Sustainability Disclosure Standards (CVM Resolution No. 171)

Sustainability Disclosure Standards (CVM Resolution No. 171): mandatory ifrs s1/s2-aligned sustainability and climate disclosure for cvm-registered issuers from january 1, 2026.

Jurisdiction
Status
active
Category
First deadline
January 1, 2026 (FY 2025 first mandatory disclosures, reported in 2026)
Who must comply
All entities registered with Brazil's Comissao de Valores Mobiliarios (CVM) as issuers, regardless of whether their securities are publicly traded. No size thresholds apply; the rule covers all industries and entity types defined under Brazilian securities law.
Penalties
The CVM may impose administrative sanctions including fines, suspension of reporting rights, and public censure for late, incomplete, or misleading sustainability disclosures.

What it is

Brazil's CVM adopted Resolution No. 171, establishing national sustainability disclosure requirements for listed and CVM-registered entities, aligned with the IFRS S1 and S2 standards developed by the International Sustainability Standards Board.

The framework aims to enhance transparency and integrate ESG and climate factors into Brazil's financial reporting, with disclosures made alongside financial statements.

Who must comply

The resolution applies to all entities registered with the CVM as issuers, regardless of whether their securities are publicly traded. There are no size thresholds, so it covers all industries and entity types defined under Brazilian securities law.

What you must disclose

Companies must report per IFRS S1 and S2, covering governance and strategy, risk management, and metrics and targets, along with climate disclosures including Scope 1 and 2 emissions and Scope 3 if material. Disclosures must be integrated into management reports, and reasonable assurance across all required IFRS S1/S2 disclosures is required starting 2026.

Timeline

Brazil's CVM adopted Resolution No. 171 on October 29, 2024, with mandatory compliance beginning January 1, 2026. Optional early adoption was permitted for FY 2024 (reporting in 2025).

The first mandatory disclosures cover FY 2025 and are reported in 2026, with sustainability disclosures submitted annually alongside financial statements thereafter. Reasonable assurance is required starting 2026.

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