FinanceMap scores this financial institution in the following areas. Please navigate to the relevant tab for in-depth analysis
FinanceMap assesses these portfolios for this financial institution. Please navigate to the relevant tab for in-depth analysis.
Banco Bradesco’s board incorporates climate-related issues in corporate strategy, decisions on major transactions, and its risk management processes and policies. It is responsible for overseeing the execution of the organization's climate strategy. Management-level committees appear to have some climate-related responsibilities, including the Risk Committee and the Sustainability Commission which assess the adherence level of risk management structure processes to established policies, and propose strategies and solutions that promote sustainability.
Bradesco has defined what it considers to be short, medium and long-term time horizons, however, it only discloses select examples of risks and opportunities it considers over these timelines. The organization references some processes used to determine which risks and opportunities could have a material financial impact on the organization, including scenario analysis and sensitivity analysis. It considers climate-related risks and opportunities on its lending, advisory, and investment activities, and has detailed several sustainable product and service offerings.
Bradesco considers the impact of climate-related risks and opportunities on its corporate strategy planning, including advancing its own net-zero ambitions, offering sustainable products and services, and is providing financial solutions that support a lower carbon consumption. The organization has also undertaken scenario analysis using three scenarios (Net-Zero, Divergent Net-Zero, and Current Policies scenario), covering the “main sectors” of the Brazilian economy. It has disclosed some implications of its analysis on its strategy and business model, but does not disclose the results of the analysis.
Bradesco’s risk management approach identifies, assesses and prioritizes climate-related risks through analysis of various business activities, assignment of an ESG score to medium or high risk clients, and scenario and sensitivity analysis. It also has processes in place to manage climate-related risks, including monitoring monthly credit operations and using a framework of standards for climate risks to restrict granting credit for high risk activities. The organization integrates climate-related risk management in its overall risk management approach through its Social, Environmental and Climate Responsibility Standard within its regulatory structure, and climate agenda in its sustainability strategy and integrated risk management.
Bradesco is transparent about various key metrics, including its incorporation of ESG risks into remuneration policies, its credit exposure by sector and region, and the amount of financing allocated to sustainable business.
The organization fully discloses Scope 1 and 2 emissions, as well as some operational Scope 3 emissions. It has also disclosed financed emissions for its corporate loans, securities, and investment in absolute metrics, and discloses the percentage of total loans and investments covered in emissions measurement.
In July 2021, the bank became a member of the UN convened Net Zero Banking Alliance, and has committed to transitioning its lending and investment portfolios to align with net-zero by 2050. In its 2023 Climate Report, Banco Bradesco announced 2030 interim targets for the coal and electricity generation sectors. It has set a target to reach zero absolute emissions for the coal sector by 2030, and has set an emissions intensity reduction target of 59% for Scopes 1 and 2 for the electricity generation sector.
Bradesco has outlined a coal phase-out policy for thermal coal mining and power by 2030 in line with IPCC guidance. It also states that it has set restrictive measures for financing of new or expansion of existing projects for mining of mineral coal or energy generation by coal-fired thermoelectric power plants, however, it is unclear what these restrictions are. Bradesco has set an interim financed emissions target for the coal sector, stating it will reduce its absolute financed emissions from coal to zero by 2030.
Bradesco is not aligned with IPCC guidance on the role of oil and gas in the energy mix up to 2050. It appears to be actively financing the expansion or increased capacity of unabated natural gas and oil infrastructure, and does not appear to have made commitments surrounding the transition away from oil and gas in the energy mix. Bradesco hasset some exclusionary policies limiting certain unconventional oil and gas projects that involve the extraction and processing of shale oil and gas and bituminous sands.
The organization is also increasing its financing of renewables, setting a target of R$250 billion for sustainable business, of which R$6.1 is allocated towards green, sustainable, and social and sustainability-linked bonds. It has also outlined eligible activities towards its sustainable business target in its Sustainable Finance Framework.
FinanceMap’s Climate Governance and Policies analysis assesses statements financial institutions (FIs) are making on how they are incorporating climate issues into their decision-making and operations using FinanceMap’s matrix methodology. This methodology is adapted from the Task Force on Climate-Related Financial Disclosures (TCFD) recommendations and guidelines, Net-Zero Banking Alliance (NZBA) or equivalent Glasgow Financial Alliance for Net-Zero (GFANZ) initiative reporting, and IPCC and IEA technology statements. The TCFD provide guidance on 11 recommendations across four areas which are reflected in our matrix: Governance, Strategy, Risk Management, and Metrics and Targets. Additional benchmarks have been introduced to strengthen the ambition of scoring criteria in the assessment of targets, which are supplemented by guidance from the NZBA or equivalent GFANZ initiatives.
Additionally, Science-Based Policy (SBP) benchmarks are used to measure alignment of an FIs technology positions with the science of climate change. These benchmarks are applied to an FIs internal policies on technologies including coal, oil, gas, nuclear, and renewables and also assesses its engagement with broader climate and energy policy issues such as advocacy on the role and importance of different strategy types in the future energy mix.
For each TCFD recommendation and technology, FIs statements are applied to a five point scoring scale ranging from +2 to -2, measuring alignment with the relevant benchmarks. The detailed scores for this FI are displayed below within each matrix cell.
The following table outlines the key queries and data sources, which FinanceMap uses to assess financial institutions climate governance, targets and policies. Every evidence piece is assessed on a five-point scale of -2,-1,0,1,2 or NA (not applicable)/NS (not scored). All queries, data sources, and evidence pieces are weighted against one another in a matrix system to arrive at a final top-level score. Clicking on specific cells will load the underlying evidence and information on how it has been assessed.
Fossil fuel companies are those whose primary sector falls within coal mining and services, or up-, mid-, and downstream oil and gas sectors. Green companies are defined as companies having over 75% revenue deriving from Substantial Contribution to Mitigation activities under the EU Taxonomy.
Portion of AUM Assessed: $5.46B
| Holding Name | Contribution to Sector Production |
|---|---|
| Centrais Eletricas Brasileiras SA - Eletrobras | 80.1% |
| Companhia Paranaense de Energia | 10.1% |
| Energy of Minas Gerais Co | 4.4% |
| Eneva SA | 4.0% |
| Auren Energia SA | 0.4% |
| CPFL Energia SA | 0.3% |
| Neoenergia SA | 0.3% |
| Equatorial SA | 0.2% |
| ENGIE Brasil Energia SA | <0.1% |
| Sao Martinho SA | <0.1% |
| Holding Name | Contribution to Sector Production |
|---|---|
| Petroleo Brasileiro SA Petrobras | 98.5% |
| Prio SA | 1.4% |
| Maha Energy AB | <0.1% |
Bradesco Asset Management (BRAM) does not appear to be actively engaging companies around climate change, although it has limited reporting and disclosures so it is unclear the extent of its stewardship. BRAM has listed climate change as a topic for engagement but does not appear to have a clear climate engagement framework. The asset manager does not appear to use defined milestones to track engagement progress or have an escalation response.
Due to the lack of case studies and examples in its reporting, it is unclear if BRAM is actively engaging companies on climate change. The asset manager does describe a collaborative engagement campaign with Climate Investors on Engagement Project (IPC in Portuguese) that it is involved in, although the extent of its participation is unclear. There is no evidence of engagement or expectations around indirect climate policy influence.
BRAM has described its general ESG governance structure but it is unclear how stewardship activities and review are incorporated into this structure. It is not transparent about engagement activities, only disclosing limited summary statistics, and does not disclose proxy voting record or how voting decisions are made.
There is no evidence in BRAM’s reporting that it is willing to use shareholder authority to engage companies on climate.
FinanceMap's methodology to measure the engagement process on climate was developed in consultation with several of the world's leading asset managers and uses key aspects of the UK Financial Reporting Council's 2020 Stewardship Code . The Stewardship Code was chosen to benchmark engagement quality as it provides an ambitious framework and detailed definitions of what constitutes effective engagement. FinanceMap defines the term ‘engagement’ as referring to all investor actions undertaken to influence the management strategy of the companies they own including private communications with corporate management and appointed advisors; questions at AGMs/other company meetings; comments on the company in the media; escalation and the shareholder resolution process (filing, voting behavior). FinanceMap’s methodology breaks the engagement process down into a set of sub-activities and looks for evidence associated with these across publicly available data sources.
Climate-relevance categorization of shareholder resolutions is based on the IPCC’s Special Report on 1.5°C and its concluded need for “rapid and far-reaching transitions in land, energy, industry, buildings, transport, and cities.” FinanceMap scored voting on any resolution where the intent and likely outcome is consistent with this IPCC stated need. The voting data is drawn from asset managers' disclosures to the US Security Exchange Commission (SEC), asset manager websites (including third-party websites they link to), directly from the asset managers, and through specialist voting data provider Insightia. The full list of resolutions assessed is available here.
The following table outlines the key queries and data sources, which FinanceMap uses to assess asset managers' corporate engagement programs. Every evidence piece is assessed on a five-point scale of -2,-1,0,1,2 or NA (not applicable)/NS (not scored). All queries, data sources, and evidence pieces are weighted against one another in a matrix system to arrive at a final top-level score. Clicking on specific cells will load the underlying evidence and information on how it has been assessed.
InfluenceMap’s methodology for assessing lobbying on climate finance policy closely follows InfluenceMap’s established methodology on climate policy engagement, which is used extensively by investors, including via the Climate Action 100+ investor engagement process. Our full methodology can be found here.
Under our lobbying assessment, InfluenceMap considers engagement on all financial policies which intersect with climate issues, as well as “real economy” climate change policies.
The analysis takes into account both the engagement of the financial institution and the activities of industry associations they hold membership of. InfluenceMap’s methodology covers seven publicly available data sources, searching for evidence of engagement and corporate positioning since 2017. To determine the policy issues within the scope of the analysis, InfluenceMap breaks down policy engagement into a series of subcategories, or 'queries'. These are designed to cover high-level issues relating to the importance of sustainable finance, as well as more specific areas of sustainable finance policymaking. InfluenceMap’s research process searches for evidence of an organization's engagement with each policy issue, across each of the data sources.
The following table outlines the key queries and data sources, which InfluenceMap uses to assess financial institutions' policy engagement. Every evidence piece is assessed on a five-point scale of -2,-1,0,1,2 or NA (not applicable)/NS (not scored). All queries, data sources, and evidence pieces are weighted against one another in a matrix system to arrive at a final top-level score. Clicking on specific cells will load the underlying evidence and information on how it has been assessed.
In this section, we depict graphically the relationships the corporation has with trade associations, federations, advocacy groups and other third parties who may be acting on their behalf to influence climate change policy. Each of the columns above represents one relationship the corporation appears to have with such a third party.
In these columns, the top, dark section represents the strength of the relationship the corporation has with the influencer. For example if a corporation's senior executive also held a key role in the trade association, we would deem this to be a strong relationship and it would be on the far left of the chart above, with the weaker ones to the right. Click on these grey shaded upper sections for details of these relationships. The middle section contains a link to the organization score details of the influencer concerned, so you can see the details of its climate change policy influence. Click on the middle sections for for details of the trade associations. The lower section contains the organization score of that influencer, the lower the more negatively it is influencing climate policy.
