Response from Vale about new reports with allegations of abuses related to the communities of Califórnia and Piquiá de Baixo, in Maranhão, Brazil, related to the company operations
25March 2014
The Business & Human Rights Resource Centre invited Valeto respond to the following items:
- [Full report] [PDF] “Briefing paper: Business and Human Rights: Enhancing Standards and Ensuring Redress”, International Federation of Human Rights (FIDH), March 2014
file:///C:/Users/Julia/Documents/BHRRC/Companies/Vale/Piquia%20de%20Baixo/briefing_enhance_standards_ensure_redress_web_version.pdf
- [Press release]“Business and Human Rights: FIDH Calls on the International Community to Enhance Standards and Ensure Redress”, FIDH, 12 March 2014
- [Portuguese] “Piquiá de Baixo: mais uma conquista rumo ao reassentamento”, Justiça nos Trilhos, 9 de março de 2014
Valesent the following response to the Resource Centre:
Proposed answer to BHRRC, regarding references to Vale on the report
“Enhancing Standards and Ensuring Redress”, International Federation of Human Rights (FIDH)
Regarding references to Vale on the briefing paper “Business and Human Rights: Enhancing Standards and Ensuring Redress", International Federation of Human Rights (FIDH), the company clarifies that:
Since 2010, Vale has maintained dialogue with the community of Piquiá de Baixo, located in the industrial area of Açailândia, state of Maranhão. In 2010, Vale - through Vale Foundation - developed a socioeconomic diagnosis of 330 families located in the community. This diagnosis had strong community participation and was completed and submitted to the Public Prosecutor’s Office in early 2011. During this process, a commission of 30 families was instituted in order to represent all the families involved.
Subsequently, Vale made a committement to fund the elaboration of the housing project of the new district, in order to allow public funding to be directed for the construction of homes. In July 2012, Vale made an official appeal proposal, to the Public Attorneys Office of Açailândia, of R$ 400 reais. This amount was destined for the elaboration of the housing project and would be credited to the Community Association of Piquiá de Baixo, as wished by the community. The Prosecutor and Public Defender offices would oversee the process, being responsible for supervision, management and implementation of resources.
In August 2012, the Public Attorney’s Office opted to have the housing project financed by the local union SIFEMA, accepting an amount inferior to that initially offered by Vale. Vale´s contribution to the project was, therefore, no longer needed. The court judgment approving the expropriation of land for which families will be removed was filed in December 2013. Currently, Vale maintains contact with local authorities and the local Prosecutor, in order to assess future opportunities for support.
Pig-iron value chain
Vale does not corroborate the practices of child or slave labor in its value chain. Thus, in 2005, Vale became a signatory to the National Pact for the Eradication of Slave Labor in Brazil, an initiative led by the Ethos Institute.
In August 2007, following the allegation of irregularities in the acquisition of coal from deforestation, and the use of slave labor, Vale suspended the supply of iron ore to eight of its clients. The same occurred in November 2011, when three clients were involved in allegations of purchasing coal of illegal origin. In both cases, Vale also suspended shipping to these clients and the supply was only resumed after provision of documentary evidence of suitability and site audits. To this date, Vale has not reestablished the commercial relationship with one of the companies involved in irregularities, since it could not identify the source of 40% of its coal.
Today, contracts of iron ore to pig iron sector are renewed quarterly, in order to maintain permanent control. A series of documents are required and later scrutinized, in order to prove the origin of the charcoal; the legality in the use of labor is required; and clauses are included in contracts with clients in Brazil that allow for the interruption in the supply of iron ore in case of evidences of noncompliance with obligations related to environmental protection and the prohibition of the use of child or forced labor. In 2009, Vale´s Code of Conduct for Suppliers became mandatory for the accreditation of new suppliers. Currently 100% of the companies that sell materials, equipment and services associated to Vale´s operations are adherent to the document.
Moreover, since 2010, a sustainability clause is applied in the contract with suppliers in Brazil, where companies undertake to comply with the Supplier Code of Conduct and share the values of Vale´s Sustainable Development Policy and Human Rights Policy. The company also monitors the list of the Ministry of Labour and Employment (MTE), which identifies companies and individuals denounced for possible occurrences of forced labor in the country. In 2013, three suppliers were identified in that list. Despite being active in our database, we did not have commercial transactions with these companies and new acquisitions were blocked.
Vale is committed to tackling child labor, forced or compulsory labor and the exposure of young people to hazardous work. For this, the company is establishing processes to actively manage these risks. Child labor and forced or compulsory labor in the value chain are addressed in the risk management tools and processes of human rights in Vale´s projects and operations.
Vale considers crucial the awareness of the value chain of the importance of sustainable charcoal production, aiming at the elimination of practices and activities that violate labor rights or cause harm to the environment.
As Vale does not corroborate illegal deforestation, the use of coal produced illegally or the violation of human rights, it mobilized relevant actors to address these issues, such as Bioatlântica and the Imaflora Institute, in order to develop a program for Engagement and Verification of Pig-iron in the Value Chain. The program aims to promote sustainability in the steel chain, engage and evaluate pig iron producers regarding the adoption of sustainable environmental practices, and induce the increase of supply of raw material (wood and charcoal) from renewable and legal sources to meet the industry demands.
The first stage of the program will be training aimed to guide companies that will be verified by the program as well as suggest action plans for their suitability. The second phase, of verification, will score and rank the companies annually. From the implementation of the program onwards, Vale intends to ensure the supply of iron ore only to sustainable producers. Importantly, today, while the program is still under development, the company offers sustainability bonus (5% discount) for companies that use more than 80% of the coal produced by their own forests, what already occurs with two of its customers : Queiroz Galvão and Planting.
In 2013, the Brazil Steel Institute (IABR) asked the Brazilian Association of Technical Standards (ABNT) to open a process for creating a certification standard to address sustainability aspects and requirements linked to the production of pig iron based on charcoal. This initiative represents the implementation of the first phase of the program foreseen in the Sustainability Protocol of Charcoal created by the steel companies and sponsored by IABR, wiith Vale´s support in 2012.
A study commission was created to verify the aspects of sustainability to be met in the production of pig iron charcoal, comprising the origin of wood and charcoal, good manufacturing practices, environmental measures, control and monitoring systems and other sustainability criteria. Vale participates in the commission contributing technically to its studies.
At the end of 2013, Vale resumed its support the Instituto Carvão Cidadão (Citizen Coal Institute), an organization that works to introduce best practices in the pig iron production chain in the Industrial area of Carajás.
Assentamento Califórnia – Açailândia
In 2013, Vale undertook a health study in the community of the `Califórnia Settlement`, in Açailândia. The study was undertaken by a specialized health consultancy firm, and approved by local health authorities. Since the onset of the study, the community took active part in the initiative. At the closure of the study, its findings were shared with the health authorities and the community leaders.
As part of Vale´s Foundation voluntary social investment program, the ´Califórnia Settlement´ community will be included in two health projects developed in the region. Both projects, ´Health Cycle´ and ´Development Rails` aim to contribute to the improvement of the community´s health conditions. Health Cycle will work on the improvement of the outpatient practice and capacity by the refurbishment of the local health post, responsible for the family health program in the community. Furthermore, the post´s staff will receive additional training. The program Development Rails will work alongside the community to implement health promotion social technologies. Both programs will be initiated during the first semester of 2014 and will be implemented by social organizations who are partners of Vale´s Foundation.
In relation to spying allegations, Vale refutes all accusations and does not comment on matters that are under investigation by the competent authorities.