Corporate reporting and disclosure

Statutory and regulatory requirements

Are businesses in your jurisdiction subject to any statutory or regulatory human rights-related reporting or disclosure requirements?

There is no express obligation to present reports or disclosures related to human rights. Nevertheless, Brazilian companies must report and disclose some information to regulatory authorities from each business area, such as the National Mining Agency (ANM), which requests periodic reports from mining companies concerning the stability of dams, for example.

In 2014, in accordance with Instruction CVM No. 552, the Securities and Exchange Commission of Brazil (CVM) included a chapter relating to sustainability policies in the reference form to be filed by issuers of securities admitted for trading on regulated securities markets.

What is the nature and extent of the required reporting or disclosure?

There is no specific or express obligation to present reports or disclosures related to human rights. However, Brazilian companies must report and disclose some information to regulatory authorities from each business area, in case of any inspection.

For instance, the periodic reports required from mining companies by the ANM must detail several security and engineering procedures, such as those relating to safety zones in case of dam disruption.

Also, the reference form to be filed by issuers of securities admitted for trading on regulated securities markets includes a chapter on sustainability policies in which the issuer must disclose social and environmental information.

Which bodies enforce these requirements, and what is the extent of their powers?

Brazil has no specific body to enforce requirements related to human rights. Decree No. 9,571/2018, which established the National Guidelines for Business and Human Rights (the National Guidelines), created the Monitoring Committee, which comprises members of the public, representatives of the federal government and other members from federal entities and international organisations; however, its competencies have not yet been detailed.

Each business area may respond to a specific regulatory authority with inspection powers, which may apply administrative penalties, such as fines or prohibitions on bidding for public contracts. For instance, the ANM regulates mining companies, and the CVM regulates issuers of securities.

Voluntary standards

What voluntary standards should businesses refer to for guidance on best practice in relation to any applicable human rights-related corporate reporting and disclosure regimes?

Brazilian companies usually publish an annual sustainability report to describe their best practices in terms of human rights. They also publish financial reports and other regulatory information relating to the specific business area, to promote the transparency principle.

Since 2017, the Brazilian financial market infrastructure public company, B3 SA, has also promoted the ‘Report or Explanation for Sustainable Development Goals (SDG)’ initiative to motivate listed companies to publish sustainability or integrated reports that incorporate United Nations (UN) SDGs. The initiative is voluntary and open to all publicly traded companies. The questionnaire was completed by 30 per cent of those listed in 2019.

Considering that Brazilian law has no particular disclosure standard, businesses must consider the UN Guiding Principles on Business and Human Rights as the main guide to ensure compliance with human rights reporting. The content of the guide has been recognised by the National Guidelines for Business and Human Rights. The international organisations of each business area may also establish standards and recommendations, such as those made by the International Council on Mining and Metals and the International Petroleum Industry Environmental Conservation Association. At the national level, companies may also follow best practice guides developed by local sectorial associations, such as the Brazilian Association of Textile Retail.

Corporate due diligence

Statutory and regulatory requirements

Are businesses in your jurisdiction subject to any statutory or regulatory human rights-related due diligence requirements?

There is no express obligation to realise due diligence on human rights matters.

What is the nature and extent of the required due diligence?

Not applicable.

Which bodies enforce these requirements, and what is the extent of their powers?

Not applicable.

What voluntary standards should businesses refer to for guidance on best practice in relation to any applicable human-rights related corporate due diligence regimes?

In light of international human rights standards that indicate companies’ responsibility to respect human rights, some Brazilian companies have used regular due diligence procedures to follow human rights issues on specific occasions, such as in the context of merger and acquisition transactions or to monitor their supply chain.

Considering that Brazilian law has no particular due diligence standard, businesses must consider the National Guidelines as the main guide to ensure compliance with human rights reporting, as well as international and industry standards.

Law stated date

Correct as of

Give the date on which the information above is accurate.

6 February 2021.

Voluntary regimes and best practices

What best practices should businesses consider when implementing policies to ensure compliance with human rights-related reporting or disclosure requirements?

Considering that Brazilian law has no particular standard, businesses must consider the UN Guiding Principles on Business and Human Rights as the main guide to ensure compliance with human rights reporting. The content of the guide has been recognised by the National Guidelines.

The international organisations of each business area may also establish standards and recommendations, such as those made by the International Council on Mining & Metals (ICMM) and the International Petroleum Industry Environmental Conservation Association (IPIECA).

At the national level, companies may also follow best practice guides developed by local sectorial associations, such as the Brazilian Association of Textile Retail (ABVTEX).

Remedies

What best practices should businesses consider when implementing policies to ensure compliance with due diligence requirements?

Considering that Brazilian law has no particular standard, businesses must consider the National Guidelines as the main guide to ensure compliance with human rights reporting.

The international organisations of each business area may also establish standards and recommendations, such as those made by the ICMM and the IPIECA.

At the national level, companies may also follow best practice guides developed by local sectorial associations, such as the ABVTEX.