OSLO, Dec.22 (Reuters) – Norway’s $ 1.4 trillion fund has disengaged from Chinese pharmaceutical company Yunnan Baiyao (000538.SZ), saying the move was due to the company using and selling parts from the body of pangolins, an endangered species.

The fund also said in a statement on Tuesday night that it had put Marfrig Global Foods (MRFG3.SA), one of Brazil’s largest beef producers, on observation for possible exclusion from its investments for helping “serious environmental damage”.

The fund, one of the largest investors in the world, follows an ethical mandate set by parliament and is not permitted to invest in companies that produce nuclear weapons, tobacco or cluster munitions, among others. .

Register now for FREE and unlimited access to Reuters.com

Register

The fund held a 0.11% stake in Yunnan Baiyao, worth $ 23 million at the end of 2020, according to fund data. He did not specify when he made the surrender. The Chinese company was not immediately available for comment.

Referring to Marfrig, the fund’s ethical watchdog said deforestation is happening on the properties of its supply chain.

“The monitoring of Marfrig suppliers has not been sufficient to avoid deforestation. In addition, the monitoring system has mainly targeted the Amazon. Suppliers from other regions with high deforestation rates have hardly been checked,” said the watchdog.

In an emailed comment, Marfrig said he recognizes the challenge of protecting the environment in Brazil. He said he plans to track 100% of his suppliers in the Amazon – including indirect sellers – by 2025 to ensure his products are free from deforestation. This will be extended to all Brazilian biomes by 2030, the company said.

The company was not immediately available for comment outside of normal business hours in Brazil. The fund held a 0.22% stake in the company worth $ 4.4 million at the end of 2020, according to fund data.

Register now for FREE and unlimited access to Reuters.com

Register

Report by Gwladys Fouché in Oslo and Sophie Yu in Beijing; Editing by David Holmes and Alistair Bell

Our standards: Thomson Reuters Trust Principles.