Last week, shocking photographs emerged from a construction site in Brazil, revealing squalid dormitories with rows of bunk beds devoid of mattresses. These were the living quarters for workers tasked with building a factory for the Chinese electric car giant, BYD.
The photos were released by Brazil’s Labor Prosecutor’s Office, the Brazilian equivalent of the Occupational Safety and Health Administration, which is investigating BYD and its contractor, Jinjang.
According to the authorities, the working conditions at the site are described as “slave-like,” with “unreasonably” long working hours, sometimes seven days a week. Reports from Reuters even suggest that the workers may be victims of human trafficking.
In a surprising twist, it was revealed that a Swedish fund, managed by Handelsbanken with approximately 654 million SEK invested in BYD, may have unknowingly been funding a company that exploits its workers under such deplorable conditions. The fund, known as Sustainable Energy, prides itself on its “pure focus on sustainability.”
“We take issues of labor rights and human rights very seriously. We have initiated a dialogue with BYD to investigate these allegations,” stated Jakob Palmgren, the press officer for Handelsbanken, in response to inquiries from Placera.
As the investigation unfolds, a meeting is scheduled for January 7th between the prosecutor and the companies to discuss a potential agreement. In the meantime, BYD and Jinjiang have agreed to relocate the 163 employees to a hotel while awaiting the resolution of their contracts.
While Jinjiang has denied the allegations, labeling them as a misunderstanding, BYD initially claimed to have severed ties with the contractor. However, a company executive later accused “foreign forces” and certain Chinese media outlets of deliberately tarnishing Chinese brands.
The implications of this scandal reach far beyond the construction site in Brazil, raising questions about corporate responsibility, ethical investing, and the treatment of workers in global supply chains. As the dialogue between Handelsbanken and BYD continues, the spotlight remains on the need for greater transparency and accountability in the business world.