Cerrado in Brazil. Image via creative commons.

Bucking a long trend of negligence, shareholders urge Bunge to halt deforestation

The vote at the massive soy trader signals greater financier focus on forests

Friends of the Earth
5 min readMay 6, 2021


by Jeff Conant, senior international forests program manager

When you think of the biggest drivers of the climate crisis, soy beans probably aren’t the first thing that come to mind.

And for most people, a huge soy trading company from Missouri with the unpronounceable name of Bunge may not be among the first companies you would reckon to be a climate villain. But the massive expansion of industrial soy plantations is one of the world’s leading drivers of deforestation and forest degradation. Deforestation, in turn, is one of the primary drivers of the climate crisis.

So, when a majority of shareholders voted yesterday for Bunge to explain its plans to deal with deforestation, it should be seen as a step forward in the financial sector’s willingness to tackle the issue.

Every spring, in what insiders refer to as “shareholder season,” every company listed on U.S. stock exchanges is required to hold an Annual General Meeting at which the company’s shareholders can have a say in how the company runs its business. This shareholder engagement is broadly divided between “proxy votes” on shareholder resolutions that ask a company to change some aspect of its business, and “director votes” where shareholders vote for or against candidates for positions on corporate boards.

The world’s largest money managers — BlackRock, Vanguard, State Street, Fidelity and other huge Wall Street institutions — have historically voted against any measure to address the climate crisis. They have also voted for corporate directors who show no concern for “non-fiduciary issues” such as climate and human rights. So this spring climate justice advocates are tracking a number of key shareholder votes to ensure that the big money managers put their increasing climate-friendly rhetoric into action.

Yesterday’s vote at Bunge is one of these key votes, along with those at oil and gas companies ExxonMobil, BP and Shell, utility company Duke Energy, and financial firms Wells Fargo, Barclays and MUFG.

The Bunge vote matters not only because Bunge is implicated in buying soy from the biggest forest destroyers in Brazil and must change its practices. It matters because in order for the financial sector to reckon with the climate crisis, it needs to address the deforestation and land conversion that cause about a quarter of global greenhouse gas emissions and drive an epidemic of violence against land defenders worldwide.

Shareholders have historically not given these issues the time of day. Years ago, when Friends of the Earth began to raise concerns about the massive crisis of global deforestation with investment firms like BlackRock, Vanguard, TIAA, and Dimensional Fund Advisors, they either failed to respond or told us point blank that they weren’t concerned. That lack of interest was underscored by our finding that the world’s top asset managers, with billions invested in companies linked to global forest destruction, had voted down every single shareholder resolution on deforestation going back to 2012. To this day, not a single large investment firm in the U.S. has a formal policy to deal with deforestation in its portfolios, and none of them subscribe to robust investment criteria such as those we have laid out here.laid out here.

But last October, years of campaigning bore fruit when a shareholder resolution on deforestation at Procter & Gamble — the world’s largest consumer goods company — won support from 67 percent of shareholders. The vote, which required P&G to report on its efforts to reduce deforestation in its paper and palm oil supply chains, bucked a decade-long trend of investor negligence regarding deforestation. The financial press went so far as to call it “an investor rebellion.”

Yesterday’s shareholder upset at Bunge indicates that last year’s rebellion is becoming this year’s norm. The old trend of investors ignoring the deforestation crisis has given way to a new trend: the world’s largest money managers now consider deforestation a material risk to their portfolios.

The resolution at Bunge, filed by shareholder advocates at Green Century, is a response to countless environmental and human rights abuses associated with Bunge’s business. Bunge’s soy operations were linked to tens of thousands of fires last year in the Brazilian Cerrado, a vast and fragile biome that ranks with the Amazon as Brazil’s most biodiverse ecosystem. Over 160 companies and investors urged Bunge to put a halt to any expansion there — a demand now underscored by this week’s mandate from the company’s top shareholders.

Bunge also does significant business in palm oil, another major driver of deforestation along with soy. Like soy, palm oil operations are often predicated on large scale land grabbing, social conflict and human rights violations. In 2020, US Customs and Border Protection blocked palm oil imports by one of Bunge’s Malaysian suppliers for use of forced labor, including “physical and sexual violence, debt bondage, and retention of identification documents and withholding of wages.” And earlier this year, Global Witness reported that nearly 40 percent of palm oil mills in Bunge’s supply chains were linked to criminalization and violence against land and environmental defenders.

It has taken years of relentless pressure to persuade large asset managers like BlackRock and State Street to use their leverage as investors to stop the ecological devastation they enable. But such shareholder votes, while important, are far from the last step. When companies fail to act, the money managers have the ability to vote out members of their boards (as BlackRock says it will do). And when push comes to shove, if the agribusiness and consumer goods giants continue to allow forests to fall for soybeans, palm oil and toilet paper, investors have a not-so-secret weapon: pulling their money from these companies altogether.

When a company goes public, it offers a mutual benefit: the company gets investments in the form of stocks, and investors receive regular dividends as reward for their risk. It can also be a democratizing process, which widens ownership over the most powerful companies in the world. Shareholder activism has proven an effective tactic for change because when all is said and done the goal of any responsible investor is to steer businesses towards long-term value. And there is no greater long-term value than ensuring the protection of that most intangible of assets: our planetary home.



Friends of the Earth

Friends of the Earth U.S. defends the environment and champions a healthy and just world. www.foe.org