Overview of Brazil’s Sustainability Disclosure Standards
Introduced: October 29, 2024
Effective from: January 1, 2026
Last modified: N/A
Region(s): Brazil
About CVM resolution 171
In October 2024, Brazil’s Comissão de Valores Mobiliários (CVM) adopted Resolution No. 171, establishing national sustainability disclosure requirements for listed and CVM-registered entities. These standards align with the IFRS Sustainability Disclosure Standards (IFRS S1 and S2) developed by the International Sustainability Standards Board (ISSB) and mark a major step in integrating environmental, social, and governance (ESG) factors into Brazil’s financial reporting landscape.
Brazil Sustainability Disclosure Standards, Resolution No. 171 aims to enhance transparency, comparability, and decision-usefulness of ESG disclosures for investors and the broader public, requiring that sustainability be treated as core to business performance.
Criteria for compliance
Applies to all entities registered with the CVM as “issuers,” regardless of whether their securities are publicly traded.
Compliance timelines
FY 2025 (reporting in 2026)
First mandatory disclosures
Annual thereafter
Sustainability disclosures submitted alongside financial statements
Optional early adoption
Permitted for FY 2024 (reporting in 2025)
Key disclosure requirements
Companies must report according to IFRS S1 and S2 frameworks:
Governance & Strategy (S1)
Board and management oversight, strategy integration into business resilience
Risk Management (S1)
Material ESG risk identification, assessment, and controls
Metrics & Targets (S1)
Quantitative targets and performance metrics covering ESG topics
Climate Disclosures (S2)
Scope 1 & 2 emissions required; Scope 3 if material; scenario analysis; transition plans
Integration
Must be filed alongside financial statements and fully integrated into the management report
Third-party assurance
Reasonable assurance required starting 2026 across all required IFRS S1/S2 disclosures. Assurance must align with CVM-recognized auditing standards, with guidance expected from Brazilian Institute of Independent Auditors (IBRACON).
Penalties for non-compliance
The CVM may impose administrative sanctions including fines, suspension of reporting rights, and public censure for late, incomplete, or misleading sustainability disclosures.
