Green Bonds and the Incentive to Decrease the Carbon Footprint in the Brazilian Agribusiness Sector

Agricultural activity in Brazil dates back to colonial times and highlights a multitude of product cycles that over time were distributed in expanded regions with the advancement of agricultural frontiers, as well as in areas of environmental preservation, in order to meet internal and external demands. Concerns about the sector’s liabilities, such as the advancement of deforestation and direct involvement in the carbon footprint, reveal growing market pressure to adopt sustainable practices. The Brazilian agribusiness sector is responsible for a significant portion of Greenhouse Gas (GHG) emissions resulting from land use and forestry changes. Consequently, investors view the green agenda as an opportunity to allocate capital into projects within the sector that mitigate existing environmental damage and prevent future liabilities, while simultaneously achieving reputational gains and competitive returns. Therefore, this chapter aims to discuss green bonds as positive tools and well-defined taxonomies, with the potential to boost the adoption of beneficial practices in Brazilian agribusiness and reduce the carbon footprint. Brazil is recognized as one of the world’s main producers and exporters of agricultural commodities, with an extensive area of cultivable land and a favorable climate for agribusiness production. Thus, promoting sustainability in the sector contributes to strengthening competitiveness in the global market, attracting foreign investments that see the green agenda as an opportunity to promote themselves positively in the market, while contributing to the preservation of natural resources and weakening the causative agents of climate change.