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B3

Name B3
Country Brazil
Number of listed companies 347
Domestic market capitalization 774133 million US$
SSE Partner Exchange Yes
Has annual sustainability report Yes

  • 2018 Annual Report
ESG reporting required as a listing rule Yes

  • B3 recommended as of 2012 that listed companies state in item 7.8 of the Reference Form (“Description of the company’s relevant long-term relationships not elsewhere described”), whether they publish a Regular Sustainability or Integrated Reports and where it is available, or if not explain why. (Source)
  • As of 2016, the Brazilian Regulator will turn the Report or Explain into a specific item to address environmental and social issues in its reference form to all listed companies. (Source: B3)
  • In 2017, B3 launched the “Report or Explain for the Sustainable Development Goals (SDGs) initiative”, which aims to stimulate the transparency of the listed companies’ strategies and actions in relation to the 17 UN-established SDGs. In 2017, B3 launched the “Report or Explain for the Sustainable Development Goals (SDGs) initiative”, which aims to stimulate the transparency of the listed companies’ strategies and actions in relation to the 17 UN-established SDGs.Through this initiative, the company recommends, from 2017, that listed companies annually state whether they publish a sustainability or integrated report taking the SDGs into account. Along similar lines with the previous initiative, if they do not, B3 requests they explain why by choosing one of the options supplied. (Source).

Has written guidance on ESG reporting Yes

Offers ESG related training Yes

  • Integration of ESG issues to education through the B3 Institute of Education.

Market covered by sustainability-related index Yes

Has sustainability bond listing segment Yes

Has SME listing platform Yes

Additional information
  • B3’s Sustainability Policy.
  • SOE Governance Program in place since May 2017.
  • B3 included sustainability criteria in the Exchange’s Operational Qualification Program (PQO). PQO certifies the quality of services offered by the brokerage houses, enabling and strengthening these institutions both as institutions/companies and as inter-mediation industry participants. The institutions certified by the PQO receive the right to use Qualification Seals, which are a declaration to investors and the general public of the high standard of institutions’ inter-mediation products and services.
  • The exchange runs the B3 Social, created to coordinate its social investment projects. One of the most important projects of B3 Social is the Social-Environmental Investment Exchange (BVSA). BVSA is a pioneering initiative created by B3 in 2003 with the support of brokers. It is a fundraising platform with a format similar to a stock exchange. As of 2016 BVSA adopted the 5 Ps (People, Planet, Prosperity, Peace and Partnership) to reflect the new Sustainable Development Goals, as a selection criteria for listed projects.
  • B3 has been making inventory of its greenhouse gas emissions since 2009 (Source). Since 2010 it has been audited externally and the document has been included in the Public Registry of the Brazil GHG Protocol Program. The inventory is a prerequisite to participate to ICO2. Also, the Exchange compensates its emissions that cannot be reduced, since 2013, when it offset the GHG emissions from 2011 and 2012. Since then, this process has been annual.
  • B3 has answered the CDP annual climate change questionnaire since 2009 and is a member of the Advisory Board of CDP Latin America. (Source).
  • B3 became the first stock exchange in the world to adhere to the Global Compact in 2004, and it is a member of the Compact’s Brazilian Committee. It was the first exchange in any emerging market country to commit officially to the Principles of Responsible Investment (PRI) in 2010; became a founding signatory to the Sustainable Stock Exchanges initiative in 2012; and is a member of the WFE’s Sustainability Working Group since 2014. B3 is also a member of the GRI Brazil Advisory Group and member of the Network of Leading Brazilian Women for Sustainability of the Brazilian Environment Ministry. (Source).
  • Results from the “Report or Explain for Sustainability or Integrated Reports: A Brazilian Success Story”.

Organizational model of stock exchange
  • Listed company for profit; demutualized in 2007

Regulatory bodies

Regulatory model
Limited Exchange Self-Regulatory Organization (SRO) Model

  • B3’s organization and operations are subject to direct oversight from the CVM. We are a market operator and operator of clearing houses that, in such capacity, act as a self-regulatory and market surveillance organization, responsible for monitoring and overseeing market participants and the transactions carried out on our markets. Our self-regulatory and market surveillance arm is B3 Market Surveillance (BSM), which maintains close relationships with the regulators, in particular the Central Bank and the CVM. It is also responsible for keeping the CVM abreast of market developments and providing the market regulator with periodic reports of its market surveillance operations. Activities involving clearing and settlement services, which we provide through our four clearing facilities are subject to the regulatory and oversight authority of both the CVM and the Central Bank.

About the stock exchange
Location: São Paulo, Brazil.

  • B3 S.A. – Brasil, Bolsa, Balcão is one of the world’s largest financial market infrastructure providers by market value. The services it offers range from exchange trading, clearing and other post-trade services to the registration of over-the-counter (OTC) transactions and of vehicle and real estate loans.
  • B3 was established in March 2017 when the securities, commodities and futures exchange activities of BM&FBOVESPA were combined with the activities of Cetip, a provider of financial services for the organized OTC market. This combination consolidated the Company’s position as a financial market infrastructure and enabled it to extend the range of services and products offered to customers while creating efficiencies for the Company and for the market.
  • In the markets for exchange-traded products, B3 develops, implements and operates trading and post-trading (clearing and settlement) systems and services for equities, equity, financial and commodity derivatives, bonds, federal government debt securities, spot currencies and agricultural commodities. It provides a listing service and acts as central securities depository (CSD) for the assets traded in its environments. It also offers software and index licensing services. Its operations in these markets require constant investment in technological infrastructure, as well as control and management of the risks inherent in these activities in order to ensure they operate efficiently and securely.
  • For unlisted products traded bilaterally on the OTC market, such as financial instruments issued by banks and customized derivatives, B3 offers the infrastructure for registration of these trades by market participants.
  • In addition, through its vehicle and real estate financing unit, the Company offers products and services that streamline local credit analysis and approval, making access to secured loans easier, faster and safer.
  • Alongside its operational, technological and risk management excellence, B3 also boosts the dynamics of the markets it manages by means of innovation and product development, as well as educational programs for the general public.
  • B3 is a public company traded under ticker symbol BVMF3 on the Novo Mercado premium listing segment for companies committed to the highest standards of corporate governance. Its stock is tracked by the Ibovespa, IBrX-50, IBrX and Itag indices, among others.
  • The Company is headquartered in São Paulo and has units in Rio de Janeiro and Alphaville, Brazil. It also has representative offices in New York (USA), London (UK) and Shanghai (China) to support local market participants in activities with foreign customers and relations with regulators, and to disseminate its products and governance practices to potential investors.

Stock Exchange Database Criteria

The SSE maintains a database of sustainability activities for all stock exchanges that are either members of the SSE initiative and/or members of the World Federation of Exchanges. This database is the most comprehensive database of stock exchanges worldwide and contains data on all main stock exchanges. The information in this database is intended to inform investors and other stakeholders on the work stock exchanges are undertaking to advance sustainability in their respective markets.

The information provided in this database is based on publicly available information prepared by the SSE Secretariat with input from stock exchanges in most instances. Sources and explanatory notes on sustainability information have been included in individual Stock Exchange Fact Sheets. The criteria for each category can be found below.

While every effort is made to keep the information in this database up to date, please be aware that certain factors change frequently and therefore may not be exact, such as the number of listed companies or market cap.

Field

Criteria Considered

Conducts business in Country or Market in which the stock exchange operates
Number of listed companies (Date updated) Updated either by the stock exchange directly or using WFE data
Domestic market capitalization  Updated either by the stock exchange directly or using WFE data
Has signed the SSE Commitment Letter? To be considered an SSE Partner Exchange, the CEO or Chairperson of the exchange must sign an SSE commitment letter. Contact the SSE for more information if your exchange would like to join.
Has annual sustainability report? For a yes, stock exchanges must report, either in a stand alone report or integrated into their financial report, on their environmental and social impact and corporate governance.
ESG reporting required as a listing rule? For a yes, all three factors have been considered (environmental, social and governance) within the listing rules for some or all listed companies. This requirement may come from the regulatory authority or the exchange, depending on the market.
Offers written guidance on ESG reporting? For a yes, all three factors have been considered (environmental, social and governance). The SSE has developed a model guidance that all exchanges can use to develop their own guidance to issuers. For more details, click here.
Offers ESG related training? For a yes, training must have taken place in the previous 12 months, and must be interactive. The topic of the training must be on some area of sustainability.
Market covered by sustainability-related index? Sustainability-related indices may include environmental or social  indices, or ESG indices. This could include specific themes, such as low carbon indices, or general sustainability indices. The index must be specific to the market the exchange operates in (a region or world index is not included).
Has sustainability bond listing segment? For a yes, the exchange has developed the rules and regulations allowing for sustainability bonds to be listed, and provides a separate segment for listing making the bonds easy to find and identify.
Has an SME listing platform? For a yes, the exchange offers a listing platform specifically for Small-and-Medium sized enterprises.
Additional Information Additional Information captures exchanges’: sustainability section of websites,  sustainability products not captured under indices; information on future sustainability commitments and other information on the exchange
Organizational model of stock exchange Whether the exchange is listed or not, and when it was demutualized
Regulatory bodies The regulatory authority that sets listing requirements and capital market regulation for the exchange's market
Regulatory model

The extent to which exchanges have regulatory authority in their market. This may include: 

  • Limited exchange SRO
  • Strong exchange SRO
  • Independent member SRO
  • Government (Statutory)
  • Non-SRO
About the stock exchange The location of the headquarters of the exchange, and any additional details about the stock exchange.