The Brazilian Sustainable Taxonomy is a classification system that identifies which economic activities are considered sustainable. It is a science-based document that provides clear guidance to identify economic activities, assets and projects that contribute to environmental, economic and social goals set by the Brazilian society.
As defined by the International Capital Market Association (ICMA, 2021), the taxonomy provides criteria and indicators that make it possible to assess whether an activity promotes sustainability and the transition to a green economy.
Why is taxonomy important?
The tool guides investors and companies in choosing investments that really benefit the planet and society, reducing the risks of the so-called greenwashing – a practice in which companies claim to adopt sustainable measures but do not actually implement them.
A taxonomy acts as a strategic tool to mobilize and redirect capital flows towards essential investments to tackle the climate crisis.
In addition, the Brazilian Sustainable Taxonomy:
✅ Helps Brazil meet its international commitments to reducing greenhouse gas emissions.
✅ Avoids environmental barriers to exports and international investments by harmonizing with other countries' taxonomies.
✅ Responds to the country's environmental and social challenges in line with national objectives and priority plans.
With this system, Brazil strengthens its leadership in the transition to a sustainable economy, ensuring more transparency and credibility in the green financial market.
