2026 and the Prospects for the ESG Agenda

2026: The "Tipping Point" for Corporate Sustainability and the ESG Regulatory Agenda

If 2025 consolidated crucial steps, 2026 is set to be strategic for the ESG agenda, definitively steering the course of economic regulation in Brazil and worldwide.

Since the post-pandemic period (2020-2021), the meaning and function of organizational performance regarding risks and impacts on the environment, climate, human and social rights, corruption, and corporate governance have reached new levels of demand in markets and regulatory environments, especially in light of a new global and business reality.

Between "lovers" and "haters," the ESG agenda (Environmental, Social, and Governance) has been driving discussions in both the public and private sectors, including a resurgence of critiques regarding corporate sustainability and the role economic activities must play in the race for sustainable development.

Despite the reluctance of many actors, this agenda shows no signs of leaving the "trending topics" in Brazil and globally—for good reason. In 2026, signs indicate that the subject will continue to be influential across various fronts.

Between 2023 and 2024, we saw a "regulatory boom" across several relevant sectors of the Brazilian and global economies. 2025 brought a reality check for companies, banks, and other economic agents in key global markets. Looking toward 2026, the message is clear: the ESG agenda has moved beyond a marketing differentiator, "isolated seals," and "home broker portfolios" to become a condition of operation for economic activities and a guarantee for financing and investment.

In the 2004 document "Who Cares Wins," published by the UN Global Compact and considered a landmark for the ESG agenda, the focus was on integrating ESG issues into investment and business management. Contextualized for 2026, the theme appears more intensely linked to the conception and the very existence of these businesses than to their mere direction.

As 2026 begins, given the scenario of unprecedented political and economic complexity, the zeitgeist for corporate sustainability is no longer about "best practices and eco-friendly agents," but rather about legal certainty, competitiveness, and access to capital.

Below are some speculative points regarding the critical outlook of what has changed and what will define the regulatory context of sustainability and the ESG agenda in Brazil.

1. The ESG Regulatory Noose Tightens...

The recently built normative architecture has begun "to show its teeth." A movement started in 2021 with Resolutions 4,945, 4,943, and 141 by the Central Bank of Brazil (BACEN) and the National Monetary Council (CMN), passing through Circular 666 published by the Superintendency of Private Insurance (SUSEP) in 2022, and reaching Resolution 193 of 2023 and the impactful Resolutions 217 and 218 of 2024 by the Securities and Exchange Commission of Brazil (CVM). These have established a set of standards, requirements, and instruments to be developed, implemented, and proven by regulated agents and publicly traded entities in the financial, insurance, and capital market sectors in Brazil.

While 2024 highlighted CVM Resolutions 217 and 218 regarding the internalization of IFRS S1 and S2 reporting standards, as well as CMN Resolution No. 5,193/2024—which tightened rural credit barriers linked to environmental and climate compliance—2025 saw a relevant development from the National Council of Private Insurance (CNSP). Resolution 485/2025 established environmental, social, and climate guidelines for rural insurance underwriting.

Additionally, 2025 saw the publication of the Brazilian Sustainable Taxonomy (TSB) (Decree 12,705/2025), a mechanism that formally instituted climate, social, and environmental criteria for the allocation of investments and public/private support. This is the "ESG public filter" that Brazil was missing.

• 2026 Outlook: With the advancement of SUSEP rules for the insurance sector and the consolidation of BACEN norms and the Brazilian Taxonomy, access to capital is strictly conditioned on the management of climate and ESG risks. Simultaneously, there is an expectation for the regulation of the Brazilian Emissions Trading System (SBCE) or the "Regulated Carbon Market."

• The IFRS Challenge: The end of the voluntary adoption period for IFRS S1 and S2 sustainability standards (CVM Resolution 193/2023) creates a challenging scenario for publicly traded companies in Brazil. Mandatory compliance in 2026 will leave no room for improvisation regarding ESG governance and risk management in operations and investments.

2. Governance Put to the Test and "Greenwashing" Litigation

Following the reflections generated by the 2023 Americanas case, the "G" for Governance in ESG strategy has never been more vital. The judicial reorganization of Ambipar in 2025 serves as a painful case study: an ESG strategy requires financial solidity and robust governance; without them, the business itself may become unsustainable.

Another aspect to consider in 2026 is the rise of climate litigation, greenwashing, and climatewashing. Impactful lawsuits filed in 2025 by IDEC (Consumer Defense Institute) against Gol Airlines and Localiza highlight the risk of judicialization regarding corporate performance disclosures.

• Legal Risk in 2026: The increase in corporate litigation focused on greenwashing demonstrates that investors and civil society are monitoring inconsistencies between discourse and practice. Fiduciary duty now undeniably includes the governance and prevention of climate risks.

3. International Socio-Environmental Responsibility

In November 2025, during COP30 in Belém, the British Court’s decision to condemn BHP (impacting Vale by extension) for the 2015 Mariana disaster brought new horizons to global corporate risk regarding liability for major damages.

• Shared ESG Risk: It has been established that international parent companies can indeed be held directly liable for damages caused by subsidiaries or joint ventures in Brazil. The theory of "corporate veil" or "corporate autonomy" fell before the Socio-Environmental Duty of Care.

• Impact in 2026? This could open the door to a wave of transnational climate and social litigation. Large Brazilian groups with foreign listings or multinationals operating in Brazil must strategically review their liabilities: justice is now global, and civil liability is broad.

4. Geopolitics, ESG, and Economic Sovereignty: The Global Chessboard

The external scenario directly impacts the predictability of national infrastructure regulation. Geopolitical tensions between the US, China, and Venezuela, combined with debates over oil exploration in new frontiers in Brazil (e.g., the Amazon River mouth), may redefine energy sovereignty priorities and impact regulation and investments.

• The COP30 Factor: The legacy of the 2025 summit in Belém reinforced the need for clear rules for risk control in large-scale projects, especially those carbon-intensive or located near sensitive biomes like the Amazon.

• The CADE vs. Markets Paradox (The Soy Issue): In 2025, the debate over the Soy Moratorium escalated into an institutional conflict. The intervention of CADE (Administrative Council for Economic Defense) questioning the legality of sector-wide pacts from a competition perspective left producers in a "legal limbo" that will continue into 2026.

• EU-Mercosur Agreement: As the trade agreement advances, requirements from countries like France will maintain pressure on Brazilian agribusiness. Free trade is now "packaged" with various ESG requirements and chain-of-value operations, such as the EU Deforestation Regulation (EUDR), requiring full traceability.

Is 2026 the "Tipping Point" for the ESG Agenda?

A "tipping point" is a critical moment where a trend triggers a massive, irreversible change. The new direction of ESG regulatory architecture in national and international markets is—and will increasingly be—a conditional element for economic, legal, and commercial security. Financing, insurance, capital markets, exports, and competition are now directly linked to ESG regulation.

This momentum is confirmed by the polycentric nature of economic risks regarding climate, human rights, competition, and technology. It is the definitive meeting of ESG and Compliance over the "ruins of soft law." Even for the skeptics, the message is clear: the era of Hard Enforcement has begun. ESG integrity is now an indispensable strategy for corporate existence.

For 2026, "adaptation" will no longer suffice; compliance, structure, and evidence of governance and ESG risk strategies will be required. Guided by this set of regulations, financial institutions, regulators, and courts will increasingly demand adherence to performance standards and governance of climate and socio-environmental obligations.

The era of voluntary ESG, detached from corporate and market regulation, seems to be bidding farewell. 2026 will indicate the concrete direction of it all.

--

[Automatically translated]

Originally published on LinkedIn.

Author: Bruno Teixeira Peixoto