profits have soared, driving JBS’ stock to a record high last month.
Deforestation and Climate Change
The Amazon rainforest, where JBS sources much of its cattle, is nearing a tipping point due to rampant deforestation. Brazilian cattle ranchers, responsible for 80% of current Amazon deforestation, are pushing the ecosystem to the brink. This environmental crisis could undermine President Luiz Inacio Lula da Silva’s efforts to host global climate talks in November.
Industry-Wide Challenges
JBS is not alone in softening its climate pledges. Oil majors Shell and BP have also backtracked on their commitments. The difficulty in reducing environmental damage related to agriculture companies like JBS highlights the need for collective action and improved regulation.
Supply Chain Challenges
Environmental activists estimate that 97% of JBS’ emissions stem from deforestation, biodiversity loss, and pollution. While JBS reports indirect emissions across its supply chain, it excludes emissions related to changes in land use. The company argues that calculating these emissions is flawed, but other global companies, such as Mars and Archer Daniels Midland, have begun disclosing change-of-land-use emissions.
Limited Control
JBS claims it has no operational, contractual, or legal control over its supply chain, making it difficult to mandate change. However, the company insists it is driving real change through investments and voluntary measures.
Investor Apathy
Despite JBS’ poor environmental track record, investors have shown little interest in holding the company accountable. The company’s 20 largest investors declined to discuss their engagement with JBS, and 17 “sustainable” funds holding JBS stock refused to comment on their investment rationale.
A Call to Action
As JBS faces scrutiny over its sustainability promises, investors and regulators must take a closer look at the company’s environmental performance. With the Amazon rainforest hanging in the balance, it is imperative that companies like JBS are held accountable for their commitments and take concrete action to reduce their environmental impact.
Leave a Reply