It often begins with rain. In the Amazon region of Brazil, heavy downpours are part of life. But for communities living near large industrial complexes, rain can mean something more ominous: the risk of toxic waste escaping into rivers, farmland, and homes. Over the past decades, residents of Barcarena have witnessed repeated environmental incidents. According to the Final Report of Pará’s Parliamentary Inquiry, these incidents are linked to the operations of Norsk Hydro, a state-affiliated Norwegian company. Norsk Hydro’s largest shareholder is the Norwegian State, represented by the Ministry of Trade, Industry, and Fisheries. The State holds 34.26 per cent of the shares followed by the Government Pension Fund Norway (Folketrygdfondet), which holds approximately 6.52 per cent. Norsk Hydro operates one of the world’s largest alumina refineries in the area, known as Alunorte—and presented on Norsk Hydro’s website as Hydro Alunorte. These events were not isolated accidents. This is not just a tale of pollution. They are symptoms of a deeper problem—one that goes beyond technical failures and points to the complex relationship between states and corporations. This is the story of ‘polluters by proxy’: how governments benefit from environmental harm abroad, while distancing themselves from direct responsibility.
How States Become Polluters by Proxy
Imagine a country that prides itself on environmental leadership. Norway, for example, is famous for its green policies and generous donations to the Amazon Fund. But what happens when a Norwegian state-controlled company is implicated in environmental issues in Brazil?
Brazilian authorities have pointed to the activities at the Norsk Hydro’s Alunorte refinery as being responsible for continuous environmental incidents, stating that its operations in Brazil have caused severe ecological damage. Investigations revealed a recurrent pattern, including the obstruction of inspections, the discharge of untreated waste, and the use of more hazardous technologies than those applied in Norway. Yet, when things go wrong, the Norwegian state, which actively approved all the expansions of the company’s activities in Brazil and has as official goal for its companies to be environmentally responsible—unlike in moments of success—invokes a distinction between share ownership and management, claims it is merely a shareholder, not responsible for managerial decisions.
This is the essence of ‘polluter by proxy’: a state benefits financially and strategically from a company’s actions abroad, but distances itself from direct responsibility by hiding behind corporate structures.
Colonial Legacies and Modern Exploitation
Brazil’s natural resources have been exploited by foreign powers since colonial times. First Portugal, then England, the United States, and now multinational corporations. The rules are simple: extract resources, maximise profits, and minimise accountability.
During Brazil’s military regime (1967-1984), foreign companies—including Norwegian ones—found fertile ground for expansion. For the Brazilian dictatorship, environmental and human rights concerns were brushed aside in the name of progress. In 1967, King Olav V of Norway made a historic visit to Brazil, the first by a Norwegian head of state to South America, accompanied by Minister Sverre Walter Rostof and prominent business leaders, aiming to foster goodwill and support for Norwegian investments.
The visit, facilitated by Erling Lorentzen, son-in-law to the king, occurred during Brazil’s military regime and was seen as a gesture of international legitimacy amid criticism over censorship and human rights. Political connections, visits from Norway’s royal family, and strategic investments paved the way for decades of resource extraction, often at the expense of local communities and ecosystems, by companies such as Borregaard, Norsk Hydro and ÅSV.
Yet, even amid the heightened tensions and censorship in Brazil, Norwegian researchers Lars Løvold, Dan Børge Akerø, Dag Viljen Poleszynski, Helge Hveem and Per Erik Borge courageously investigated the enterprises carried out by Norsk Hydro and ÅSV in the Trombestas River. Their work overcame significant logistical and political obstacles in Brazil and exposed troubling realities about the impact of mining activities in the country, culminating in the 1979 publication of the book Norge i Brasil. Militærdiktatur, folkemord og norsk aluminium (‘Norway in Brazil, military dictatorship, genocide and Norwegian aluminium’; in Norwegian only).
Accountability: Who Pays the Price?
Norsk Hydro’s involvement in Brazil began in the 1970s during the military regime, when it joined the MRN joint venture to access bauxite reserves in Pará—a project that led to severe pollution in Lake Batata, located in the region. Despite early criticism from the Norwegian Parliament over environmental and Indigenous harm, Norsk Hydro maintained its position. In 1995, Alunorte began operations, sourcing bauxite from MRN, where Norsk Hydro held shares. By the early 2000s, Norsk Hydro had acquired a 25.25 per cent stake in the company Alunorte , becoming its second-largest shareholder and playing an active role in the refinery’s operations. In 2010, it increased its control to 91 per cent, becoming the majority shareholder—a move that required and received unanimous approval from the Norwegian Parliament (Stortinget), given the Norwegian State’s role as Hydro’s largest shareholder (34.26 per cent).
Alunorte’s environmental record in Barcarena is marked by recurring disasters. In 2003, toxic mud leaked into local water sources, killing wildlife and contaminating farmland. In 2009, hazardous effluents polluted the Murucupi River, leading to the Federal Regional Court of the 1st Region (TRF1) in Brazil ruling in 2024 that found the company’s pollution ‘indisputable’ and ordered damages. The 2018 incident exposed clandestine discharges and severe community health impacts (in Portuguese). The impact on local communities is profound. Residents reported illnesses, animal deaths, destroyed livelihoods, and contaminated water that tasted ‘like perfume’. The affected communities, including quilombolas—descendants of African slaves who established communities as a form of resistance—have fought for recognition and compensation, but their claims are often dismissed as ‘legal adventures’. Despite fines and mandated corrective actions, Norsk Hydro consistently denied responsibility, blaming external factors. Meanwhile, the Norwegian government, as main shareholder, profited and distanced itself from accountability. Local communities continue to bear the cost, while justice remains elusive.
Asymmetrical Standards: One Company, Two Worlds
Here’s where things get even more troubling. Norsk Hydro operates aluminium plants in both Norway and Brazil, and is active in over 40 countries worldwide. But the standards are worlds apart. In Norway, pollution-control technologies are state-of-the-art, and local protests in the 1960s in the city of Øvre Årdal led to real change and improved environmental conditions. In Brazil, however, cheaper and more hazardous technologies have been used for years. In 2024, the Court of Justice of the State of Pará issued another ruling, finding Norsk Hydro liable as the entity responsible for controlling operations, making strategic decisions, and choosing technologies for its Brazilian plant. The court found that the company failed to prevent pollution in the region, breaching its own commitments and allowing significantly higher emissions compared to its operations in Norway. To illustrate the scale of the damage, the court compared the emissions from Norsk Hydro’s operations to those produced by the entire city of Belém, which has approximately 1.5 million inhabitants (news article in Portuguese). Unlike the previous case, where the company was convicted of environmental crimes, this ruling concerns civil liability.
When confronted, Norsk Hydro claims compliance with local laws. But is that enough? Shouldn’t multinational companies apply the same standards everywhere—especially in regions with sensitive biomes like the Amazon rainforest (the very place where the Norwegian government provides environmental aid to the Amazon Fund), and when their home countries ultimately benefit from the profits generated abroad?
Yet, the answer is not merely a matter of corporate discretion—it is a question of structural accountability. When multinational corporations operate under the influence or control of states, as in the case of Norsk Hydro and the Norwegian government, the application of uneven standards across jurisdictions becomes not merely ethically questionable, but indicative of a deeper governance failure. The Amazon, with its globally significant biome and vulnerable populations, would deserve more than the bare minimum. If the Norwegian state profits from Hydro’s activities and actively shapes its expansion, then it cannot claim innocence when those same activities result in environmental degradation. The principle of polluter by proxy demands that states uphold consistent standards across borders, especially when their involvement is not passive but strategic and financial. Anything less perpetuates a system where environmental harm is outsourced, and responsibility is obscured behind layers of corporate governance.
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What Can We Learn?
‘Polluters by proxy’ is more than a catchy phrase— it is a conceptual lens to expose how states benefit from environmental harm while avoiding direct accountability. In a world facing climate urgency, we need to look beyond corporate veils and demand real accountability from states and corporations alike. Environmental harm is not just a technical issue—it’s a matter of justice, history, and power.
The case of Norsk Hydro in Brazil illustrates how state-corporate entanglements can produce environmental damage across borders. The Norwegian State, as the company’s largest shareholder, not only profited from Hydro’s activities but also played a decisive role in their expansion—approving key transactions, celebrating milestones, and incorporating dividends into the national budget. Despite this, it has institutionally distanced itself from the consequences of pollution in Brazil, invoking a formal separation between ownership and management.
This is the essence of pollution by proxy: when a state benefits—financially, politically, or strategically—from the actions of affiliated entities such as state-owned enterprises, subsidiaries, or contractors, while remaining shielded by legal and corporate structures that deflect accountability. The environmental harm remains in the Global South, while profits and reputational gains are centralized in the Global North.
This pattern is not unique to Norway or Brazil. It reflects the dynamics of global value chains, where production is fragmented across jurisdictions with uneven regulations, creating opportunities for companies and states to externalize environmental costs. While firms often showcase corporate social responsibility commitments, these pledges rarely address the structural asymmetries that allow harm to persist in supplier regions. States and corporations collaborate, profit, and evade responsibility—leaving vulnerable communities to bear the brunt of environmental damage.
In this context, the recent EU Corporate Sustainability Due Diligence Directive represents a step toward addressing these transnational accountability gaps. By requiring companies to identify, prevent, and mitigate adverse impacts in their global value chains—including environmental harm and human rights violations. However, as critics have pointed out, its effectiveness may be limited by the very corporate and legal architectures that enable polluters by proxy to operate with impunity. Norway, although not an EU member, aligns with EU law through the European Economic Area Agreement, and its involvement in the Alunorte refinery reveals contradictions between its sustainability commitments and its economic interests abroad.
Therefore, polluter by proxy should be understood as a conceptual contribution to environmental justice in global value chains. It describes a scenario in which a polluting enterprise is carried out by one actor who does not directly execute the harmful actions but benefits from them through complex share ownership and governance structures. Although not a legal category, it offers a critical framework to identify and expose those actors who hide behind diffused responsibility while profiting from environmental exploitation.
Next time you hear about a pollution scandal, ask yourself: who really benefits, and who pays the price? It’s a question that deserves to be asked—not just at work, in class, or around the dinner table, but loudly, in public, on the streets, in parliaments, and in the media. The answer might surprise you.
