What are neonics?
Over the last 12 months, we requested dialogue with ten companies involved in the production of neonics, namely FMC Corp, Nufarm Ltd, K+S AG, Israel Chemicals Ltd, Monsanto Co, Yara International ASA, Mosaic Co, CF Industries Holdings Inc, Syngenta AG and BASF SE.
Of the ten companies we reached out to, all but four were responsive, though they offered varying degrees of openness when discussing the topic – and not all were willing to discuss their biodiversity risk management in depth.
We will continue to engage with those who failed to provide us with information on this issue to ensure that their biodiversity-related risks, including reputational risks, are managed with a transparent approach.
The value of investments and any income derived from them can go down as well as up as a result of market or currency movements and investors may not get back the original amount invested.
reo® is a registered trademark of BMO Asset Management (Holdings) PLC.
Since we believe that BASF would be affected by the EU’s ban, we prioritised it in our engagement plan. We spoke with the company to ask how they take considerations of bee health into account within their product development strategy. With a 250-strong team working on product and chemical safety, the company has well-developed procedures, but we wanted to understand how this is helping them to navigate the rapidly changing regulatory situation.
BASF informed us that, since 2019, bee protection is formalised in their R&D process. Bee experts conduct toxicology tests at an early stage of the product development cycle, and only products that won’t cause bee mortality will then be further developed. BASF has also been conducting farmer training to educate smallholders on the right ways to apply their products to avoid biodiversity harm, as well as post-sale product research to determine impacts on the ground.
We were impressed with the level of detail shared by the company, but this does not entirely mitigate the risks, particularly given the complexities of integrating the recently acquired Bayer assets. We encouraged the company to improve its reporting in this area.