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20 Oct 2021

Repórter Brasil

Brazil: Marfrig sends note to Repórter Brasil regarding the article 'Financing for deforestation: organizations call for veto on millionaire loan to Marfrig'

"Full text of Marfrig's position", October 20, 2021

Marfrig has had a public commitment to combat deforestation in the Amazon biome since 2009 - and has been developing several concrete actions in this regard, all duly published and documented. Over the last decade, the company has invested more than R$ 260 million in sustainability initiatives in its value chain and is constantly improving its practices in all ESG dimensions - environmental, social and governance. We respect the work of the NGOs responsible for the statement sent to the Inter-American Development Bank. But we cannot agree with the superficial - and, in some points, distorted - view of the narrative employed. Let's get to the facts:

On the environmental front, Marfrig maintains a strict animal purchasing policy and a protocol with criteria and procedures that are prerequisites for supplier approval. These conditions include social and environmental parameters focused on the fight against deforestation, slave labor, activities in environmental protection areas, indigenous areas or areas embargoed by Ibama. Only suppliers in compliance with these terms are approved and, at each new cattle purchase, the check is redone. When noncompliance is identified, the supplier is immediately blocked until the situation is clarified.

In addition, Marfrig has been monitoring, via satellite and in real time, the Amazon region since August 2009. The area monitored is equivalent to 30 million hectares, a territory larger than the state of São Paulo or the United Kingdom. And, to give more reliability to these processes, this entire purchase system is submitted to the evaluation of external auditors. In the last eight annual audits, the company was 100% in compliance with the audited requirements of its direct suppliers.

In mid-2020, it launched the Marfrig Green+ Plan. The plan, a pioneer in the country, aims to track 100% of its chain, including indirect suppliers. The company's production chain in the Amazon will be fully tracked and free of deforestation by 2025. In 2030, this scenario will be extended to all the other biomes. The company is doing this in partnership with the producers, in a strategy of sustainable inclusion, based on the development of financial mechanisms, technical assistance and monitoring and traceability technologies. The pure and simple exclusion of producers, many of them small and without access to technology and credit, is not the solution to the problems of the Amazon. This may be the easiest path - but we do not believe it is the most efficient and fairest in socio-environmental terms.

Although it has medium and long-term objectives, the Marfrig Green+ Plan already presents several measurable results. Over 60% of Marfrig's value chain in the Amazon biome and 47% in the Cerrado biome have been mapped. More than 1,000 suppliers were regularized and re-included in the company's registry. Blockchain technology was adopted to provide greater security to the data collected. In partnership with Agroicone, risk mapping was carried out. Integrated production models such as Carbon Neutral Meat (CCN), in partnership with the Brazilian Agricultural Research Company (EMBRAPA), were developed. The company adopted Visipec (a tool to identify indirect suppliers) and implemented the unified protocol for cattle purchases in the Legal Amazon. Finally, the Marfrig Club program, with a follow-up protocol and technical support centres for producer regularization, was reformulated. We are talking about facts, which can be proven, and not empty narratives.

The accusations described in the letter sent to the IDB need clarification. All the cases of alleged environmental irregularities cited by the NGO Global Witness were analysed and brought to the organization's attention. Most of them - 42 - occurred before October 2009, the date on which the Public Commitment to Cattle Ranching in the Amazon was established. In another 15 cases, the operations were regular, according to the Prodes for the dates of slaughter. Eleven cases were false-positives - the image history indicates that the area was anthropized before the Commitment date, not characterizing new deforestation or showing that the polygon does not present characteristics of vegetation cutting. In 14 cases there was overlapping of polygons smaller than 6.25 hectares and that are in accordance with the rules established by Inpe. Two cases cited properties blocked for purchase by the company. Finally, there were five cases in which it was not possible to identify the properties, since the CAR informed by the NGO does not correspond to any farm registered in Marfrig's database. Therefore, there is no proof whatsoever that Marfrig has disregarded its protocol.

Clarifications are also needed on the alleged cases of compliance failure described in the document sent to the IDB. Most of the cases pointed out were answered by the company and exhaustively investigated by the competent authorities, without Marfrig ever being convicted.

Translated by the BHRRC.

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