To promote regularization and increase socio-environmental compliance in cattle-raising production, the BNDES has established a set of guidelines that must be followed by companies applying for financing and stakes in companies.
The guidelines encompass the entire country. The challenge is to meet the growing demand for beef and establish a production model that guarantees the preservation of natural resources, as well as respect for workers and communities. Instituting environmental safeguards is one way to stimulate modernization and foster a gain in competitiveness in sustainable bases.
Meatpacking companies and slaughterhouses need to prove, for example, that their suppliers have not been charged with trespassing on indigenous lands, with discrimination, child labor or slavery. Neither can they set up in areas that IBAMA has embargoed. In addition, financing applicants must commit to maintaining an updated list of suppliers as well as verifying they are abiding by the rules so as to monitor environmental compliance throughout the supply chain.
These new guidelines, established in October 2009, strengthen other efforts within the BNDES' social and environmental policy. Thus, this reinforces the Bank’s concern to finance the country's development in accordance with the basic principles, such as respecting the environment and human dignity.
Following are the rules for:
During the analysis phase of a request for financial support, applying companies and all their branches, must provide proof that a list of direct suppliers is kept, with information such as a corporate name, individual taxpayers number (CPF) or a corporate taxpayer’s number (CNPJ), a geo-referenced property, registration number in the National Rural Registration System and an environmental license number.
The company should also prove that it offers a system with cattle purchasing procedures, including only direct suppliers who have proven they meet the following conditions once the applicant has carried out an assessment:
Applicants for financial support should declare that the system to purchase cattle meets the BNDES' requirements. False declarations may result in the immediate termination of the contract, in addition to applicable legal penalties.
Still in the analysis phase, companies applying for financial support from the BNDES should meet the following requirements in all their branches:
The BNDES also adopts guidelines and environmental criteria in automatic indirect operations, that is, those conducted through an accredited financial agent and worth up to R$ 10 million.
During analysis of operations, applying companies should deliver a declaration to the financial agent stating that they keep records of direct suppliers with the same information required in direct operations, non-automatic indirect operations and stakes in companies. Companies should also declare that they maintain a system with procedures to purchase cattle from direct suppliers that includes only those that meet the social and environmental conditions already mentioned, such as never having been convicted of practicing child labor and slavery, and having submitted an environmental permit.
A special obligation in the contract for financial support requires beneficiaries to update and maintain registration of direct suppliers available to the financial agent and to the BNDES. Non-compliance may result in the contract being terminated early. The BNDES may request the list of suppliers at any moment up to the full repayment of the loan.
Resources will not be released if financial agents do not receive the updated list of the company’s direct suppliers. In the case of the BNDES card, such a list must be submitted upon the request for documents to issue the card, when renewing the credit limit, and when the accredited financial institution is updating registration.
False declarations may result in the immediate termination of the contract, in addition to applicable legal penalties.