Report links financial giants to deforestation of Paraguay’s Gran Chaco

Report links financial giants to deforestation of Paraguay’s Gran Chaco

  • Major banks and financial institutions including BlackRock, BNP Paribas, HSBC and Santander continue to hold substantial shares in – or provide financial services to – beef companies linked to illegal deforestation in the Gran Chaco region of Paraguay.
  • A report by rights group Global Witness released last month says these financiers knowingly bankroll beef traders accused of having links to deforestation, despite warnings in 2020 by U.K.-based NGO Earthsight about the beef industry’s impact on the Gran Chaco.
  • Almost all of the banks, investment managers and pension funds named in the new report are members of voluntary initiatives to eliminate and reverse commodity-driven deforestation from their portfolios.
  • Paraguay has one of the highest rates of tropical deforestation in the world, having lost a quarter of its net forest cover between 2000 and 2020 — an area almost twice the size of Belgium.

Some of the world’s largest banks and financial institutions are helping to finance beef companies linked to the destruction of the Paraguayan Gran Chaco, according to a report published by rights group Global Witness.

It lists investment giants BlackRock and Vanguard; lenders BNP Paribas, HSBC, Santander, J.P. Morgan and Bank of America; and pension fund APG as among the institutions that hold large investments in companies linked to illegal deforestation and land-grabbing.

“Our new investigation shows that banks are continuing to service and hold equity in companies linked to deforestation and human rights abuses, even when they made public pledges not to,” says the report, titled “Cash, Cattle and the Gran Chaco: How financiers turned a blind eye to Paraguay’s deforestation crisis.”

Even after it was made public in 2020 that deforestation had entered the beef companies’ supply chains, the financial institutions “continued to hold and even accelerate investments.”

Deforestation in the Chaco for cattle ranching. Image by Earthsight.

Paraguay’s Gran Chaco region is home to the second-largest forest in South America, covering around 60% of Paraguay, as well as areas of Argentina, Bolivia and Brazil. It has one of the highest rates of tropical deforestation in the world, with Paraguay losing a quarter of its net forest cover between 2000 and 2020, or an estimated 5.2 million hectares (12.8 million acres) — an area almost twice the size of Belgium.

The primary driver of deforestation in the Gran Chaco is cattle ranching.

This sustained loss, despite the Gran Chaco being designated a protected area in 2001, is having detrimental impacts on the estimated 49,000 Indigenous peoples who live there. It’s home to the only known “uncontacted” Indigenous group in South America outside the Amazon, known as the Ayoreo-Totobiegosode. The group has been fighting for its ancestral land for nearly 30 years, after being pushed away by cattle-ranching companies who obtained rights to their territory.

In 2020, London-based NGO Earthsight published a report, titled “Grand Theft Chaco,” which accused Brazilian beef company Minerva and Paraguayan meatpacker Frigorífico Concepción of buying cattle from two ranchers responsible for land grabbing and forest clearance within the ancestral lands of the Ayoreo-Totobiegosode in the Gran Chaco.

Global Witness drew from Earthsight’s original findings to form the basis of its new investigation, adding new financial data to reveal the actors behind the beef traders’ illegal operations.

“The Earthsight report made some strong allegations about how big meatpackers in Paraguay had been sourcing from branches that were well known to be deforesting in Indigenous land,” Charlie Hammans, civil society adviser at Global Witness, told Mongabay. What it hadn’t covered was the financial actors funding these operations.

“The reality is that very little has changed two years later,” Hammans said.

Throughout 2021, Minerva purchased cattle from Yaguarete Porá, a Brazilian-owned cattle firm. Between 2015 and 2019, the company was responsible for destroying an estimated 10,000 hectares (about 25,000 acres) of forest within the Natural and Cultural Patrimony of the Ayoreo-Totobiegosode (PNCAT). The same company also sold cattle to Frigorífico Concepción.

“These forests are the only source of food and medicine for these Indigenous communities, and the absence of public institutions has left many families facing disease, malnutrition and death,” said Ana Romero, a representative of the Indigenous Youth Union of Paraguay.

Romero said deforestation has caused contamination in villages. Companies feed the Gran Chaco’s slow-growing, dense hardwood trees into ovens to produce high-quality charcoal that’s shipped across the world. But these ovens are often installed near the homes of those who can’t escape the dark and dirty gray clouds of smoke.

Guireja, an Ayoreo woman, sits outside her house that she was forced to abandon as a result of logging, Paraguay. Image by Survival.
Guireja, an Ayoreo woman, sits outside her house that she was forced to abandon as a result of logging in Paraguay. Image by Survival International.

The Gran Chaco is also home to large mammals, many of them threatened species, such as jaguars (Panthera onca), Chacoan peccaries (Catagonus wagneri) and lowland tapirs (Tapirus terrestris). The boom in Paraguay’s meat and dairy industries has contributed to loss of habitat for many of these species, with few public policies focused on the sustainable conservation of the region’s important biodiversity hotspots.

“The many complaints that we make about illegal logging in our territories are not accepted or taken into account by our institutions,” Romero told Mongabay. “The greatest evil we have in the country is precisely corruption, and it covers all public institutions.”

In response to the allegations in the Global Witness report, Minerva said “there is no illegal deforestation, use of labour analogous to slavery or child labour and environmental embargoes in the Minerva Foods supply chain.”

It also denied any relationship with Yaguarete Porá, saying the supplier is “not registered in the Minerva Foods database,” and that there “were never purchases of the referred rancher.”

However, in Yaguareté Porá’s global impact report published in 2021 and seen by Mongabay, the company reports having sold products to Athena Foods, Minerva’s Chile-based subsidiary.

Frigorífico Concepción did not respond to requests for comment.

Cattle ranch in Gran Chaco. Image by Peer V via Wikimedia Commons (CC BY-SA 3.0).

Read more: Paraguay weighs natural gas drilling in Médanos del Chaco National Park

No pulling back

According to the report, even after reports of deforestation in the supply chains of Minerva and Frigorífico Concepción were made public by Earthsight in 2020, financial institutions maintained or even “accelerated” their investments in the two companies.

“Rather than there be any kind of indication of banks pulling back, we found examples of these banks doubling down and increasing their investments,” Veronica Oakeshott, head of forests campaign at Global Witness, told Mongabay.

The value of Santander’s holding increased by 1,000%, far outpacing the stock price increase and suggesting they bought more shares between 2020 and 2022. It also earned nearly $500,000 providing financial services such as bond underwriting to Minerva, as did HSBC and J.P. Morgan.

Santander was the only bank that responded to Mongabay, stating it doesn’t “knowingly finance any activity that leads to illegal deforestation or incursions into Indigenous territories.”

During the same period, Dutch pension fund APG and French bank BNP Paribas have seen the value of their shares in Minerva nearly double, at a time when Minerva’s share price increased by a similar amount. APG’s shares increased in value from $7 million to $13.7 million, while BNP’s increased from $740,000 to $1 million. Neither company provided comments in response to Mongabay’s requests.

Deforestation alerts between 2001 and 2020 in and around PNCAT are shown in pink.

Both BlackRock and Vanguard have maintained their investments in Minerva since the Earthsight report but the value of their shareholdings have slightly decreased by a few hundred thousand dollars.

However, both American companies have maintained million-dollar and increased investments in the meatpacking company since deforestation by Yaguarete Porá in the PNCAT was ruled illegal in 2018. Between September 2019 and December 2022, BlackRock’s shareholding in Minerva increased nearly fivefold to $4.78 million, far outpacing the company’s stock price increase and suggesting they bought more shares between 2019 and 2020.

During the same period, U.S. investment manager Vanguard saw the value of its shares in Minerva almost double, from $4.54 million to $8.56 million, at a time when Minerva’s share price increased by a similar amount.

When approached for comment, Vanguard told Mongabay that its investment team “engages with portfolio company boards and executives to understand how they oversee, address and disclose financially material risks, including environmental risks such as deforestation.”

It added that “Vanguard is a signatory to CDP Forests, an effort to advocate for better disclosure of material deforestation risks by public companies.”

Claudio Benitez (second to the left), leader of the Ñu Guasu Indigenous group, poses among other men from his community. Image by Matteo Fabi.
Claudio Benitez (second to the left), leader of the Ñu Guasu Indigenous group, poses among other men from his community. Image by Matteo Fabi.

U.N. biodiversity commitments in the air

At the United Nations Biodiversity Conference (COP15) in Montreal last December, many companies pushed for a new global agreement that would require large and transnational businesses and financial institutions to assess and disclose their biodiversity risks, impacts and dependencies throughout their value chains and portfolios.

BlackRock was one of the organizations that pushed self-reporting measures. Bank of America, which underwrote a $285 million bond for Frigorífico Concepción in 2021, the year after Earthsight’s report linked it to deforestation, also pushed for mandatory reporting of risks, dependencies and impacts for the private sector. Neither company responded to requests for comment.

“This report highlights the need to urgently transform our economic system by including the true value of nature and people alongside financial performance in decision-making and disclosure,” said Eva Zabey, executive director of Business for Nature, a coalition of businesses and conservation organizations.

“Businesses must act now to assess and disclose their material impacts and dependencies, set meaningful science-based targets, transform their business models by avoiding and reducing negative impacts, regenerate and restore nature and advocate for more ambitious public policies.”

Children playing in Chaidi, one of the 10 communities of the Ayoreo people that inhabit this area of Chaco in Paraguay. Image by Pánfilo Leguizamón.

Nearly all of the financial companies named in the report are signatories to the Net Zero Asset Managers initiative or members of the Net-Zero Banking Alliance (the only exception is Vanguard, which left the asset managers’ initiative at the end of last year). Both schemes require members to commit to reaching net-zero greenhouse gas emissions by 2050, as well as set targets to eliminate and reverse commodity-driven deforestation from their portfolios, according to Global Witness.

Critics say that because these commitments are voluntary, they fail to guarantee appropriate action.

“The continued exposure of these financial giants to deforestation and human rights abuses, despite their voluntary commitments to net zero, shows the need for governments to put laws in place to end the problems linked to these portfolios,” the report says.

“There have been a great number of voluntary agreements over the years,” Oakeshott added. “Time after time, unfortunately, they don’t meet their targets.

“This is not about information — information which is within the public domain. It’s about mechanisms to incentivize action,” she said. “And if those are not profit mechanisms, then they have to be legal mechanisms.”



Milán, M. J., & González, E. (2022). Beef–cattle ranching in the Paraguayan Chaco: Typological approach to a livestock frontier. Environment, Development and Sustainability, 1-26. doi:10.1007/s10668-022-02261-2

Mereles, M. F., Céspedes, G., Cartes, J. L., Goerzen, R., De Egea-Elsam, J., Rodríguez, L., … Cacciali, P. (2019). Biological corridors as a connectivity tool in the region of the Great American Chaco: Identification of biodiversity hotspots in the ecoregions of the Paraguayan Chaco. Research in Ecology2(1). doi:10.30564/re.v2i1.1324


Banner image: Jaguars still roam the Chaco, but they require large tracts of contiguous forest to survive and reproduce. As forest is destroyed, fewer of these intact landscapes exist. Photo by Eduardo Merille via Flickr (CC BY-SA 2.0).

Related listening from Mongabay’s podcast: We look at how agroforestry, an ancient Indigenous technology that is increasingly being adopted by farmers around the world, can help solve many of the major environmental issues we’re facing, from deforestation and biodiversity loss to climate change. Listen here:

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