Environmental groups are outraged that the world’s biggest meatpacking company, JBS, which has long been linked to Amazon’s deforestation, has received approval from US authorities to list on the New York Stock Exchange.
The decision, announced on Tuesday by the Securities Exchange Commission, follows reports that JBS subsidiary Pilgrim’s was the biggest donor to the inauguration committee of Donald Trump. Since taking power, Trump hasreduced the independenceof the SEC and other agencies, demanding their work be “controlled” by the president.
The Brazil-based company’s shares elsewhere hit a record high on Tuesday whennews broke of the SEC rulingon the contentious application, which has been tussled over for several years, and is a joint listing with Amsterdam.
Last week, JBS filed a report to the SEC saying it would hold a general shareholders meeting about the listing on approximately 23 May, and that the first day of trading of its shares in New York could be as early as 12 June.
The joint listing is expected to raise the value of the multinational, which started as a family business and grew globally with the support of Brazil’s national development bank. Almost half of its revenue now comes from the United States, where it sells household brands including Pilgrim’s, Moy Park, Seara and Primo. It also has a significant presence in Australia and strong sales in Europe and China. The companywebsiteboasts: “We feed the world with the best.”
But it has alarmed conservation groups, who fear JBS will use the extra financial resources to expand its market and environmental footprint.
JBS has been linked to deforestation on multipleoccasions, and the New York attorney general, Letitia James,filed a lawsuitlast year accusing the company of misleading consumers with its climate goals in an effort to increase sales. That lawsuit was dismissed in February.
A bipartisan group of 15 US senators had urged the Securities and Exchange Commission to reject JBS’s application for a share listing. “Dozens of journalistic and NGO reports have shown that JBS is linked to more destruction of forests and other ecosystems than any other company in Brazil,” they wrotein an open letter.
JBS – which is dominated by two brothers from the founding family, Joesley and Wesley Batista – had promised to clean up its supply chain in the Amazon rainforest, but ayear-long investigation published last weekby the Guardian, Unearthed and Reporter Brasil found widespread scepticism by frontline workers that the company’s new cattle tracing system will be ready by the deadline commitment of the end of this year. JBS has told the Guardian that it contested the conclusions of that investigation which it said were drawn from “a limited sample of 30 farmers”, saying it was irresponsible to disregard that JBS has “over 40,000 registered suppliers”.
The company has also had to pay fines or make plea bargains in severalhigh-profilecorruption cases in Brazil and theUnited States.
A recent Federal Election Commission filingrevealedJBS subsidiary Pilgrim’s made the largest single donation of $5m to Trump’s inaugural committee for his second term.
Environment groups linked the listing decision to Trump’s executive order for the SEC and other formerly independent regulatory agencies established by Congress to be accountable to the White House. Thatdecreestates: “In order to improve the administration of the executive branch and to increase regulatory officials’ accountability to the American people, it shall be the policy of the executive branch to ensure Presidential supervision and control of the entire executive branch … Officials who wield vast executive power must be supervised and controlled by the people’s elected President.”
Glenn Hurowitz, the CEO of the Mighty Earth environmental watchdog group, said: “Given the company’s long rap sheet of illegal and corrupt conduct, it’s hard to see how the SEC could have confidence that JBS won’t deceive US investors. The approval of JBS’s IPO shows this is no longer the independent SEC that has upheld honest practices on American markets for nearly a century.”
Others echoed the risks a listing posed to both investors and communities around the world. “By almost every metric, a company like JBS has a detrimental impact on society. Allowing it to list on the world’s largest stock exchange – unlocking vast opportunities for expansion and profit – shows the deep failures of the US financial regulatory system. This decision is a disaster for both people and the planet,” said Alexandria Reid of Global Witness, an environmental justice organization.
Greenpeace UK said JBS’s plans for global expansion threaten to tip the planet further towards climate chaos. “JBS built its meat empire on a history of corruption, broken promises and environmental destruction, including emissions that would make even fossil fuel companies raise an eyebrow,” campaigner Daniela Montalto, said. “This listing will benefit only the billionaire Batista brothers who sit at the helm of JBS, while ordinary people pick up the tab for climate chaos and environmental destruction that industrial agriculture is driving.”
Asked about the criticism from the green groups, JBS said in a statement: “JBS believes the dual listing presents a compelling opportunity for stakeholders interested in the performance and sustainable growth of the company. The proposal creates value for our team members, the communities where we operate, and investors. We’ve maintained ongoing disclosures with domestic and foreign investors and partners, who have repeatedly demonstrated their confidence in the credibility and robustness of our policies.
“JBS will continue to partner with farmers, NGOs, universities, customers, and other stakeholders to identify ways to reduce agricultural emissions, combat global food insecurity, and enhance the sustainability of food systems. Agriculture has an essential role to play in the climate change solution, and companies like JBS can and should help lead collective action.”
The company repeated its comment on the investigation published by the Guardian last week about deforestation, saying that “while the sector-wide challenges are significant and larger than any one company can solve on its own, we believe JBS has an in-depth and robust series of integrated policies, systems, and investments that are making a material and positive impact on reducing deforestation risks”.
Asked about the listing on the New York stock exchange, the SEC declined to comment, a spokesperson said.