The Brazilian Securities and Exchange Commission (CVM) has enacted Resolution CVM No. 193, dated October 20, 2023 (‘Resolution 193’). The resolution grants publicly traded companies, investment funds, and securitization companies the choice to voluntarily prepare and disclose a sustainability-related information report (‘Sustainability Report’).

The sustainability reporting form will become mandatory for publicly traded companies in January 2026. Companies that voluntarily opt to comply with the regulation must declare their choice through an announcement to the market by May 31, 2024, but no later than December 31, 2024.

Conversely, investment funds and securitization companies may declare their choice or its amendments by the end of the financial year preceding the first preparation and disclosure of the sustainability reporting form.

Sustainability reports must be as per the outstanding international standards issued by the International Sustainability Standards Board – ISSB. The reporting frequency must be equivalent to the disclosure of financial reports.

Following the best international practices, CVM has established more straightforward rules related to the ESG agenda.