BRF SA
BRFS3:BZ BRBRFSACNOR8
Key Information
HQ:
Brazil
Market Cap:
$1.35bn
Primary Markets:
Asia, LATAM, MENA
Waste & Pollution Engagement
Analysis Overview
Risk Assessment Value Chain Coverage Risk Mitigation Circularity Company Engagement
Analysis Breakdown
Risk Assessment
Good
Coverage of water quality risk assessment
The company provides details about the Hydric Vulnerability tool it uses to assess water risks, including water scarcity and quality. The company has conducted a risk analysis and discloses the number of facilities with significant water risk exposure. The company mentions that it has prioritised the six units with the highest levels of water vulnerability and discloses the locations. It also discloses that South Brazil is where the majority of its facilities are at risk from its water assessment. However, the company does not fully disclose all its facilities at risk.
The company explains the methodology and data sources clearly. The company uses both the WRI Aqueduct tool and CDP Water. It also mentions that it has expanded the tool to cover all its international operations.
Transparency and disclosure of water quality indicators
The company discloses that in 2021, the sum of R$ 1,630,983.52 was received in fines of an environmental nature. The previous year, the sum was R$ 1,144,921.38. There was a reduction in monetary sanctions, dropping from 15 received in 2020 to 11 in 2021. BRF also mentions no incidents related to non-compliance with water quality permits, standards and regulations during the reporting period.
The company discloses the Biochemical Oxygen Demand (BOD) removal level for wastewater quality indicators.
Recognition of nutrient pollution risk on biodiversity
The company has included biodiversity in its list of material topics. It adopts a top-down biodiversity approach which identifies sites in areas of high biodiversity value (both protected and not) and why they are under pressure. It highlights how the company is managing deforestation to preserve biodiversity. However, the company does not explain how biodiversity and nature risks drive the company´s water quality assessments.
The company is focused on meeting regulation in Brazil and doesn't discuss whether this constitutes a baseline for operations in Turkey and elsewhere.
Value Chain Coverage
Poor
Inclusion of upstream feed and livestock suppliers in risk assessment
The company discloses the farms included in the risk assessment, clearly indicating the portion owned, integrated, leased, contracted or fully independent.
The company indicated that much of its feed is produced locally and that its manure and animal waste aren't sufficient to fertilise those fields fully. However, there is no disclosure on how its manure nutrient management plan is connected to its feed.
Downstream use of manure by animal feed suppliers
The company also recommends and encourages all its producers to use animal waste as organic bio-fertilisers, in line with current legislation. This appears to be related to livestock producers rather than a link with feed producers. The company acknowledges such overlap but disclosure needs to be clarified.
Acknowledgment of regulatory risks
The company discusses meeting current regulations, but there is no discussion of regulatory movement.
Transparency on non-compliance from suppliers
The company mentions that all the properties belonging to integrated producers and its farms receive four-monthly inspections, including animal waste management. However, the company does not disclose the results of these inspections.
Risk Mitigation
Poor
Biogas generation and organic fertilisers from animal waste
On the engagement call with FAIRR, the company mentioned that biodigesters are used in integrated farms. However, in its public disclosure, the company says that the leading method of waste disposal is transforming waste into organic fertiliser, but it does not mention biogas production.
The company also mentioned that it pays farmers to have biodigesters. However, the company must still disclose that information in its public reporting.
Target-setting for water quality
The company says all its units have contingency plans to ensure their activities do not have material impacts. It mentions various initiatives and efficiency projects to optimise water use, including water recycling. However, it does not disclose targets/plans per se to improve the overall quality of wastewater discharged.
The company says 100% of integrated producers and own farms are part of the Operational Excellence System, which assesses how animal waste is managed. The company mentions providing support concerning the correct management of waste as well as encouraging suppliers to use waste as organic fertiliser. However, there is no more information about what happens with the manure afterwards.
Support to third-party suppliers
The company mentions that part of the farmers’ environmental licensing includes the management and destination of the waste on the property. It recommends and encourages all producers to use animal waste as organic bio-fertilizer. However, there is no information about supporting downstream third-party-arable farmers.
Circularity
Poor
Pilot projects around nutrient circularity
The company does not disclose information.
Disclosure of investment in circular solutions
The company does not disclose information.
Targets to increase share of manure under circular initiatives
The company does not disclose information.
Company Engagement
Good
Level of company engagement with the coalition
The company provided a timely response to the investor letter. It also responded to the engagement questions and met with investors within the engagement period. The company acknowledged FAIRR´s assessment, but it did not provide feedback.
Workstream Information
2023 level
Medium
Index Waste & Pollution Score:
22/100
Assessed Proteins:
Poultry and eggs, Pork
Last Updated:
28 June 2023
2023/24 Resources
Phase 1 | Key Findings Report Waste & Pollution Engagement