The New ESG Regulations: Challenges and Opportunities for Companies

Introduction

New ESG (Environmental, Social, and Governance) regulations are bringing significant changes for Brazilian companies. Starting in 2026, all publicly listed companies registered with the Brazilian Securities and Exchange Commission (CVM) must align their sustainability reports with the global standards established by the International Sustainability Standards Board (ISSB). This article explores the key impacts of these regulations and how companies can prepare to face the challenges and seize the opportunities associated with ESG practices.

Standardization and Compliance

Standardization is essential for organizations to move toward compliance in ESG and sustainability matters. Adopting ISSB standards will allow for greater comparability and transparency in sustainability reports, making it easier for investors and stakeholders to analyze data.

Early Adaptation

Although the new disclosure models will only become mandatory in 2026, more than half of the companies surveyed intend to adapt in advance. This shows growing awareness among businesses about the importance of preparing early for regulatory changes.

Challenges

The transition to new ESG regulations presents several challenges, including associated costs, identifying relevant metrics, and linking sustainability and ESG reports to financial reports. Furthermore, data standardization and the difficulty in measuring financial impacts remain key obstacles that companies must overcome.

Corporate Governance

Companies are focusing on building robust corporate governance structures to ensure transparency, reliability, and ethics in stakeholder communication. The presence of ESG committees is crucial to defining strategies, fostering an ESG-aligned organizational culture, and monitoring established goals and metrics.

Benefits

The new regulations provide greater clarity and comparability in reporting, help develop risk mitigation and control policies (such as avoiding greenwashing), and attract sustainable investments. Additionally, having ESG specialists on Investor Relations (IR) teams is vital to support the understanding and implementation of ESG practices.

Conclusion

The new ESG regulations present both challenges and opportunities for Brazilian companies. It is essential that businesses prepare by investing in governance, technology, and training to ensure compliance and take full advantage of the opportunities that ESG practices offer.

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References

• Deloitte: “Research on ESG and Sustainability” (2024)

• CVM: “CVM Resolutions 217, 218, and 219” (2024)

• ISSB: “Global Sustainability Standards” (2023)