A small activist group called Mighty Earth is taking on the Brazilian-based food giant JBS over whether its “green” bonds deserve that Earth-friendly connotation.

In 2021, JBS, the world’s biggest meat company and mammoth food-processing firm, sold $3.2 billion worth of “green bonds” linked to the company’s sustainability goals. If JBS fails to reach its targets for greenhouse gas emissions, it will be penalized and will pay bondholders a “step up amount or premium payment,” the company says.

On Tuesday, Mighty Earth filed a complaint with the Securities and Exchange Commission alleging that JBS is already failing to meet its emissions targets. Mighty Earth wants the agency to impose penalties and injunctions on the Brazilian company, which it says has contributed to or ignored deforestation carried out by its suppliers.

“We see JBS as one of the three linchpin companies for changing the whole meat industry,” said Glenn Hurowitz, founder and chief executive of Mighty Earth. “It has by far the highest emissions of any company in agriculture.” The company’s methane emissions exceed the combined total of France, Germany, Canada and New Zealand, the group said.

JBS disputes the allegations. It said that $7 billion would be “channeled” to sustainability. It plans to adopt enough solar for all of its Swift & Company stores, a U.S. company it acquired in 2007. It entered a partnership with European health and nutrition firm DSM to reduce methane emissions from its cattle herds. And the company plans more than $1 billion in capital expenditures over the next decade to reduce greenhouse emissions intensity by 30 percent.

Nikki Richardson, a spokesperson for JBS, said in an email that the company hopes to reduce its Scope 3 emissions — climate impacts caused by suppliers and other entities the company does not directly control.

“While we acknowledge the importance of measuring and ultimately reducing scope 3 emissions, a widely-accepted method for measuring scope 3 emissions does not currently exist for our industry,” JBS said in a filing.

The complaint this week comes as the SEC is expected by April to unveil a new rules on climate-related disclosures. Environmental organizations hope these rules will boost transparency by requiring companies to issue periodic reports on climate-related risks and their impacts on the environment.

In some instances, the SEC has already acted on this front. Last November, the SEC accused Goldman Sachs Asset Management of misrepresenting two of its mutual funds and a separately managed account Goldman had marketed, which featured environmental, social and governance investments. To settle the charges, GSAM agreed to pay a $4 million penalty.

But the new SEC rules will have to deal with the broader issue of how companies calculate emissions that come from sources they do not own or control.

“This is a great example of why investors desperately need standardized climate financial risk disclosures,” said David Shadburn, government affairs advocate of the League of Conservation Voters. “The company has been able to benefit from a sustainability-linked bond and greenwash itself for potential investors.” He said 90 percent of JBS’s emissions come from its supply chain.

JBS does not dispute the need for corporate measures to slow climate change. In March 2021, the company pledged to achieve net-zero greenhouse gas emissions by 2040.

“Climate change is the most pressing issue facing society today and has the potential to negatively impact future generations if bold action is not taken immediately,” the company said separately in a “framework” published for bond investors in June 2021. “This issue also poses significant risks to our business, our producer partners, customers and consumers.”

Mighty Earth argues for more disclosure. It says that for a meat processor such as JBS, figures on the total slaughter of animals are an “indispensable component” of the company’s total greenhouse gas emissions. Despite that, JBS has concealed its total animal slaughter numbers since 2017, the group said.

JBS says it has not misled investors. Richardson said in an email that its bonds were tied only to Scope 1 and 2 emissions, and then only to emissions intensity, meaning that emissions could continue to grow if the business does, too.

“Importantly, these bonds are not intended to fund the entire decarbonization process,” Richardson said. She said they were “clearly designed and structured” to address the JBS facilities in the company’s control.

“We must start with elements over which we have direct control and that have robust and trusted measurement guidelines,” the company said in a filing.

JBS is seeking time, however, to stop destruction of tropical forests caused by beef production. The company has said that it will eliminate illegal Amazon deforestation from its supply chain by 2025, but would not completely stop deforestation globally across its supply chains until 2035.

Last November, JBS admitted it bought about 9,000 head of cattle from illegal farms in the Amazon. JBS said it was the victim of a fraud.

Founded in 1953 in western Brazil, JBS expanded from Brazil and Argentina to the United States and beyond. Though not well known, it has acquired the pork business of Cargill, the beef business of Smithfield Foods and most of the chicken production of Pilgrim’s Pride.

In 2017, JBS was drawn into financing and bribery investigations in Brazil. In the past five years, it has settled four price-fixing cases in the United States and paid $27 million for violations of the Foreign Corrupt Practices Act.

Mighty Earth says JBS “picks and chooses what it will disclose, and to whom, about its greenhouse gas emissions.”

The organization says JBS is contemplating tapping U.S. capital markets for a public offering but the dispute over emissions could make that difficult.

“JBS wants U.S. dollars from our capital markets,” said Kevin Galbraith, an attorney for Mighty Earth. “At the same time, they do not want the regulatory scrutiny that will accompany that.”