Oat milk brand Oatly has been forced to defend its funding from an investment firm with alleged links to deforestation in the Amazon and whose CEO is a major donor to the Trump campaign.
Private equity firm Blackstone invested $200 million in Oatly in a deal confirmed in July, and which has in the last week faced scrutiny online. The criticism stems from another company that Blackstone invests in, Brazilian infrastructure company Hidrovias, which has been accused of links to deforestation in the Amazon, by investigative outlet The Intercept. Blackstone denies any link to deforestation via Hidrovias.
Blackstone chief executive Steve Schwarzman is known to be a prolific donor to the Trump re-election campaign, and was described in a Bloomberg article published this summer as “one of the president’s most ardent Wall Street backers”. Since taking office, Trump has continuously rolled back environmental regulation in the US, backed the fossil fuel industries and aired his own scepticism over the reality of climate change.
Oatly has built its name around sustainable farming, low carbon and ethical business principles, as an alternative to dairy, and a self-described “oat-based sustainability movement”.
Demand for its oat milks has skyrocketed across the world, the company said, leading it to search for new funding to continue expansion. After a Twitter thread by zero waste campaigner @LessWasteLaura brought the issue to light, Oatly issued a statement defending its decision.
“Getting a company like Blackstone to invest in us is something we have been working on to create maximum change to benefit the planet,” it said.
“Our bet is that when Blackstone’s investment in our oat-based sustainability movement brings them larger returns than they would have been able to get elsewhere…a powerful message will be sent to the global private equity markets, one written in the only language our critics claim they will listen to: profit.
“If we ever want to have a chance of reaching the global climate goals of cutting the greenhouse gas emissions by 50% before 2030 and reach net zero emissions by 2050, we need to speak a language that the capital markets can understand.”
But the brand has faced widespread criticism on social media from activists and campaigners, and it has been delisted by Sheffield independent retailer Beanies, which said in a statement to customers: “As a small independent retailer with ethical principles at our core, we must always reassess whether or not we want to continue selling products with backers whose complex, global investment backgrounds can make it unclear exactly who and what they are involved in.
“Oatly is one of our most popular brands and has been a great option for vegan alternatives to milk, cream and custard for many years so we are of course disappointed to say goodbye.
“However – ethics rule here at Beanies and we are about offering ethical alternatives to the status quo. So we won’t be buying any more Oatly from our suppliers once our stock runs out.”
Responding to the criticism on social media, Oatly said: “We are convinced that helping shift the focus of massive capital towards sustainable approaches is potentially the single most important thing we can do for the planet in the long-term. We realize that all of you may not share this view and disagree on the right path forward to create a more sustainable world.”