Impact Policy Tracker Policy

Brazilian Sustainability Disclosure Standards (CBPS 01 & CBPS 02)



After two exposure drafts published by the Brazilian sustainability reporting standard-setter CBPS and the Brazilian accounting institute (the Conselho Federal de Contabilidade - CFC), CBPS 01 and CBPS 02, based on the IFRS Foundation’s S1 and S2 Standards, were issued to guide corporate sustainability disclosures in the country. CBPS 01 establishes general requirements for disclosing sustainability-related financial information, ensuring consistency, comparability, and transparency in how companies report on sustainability matters relevant to enterprise value. CBPS 02 focuses specifically on climate-related disclosures, aligning with global frameworks to enhance the quality of information related to climate risks and opportunities.

Highlights

  • Early adopter: Brazil was one of the first countries to adopt the ISSB Standards when in October 2023 the financial regulator CVM and the Ministry of Finance announced the integration of ISSB standards into their regulatory framework.

  • Phased approach: companies can voluntarily apply the Standards from annual periods beginning in January 2024; companies are required to apply the Standards from annual periods beginning in January 2026.

  • Scope: companies registered at the CVM, including listed companies, investment funds and securitisation companies, even if they do not have traded shares or securities in the market.

  • Assurance: until the end of 2025, limited assurance is required; from 2026, sustainability reports will be subject to the International Auditing and Assurance Standards Board (IAASB)’s ISSA 5000 Standards.

Government’s Role:
Market Regulator


Country:
Brazil

Policy Type:
Sustainability Disclosure Standards

Year: 2023

Responsible Institution:
Ministry of Finance, Brazilian Securities Commission of Brazil (CVM), Brazilian Committee on Sustainability Pronouncements (CBPS)

Sustainability Disclosure Regulations

What are Sustainability Disclosure Regulations?

Sustainability Disclosure Regulation requires financial market participants to report on their impacts on the economy, people, and planet, alongside financial information. To comply with the regulatory mandate, organisations must use Sustainability Disclosure Standards (SDS),which ensure that the information disclosed is comprehensive, verified, comparable and decision-useful. They can help organisations assess not only how sustainability-related risks and opportunities affect the short, medium and long-term enterprise value (single materiality; only financially-relevant information) but also how their operational impacts affect people and the planet (double materiality). The availability of such information is essential for investors and other key decision makers to integrate social and environmental factors into their investment and decision-making processes.

SDS are one of the most effective mechanisms to achieve comparable, consistent and reliable information on impact. Although companies can opt to report based on existing voluntary standards (such as those from the Global Reporting Initiative - GRI), in some jurisdictions publicly listed companies must abide by mandatory financial and non-financial (i.e. sustainability-related) disclosure requirements issued by financial regulators. These mandatory reporting standards are increasingly being implemented in different countries, both in developed and developing economies, most of which are either adopting the standards set by the IFRS Foundation’s International Sustainability Standards Board (ISSB) in full or working on local adaptations with local specificities to cater for specific nuances, capabilities, readiness and topics relevant to their local markets.