BRAZIL Trends and Developments Contributed by: Ralph Melles Sticca, Passos e Sticca Advogados Associados
Regarding labour protection, Brazil has had legislation in force since 1943 (Consolidation of Labour Laws – CLT, Decree-Law No 5,452), and this remains highly restrictive. Although it underwent a significant reform in 2017 aimed at reducing the backlog of lawsuits and employers’ costs, it still represents a major challenge to unlocking corporate productivity without setting aside employee protection and hard-won benefits. In parallel, in May 2026 an update to the Brazilian Min - istry of Labour and Employment’s regulation (Regula - tory Standard – NR No 1) came into force. It serves as the cornerstone of Brazil’s Occupational Health and Safety system ( Saúde e Segurança do Trabalho – SST), requiring companies to implement Occupational Risk Management ( Gestão de Riscos Ocupacionais – GRO) and document a Risk Management Program ( Programa de Gestão de Risco – PGR), which now includes the obligation to prevent mental health risks such as stress, harassment and burnout. Lastly, a reduction in working hours is under discus - sion in the National Congress. In Brazil, under the Federal Constitution of 1988, the working week is 44 hours, which is why it is commonly referred to as the “6x1 schedule” (six working days and one weekly day of rest). The proposals provide for either a 5x2 schedule or a reduction to 40 hours per week, initially without the possibility of salary reduction by employ - ers, which will likely lead to lay-offs in industry, retail and services. And What About “G” for Governance? Notwithstanding the great relevance of the “E” and the “S” in public and corporate policies, unfortunate - ly in the past years there has been much less effort and investment on the “G”, leading to cash shortage, accounting frauds and corruption cases which drain resources for investing in innovation and technology, and in new programmes and funds for promoting envi - ronmental and social development. There are several international frameworks that guide how organisations are directed, controlled and held accountable around the world, but based on the OECD Principles (2023), corporate governance guide - lines are summarised as:
• corporate governance framework, rights and equi - table treatment of shareholders; • disclosure and transparency; • institutional investors, stock markets, and other intermediaries; • compliance and the responsibilities of the board; and • sustainability and resilience. Corporate governance framework, rights and equitable treatment of shareholders Brazil has an extensive business regulation in the field of corporate governance. The Brazilian Corporations Law (Law No 6,404) dates back to 1976 and remains in force to this day, having undergone numerous amendments, especially in 1997 (Law No 9,457), 2001 (Law No 10,303), 2007 (Law No 11,638), 2009 (Law No 11,941) and, more recently, 2021 (Law No 14,195), with a view to modernising the Brazilian capital mar - kets, promoting the protection of minority sharehold - ers, and incorporating international accounting stand - ards. Disclosure and transparency Specifically with regard to accounting standards, Bra - zil began, on a phased basis from 2008 onwards, to adopt the International Financial Reporting Standards (IFRS) issued by the International Accounting Stand - ards Board (IASB), creating the Brazilian Accounting Pronouncements Committee – an autonomous body composed of professional associations and Brazilian financial-market entities. This is responsible for study - ing, preparing and issuing accounting standards in Brazil, later endorsed by public agencies and regu - lators with binding authority, including the Brazilian Securities and Exchange Commission ( Comissão de Valores Mobiliários – CVM) and the Brazilian Central Bank ( Banco Central – Bacen). Institutional investors, stock markets, and other intermediaries The CVM’s own regulatory framework also dates back to 1976 (Law No 6,385) and has been updated so as to provide clear concepts and definitions concerning the issuance, custody and trading of shares, deben - tures, subscription warrants, coupons, receipts, secu - rities deposit certificates, bonds, commercial papers,
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