Impact Policy Tracker Policy

Brazil’s Sustainable Taxonomy (TBS)



In 2025, after more than two years of development, Brazil officially published its Sustainable Taxonomy Developed through broad governance and social participation, the taxonomy establishes technical criteria for both green and enabling activities, supporting decarbonization, climate resilience, and nature-positive transitions across the economy.

The TSB forms the foundation of Brazil’s Ecological Transformation Planand will guide capital allocation for sovereign sustainable bonds, the Eco Invest programme, Fundo Clima, sectoral credit lines, tax and credit incentives, public procurement, and alignment with international disclosure standards such as the ISSB (CVM Resolution Nº 193).

At the heart of the TSB is a strong just-transition focus: activities can only be labelled as sustainable if they reduce emissions, strengthen climate adaptation, and address Brazil’s structural social inequalities. The taxonomy covers a wide range of sectoral activities - including agriculture and livestock; land-use change and forestry (LULUCF); extractive industries such as mining; manufacturing; electricity and gas; construction; transport and logistics; urban planning and social services; and information and telecommunications.

Highlights

  • Climate Mitigation, Adaptation and Social Justice at Its Core: Brazil’s Sustainable Taxonomy breaks new ground by explicitly prioritising both climate change mitigation and climate change adaptation as central environmental objectives, while embedding race-related, gender, and regional inequality criteria within its social objectives. This dual emphasis positions the TSB as one of the only taxonomies to directly align sustainable investment classification with broader social justice outcomes.

  • Leading the Way on Mining and Extractive Industries:The TBS is also among the first taxonomies globally to cover the mining and extractive industries, positioning Brazil -alongside emerging developments in Chile and Australia- as a pioneer.

  • From Voluntary Use to Mandatory Adoption: While initially voluntary, the taxonomy is designed for gradual progression toward mandatory adoption by January 2026, with financial regulators (Central Bank and CVM) preparing reporting requirements aligned with the TSB. This regulatory trajectory, combined with the taxonomy’s interoperability with ISSB standards (via CVM Resolution Nº 193), is expected to accelerate market uptake and anchor the TSB as a central instrument of Brazil’s Ecological Transformation Plan.

Government’s Role:
Market Facilitator


Country:
Brazil

Policy Type:
Sustainable Finance Taxonomies

Year: 2025

Responsible Institution:
Ministry of Finance, Undersecretariat for Sustainable Economic Development

Additional information:
Sustainable Fitch, Brazil’s Sustainable Taxonomy

Sustainable Finance Taxonomies

What are Sustainable Finance Taxonomies?

Sustainable finance taxonomies provide a common language to classify and compare sustainable economic activities. They can be thought of as an encyclopaedia of sustainable activities: they list and define which sectors and actions qualify as sustainable based on specific criteria - either qualitative (e.g., social safeguards) or quantitative (e.g., emission thresholds). As such, taxonomies help assess whether activities align with sustainability standards and channel investments towards projects that support environmental and social objectives, while reducing the risk of greenwashing. As of July 2024, over 53 taxonomies have progressed worldwide, with 24 fully developed.

In practice, taxonomies are used by companies and investors to align portfolios, business activities, and financial products with sustainable objectives. Governments also use them to issue and enforce disclosure regulations, develop sustainability standards and labels, issue taxonomy-aligned bonds, and monitor progress on national and international commitments. While green taxonomies are the most widespread -focusing on activities that support environmental goals- there is growing interest in developing social taxonomies (e.g. the EU’s proposal to develop a Social Taxonomy), which aim to classify activities that promote social objectives such as human rights and equality.

For more information on taxonomies, visit SBFN Toolkit on Sustainable Finance Taxonomies (May, 2024), NATIXIS New Geography of Taxonomies (July, 2023) and PRI’s Implementation guide for sustainable investment policy and regulation tools: taxonomies of sustainable economic activities (June, 2022)