Corporate Governance in Brazil has advanced significantly over the past decades, accompanying the country’s deeper integration into the global economy and the growing international demands for transparency, integrity, and accountability in corporate management. For foreign investors, understanding this framework is essential to assess risks, ensure compliance, and identify opportunities.
1. Overview
Corporate Governance in Brazil refers to the system that guides, monitors, and incentivizes companies, involving shareholders, executives, boards of directors, oversight bodies, and other stakeholders. Its central objective is to preserve and generate long-term value, mitigate risks, and ensure high ethical standards.
The topic gained prominence in the country beginning in the 1990s, especially with the creation of the Brazilian Institute of Corporate Governance (IBGC), whose work follows international references such as the OECD and G20 principles.
2. Fundamental Principles
The Brazilian model is based on four principles widely recognized by the global market:
- Transparency – Timely and comprehensive disclosure of relevant information.
- Fairness – Equitable and impartial treatment of all shareholders, especially minority investors.
- Corporate Responsibility – Integration of environmental, social, and sustainability factors into business strategy.
- Accountability – Responsibility of management for their decisions and outcomes.
These pillars now extend beyond corporate oversight, influencing areas such as risk management, compliance, technology, and ethics channels.
3. Brazilian Regulatory Framework
Brazil has a solid legal and regulatory structure, composed primarily of:
- Brazilian Corporations Law (Law No. 6,404/1976) – Establishes shareholder rights, transparency requirements, and disclosure obligations.
- Brazilian Securities and Exchange Commission (CVM) – Regulates the capital markets, ensuring investor protection and high standards of corporate governance.
- IBGC (Brazilian Institute of Corporate Governance) – The country’s leading reference for governance best practices and governance codes.
The enhancement of the regulatory framework — particularly the strengthening of the CVM, the update of the Brazilian Corporations Law, and the adoption of international standards such as ISO 37000 — provides greater predictability and stronger protection for capital.
For foreign investors, this means reduced legal risks, increased confidence in the fulfillment of disclosure obligations, and an environment conducive to the accurate valuation of assets.
4. Corporate Governance Structure in Companies
To ensure proper checks and balances, organizations commonly maintain:
- General Shareholders’ Meeting
- Board of Directors
- Fiscal Council
- Executive Management
- Advisory Committees (Audit, Risk, Compensation, Sustainability, etc.)
- Corporate Governance Office
This governance architecture ensures more independent decision-making, stronger internal controls, and greater transparency.
5. Governance and Strategic Planning
Brazilian companies have been adopting models that include:
- Integrated risk assessment
- Governance gap mapping
- Quantitative metrics and qualitative analyses
- Development of short-, medium-, and long-term governance agendas
These practices strengthen corporate sustainability, efficiency, and credibility.
6. Relevant IBGC Initiatives
The current agenda of best practices includes priority topics such as:
- Ethics and integrity
- Diversity and inclusion
- Environmental and social impacts
- Innovation
- Transparency and stakeholder engagement
- More diverse boards better prepared for digital transformation
The diversification and strengthening of Boards of Directors — driven by the IBGC and investor pressure — generate:
- More technical and impartial decision-making processes;
- Stronger corporate strategies;
- Greater resilience during periods of instability.
For foreign investors, this represents stronger strategic governance with a direct impact on long-term value creation.
7. Applicable International Standards (ABNT ISO 37000:2022)
Brazil adopts global governance standards that reinforce:
- Organizational purpose;
- Sustainable value creation;
- Effective oversight;
- Stakeholder engagement;
- Risk management;
- Social responsibility and long-term vision.
8. Governance Segments at B3
The Brazilian Stock Exchange offers special listing segments that require enhanced governance practices:
- Novo Mercado
- Level 1
- Level 2
The growing adherence of Brazilian companies to B3’s differentiated segments demonstrates greater governance maturity. These companies typically feature:
- More independent boards;
- High transparency standards;
- Robust internal controls and compliance mechanisms;
- Strengthened protection for minority shareholders.
This trend expands investment opportunities in companies whose governance standards are comparable to those of developed markets.
9. Advancement of the ESG Agenda
Brazil has natural and regulatory competitive advantages in the ESG field, particularly in the environmental and social dimensions. The maturation of corporate responsibility practices generates opportunities in:
- Renewable energy;
- Sustainable agribusiness;
- Low-impact infrastructure;
- Clean technology;
- Biodiversity projects and carbon credits.
Foreign investors who prioritize ESG find in Brazil a broad and fast-evolving market with growing demand for green capital.
10. Maturity in Risk Management and Compliance
The growing integration of Governance, Risk Management, and Compliance strengthens confidence in the Brazilian corporate environment. This structure reduces risks of:
- Fraud and corruption,
- Accounting inconsistencies,
- Operational instabilities.
As companies adopt more rigorous controls and integrity systems, space opens for more sophisticated investments and for the entry of institutional funds with high compliance requirements.
11. Trends and Opportunities
a) Expansion of Strategic Sectors
The governance environment creates favorable conditions for investments in sectors that require a high degree of compliance, such as:
- Capital markets;
- Banks and fintechs;
- Infrastructure and logistics;
- Energy;
- Healthcare;
- Technology and innovation.
These sectors, historically subject to strict regulation, become even more attractive with increased transparency and institutional security.
b) Growth of the Capital Markets
The evolution of governance drives:
- Initial Public Offerings (IPOs);
- Debt issuances;
- Expansion of investment funds and private equity;
- Development of the local capital markets.
For foreign investors, this increases the availability of assets, diversifies portfolio options, and broadens entry channels into the Brazilian market.
c) Favorable Environment for Strategic Partnerships and M&A
With companies adopting more structured governance practices, the likelihood increases for:
- Safer joint ventures;
- More transparent mergers and acquisitions;
- Clearer due diligence processes based on reliable data.
This reduces information asymmetry and facilitates cross-border transactions.
d) Appreciation Potential in Emerging Markets
Brazil, as the largest economy in Latin America, combines:
- A large consumer market;
- Increasing institutional stability;
- Governance policies aligned with international standards.
Foreign investors encounter an emerging market with above-average appreciation potential, while risks are mitigated by modern governance structures.
12. Final Considerations
Corporate Governance has become one of the essential pillars for strengthening the business environment in Brazil. Over the past decades, significant advances in the regulatory framework, the role of supervisory bodies, and the adoption of practices aligned with international standards have elevated the level of transparency, integrity, and efficiency within Brazilian organizations.
The growing professionalization of Boards of Directors, the integration of governance, risk, and compliance functions, and the expansion of the ESG agenda demonstrate that the country is undergoing a continuous process of institutional maturation. These elements reduce information asymmetry, mitigate risks, and increase the confidence of both domestic and foreign investors in the ability of companies to generate sustainable long-term value.
Although challenges remain—especially regarding the consolidation of ethical organizational cultures and political and economic stability—Brazil today presents a more modern, predictable, and competitive corporate environment. In this context, governance is no longer merely a regulatory requirement but becomes a strategic differentiator.
Thus, the continued strengthening of corporate governance practices tends to position the country at an increasingly favorable level in the global landscape, expanding investment opportunities and contributing to sustainable economic development.
Author: Renata Assalim Fernandes Souza
Head of the Contracts, Compliance, and Intellectual Property Departments at De Vivo, Castro, Cunha e Whitaker Advogados.
De Vivo, Castro, Cunha, Ricca e Whitaker Advogados
Rua Leopoldo Couto de Magalhães Jr., 758
9º e 10º andares – Itaim Bibi
04542-001 São Paulo – SP
Tel.: (11) 3048 3266
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