Pension funds and other investors have met with the Brazilian Congress to discuss potential improvements to the country’s sustainable management of the Amazon rainforest.

As reported in our sister publication, European Pensions, the 26 financial institutions met with Congress to outline five areas of development they wanted to see improvements in, or risk losing their investments.

These areas were: A significant reduction in deforestation rates; the enforcement of Brazil’s Forest Code; the ability of Brazil’s agencies to carry out their mandates effectively, as well as any legislation that may impact forest protection; the prevention of fires in or near forest areas; and public access to data on deforestation, forest cover, tenure and traceability of commodity supply chains.

Following the meeting, the Brazilian government agreed to deploy the military in future to help prevent forest fires.

Danish pension fund, MP Pension, is one of the investors participating in the initiative. Its investment director, Anders Schelde, commented: "It is gratifying that something is starting to happen in Brazil. But the decision is only the first small step. Much more is needed to save the rainforest in the Amazon.

"If large investors come together, we represent a considerable sum of billions. Brazil needs this money badly, so if we threaten to pull our investments out of the country, they will have to listen.”

Engagement with the Brazilian government began on 23 June 2020, when 34 financial institutions wrote an open letter to Brazilian embassies calling for action on deforestation.

The 34 institutions represent over $4.6trn in funds.

The group of 26 investors that attended the meeting included pension funds from the across Europe.

The meeting attendees were: Storebrand Asset Management, BlueBay Asset Management, NN Investment Partners, Robeco, KLP, SEB Investment Management, AP2 Second Swedish National Pension Fund, Legal and General Investment Management, Nordea Asset Management and Sumitomo Mitsui Trust Asset Management, Aviva Investors, Actiam, a.s.r. asset management, Church Commissioners for England, LGPS Central, Border to Coast Pension Partnership, Brunel Pension Partnership, Surrey Pension Fund, Northern LGPS, The Local Authority Pension Fund Forum, Church of England Pensions Board, Comgest, Fram Capital, Domini Impact Investment, MP Pension, Pax World Funds, and AP Pension.

Commenting on the meeting, Storebrand Asset Management CEO, Jan Erik Saugestad, said: "We are pleased to hear that the House share our concerns.

"The representatives expressed that they will not vote on matters related to the environment that may damage Brazil's image abroad and any approval of bills needs to go through proper process.

"This is important to ensure a regulatory framework that is consistent, long-term and protects the forests and the best interest of Brazil, companies, and investors.

“Given the recent developments with increasing deforestation, action will speak louder than words."

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