Marfrig issues sustainability bonds
- The “sustainable bonds” are securities linked to environmental, social and corporate governance projects. Marfrig is the first company in Brazil to issue such bonds
- Funds raised in the international market will be used to source cattle in the Amazon Biome region using control systems that prevent sourcing from deforestation areas
São Paulo, July 30, 2019 – Marfrig Global Foods, one of the world’s leading beef producers, today announced the issue of sustainable bonds in the international market.
The US$500 million, 10-year offering, with coupon of 6.625%, is the longest and cheapest issue carried out by the company, and is being coordinated by Santander, ING, BNP, Banco do Brasil, Bradesco, BTG, Nomura, HSBC, XP and Rabobank. The company’s securities were classified as Sustainable Transition Bonds and place Marfrig as a pioneer in sustainability in the industry.
One of Marfrig’s strategic pillars is sustainable development. In all the countries where it operates, Marfrig has taken concrete steps to reduce the impact of its activities on the environment. In recognition of its efforts to reduce deforestation across its value chain and consequently reduce GHG emissions, Marfrig was honored by the Forests Program of the Carbon Disclosure Program (CDP), which represents member investors who wish to understand how companies address their exposure to deforestation risks.
In this context, Marfrig is the benchmark of sustainability in the industry, which is evident from a series of pioneering initiatives. Since 2009, the Company has maintained a public commitment to “Zero Deforestation” in the Amazon Biome. In 2010, the company launched the Marfrig Club program, which encourages its suppliers to adopt the best farming practices based on three pillars: Respect for Animals, Respect for the Environment and Respect for Society. In 2015, Marfrig launched the world’s first beef certified by Rainforest Alliance, the global benchmark in sustainability. In 2019, through a partnership with the Brazilian Agricultural Research Company (Embrapa), the company will introduce in the market the first beef with the “Zero Carbon Beef” seal produced under a strict protocol certified by independent auditors.
Continuing this pioneering spirit, in the last five months Marfrig underwent audit conducted by the French firm Vigeo Eiris, one of the world’s leading certification authorities. At the end of the process, which involved diverse stakeholders, Vigeo Eiris concluded that the Company meets the sustainability requirements and best practices set by the International Capital Market Association (ICMA), Switzerland, which brings together leading global debt market investors. Marfrig was Brazil’s first company in the industry to receive this certification.
“Sustainability is one of the strategic pillars of the company and the certification underlines our commitment to initiatives in this area and places Marfrig at the vanguard of the industry,” said Eduardo Miron, CEO of Marfrig Global Foods.
Proceeds from the Marfrig Sustainable Transition Bonds issue will be invested in sourcing cattle from the Amazon Biome, more specifically from the Brazilian states of Mato Grosso, Pará and Rondônia. Marfrig will strive to ensure that cattle farmers in the region meet the requirements and criteria established in its sustainable sourcing protocol. All cattle farmers must reiterate the commitment to not use slave or forced labor or child labor, or raise cattle in indigenous reserves, conservation units, blacklisted areas or deforestation areas. By honoring these commitments, they become qualified to supply cattle to Marfrig.
At present, Marfrig is the only company with georeferenced maps for 100% of its suppliers in the Amazon Biome. The mapping provides geospatial analysis containing all the data of suppliers and identifies whether they are operating in agreement with the Amazon Biome. Marfrig is the only company in the sector to be judged 100% compliant in the independent audits carried out by DNV GL in the last seven years in a row.