SBFN Member Since:

2012

Member Organisations

Central Bank of Brazil
Brazilian Federation of Banks (FEBRABAN)

Progress Against Pillars and Sub Pillars

This graphic can also be found within this country’s 2019 Country Progress Report. 

Strategic Development - Alignment with global E&S standards and best market practices

S1.1 – Does the framework make reference to international E&S targets (SDGs, Paris Agreement, Global Compact)?

Yes

(4) – Introduction
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

S1.2 – Does the framework make reference to established international E&S risk management standards (IFC PSs, EPs)?

Yes

(3) – Section II – Article 14 – Sub-paragraph 2
Framework for the creation and implementation of a socioenvironmental Responsibility Policy – SARB Framework (FEBRABAN, 2014)

S1.3 – Does the framework make reference to established international sustainability reporting standards (GRI, SASB)?

Yes

(4) – Introduction
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 
S1.3 Source Reference Document Url

S1.4 – Does the framework make reference to established international climate finance reporting standards (TCFD)?

Yes

(5) – 1) Introduction
Implementing the TCFD recommendations a roadmap for the Brazilian banking sector (FEBRABAN, 2019)
S1.4 Source Reference Document Url

S1.5 – Does the framework ask to make E&S policies, practices and results externally verified (assurance, independent review)?

No

S1.5 Source Reference Document Url

Strategic Development - Multi-stakeholder collaboration

S2.1 – Does the framework involve interagency collaboration between financial supervisors/regulators, industry association, and FIs?

Yes

S2.2 – Does this collaboration also include other public agencies (e.g., environmental agencies, ministries)?

Yes

(1) – Page 1
Brazil Protocolo Verde (FEBRABAN, 2009)

S2.3 – Does this collaboration also include representatives of civil society (e.g., NGOs, associations, media)?

Strategic Development - Alignment to NDCs and with National or Regional Climate Change Targets

S3.1 – Is the framework aligned with national NDCs or other national and regional policies on climate?

Yes

(4) – Page 19
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

S3.2 – Has the SBN member identified the main climate risks (transition/physical) for their local financial sector?

No

Source Reference Document Url

ESG Integration - Governance of E&S

Role of Governing Bodies on E & S

E1.1 – Does the country policy require one of the FI’s governing bodies (e.g., Board of Directors, Executive Committee, Supervisory Board, etc.) to approve an E&S strategy?

Yes

(2) – Art.10
Resolution 4327 (Banco Central do Brasil, 2014) 
E1.1 Source Reference Document Url

E1.2 – Does the policy require management to report on E&S strategy implementation to the governing bodies?

Yes

(2) – Art.10
Resolution 4327 (Banco Central do Brasil, 2014) 
E1.2 Source Reference Document Url

E1.3 – Does the policy require FI operational bodies to report to the governing bodies (or specific Board committee) on implementation of the E&S strategy?

No

E1.3 Source Reference Document Url

Organization

E1.4 – Does the framework ask FIs to define E&S roles and responsibilities?

Yes

(2) – Art. 3
Resolution 4327 (Banco Central do Brasil, 2014) 
E1.4 Source Reference Document Url

E1.5 – Does the framework highlight the E&S roles of front office staff and second lines of defense (e.g. risk officers and/or compliance officers)?

No

E1.5 Source Reference Document
E1.6 – Does the framework ask FIs to define E&S competencies for each role?

No

E1.6 Source Reference Document

E&S Risk Management

E&S Policy

E2.1 – Does the framework ask FIs to formalize an E&S or ESG policy?

Yes

(1) – Page 3 – 2.
Brazil Protocolo Verde (FEBRABAN, 2009)
E2.1 Source Reference Document Url

E2.2 – Does the framework encourage FIs to go beyond E&S requirements of local laws and regulations?

Yes

(3) – Page 2 – Article 8
Framework for the creation and implementation of a socioenvironmental Responsibility Policy – SARB Framework (FEBRABAN, 2014)
E2.2 Source Reference Document Url

E2.3 – Does the framework ask FIs to set E&S objectives and targets?

No

E2.3 Source Reference Document Url

E2.4 -Does the framework ask FIs to publicly disclose their E&S policy and its governance?

Yes

(1) – Page 3 – 4.
Brazil Protocolo Verde (FEBRABAN, 2009)
E2.4 Source Reference Document Url

Risk Assessment

E2.5 – Does the framework require FIs to carry out appropriate E&S due diligence at transaction level?

Yes

(1) – Page 3 – 2.
Brazil Protocolo Verde (FEBRABAN, 2009)
E2.5 Source Reference Document

E2.6 – Does the framework require FIs to carry out appropriate E&S due diligence at client level?

Yes

(1) – Page 3 – 2.
Brazil Protocolo Verde (FEBRABAN, 2009)
E2.6 Source Reference Document

E2.7 – Does the framework encourage FIs to categorize projects/clients according to their level of E&S risk?

Yes

(1) – Page 3 – 2.
Brazil Protocolo Verde (FEBRABAN, 2009)
E2.7 Source Reference Document

E2.8 – For high-risk transactions, does the framework encourage site visits to be organized?

No

E2.8 Source Reference Document

E2.9 – In case of negative E&S impacts, does the framework invite FIs to engage with clients to implement mitigation measures?

No

E2.9 Source Reference Document

E&S Covenants

E2.10 – Does the framework ask FIs to incorporate E&S covenants and investment conditions into legal agreements with clients?

No

E2.10 Source Reference Document

Project Supervision & Portfolio Review

E2.11 – Does the framework ask FIs to develop processes to manage E&S risks during supervision?

Yes

(2) – Art. 6.
Resolution 4327 (Banco Central do Brasil, 2014) 
E2.11 Source Reference Document

E2.12 – Does the framework encourage a periodic review of E&S risks at aggregate portfolio level?

No

E2.12 Source Reference Document

Training

E2.13 – Does the framework ask FIs to develop and maintain E&S capacity through regular training?

Yes

(2) – Art. 3.
Resolution 4327 (Banco Central do Brasil, 2014) 

E2.14 – Does the framework highlight the training of (i) front office staff, (ii) second lines of defense (risk officers and/or compliance officers), and (iii) E&S experts?

No

External Communication Mechanism

E2.15 – Does the policy require FIs to establish and maintain an inquiry/complaints/grievance mechanism in relation to E&S or ESG practices?

No

E & S Reporting

E2.16 – Does the policy require FIs to report regularly on E&S or ESG performance, including publicly, to investors or to regulators?

Yes

(3) – Page 6 – Chapter IX – Article 22
Framework for the creation and implementation of a socioenvironmental Responsibility Policy – SARB Framework (FEBRABAN, 2014)

E2.17 – Does the policy make E&S or ESG reporting and disclosure more consistent across financial institutions through principles, guidelines, or templates?

No

E & S Integration - Enforcement

E3.1 – Is the implementation of the framework regularly verified or is information regularly collected from FIs?

Yes

(3) – page 6 – article 22

E3.2 – Is there any financial and/or non-financial incentive for establishing ESRM systems?

No

E3.3 – Are there sanctions/penalties/warnings in case of noncompliance with the framework?

No

Climate and Green Finance - Products and Services

Defining sustainable assets and financial products

C1.1 – Does the framework provide definitions and examples of green assets?

Yes

(4) – Page 15 – Table II
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

C1.2 – Does the framework provide a comprehensive taxonomy of green assets?

Yes

(4) – Page 36 to 41
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

C1.3 – Does the framework provide definitions, examples, or a taxonomy of social and/or sustainable assets?

No

C1.4 – Besides debt products (loans, bonds), does the framework provide definitions and examples of different types of sustainable finance products/services (e.g., saving accounts, means of payment, insurance, private equity, etc.)?

No

Green Finance Product Guidelines

C1.5 – Does the framework provide guidelines for green loan/green credit or other green financial assets (excluding green bonds)?

No

C1.6 – Does the framework provide guidelines for issuance of green bonds?

Yes

(4) – Introduction, and Page 44 – 5.2.
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

C1.7 – Does the framework refer to existing standards (e.g., ICMA’s Green Bond Principles or CBI’s Climate Bonds Standard)? 

Yes

(4) – Introduction, and Page 44 – 5.2.
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

C1.8 – Does the framework recommend external party verification (e.g., second party opinion, assurance, certification)?

Yes

(4) – Introduction, and Page 44 – 5.2.
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

Climate and Green Finance - Climate and Green Investment Reporting

Tracking and Disclosure of Climate & Green Finance

C2.1 – Does the framework ask FIs to report on climate/green finance flows (quantitatively or qualitatively)?

Yes

(4) – introduction, and Page 44 – 5.2.

C2.2 – Does the framework ask FIs to report on climate risk exposure at portfolio level?

No

C2.3 – Does the framework encourage FIs to report publicly on their green finance activities (i.e. not only to the regulator)?

Yes

(4) – Introduction, and Page 44 – 5.2.
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

Climate and Green Finance - Measurement

Calculation of Environmental Benefits

C3.1 – Does the framework ask FIs to calculate the environmental benefits of their investments? (e.g., CO2 emission reduction, water saving, etc.)

Yes
(4) – Page 22 – Environmental performance indicators for the Green Projects
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

C3.2 – Does the framework provide a taxonomy of potential environmental impacts?

Yes

(4) – Page 23 & 24
Guidelines for Issuing Green Bonds in Brazil (FEBRABAN and CEBDS, 2016) 

C3.3 – Does the framework provide methodologies, tools, and/or templates to measure and report these impacts?

No

Climate Risk Exposure Assessment

C3.4 – Does the framework ask FIs to monitor climate risk exposure at portfolio level?

Yes

(5) – Bank’s exposure to climate-related risks
Implementing the TCFD recommendations a roadmap for the Brazilian banking sector (FEBRABAN, 2019)

C3.5 – Does the framework refer to specific climate risk exposure methodologies (e.g., climate scenario analysis, climate risk stress testing, calculation of carbon risk exposure, tracking of energy efficiency for real estate portfolio)?

No

(5) – Bank’s exposure to climate-related risks
Implementing the TCFD recommendations a roadmap for the Brazilian banking sector (FEBRABAN, 2019)

C3.6 – Does the framework encourage FIs to take mitigating steps on these risks?

Yes

(5) – Bank’s exposure to climate-related risks
Implementing the TCFD recommendations a roadmap for the Brazilian banking sector (FEBRABAN, 2019)

Climate and Green Finance - Incentives

Financial and Non-Financial Incentives

C4.1 – Does the framework provide any type of incentives for green financial products and services?

No

C4.2 – More specifically, does the framework introduce financial incentives on green products and services?

No