Brazil has emerged as an attractive destination for international businesses — and the law firms advising them — seeking opportunities in sustainable projects with positive environmental and social outcomes, as well as generating notable financial returns.
Remarkably, over 80% of Brazil’s electricity production consistently stems from renewable sources1, offering vast potential for decarbonising industries to harness clean energy and take advantage of a broad range of sustainable initiatives and investment opportunities.
Brazil’s environmental conditions are unparalleled, with vast territory and abundant natural resources, not to mention its crown jewel: the Amazon rainforest. (Cerrado and Pantanal biomasses add further opportunities.) This offers immense potential for exploring and harnessing the bioeconomy.
Brazil is a standout in clean and renewable energy resources, too, with hydropower, wind, and solar energy playing pivotal roles. Even as Brazil transitions towards cleaner energy sources, its oil extraction practices boast some of the lowest emissions in the world (CEBRI 2023).
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Brazil’s commitment to sustainability is exemplified by its modern environmental laws, such as 2012’s Forest Code, which governs the use and protection of private land in Brazil, leading to a significant reduction in deforestation rates. These laws provide a robust legal framework for ESG (Environmental, Social, Governance) projects.
While private landowners generally embrace sustainable land management and resource exploitation, challenges persist on public land — roughly half of Brazil’s territory. Enforcement of environmental laws has been inconsistent in these areas. In 2023, a pivotal shift occurred with the election of a new government who view the bioeconomy and sustainable investments as opportunities, rather than obstacles — new initiatives and the reinforcement of existing environmental laws have since been seen, setting a positive precedent for international investors.
Brazil is currently assessing a legal framework for regulated emissions and a trading system, to introduce mandatory requirements and a framework for trading emission credits — an important initiative expected to be in place by COP 30 (Brazil, 2025). This will be a milestone for the government to present its concrete initiatives. Already in place is the launch of a framework for sustainable sovereign green bonds, aimed at raising funds dedicated to policies that genuinely promote sustainable and inclusive development in line with the Sustainable Development Goals (SDGs) identified by the United Nations.
Today, companies buy credits generated from Brazilian projects to reduce emissions, not because they’re required to do so by law but on a voluntary basis. Across Brazil, there are many carbon credit projects in development, from preservation of the rainforest to the restoration of native forests and endangered ecosystems.
Other Latin American jurisdictions may have more proximity to the US but lack the vast natural resources and renewable energy of Brazil. Indonesia, South East Asia, and some African countries have simple regulatory frameworks for streamlined investment opportunities. Brazil provides a far more robust foundation for sustainable projects, with:
Brazil is also a significant producer of agricultural commodities like soy, coffee, and cotton, all having the potential to meet stringent EU (and other jurisdiction) sustainability requirements. There remains room for improvement in traceability and accountability throughout the supply chain, from production to transportation. Investing in traceability technology and sustainable value chains is paramount for companies operating in Brazil, to ensure the sustainability of commodities and products can be demonstrated and accounted for.
Brazil is miles ahead in sustainable initiatives compared to other emerging economies.
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Brazil's sustainable infrastructure development is a key attraction for investors. The country has seen a variety of significant investments in green infrastructure, reflecting a commitment to environmentally friendly transportation hubs — including ports, airports, and rail transportation on the horizon.
Less than 50% of the Brazilian population currently has access to sewage networks (Agencia Brasil, 2021), making this sector ready for significant sustainable developments — not to mention societal improvement.
Brazil's energy sector stands out with its focus on a variety of renewable options. The country boasts a diverse range of sources, including hydropower, wind, and solar, contributing to a robust and eco-friendly energy landscape.
Agriculture is the largest contributor to Brazil's GDP growth (Agencia IBGE, 2023). The sector leverages advanced technology to maximise land productivity while emphasising traceability in the supply chain. Sustainable agriculture practices are gaining traction, aligning with global demands for environmentally conscious food production.
Brazil's approach to forestry is twofold: maintaining the forest, while extracting value sustainably. This includes responsible timber production and a diverse array of forest products — Brazil nuts, açai, cocoa, and medicinal / pharmaceutical resources. Importantly, there's a strong social component to this strategy, too, through employment to poorer areas where damaging practices may previously have been the only option for people to take.
Brazil recognises the significance of its native and traditional communities living in the Amazon. These communities serve as guardians of the forest, and their livelihoods are intricately tied to the land. With a shift toward the bioeconomy, these communities are empowered to produce sustainable forest products, transforming their traditional activities into sources of economic stability.
Brazil's approach to the bioeconomy of the forest emphasises social sustainability alongside environmental conservation. This approach acknowledges that native and traditional communities require a livelihood and aims to reduce their dependence on environmentally damaging activities, like illegal mining activities, that can lead to deforestation.
Brazil's commitment to organic products and sustainable consumption adds another layer of appeal for investors. The emphasis on environmentally friendly and socially conscious products aligns with global sustainability trends, making Brazil an appealing destination for those interested in organic and eco-friendly markets.
International law firms are restricted from operating in Brazil due to legal regulations. This limitation means international firms seeking advice on Brazilian matters must collaborate with Brazilian law firms, not to mention for navigating the complex, ever-changing legal and financial landscape in the country.
We believe Vieira Rezende is your ideal partner for investing in sustainable projects with positive social and environmental impact. We focus on international businesses, and many of our partners have worked abroad in countries like the US, UK, and across Europe. Founded in 1995, we have always specialised in working with international clients across Brazil since day one, effectively translating our beautiful country’s complexities. We boast deep sector expertise, particularly in key economic areas such as renewable energy, oil and gas, agriculture, and infrastructure, providing clients with not only legal expertise but also valuable market knowledge — who are the big players, and how to operate with them.
We consider ourselves to hold a consultancy role in client relationships, and beyond just a legal advisor. We understand the business of our clients, not just their immediate legal needs.
While our process typically begins by speaking with one of our transactional partners, clients are then connected with the specific expertise they require, whether that pertains to a particular industry or area of law. Our approach is always multidisciplinary, working holistically across our teams to find the best solution for any of our projects, ensuring comprehensive support.
Written by Camila Borba Lefèvre
