Cosmetics maker Natura urges Brazil to protect Amazon after fires hit suppliers

SAO PAULO (Reuters) - Brazilian cosmetics maker Natura & Co NATU3.SA is pressing government officials, the private sector and local communities to bolster environmental protections in the Amazon after fires this year disrupted its supply chain, its chief executive told Reuters.

Natura's Chief Executive Officer, Joao Paulo Ferreira, attends an interview with Reuters at Natura's headquarters in Sao Paulo, Brazil November 29, 2019. REUTERS/Leonardo Benassatto

Soon to become the world's fourth-largest beauty group after acquiring rival Avon Products Inc AVP.N, Natura is advocating sustainable development of the Amazon without antagonizing right-wing President Jair Bolsonaro, who has called for greater economic exploitation of the vast region.

“It seems to me the new government is critical of existing control mechanisms but has not yet set in motion alternatives,” Natura CEO João Paulo Ferreira said in an interview late on Friday.

Under Bolsonaro, who took office at the start of this year, forest fires surged in August, the most for the month since 2010. That backslide triggered global outcry about his government’s policies toward the world’s largest tropical rainforest, considered key to the fight against climate change because of the amounts of carbon dioxide it absorbs.

Reuters reported in August that Bolsonaro’s government had systematically weakened Brazil’s environmental agency, grounding an elite enforcement team and forbidding agents from destroying machinery used in illegal deforestation.

Natura, which makes many cosmetics using natural additives from the Amazon, convened meetings to improve dialogue between government officials, NGOs and local communities as deforestation in Brazil’s Amazon region hit an 11-year high this year.

“The Amazon rainforest is too big for an individual actor alone to have the capacity for change,” Ferreira said.

Last week, Natura publicly backed the Health and Happiness Project, expressing concern about a state police raid against the NGO amid a probe of a recent rash of forest fires.

Natura is also faced with operational challenges as some of its suppliers in the Amazon, mostly nut producers, were affected by the fires, according to Ferreira.

“Luckily, we were able to compensate for shortages by using our extensive network of 4,500 families in the Amazon region,” he said.

Natura’s ties with the Amazon can be traced to 1999, when it started working with local families to explore Brazil’s biodiversity in a sustainable way. The company partners with 37 communities supplying dozens of ingredients.

“We’ve been partners for almost 20 years now and Natura helps us strengthen our cooperative and improve management,” said Alexandro Queiroz dos Santos, who coordinates a project called RECA that supplies mostly vegetable oils and butter to Natura from 260 small agro-forestry producers.

Two of its producers lost plantations to flames a few months ago, and it also faces pressure from logging companies and cattle ranchers, Santos said.

Since 2011, Natura has invested around 1.5 billion reais ($357 million)in multiple activities in the Amazon, contributing to preserve 1.8 million hectares of rainforest.

Ferreira sees the company boosting Amazon investments as it expands the Natura brand following the acquisition of Britain's The Body Shop in 2017 and Avon Products Inc AVP.N this year.

A recent move into the Malaysian market through a partnership with a The Body Shop franchisee is producing good results, Ferreira said, and the group is eyeing new markets in Southeast Asia. “This specific franchise operates in more than one market and there other excellent franchisees in Indonesia, Philippines and adjacent markets,” he said.

Reporting by Gabriela Mello; Additional reporting by Brad Haynes; Editing by Daniel Flynn and Dan Grebler