Response from Vale about new reports with allegations of abuses related to
the communities of Califórnia and Piquiá de Baixo, in Maranhão, Brazil,
related to the company operations
25 March 2014
The Business & Human Rights Resource Centre invited Vale to respond to the
following items:
 [Full report] [PDF] “Briefing paper: Business and Human Rights: Enhancing
Standards and Ensuring Redress”, International Federation of Human
Rights (FIDH), March 2014
file:///C:/Users/Julia/Documents/BHRRC/Companies/Vale/Piquia%20de%2
0Baixo/briefing_enhance_standards_ensure_redress_web_version.pdf
 [Press release] “Business and Human Rights: FIDH Calls on the
International Community to Enhance Standards and Ensure Redress”,
FIDH, 12 March 2014
http://www.fidh.org/en/united-nations/human-rights-council/un-humanrights-council-25th-regular-session/14899-business-and-human-rights-fidhcalls-on-the-international-community-to
 [Portuguese] “Piquiá de Baixo: mais uma conquista rumo
reassentamento”, Justiça nos Trilhos, 9 de março de 2014
http://www.justicanostrilhos.org/Piquia-de-Baixo-mais-uma-conquista
ao
Vale sent the following response to the Resource Centre:
Proposed answer to BHRRC, regarding references to Vale on the report
“Enhancing Standards and Ensuring Redress”, International Federation of
Human Rights (FIDH)
Regarding references to Vale on the briefing paper “Business and Human Rights:
Enhancing Standards and Ensuring Redress", International Federation of Human
Rights (FIDH), the company clarifies that:
Since 2010, Vale has maintained dialogue with the community of Piquiá de Baixo,
located in the industrial area of Açailândia, state of Maranhão. In 2010, Vale through Vale Foundation - developed a socioeconomic diagnosis of 330 families
located in the community. This diagnosis had strong community participation and
was completed and submitted to the Public Prosecutor’s Office in early 2011.
During this process, a commission of 30 families was instituted in order to
represent all the families involved.
Subsequently, Vale made a committement to fund the elaboration of the housing
project of the new district, in order to allow public funding to be directed for the
construction of homes. In July 2012, Vale made an official appeal proposal, to the
Public Attorneys Office of Açailândia, of R$ 400 reais. This amount was destined
for the elaboration of the housing project and would be credited to the Community
Association of Piquiá de Baixo, as wished by the community. The Prosecutor and
Public Defender offices would oversee the process, being responsible for
supervision, management and implementation of resources.
In August 2012, the Public Attorney’s Office opted to have the housing project
financed by the local union SIFEMA, accepting an amount inferior to that initially
offered by Vale. Vale´s contribution to the project was, therefore, no longer
needed. The court judgment approving the expropriation of land for which families
will be removed was filed in December 2013. Currently, Vale maintains contact
with local authorities and the local Prosecutor, in order to assess future
opportunities for support.
Pig-iron value chain
Vale does not corroborate the practices of child or slave labor in its value chain.
Thus, in 2005, Vale became a signatory to the National Pact for the Eradication of
Slave Labor in Brazil, an initiative led by the Ethos Institute.
In August 2007, following the allegation of irregularities in the acquisition of coal
from deforestation, and the use of slave labor, Vale suspended the supply of iron
ore to eight of its clients. The same occurred in November 2011, when three clients
were involved in allegations of purchasing coal of illegal origin. In both cases, Vale
also suspended shipping to these clients and the supply was only resumed after
provision of documentary evidence of suitability and site audits. To this date, Vale
has not reestablished the commercial relationship with one of the companies
involved in irregularities, since it could not identify the source of 40% of its coal.
Today, contracts of iron ore to pig iron sector are renewed quarterly, in order to
maintain permanent control. A series of documents are required and later
scrutinized, in order to prove the origin of the charcoal; the legality in the use of
labor is required; and clauses are included in contracts with clients in Brazil that
allow for the interruption in the supply of iron ore in case of evidences of
noncompliance with obligations related to environmental protection and the
prohibition of the use of child or forced labor. In 2009, Vale´s Code of Conduct for
Suppliers became mandatory for the accreditation of new suppliers. Currently
100% of the companies that sell materials, equipment and services associated to
Vale´s operations are adherent to the document.
Moreover, since 2010, a sustainability clause is applied in the contract with
suppliers in Brazil, where companies undertake to comply with the Supplier Code
of Conduct and share the values of Vale´s Sustainable Development Policy and
Human Rights Policy. The company also monitors the list of the Ministry of Labour
and Employment (MTE), which identifies companies and individuals denounced for
possible occurrences of forced labor in the country. In 2013, three suppliers were
identified in that list. Despite being active in our database, we did not have
commercial transactions with these companies and new acquisitions were blocked.
Vale is committed to tackling child labor, forced or compulsory labor and the
exposure of young people to hazardous work. For this, the company is establishing
processes to actively manage these risks. Child labor and forced or compulsory
labor in the value chain are addressed in the risk management tools and processes
of human rights in Vale´s projects and operations.
Vale considers crucial the awareness of the value chain of the importance of
sustainable charcoal production, aiming at the elimination of practices and
activities that violate labor rights or cause harm to the environment.
As Vale does not corroborate illegal deforestation, the use of coal produced
illegally or the violation of human rights, it mobilized relevant actors to address
these issues, such as Bioatlântica and the Imaflora Institute, in order to develop a
program for Engagement and Verification of Pig-iron in the Value Chain. The
program aims to promote sustainability in the steel chain, engage and evaluate pig
iron producers regarding the adoption of sustainable environmental practices, and
induce the increase of supply of raw material (wood and charcoal) from renewable
and legal sources to meet the industry demands.
The first stage of the program will be training aimed to guide companies that will be
verified by the program as well as suggest action plans for their suitability. The
second phase, of verification, will score and rank the companies annually. From
the implementation of the program onwards, Vale intends to ensure the supply of
iron ore only to sustainable producers. Importantly, today, while the program is still
under development, the company offers sustainability bonus (5% discount) for
companies that use more than 80% of the coal produced by their own forests, what
already occurs with two of its customers : Queiroz Galvão and Planting.
In 2013, the Brazil Steel Institute (IABR) asked the Brazilian Association of
Technical Standards (ABNT) to open a process for creating a certification standard
to address sustainability aspects and requirements linked to the production of pig
iron based on charcoal. This initiative represents the implementation of the first
phase of the program foreseen in the Sustainability Protocol of Charcoal created
by the steel companies and sponsored by IABR, wiith Vale´s support in 2012.
A study commission was created to verify the aspects of sustainability to be met in
the production of pig iron charcoal, comprising the origin of wood and charcoal,
good manufacturing practices, environmental measures, control and monitoring
systems and other sustainability criteria. Vale participates in the commission
contributing technically to its studies.
At the end of 2013, Vale resumed its support the Instituto Carvão Cidadão (Citizen
Coal Institute), an organization that works to introduce best practices in the pig iron
production chain in the Industrial area of Carajás.
Assentamento Califórnia – Açailândia
In 2013, Vale undertook a health study in the community of the `Califórnia
Settlement`, in Açailândia. The study was undertaken by a specialized health
consultancy firm, and approved by local health authorities. Since the onset of the
study, the community took active part in the initiative. At the closure of the study, its
findings were shared with the health authorities and the community leaders.
As part of Vale´s Foundation voluntary social investment program, the ´Califórnia
Settlement´ community will be included in two health projects developed in the
region. Both projects, ´Health Cycle´ and ´Development Rails` aim to contribute to
the improvement of the community´s health conditions. Health Cycle will work on
the improvement of the outpatient practice and capacity by the refurbishment of the
local health post, responsible for the family health program in the community.
Furthermore, the post´s staff will receive additional training. The program
Development Rails will work alongside the community to implement health
promotion social technologies. Both programs will be initiated during the first
semester of 2014 and will be implemented by social organizations who are
partners of Vale´s Foundation.
In relation to spying allegations, Vale refutes all accusations and does not
comment on matters that are under investigation by the competent authorities.