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The deadly dam collapse in Brazil

The deadly dam collapse in Brazil

On January 25, 2019, life changed irrevocably for hundreds of families 9 kilometres east of Brumadinho in Brazil. A tailings dam, owned by the Brazilian mining giant Vale, suffered a catastrophic failure. 10 million cubic meters of iron oxide, water and chemicals caused a muddy tsunami that buried buildings and people alike, causing the death of nearly 300 people. Many are still missing.

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Just after noon on January 25, a wave of toxic water hit the administrative area of the Corrego do Feijao mine and its surroundings. A tailings dam – an embankment which is supposed to hold back a vast reservoir of toxic mining byproducts – had collapsed. The dam, which held 10 million cubic meters of water, caused a deadly tsunami of waste and mud. As the wave came rushing, it crushed both homes and offices and killed nearly 300 people. Many are yet to be found. In addition to human lives lost, the swathe of natural habitat destroyed was the equivalent of 300 football pitches.

“As one of the largest financial institutions in the Nordics, it is important to ensure that the companies we invest in or that we lend money to, are sustainable and take their responsibility in society”.

In May 2019 Karim Sayyad, Senior Analyst at Nordea Asset Management, travelled to Brazil to speak to the company Vale, the Mayor of Brumadinho and with the victims’ families.

“As one of the largest financial institutions in the Nordics, it is important to ensure that the companies we invest in or that we lend money to, are sustainable and take their responsibility in society. We are here to verify that Vale does what they claim to do, that they make efforts to remediate the consequences of the disaster and are transparent with us as stakeholders,” says Karim Sayyad.

Our responsibility

Field trips have long been a key component in Nordea’s responsible investment strategy and something we believe make us better investors. Being on-site enables us to understand situations and conditions in a deeper way and ultimately make better analyses of the companies we invest in. We believe that we can and should use our influence to make a difference, by encouraging the companies we invest in to conduct business more sustainably and responsibly. We must ensure that we invest in companies that share our values and understand the possible consequences of the changing climate conditions and asses the risks they may be facing and adapt to these, according to best practice.

Adapting to change

Climate change substantially contributes to the risk of more frequent catastrophes such as dam collapses, floods, droughts and so forth. A disaster, such as the one in Brumadinho, has far-reaching consequences and must be learnt from and prevented from happening again. Following the accident, Nordea’s investments in Vale were immediately quarantined.

For more information about how we work with sustainability at Nordea, read our latest Sustainability Report.

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