Storebrand Asset Management, based in Norway, has collected signatures from a total of 29 companies, which include Legal & General Investment Management Ltd, Sumitomo Mitsui Trust Asset Management and NN Investment Partners.
Together, the companies have $ 3,75 billion in assets under management, according to a statement by Storebrand.
In the letter, sent on Monday to the Brazilian embassies in Norway, Sweden, France, Denmark, the Netherlands, the United States (USA) and the United Kingdom, it is said that “the dismantling of environmental and human rights policies is creating a widespread uncertainty about investment conditions or provision of financial services to Brazil ”.
The companies requested to start a dialogue on the problem.
In the letter, Brazilian law projects to legalize the occupation of public lands and allow mining in indigenous territories were highlighted.
The signatories also criticize the current Minister of the Environment, Ricardo Salles, who in a cabinet meeting held last April suggested that the Government should take advantage of the fact that public attention is focused on the covid-19 pandemic to relax environmental control rules and allow the expansion of productive activities in the Amazon.
Asset managers did not explicitly threaten disinvestment, but said they were concerned about deforestation and the violation of indigenous rights, which could pose risks to clients and the companies in which they invest.
“When considering the increase in deforestation rates in Brazil, we are concerned that companies exposed to potential deforestation in their Brazilian operations and supply chains face increasing difficulties in accessing international markets. Brazilian sovereign bonds are also likely to be considered high risk if deforestation continues, ”the letter reads.
Bolsonaro, who defends initiatives questioned by environmentalists about preserving the environment, encourages agriculture and mining in the forest, even in demarcated protected areas where such activities are prohibited.
In July last year, Bolsonaro dismissed the then president of Inpe for disagreeing on the methods used by the Brazilian space agency to measure deforestation in the largest tropical forest in the world.
Bolsonaro's speeches in favor of commercial exploitation in the Amazon also encourage woodcutters to increase illegal logging to extract timber, as well as farmers who have promoted an illegal expansion of their cultivation areas in the region.
Because of Bolsonaro's environmental policy, some members of the European Parliament said they would vote against ratifying a free trade agreement between the European Union and the Mercosur customs union, which includes Brazil, signed in June, after two decades of negotiations .
Deforestation in the Brazilian Amazon increased by 54% in the last 10 months compared to the immediately previous period, with a total of 4.567 square kilometers of forest destroyed between August last year and May 2020, according to the non-governmental organization's Deforestation Alert System Institute of Man and the Environment of the Amazon (Imazon).
In May alone, the Brazilian Amazon lost 649 square kilometers of native tropical forest, registering the second highest rate of deforestation for this month in the last decade.
In addition to deforestation, the Brazilian Amazon was heavily threatened last year by fires that struck the region between June and August, forcing the Government to send the Armed Forces to help control the fires.
The Amazon is the largest tropical forest in the world and has the highest biodiversity recorded in a single area of the planet.
It has about 5,5 million square kilometers and includes territories of Brazil, Peru, Colombia, Venezuela, Ecuador, Bolivia, Guyana, Suriname and French Guiana (belonging to France).