chapter  7
15 Pages

Reclaiming pluriverse in CSR: Brazilian Indigenous peoples and the Finnish forest cluster

WithSusanna Myllylä, Independent Scholar, Finland

The study examined various agribusiness impacts on three Indigenous groups, and their relations to business management. First, how did the massive environmental change affect their livelihoods, social relations, identity, and cultures? Second, how did they articulate and defend their rights and interests? What did the land struggle-–a luta pela terra-–mean to the Indians? Third, did the communities expect certain CCR actions from the firms, and if so, what were these? How did they define what constitutes a “responsible” firm? Fourth, how did the communities perceive the influence of CCR initiatives on their lives? Did they benefit from social programs and other forms of corporate philanthropy? My research approach was based on Indigenous knowledge, rather than starting from the usual top-down perspective. I used a qualitative research methodology among the Indians, combining a case study with Grounded Theory and field ethnographic approaches. The research materials also included a few interviews at the corporate level and analyses of corporate disclosures or reports. The companies’

CCR policies, mutual relations, and their subsequent impact were brought under closer scrutiny by juxtaposing corporate words with corporate actions. Since nearly 50 years of land conflict between the Tupinikim-Guaraní and Fibria Celulose (formerly Aracruz Celulose) was resolved in 2007, the entire Indigenous territory (18,070 ha) was finally formalized in Espírito Santo state. The third community, the Pataxó, was chosen in this study as a specific focus group in order to find out Indigenous views and expectations as to what constitutes responsible business practices, and what a good relationship entails. The Pataxó are affected by a multinational Veracel Celulose. The Pataxó Indigenous Territory was waiting for official registration at its total size (52,000 ha) in Bahia state. I used my earlier interviews among the Tupinikim and the Guaraní as a reference case. The field research sites and the Indigenous territories are in Espírito Santo and Bahia (see Myllylä, 2015, pp. 50-52). The Finnish forest industry cluster is well established in Brazil: The SwedishFinnish Stora Enso and the Brazilian Fibria Celulose each owns 50% of their joint corporation, Veracel Celulose in Bahia. In addition, consultants such as Pöyry and Metso, which supplies machines and equipment, are involved in both states. Considering the operational context of business (see United Nations, 2012, pp. 20-21) in Brazil, the Finnish companies’ position becomes questionable: agribusiness on the Atlantic coast has benefited exceedingly well from a situation where the state has evaded its legal responsibility-–officially recognizing the ITs-–and therefore, industrial activities have been established on already disputed lands. In addition, agribusiness as a neighbor often creates side-effects for wider environments, diminishing local people’s livelihoods. Hence, the Finnish firms were entangled to various degrees in the multifaceted land struggles of the Tupinikim, the Guaraní, and the Pataxó. As one Pataxó member described the development impact of agribusiness (Myllylä and Takala, 2011):

Although the Finnish companies have duly outlined their CSR principles and the assumed societal benefits of their operations, they do not take into account local socioeconomic conditions among the Indigenous communities, namely poverty and the unequal distribution of economic and natural resources. Yet the protection of Indigenous rights is not exclusively an issue of the Brazilian Government (Bier, 2005) as the country has signed certain international agreements: ILO Convention No. 169 (the Indigenous and Tribal Peoples Convention, 1989); the 1948 United Nations Declaration of Human Rights; the 2007 United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP); the 1996 International Covenant on Civil and Political Rights; the 1966 International Covenant on Economic, Social, and Cultural Rights; and the 1972 Stockholm Declaration on the Human Environment. The ILO Convention No. 169 is the most important operative international law that is meant to guarantee the rights of Indigenous nations,

and it is a legally binding international instrument that deals specifically with the rights of Indigenous and tribal peoples-–Brazil ratified this in 2004. In addition to ILO Convention No. 169, the most critical international instrument is UNDRIP; these agreements are compatible and mutually reinforcing, as they define Indigenous peoples’ rights to lands, territories, and resources under international law (see Myllylä, 2015, p. 29). One fundamental problem, however, with a large number of guidelines and conventions, is the fact that they are scattered across numerous, mutually uncoordinated regimes and documents. Indigenous peoples’ juridical position is complex, delayed, and insecure in the country (Myllylä, 2014). Since the state itself does not adhere to domestic laws-–much less international agreements-–it is one of the primary violators of Indigenous rights. Hence a power vacuum allows multinational corporations (MNCs) to step in and benefit from the unclear situation. The UN Guiding Principles (GPs) on Business and Human Rights (2011, pp. 5, 14, 20, 23, 27), implementing the United Nations “Protect, Respect and Remedy” framework, specifically outline the state’s duty to protect human rights. The GPs emphasize that business should interact with governments in a way that affirms the state’s duty to protect Indigenous peoples’ rights. Furthermore, the GPs state that firms should pay particular attention to the rights, needs, and challenges of populations that may be at heightened risk of becoming vulnerable or marginalized due to business operations: the more extensive and severe the impact, the more a business needs to be aware of Indigenous peoples’ rights, and respect them. Therefore, business enterprises may need to consider additional standards. The recommendation is particularly valid with regard to agribusiness that much resembles extractive industries. These sectors usually cause massive environmental problems, leading to diverse negative social, cultural, and livelihood changes among poor rural and forest-adjacent communities (see for example, Myllylä, 2010). The concerns of the three Indian communities in this study, especially in territorial issues, reflect well on the Indigenous peoples’ rights under ILO Convention No. 169 (see articles 7, 13-19) and the United Nations Declaration on the Rights of Indigenous Peoples (see Articles 25, 26, 29, and 40, Appendix, pp. 183-187). This is also the case with regard to the cross-cutting issue of self-determination as a holistic concept. In the case of the Tupinikim, for instance, Fibria (Aracruz) questioned the origins and identity of the Tupinikim during the land conflict (see Myllylä, 2010). The ILO Convention defines the scope of Indigenous peoples’ lands: Indigenous peoples have rights over a broader territory, comprising the total environments of areas which these communities occupy or otherwise use, inclusive of natural resources, rivers, lakes, and coasts (see also International Labor Organization, 2013, pp. 21, 22, 23). However, these wider Indigenous territorial rights were not apparent in the Brazilian cases, since the companies restricted the Indians’ movement and livelihoods. The UN Declaration (Article 18, Appendix, p. 182) recognizes that Indigenous peoples have a right to participate in decisions that affect their rights. In Brazil, the Indigenous communities are excluded from decision-making concerning the arrival or location of foreign companies. The communities are not involved in the

business decision-making on the more equitable benefits. In fact, they did not claim to be part of the decision-making, except concerning the Indigenous territory issue. I also found minimal assistance to Indigenous communities compared with the huge financial profits that the Finnish companies produced in the region (see Myllylä, 2014). The Indians were afraid to lose the small benefits, such as school kits. The Business Reference Guide (BRG) to the UN Declaration on the Rights of Indigenous Peoples recommends that business should not force development on Indigenous peoples. This refers to modernizing or interfering with the local economic dynamics and making the community too dependent upon the company’s presence (United Nations, 2013, p. 38). I found that the Finnish companies’ developmental role in Brazilian society is not small and undetectable. Stora Enso and the associated firms and export credit agencies comprise a powerful political and economic actor group, critically influencing local and regional development processes. Thus I argue that the main corporate CSR approach here, philanthropy, is likely to create dependency and tensions among the community members, if the aspects of equality and Indigenous cultures are not properly taken into account (Myllylä, 2014). This raises the question of whether corporate philanthropy is always a “good thing” if there is no scrutiny of how firms are carrying out their activities. The BRG encourages business to engage in meaningful consultation and partnership with Indigenous peoples on a local level. The BRG also suggests the use of a company ombudsman to deal with community grievances (United Nations, 2013, pp. 2, 11, 32). In Brazil the companies’ attempts to create partnerships with Indigenous villages were lopsided since some villages received more assistance than others. For instance, several village chiefs discussed how to improve the partnership with Veracel, and as a result they received project funding. The other chiefs complaining of ongoing land disputes with the firm were excluded from philanthropic activities. A few villages preferred to avoid any contact with Veracel. Nevertheless, in corporate reports and media the firms treated and discussed their local stakeholders as consisting of a homogeneous stakeholder group. Some villages also complained that the company management visited them and consultations were organized, but this did not lead to any positive change; people felt they were not genuinely listened to and processes were selective. The BRG acknowledges that businesses are reporting on positive engagements with Indigenous peoples and the resulting benefits (United Nations, 2013, p. 7). In light of my research, it is quite difficult to rely on corporate disclosures as they tend to prettify situations and report selectively, for the most part leaving out the drawbacks. For instance, Veracel does not much mention nor analyze its local incidents with the Pataxó, or reveal the undermining land dispute as the main cause for these. Instead, the company characterizes its relationship with the communities as harmonious. Furthermore, the actual corporate-community interactions are in stark contrast with the corporate disclosures assuring the public that the companies operate according to the regulations and guidelines. However, the reports never specify the principles that should govern the firms’ relations to Indigenous peoples

in multiple ways. The companies (Veracel, Stora Enso, and Fibria) in their reports do not refer to Indigenous rights, but more generally to human rights. On the other hand, it is difficult to ascertain whether keeping silent about the breadth of Indigenous rights is a chosen business tactic or just indicates their ignorance. Perhaps traditional pulp and paper production is such a field of industry that its growth logic is incompatible with local communities with little education that depend on their environmental resources. Hence, although the national and international regulatory framework protecting Indigenous rights is strong, these companies do not recognize it in its entirety. Therefore, it can be argued that if the most critical questions, such as Indigenous land titles, are not a priority in corporate-community relationships, firms may merely buy local acceptability via social programs and other philanthropic actions. The Brazilian experience illustrates how complex the situations can be, challenging the guidelines, which must balance between general and specific issues. Firms can secure membership and respectable status in international institutions and national societies promoting responsible business, and even receive multiple awards for good CSR performance, while simultaneously violating the rights of their Indigenous stakeholders in diverse ways, as the Brazilian experience illustrates. At the time of the land dispute incidents comprising violations of human rights and Indigenous peoples’ rights in Espírito Santo State in 2005/2006, Fibria (Aracruz) enjoyed membership within the United Nations Global Compact, whose basic principles include respect for the rights of Indigenous peoples (see United Nations, 2013, p. 38). Furthermore, Veracel was expelled from the Global Compact in 2010 because the company failed to communicate progress by the required deadline, unbeknownst to the Stora Enso Sustainability Communications group (personal communication, 2011). The UN Global Compact has 10 principles covering human rights, labor rights, environmental protection, and anticorruption (see p. ix). However, these principles can be considered too general and vague compared with the complex situations of the Brazilian Indians vis-à-vis the pulp industry. Therefore, the principles do not offer practical guidance for the firms to encounter Indigenous communities, and hence the firms make their own, free interpretations. Information from the local stakeholder situations does not reach these types of global institutions (such as the UN Global Compact) since they do not have the capacity or proper monitoring and feedback systems, and rely too much on lopsided corporate disclosures. How could we then improve national and global regimes promoting good corporate governance? The first step is to focus more specifically on indigeneity itself: What kinds of elements are involved, and how does corporate-community interaction differ from other stakeholder situations? What kinds of Indigenous knowledge systems emerge, and how does Western scientific knowledge communicate with them-–how can these diverse knowledge systems encounter in a productive way? By retrospectively assessing the Finnish companies’ performance in Brazil, the Business Reference Guide to the UN Declaration on the Rights of Indigenous Peoples offers a concise package for the concerned companies’ diverse management

levels, and perhaps could result in a higher corporate responsibility performance. Various guiding principles on business and Indigenous rights in general could further improve by offering more detailed recommendations on how to act in respect to complex incidents and other situations, such as when the business operation sparks an Indigenous resistance movement, or how to recognize and deal with certain demographic, political, economic, and social chain reactions deriving from business operations. Such situations are, for instance, created when agribusiness requires large land areas, expanding onto unregistered Indigenous lands or their vicinity, and furthermore, creating the loss of livelihoods, forcing people to live in poverty pockets, or to migrate to urban slums or protected rainforests. In addition, we need more critical analyses on corporate philanthropy in the global South, relying more on independent and transparent evaluations rather than only the companies’ self-assessments.