Brazil Is in Vanguard of Sustainability Juggernaut

Demonstrating leadership, especially in the regulatory sphere, Brazil is moving forward assertively in its sustainability and ESG agenda, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2023 ISG Provider Lens Sustainability and ESG report for Brazil finds that enterprises in Brazil are pioneers in undertaking important steps toward realizing an ecological transformation agenda. Brazil was the first country in the world to incorporate global standards issued by the International Sustainability Standards Board (ISSB) into its regulatory framework, a move that has led to rising demand throughout the country for sustainability solutions, the ISG report says.

“Service providers are increasingly recognizing the importance of sustainability,” said Andy Miears, director, adaptive organization, with ISG. “They have an unprecedented opportunity to lead the transition to a greener future.”

Despite the popularity of sustainability and ESG topics in Brazil, enterprises remain unsure of exactly how to fulfill their sustainability and ESG commitments and how to do so in a way that will resonate positively with stakeholders, the ISG report says.

Although traditional ESG ratings have typically focused on environmental factors, there is a growing emphasis on social and governance factors, such as human rights, labor practices and board diversity, the report notes. This is leading to the development of new ESG rating methodologies that give greater weight to social and governance factors, ISG says.

To this end, AI and ML are being used to develop new ESG ratings and benchmarking methodologies that are more accurate and efficient, and show the potential to reduce bias, the ISG report says. Standardized ESG ratings across industries enable organizations to gauge their sustainability performance relative to their peers, the report says. By benchmarking against industry standards, companies can identify improvement areas and establish sustainability targets, ISG says.

“ESG compliance is no longer an option but a requirement for operating in today’s business environment,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “Enterprises are looking for strategic partners that can offer specialized solutions and services to help them integrate sustainable practices into their operations.”