ESG in the Boardroom: Data Governance and Corporate Disclosure Requirements in Brazil

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Introduction to reporting requirements for ESG policies

The integration of ESG frameworks and practices in companies, as well as the release of sustainability reports, is an increasingly widespread practice in Brazil, although carried out voluntarily, based on ESG criteria and indexes such as the standards of IFC, GRI, SASB, International Financial Reporting Standards, Task Force on Climate-Related Financial Disclosures, Task Force on Nature-Related Financial Disclosures, Climate Bonds Standard, United Nations Sustainable Development Goals, UN Global Compact Brazil Local Network, among others.

In addition, certain sectoral associations are discussing and publishing ESG guidelines for companies and institutions, including the Brazilian Banks Federation (FEBRABAN), the Brazilian Association of Financial and Capital Market Institutions (ANBIMA), the Brazilian Banks Association (ABBC), among others.

Nevertheless, in accordance with its regulatory scope, the Brazilian Association of Technical Standards (ABNT) published ABNT PR 2030 ESG in December 2022, which sought to standardise the metrics and guidelines for reporting ESG information. The ‘Recommended Practice’ is the world’s first national ESG standard and is one of the baselines for creating the first global ESG standard, which is currently being applied by the International Organization for Standardization (ISO).

Several regulatory agencies in Brazil have issued rules on ESG reporting. Financial institutions must follow the rules issued by Brazil’s Central Bank (BACEN). Issuers of bonds and securities must include ESG information in their annual report or reference form, pursuant to Brazil’s Securities and Exchange Commission (CVM) and the Official Stock Exchange (B3) regulations and guides. Finally, insurance companies, open complementary pension fund entities, capitalisation companies and local reinsurers are also under scrutiny for sustainability reporting pursuant to the Superintendence of Private Insurance (SUSEP)norms, among others.

Significant specific ESG-related terms have also been addressed by Brazilian regulators to mitigate occurrences of greenwashing or social washing. For example, the use and definition of terms such as ‘green’, ‘social’, ‘sustainable’and ‘ESG’, among others, and the parameters for such use, have been established by the National Council of Self-Regulation in Advertisement (CONAR), through the Brazilian Code of Self-Regulation in Advertisement, by CVM, through CVM rules, and by the Brazilian Association of Financial and Capital Market Entities (ANBIMA).

In addition to the reputational scope, a more focused approach to ESG is being reinforced through ever-stricter legal requirements, national and international voluntary standards, regulatory agencies, financial institutions, among others. As a result, ESG-related issues such as sustainability, climate change, social responsibility, antibribery, anti-corruption and diversity are resulting in greater repercussions in courts in Brazil and all over the world.

Through this trend, institutions are being legally, morally and even financially encouraged to gather the data regarding their material impact on ESG matters, publicly disclose such information and outline efficient internal policies for risk mitigation and control.

At the same time, many opportunities are being created for sustainable businesses and practices, supported by Brazilian legislation, including extensive forms of incentive, carbon credit potential of covered forests and the ongoing discussion over the regulation of the Brazilian carbon credit market.

In view of the above, it is fundamental to map and avoid or mitigate ESG-related risks and take advantage of the opportunities, especially for sustainable, social and environmental investments.

Financial Institutions ESG rules and respective obligations

ESG aspects are constantly being included in the context of various segments and activities of economic agents, including in global financial markets.

In the Brazilian market, since 2014, the Central Bank of Brazil (BACEN) has devoted a great deal of attention to the work of laying the foundations necessary for financial institutions to act in such a way as to foster the development of sustainable finance.

Currently, CMN Resolution No. 4,945/21 sets out the principles and guidelines for the establishment and implementation of the Social, Environmental and Climate Responsibility Policy (PRSAC) and management of socio-­environmental risks by financial institutions and other institutions authorised to operate by BACEN.

It is also noteworthy to consider BACEN Resolution No. 4,557/2017, which provides for a risk management structure (including social and environmental risks) that must be implemented by certain institutions authorised to operate by BACEN, considering the different structures defined according to the framework of the respective financial institution, or equivalent institutions.

This resolution was updated, through CMN Resolution No. 4,943/2021, in September 2021, to align the Brazilian banking practices with those that institutions at the global level have been conducting, with a more comprehensive scope compared to the previous rules.

Accordingly, financial institutions, and similar institutions in Brazil, must comply with the following set of main rules:

  • CMN Resolution No. 4,943/2021;
  • CMN Resolution No. 4,944/2021;
  • CMN Resolution No. 4,945/2021;
  • BACEN Resolution No. 139/2021;
  • Normative Instruction No. 153/2021;
  • BACEN Resolution No. 151/2021; and
  • BACEN Resolution No. 140/2021.

It should be noted that rules applicable as per each resolution may differ for specific types of financial institutions defined therein.

In sum, the rules above provide for obligations for distinct types of financial institutions, and other similar institutions, to:

  • maintain social, environmental, and climate-related risk management structures;
  • provide for policies compatible with the Social, Environmental and Climate Responsibility Policy, as defined by BACEN; and
  • promote the disclosure of information on policies, risks and opportunities related to social, environmental and climate matters. In addition, such regulations determine certain criteria and impediments for granting rural credits.

Each of the rules above came into effect during 2022. The deadlines for adopting the requirements vary according to the type of institution and obligations set out.[2]

CMN Resolution No. 4,943/2021, which amends Resolution No. 4,557/2017, and CMN Resolution No. 4,944/2021 refer to risk management structures, detailing the need and form of identification, measurement, classification, evaluation, monitoring, control and mitigation of social, environmental and climate risks, among others. For this, CMN Resolution No. 4,943/2021 provides a more comprehensive approach, and, in its turn, CMN Resolution No. 4,944/2021 refers to a simplified risk management structure applicable in certain contexts.

Within this scope, risks of a social nature are defined as: the possibility of occurrence of losses for the institution caused by events associated with the violation of fundamental rights and guarantees or acts harmful to the common interest.[3] Additionally, environmental risks are defined as: the possibility of losses to the institution caused by events associated with environmental degradation.[4] The Resolution also generally indicates that such risks include acts or activities that, despite being regular, legal, and not criminal, negatively impact the institution’s reputation, as it is considered harmful to the common interest or as a result of environmental degradation.

Finally, climate risks are divided into two types, defined as follows:

  • Transition climate risks: the possibility of occurrence of losses for the institution caused by events associated with the transition to a low carbon economy, in which the emission of greenhouse gases is reduced or compensated, and the natural mechanisms for capturing these gases are preserved.
  • Physical climate risks: the possibility of occurrence of losses for the institution caused by events associated with frequent and severe weather or long-term environmental changes that can be related to changes in weather patterns.

In order to deal with such risks, financial institutions must establish management structures to identify and monitor risks incurred as a result of their products, services, activities, or processes. This must be performed not only regarding the risks of the institution itself, but also of its counterparties, controlled entities, significant suppliers, and significant outsourced service providers. It must be noted that risk management also extends to the identification of reputational risks.

Besides risk management, BACEN’s set of rules also emphasises the need for compatibility of the policies of financial institutions and other institutions authorised to operate by BACEN within the Social, Environmental and Climate Responsibility Policy (PRSAC). Such Policy is regulated by CMN Resolution No. 4945/2021 and deals with principles and guidelines of a social, environmental and climate nature that the institution must observe in executing its business, activities, and processes, as well as in its relationship with concerned parties. Financial institutions must consider this policy in evaluating their products and services, and the institution must establish the PRSAC and implement actions aimed at its effectiveness, including, among others, a periodic evaluation by the institution’s internal auditors, based on clear and verifiable criteria.

The PRSAC also stipulates the obligation to appoint a director responsible for compliance with the Resolution and actions related to PRSAC, and there are also initiatives in this scope for which the board of directors is obliged to participate. Certain institutions must also constitute a social, environmental and climate responsibility committee linked to the board of directors.

Furthermore, CMN Resolution No. 4,945/2021 also addresses existing concerns in the ESG context regarding transparency and information disclosure, making it mandatory to release the PRSAC and its actions, among other information, to the public. If an inadequacy or insufficiency is identified in the controls and procedures related to establishing the PRSAC and implementing actions aimed at its effectiveness, BACEN may determine that improvements are necessary.

In addition to the PRSAC, BACEN Resolution No. 139/2021 and BACEN Normative Instruction No. 153/2021 determine the annual disclosure of the Social, Environmental and Climate Risks and Opportunities Report (GRSAC Report), which is mandatory for certain institutions.

Regarding the disclosure of information related to ESG, it is also necessary to consider the provisions of BACEN Resolution No. 151/2021, which defines the obligation of certain institutions to send to BACEN certain information related to the assessment of social, environmental and climate risks in the context of their exposures in credit operations and securities, and their respective debtors.

Add to that, BACEN Resolution No. 140/2021, amended by CMN Resolution No. 5,081/23, provides for Social, Environmental and Climatic Impediments in the Rural Credit Manual, establishing certain restrictions for granting rural credits to enterprises that:

  • are fully or partially inserted in a conservation unit, unless the economic activity is in accordance with the conservation unit’s management plan;
  • are located totally or partially on indigenous lands (already approved) or in areas inserted in lands occupied and titled by remainders of quilombola communities;
  • are located in the Amazon biome on a property embargoed by the Brazilian Institute of the Environment and Renewable Natural Resources (IBAMA);
  • have a restriction in effect for illegal deforestation, according to records made available by the National Institute of Colonization and Agrarian Reform (INCRA);
  • are registered in the registry of employers that have kept workers under conditions analogous to slavery, due to a final administrative decision regarding the notice of violation; or
  • are located in a rural property not registered or whose registration is cancelled or suspended in the Environmental Rural Registry (CAR).

Noteworthy among the wide range of resolutions on the subject is BCB Resolution No. 331, which deals with the Social, Environmental and Climate Responsibility Policy (PRSAC), to be instituted by prudential conglomerates classified as Type 3, as well as the measures needed to ensure its effectiveness.

The Resolution establishes that the leading institution of a prudential conglomerate classified as Type 3 and framed within Segment 2 (S2), Segment 3 (S3), Segment 4 (S4) or Segment 5 (S5), as provided for in BCB Resolution No. 197/2022, must establish the PRSAC and implement measures accordingly, which must be:

  • proportional to the business model, to the nature of operations and to the complexity of the products, services, activities and processes of the conglomerate; and
  • suitable for the size and importance of the exposure to social, environmental and climate risks, provided for in BCB Resolution No. 265/2022.

In addition, Resolution No. 331/2023 defines the PRSAC as a set of principles and guidelines of social, environmental and climate nature, which must be followed by the prudential conglomerate classified as Type 3 while running its business, activities and processes, as well as in the relationship with its stakeholders. Part of such Resolution is already into force.

Finally, more recently, in October 2023, CVM Resolution No. 193/2023 was enacted, which expands the integration of ESG practices in the Brazilian Capital Market, aligning Brazil with the global standards established by the International Sustainability Standards Board (ISSB).

The Resolution determines that the financial information report related to sustainability, based on the ISSB standard, must be objectively identified, and presented separately from the entity’s other information. Its issuance will be optional until 31 December 2025. After that, it will be mandatory exclusively for publicly traded companies whose fiscal years begin on or after 1 January 2026.

For the time being, this obligation does not extend to investment funds and securitisation companies, which will continue to have the option of adopting the preparation and disclosure of financial information reports related to sustainability on a voluntary basis, as long as they comply with the standards established by the ISSB.

Financial market ESG rules and respective obligations

The CVM is an autonomous agency under a special regime under the Ministry of the Economy, with its own legal personality and assets, independent administrative authority, free of hierarchical subordination, with fixed terms and stability for its directors, and financial and budgetary autonomy, whose objective is inspecting, regulating, governing and developing the securities market in Brazil. In view of its Regulatory Agenda proposed for 2021, the CVM amended Resolution CVM 59/2021,[5] amending provisions of CVM Instructions 480/2009[6] and 481/2009,[7] related to the informational regime of securities issuers. Also in 2022, such amendments were consolidated, through CVM Resolution 87/2022,[8] into the current CVM Normative Instructions 80/2022[9] and 81/2022.[10]

The CVM emphasises that the new regulatory context of its scope does not require that issuers of securities adopt specific practices, but only that they disclose those practices that are or are not adopted.

CVM Resolution No. 14/2020 defines the rules for publicly traded companies that decide to prepare and publish an integrated report to include in such document information related to sustainability reports, among other types of information, to reflect considerations on the subject of ESG, aiming to demonstrate, in an comprehensive manner, how the organisation publishing the information generates value over time. If the organisation chooses to issue such a report, the format for the information presented is prescribed, and the release of the Integrated Report, in such format, must come with assurance by an independent auditor registered at the CVM. The preparation itself of the integrated report is not mandatory.

The concept referred to by the CVM as ‘practice-or-explain’ was adopted. In other words, those that do not proved a report on their ESG practices will need to explain the reason for this lack. As such, when applicable, the CVM requires an explanation for the failure to:

  • disclose ESG information;
  • adopt a materiality matrix;
  • adopt ESG key performance indicators;
  • audit or review disclosed ESG information;
  • conduct greenhouse gas emission inventories; and
  • comply with certain international standards, including climate issues and the sustainable development goals (SDGs), which the United Nations implemented with the aim of ending poverty, protecting the environment and climate and ensuring that people may enjoy peace and prosperity. Roughly 67 per cent of Brazilian companies link their disclosed information with SDGs, reporting development goals for their SDG-related businesses.[11]

CVM Normative Instructions 80/2022 and 81/2022, in accordance with CVM Resolutions 59/2021 and 87/2022, address the rules on disclosure of information by issuers of securities. In 2021, the CVM added to the information contained in the Reference Form, with the objective of increasing transparency in the disclosure of ESG practices by listed companies. By doing so, certain specific requirements are established for the disclosure of information related to ESG and sustainability issues.

Working jointly with CVM through the execution of cooperation agreements, B3 has introduced measures to be adopted by its listed companies regarding ESG issues. In August 2022, B3 opened a public consultation[12] on a proposal for an Annex to the Regulation for Listing of Issuers and Admission to Trading of Securities, with the objective of gathering contributions from market agents, companies, investors, regulators, organisations and other interested parties to align B3’s rules with the recent regulatory movement. This is a key step for the stock exchange to strengthen its governance rules in light of diversity and inclusion criteria.

B3 proposes that compliance with the measures set forth in the Annex be conducted by the companies in the ‘practice-or-explain’ model. In this regard, four ESG measures are provided:

  • to elect as a full member of the board of directors or statutory board at least one woman and one member from a minority community, observing the transition period, or a member who meets both requirements;
  • to establish a procedure for the nomination of members of the board of directors and of the statutory management in the by-laws or in the nomination policy, including, at least, criteria of:
    • complementarity experiences; and
    • diversity in terms of gender, sexual orientation, color or race, age group and inclusion of people with disabilities;
  • to define, in the compensation policy or practice, performance indicators linked to ESG themes or targets, when there is variable compensation for members of the board of directors or statutory management; and
  • to prepare and to disclose a document, approved by the board of directors, on ESG guidelines and practices, with the inclusion of minimum content, including:
    • combating discrimination;
    • respect for human rights and labour relations;
    • defence of animals against suffering and mistreatment;
    • protection of the environment against harmful activities; and
    • treatment of solid waste and hazardous chemicals, as well as corporate governance and compliance mechanisms that indicate how such ESG guidelines and practices are implemented in the company.

Private insurance ESG rules and respective obligations

The increasing attention to ESG has resulted in the further development and carrying out of sustainable business, which encompasses those businesses and investments in activities, products or services aimed at achieving sustainability-related goals regarding benefits to the environment and society, to bring legacies to the communities impacted by the respective projects.

Against this backdrop, within the scope of regulatory standards in relation to insurance, SUSEP, an autonomous agency under the Ministry of Economy and responsible for the control and supervision of the insurance, private pension, capitalisation and reinsurance markets, on 27 June 2022, incorporated ESG criteria and practices into its structures and policies. Among the main topics under the spotlight are climate change and the need for a greater and better understanding of climate risks to promote a more efficient allocation of capital and avoid abrupt adjustments that may result in disruptions to the financial system. In this context, SUSEP Circular 666/2022[13] was published, and came into force on 1 August 2022. It provides for sustainability requirements to be met by insurers, open complementary pension fund entities, capitalisation companies and local reinsurers, considering their respective roles in the insurance industry, both as risk managers and policyholders, and as investors, as well as considering their duty to promote economic, social and sustainable development, especially when considering the qualifications of such entities to perform risk assessment and pricing.

While focusing on climate matters, SUSEP calls for the evaluation of potential and factual risks considering three subsects: transitional, physical and litigation risks. Transitional climate risks take into account the possibility of losses for the institution caused by events associated with the transition to a low carbon economy, in which emissions of greenhouse gases are reduced or compensated, and the natural mechanisms for capturing such gases are preserved. Physical climate risks are those caused by events associated with frequent and severe weather or long-term environmental changes linked to the alteration of weather patterns. Finally, litigation risks arise from losses due to claims under liability insurance policies or direct actions against the supervised company, both due to failures in managing physical or transitional climate risks.

Health Agency ESG rules and respective obligations

Within the scope of regulations that provide for regulated companies in the health sector, the Brazilian National Supplementary Health Agency (ANS) has published Administrative Resolution No. 82/2023, which provides for its Integrated Policy of Governance and Socio-environmental Responsibility. This resolution introduces normative provisions and defines ESG factors in programmes, projects, processes, activities and tasks conducted by the ANS.

Although this resolution is exclusively connected to ANS’s regulatory operation, it supports the ANS’s increasingly evident intention to implement new regulations for its regulated companies, based on and in compliance with international ESG practices.

In fact, the ANS has already published new regulations in this regard – emphasising governance practices. One example is the publication of Normative Resolution No. 518/2022, which provides for the adoption of minimum corporate governance practices, and the creation of regulatory incentives, such as the ‘New Operators Accreditation Programme’, which encourages the adoption of good practices for organisational management and health management.

Climate change and carbon credits

Brazil has signed all of the climate change international treaties, such as the United Nations Framework Convention on Climate Change (UNFCC), Kyoto Protocol and Paris Agreement. Law No. 12,187/2009 established the National Climate Change Policy (PNMC) and provided for the main guidelines and public policies aimed at tackling climate change at the national level, such as sectoral plans for mitigation and adaptation, and the National Climate Change Plan.

It also created the Brazilian Market for Emission Reduction (MBRE), which is still awaiting the publication of rules. Several states and municipalities have also issued laws regarding climate change policies. As determined by the Brazilian National Policy on Climate Change (PNMC), the following sectors are to be within the scope of the Sectoral Plans, as outlined by Decree No. 9,578/2018,[14] which consolidates the PNMC:

  • the generation and distribution of electric power;
  • urban public transportation and interstate passenger and cargo transportation systems;
  • the transformation and durable consumer goods industry;
  • the refined and base chemical industries;
  • the paper and pulp industry;
  • mining;
  • the civil construction industry;
  • health services; farming; and
  • agriculture and steel.

There are several pending bills related to carbon credits market and it is possible that the draft elaborated by the Ministry of Economy will be approved by the Brazilian National Congress soon. Such bill establishes the Brazilian Emission Trading System of Greenhouse Gases. According to the draft, the Brazilian Emissions Quota and Verified Emission Reduction or Removal Certificates may be set up and traded within SBCE. The quota can be understood as a tradable fungible asset representing the emission of one ton of carbon dioxide equivalent granted by SBCE management body, free of charge or onerous, to regulated facilities or sources, which will be allocated by the National Allocation Plan. The Certificate of Verified Emission Reduction or Removal is defined as a fungible, tradable asset, representing the effective reduction of emissions or removal of greenhouse gases of one ton of carbon dioxide equivalent, following an accredited methodology.

Based on the draft, a carbon credit is defined as a fungible tradable asset representing the actual reduction of emissions or removal of one ton of carbon dioxide equivalent. It is also important to mention that the income from the sale of carbon credits will be taxed.

For carbon credits to be considered Certificates of Verified Emissions Reductions or Removals, included in SBCE, they must be originated from methodologies accredited by SBCE’s management body; measured, reported and verified by an independent entity; and registered in SBCE Central Registry. The bill also creates the National Allocation Plan, which establishes the maximum limit of GHG emissions, the quantity of Brazilian Emission Quotas to be allocated, among other matters.

Voluntary carbon market transactions have increased in Brazil, which is considered one of the countries with the highest potential to generate carbon credits. National financial initiatives have also been implemented for greenhouse gas offsets and nature-based solutions.

Tapping into the carbon credit potential of the granted forests

As ESG matters have gained a different status in the private sector, the government agenda has also changed. Forest concessions have been prioritised in Brazil, bringing more attractive incentives, as they include environmental and social topics. Forest concessions are provided for in the Public Forest Management Law (Federal Law No. 11,284/2006), as an important instrument to foster the conservation of public forests, in addition to improving the quality of life of the population that resides around these areas.

The Public Forest Management Law enables private companies to enter public procurement processes, take over the maintenance of forest areas in Brazil, extract timber and non-timber products, and offer tourist services in specific areas. In addition to ensuring the maintenance and preservation of Brazilian flora and fauna, forest concessions play a key role in preventing and combating illegal practices, such as deforestation, mining, illegal fires and even land grabbing.

Companies interested in obtaining a forest concession must enter a bidding process involving the assessment of technical documents and financial proposals, in return for the rights to manage the forest area. In the beginning of 2023, Law No. 14,590/23 was published, which allows for the trading of carbon credits and the exploitation of the biodiversity of an area under concession. However, the rules for the use of carbon credits by the concessionaire will be defined through the corresponding public notice and concession contract. According to the same Law, the public notice for concession for the exploitation of public forests can include the right to sell carbon credits as well as other similar instruments for mitigating greenhouse gas emissions, comprising of a percentage of participation of the granting authority.

Also, the concession contract can provide for the transfer of ownership of carbon credits from the granting authority to the concessionaire, during the concession period, except for areas occupied or used by local communities.

Administrative and judicial scrutiny over ESG compliance

Issues related to ESG have been subject to administrative and judicial evaluation, considering the growth of scrutiny from regulatory agencies over such matters (including CVM, for example) and an increase in lawsuits brought by consumers, civil society and non-governmental organisations, as well as due to media attention and possible reputational impacts, especially in relation to greenwashing, social washing and similar practices.

ESG-related topics subject to administrative and judicial oversight in Brazil are:

  • diversity in companies’ staff, managers and directors;
  • contradictions and inconsistencies in sustainability reports;
  • criteria for adequate disclosure of environmental information to investors;
  • due diligence duties of companies’ administrators and directors;
  • anticorruption and compliance practices;
  • legal nature of carbon credits and respective applicable legislation;
  • methodologies for accounting for and reaching goals related to sustainable businesses and obtaining certifications, among other criteria.

In addition, Brazilian courts (including the Federal Supreme Court) have been addressing cases involving climate litigation, considering governmental policies regarding the combating of deforestation, financial initiatives related to climate change, indemnification for environmental damages related to climate change or air pollutant emissions, among others. Moreover, the Brazilian Council of Justice (CNJ) has recently issued the Resolution 433/2021, which provides that, when assessing environmental damage lawsuits, judges must consider, among other parameters, the impact of such damage on global climate change.

The inspection of ESG factors is not limited to Brazilian borders, even for Brazilian companies, given that companies that operate internationally must comply with the regulations of the respective countries where they carry out business. For example, the US Securities and Exchange Commission has addressed cases of accountability based on information disclosed by Brazilian companies. Due to the publication of regulations resulting from the European Green Deal, importers and exporters will be subject to compliance with additional regulations.


The integration of ESG structures and practices in companies and the disclosure of sustainability reports is a progressively widespread management model on a global scale. Climate change alongside with social equality and compliance policies are a recurrent theme due to their effects on society, companies and investors, being the target of increasing pressure by such actors.

For companies, there is growing recognition of how climate change results in risks, which may impact their business models and purposes, as well as bring new opportunities to be considered. The understanding of the relevance of social inclusion has become a guideline for any company that seeks to fit into the ever-evolving diversity parameters. Non-compliance with anti-corruption policies, both internal and external, can condemn a business in the public eye. In this sense, companies are more frequently required to commit to such topics, disseminating voluntary (or not) criteria for risk management structures and reporting formats for information disclosure.

Concerning the potential effects of the climate variable, diversity integration, data management and compliance on businesses and the ensuing impact on the financial market, Brazilian regulatory bodies such as BACEN and CVM have promoted the enactment of regulations on ESG subjects, with voluntary criteria becoming eventual obligations for companies.

For now, the published regulatory framework contains a limited degree of detail, and it is important for companies and institutions to have a clear understanding of how to use it. This is especially relevant for those that operate outside Brazil, and there may be the application of standards from different jurisdictions, which, despite being similar, must be given the due attention and be subject to detailed and specific analysis.


[1] Fernanda Vianna Stefanelo, Eloy Rizzo, Cassia Pizzotti, Luiz Fernando Sant’Anna and Thiago Giantomassi are partners at Demarest Advogados.

[2] The majority of BACEN’s ESG rules mentioned in this chapter have entered effect as of December 2022. However, BACEN Resolution No. 151/2021, which provides for social, environmental, and climatic risk disclosure, entered into effect in June 2023 for smaller financial institutions, while other specific dates will be set out for institutions whose size is classified as less than 1 per cent of Brazil’s Gross Domestic Product (GDP).

[3] The resolutions detail several concrete examples of this type of risk, including acts of harassment, discrimination or prejudice based on personal attributes; practices related to working conditions analogous to slavery; irregular, illegal or criminal exploitation of child labour; non-compliance with social security or labour legislation; irregular, illegal, or criminal acts that negatively impact traditional peoples or communities; acts that are harmful to public, historical, or cultural assets, or urban public order; irregular, illegal or criminal processing of personal data, among other examples.

[4] This includes excessive use of natural resources, such as the occurrence of or signs of the occurrence of irregular, illegal or criminal conduct or activity against fauna or flora; irregular, illegal or criminal pollution of the air, water or soil; irregular, illegal or criminal exploitation of natural resources, including water, forests, energy and mineral resources; environmental disasters resulting from human intervention, among other examples.

[9] Currently amended by Resolutions 59/21, 162/22, 168/22, 173/22, 180/23 and 183/23.

[11] KPMG International, ‘The Time has Come: The KPMG Survey on Sustainability Reporting 2020, Resultados Brasil’, 2021, available at, accessed on 2 October 2022.


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