The Brazil Securities Commission (CVM) is gathering technical evidence on the usefulness, market use and costs of public companies’ Corporate Governance Report under Annex D of CVM Resolution 80. The call for evidence follows a December 2024 assessment that found the report’s influence positive but limited. That assessment proposed integrating its content into the Reference Form and reviewing governance arrangements for the Brazilian Corporate Governance Code. The exercise tests whether the report’s additional informational value is concentrated in a small set of practices and whether explanations for nonadoption or partial adoption tend to be standardized and repetitive. It also examines whether direct use is concentrated among institutional investors and other specialists, while reporting costs weigh proportionately more heavily on smaller companies despite being modest relative to Reference Form costs. Other hypotheses concern whether the absence of periodic Code revisions reduces its relevance, whether improvements in adoption reflect factors other than reporting, and whether concentrated ownership limits market discipline arising from disclosures. These are working hypotheses, not CVM findings or preferences. The preliminary exercise could inform future rule changes but does not necessarily entail a subsequent regulatory impact analysis.
Brazil Securities Commission seeks evidence on corporate governance reporting value and costs
The Brazil Securities Commission (CVM) is gathering evidence on the usefulness and costs of public companies’ Corporate Governance Report, following a 2024 assessment that found its influence positive but limited. It is testing hypotheses about repetitive disclosures, specialist use and the relative burden on smaller companies. The preliminary exercise could inform rule changes, but the hypotheses are not findings.