Opinion: Five years after deadly dam breach in Brumadinho Vale does not seem to have learned its lesson

This article is by Fair Finance The Netherlands

25th January 2024 marks the fifth anniversary of the dam breach in Brumadinho (Brazil). The dam breach caused a tsunami of toxic mud in which 272 people were buried alive. Two other Brazilian dams run by the same company - Vale - are currently in the highest risk scale for a breach, yet pension funds ABP, bpfBOUW and Retail, and insurers Allianz and Aegon, still invest more than $1 billion in Vale even with all the risks that entails. This is why the Fair Finance Guide Netherlands along with Both ENDS, SOMO and BankTrack are sending a letter of concern to those companies.

The dam breach five years ago was not just an accident. The breach could have been prevented and the number of casualties could have been much lower – if Vale had taken the right actions. The dam was in very poor condition and the company had known that since 2003, according to an internal report. Irresponsible drilling activities by the Dutch company Fugro eventually led to the sudden liquefaction and collapse of parts of the dam. On the day of the disaster, Vale's sirens, which were supposed to warn of danger, were found not to be working.

The worrying thing is that Vale does not seem to have learned from this dam breach, nor from an earlier, disastrous dam breach in Mariana. Five years after the Brumadinho disaster, mining giant Vale still manages 27 similar dams in Brazil operating under emergency protocols. In two of them, there is an increased risk of fracture. Vale was recently fined $46 million for failing to meet the agreed-upon deadline to strengthen or dismantle these dams to prevent yet another disaster.

The residents of Mariana and Brumadinho are still looking for justice. While Vale paid $7 billion in a settlement many of these funds have been used for infrastructure investments and to facilitate transportation to and for mining. This is instead of going towards the substantial reparations due to the affected residents or for the necessary remediation of the polluted Paraopeba River.

In the run-up to this day of remembrance, a global coalition of concerned NGOs sent a letter to investors in Vale. In the Netherlands, these are the pension funds ABP, bpfBOUW and Detailhandel, and insurers Allianz and Aegon. Together, they invest more than $1 billion in Vale.

In fact, pension fund ABP and insurer Allianz are among the top 20 investors in Vale, with an amount of $462 million and $641 million, respectively. As a result, they are receiving a letter from the Dutch Fair Finance Guide, Both ENDS, BankTrack and SOMO asking how they intend to prevent the next disaster and how they will contribute to recovery.

If you are an Aegon or Allianz customer or a member of ABP, bpfBOUW or pension fund Retail and want to ask your pension fund or insurer to help prevent the next disaster and to ensure justice for the residents, you can do so here.