1 00:00:00,200 --> 00:00:02,360 Speaker 1: This is Tom ronnans Reese and you're listening to Switched 2 00:00:02,400 --> 00:00:04,920 Speaker 1: on the BNF podcast, and today we bring you a 3 00:00:04,960 --> 00:00:08,280 Speaker 1: recording from our Bloomberg NEF Forum Salpaolo, which took place 4 00:00:08,280 --> 00:00:10,720 Speaker 1: on the first of April. The panel feature on today's 5 00:00:10,720 --> 00:00:13,520 Speaker 1: show is titled Brazil's Role in the evolution of Global 6 00:00:13,520 --> 00:00:16,800 Speaker 1: Carbon Markets. Twenty twenty five is likely to see Brazil 7 00:00:16,880 --> 00:00:19,639 Speaker 1: at the center of most major carbon market developments, with 8 00:00:19,720 --> 00:00:22,200 Speaker 1: the nation hosting COP thirty later this year. They've been 9 00:00:22,239 --> 00:00:25,119 Speaker 1: working hard to develop their domestic carbon market and given 10 00:00:25,120 --> 00:00:28,120 Speaker 1: the natural resources at their disposal, including vast swaths of 11 00:00:28,120 --> 00:00:30,760 Speaker 1: the Amazon rainforest, they're looking to ramp up their nature 12 00:00:30,760 --> 00:00:33,920 Speaker 1: based carbon supply for international trading. But what is needed 13 00:00:33,920 --> 00:00:35,639 Speaker 1: to ensure Brazil can be the hub for a high 14 00:00:35,720 --> 00:00:38,479 Speaker 1: quality nature based carbon credit supply and what role do 15 00:00:38,520 --> 00:00:41,479 Speaker 1: they play in a global un regulated carbon market. On 16 00:00:41,520 --> 00:00:43,880 Speaker 1: today's show, the panelists discuss how best to get people 17 00:00:43,880 --> 00:00:46,760 Speaker 1: excited about carbon credits, the types of credits the buyers 18 00:00:46,760 --> 00:00:48,680 Speaker 1: are looking for, and the role that banks can play 19 00:00:48,720 --> 00:00:52,760 Speaker 1: in the carbon market. The panelists include Tiago Piccolo, Chief 20 00:00:52,800 --> 00:00:57,040 Speaker 1: executive Officer, at Ari Green, Babiana Alvez, chief executive officer 21 00:00:57,080 --> 00:01:01,600 Speaker 1: at Rabobank, Fabio Galindo, chief executive officer at Future Climate, 22 00:01:01,760 --> 00:01:06,160 Speaker 1: and Angela Pinnati, chief sustainability officer at Natura. The panel 23 00:01:06,240 --> 00:01:09,000 Speaker 1: was moderated by Kyle Harrison, Bloomberg and EF's head of 24 00:01:09,080 --> 00:01:13,200 Speaker 1: Environmental Markets Research. For more information on BNF's events, including 25 00:01:13,200 --> 00:01:15,520 Speaker 1: our upcoming BNF Summit in New York on the twenty 26 00:01:15,600 --> 00:01:17,840 Speaker 1: ninth and thirtieth of April, and to view recordings from 27 00:01:17,880 --> 00:01:26,080 Speaker 1: our previous events, had to about BNF dot com slash summits. 28 00:01:31,880 --> 00:01:33,959 Speaker 2: Thank you all so much. I love the diversity that 29 00:01:34,000 --> 00:01:35,880 Speaker 2: we have on this panel. I think we cover the 30 00:01:36,040 --> 00:01:39,120 Speaker 2: entire value chain from the development of a project all 31 00:01:39,160 --> 00:01:42,440 Speaker 2: the way to the end user. Right that off ramp, Jiago, 32 00:01:42,440 --> 00:01:44,120 Speaker 2: I want to throw it right back to you actually, 33 00:01:44,160 --> 00:01:47,840 Speaker 2: so tell us what does a good carbon credit project 34 00:01:47,880 --> 00:01:49,880 Speaker 2: look like, especially in nature based solutions. 35 00:01:49,640 --> 00:01:52,400 Speaker 3: What characteristics do you need to emphasize? 36 00:01:52,560 --> 00:01:54,840 Speaker 4: Well, I guess it could start talking a little bit 37 00:01:54,880 --> 00:01:58,320 Speaker 4: about the characteristics of the project itself. And there's many 38 00:01:58,960 --> 00:02:02,040 Speaker 4: kind of traditional words that I'm sure some of you 39 00:02:02,080 --> 00:02:05,160 Speaker 4: have heard about. So the project needs to have a 40 00:02:05,200 --> 00:02:09,360 Speaker 4: clear additionality. It must be obvious and very well proven. 41 00:02:09,520 --> 00:02:12,160 Speaker 4: To whoever's buying that that your project would not go 42 00:02:12,240 --> 00:02:15,800 Speaker 4: forward unless it had the carbon credit mechanism as a 43 00:02:15,800 --> 00:02:17,920 Speaker 4: way to fund it. You need to show that you 44 00:02:18,040 --> 00:02:21,240 Speaker 4: have a strong claim to permanence, that whatever you're doing 45 00:02:21,400 --> 00:02:23,280 Speaker 4: is going to stay there for a very long time, 46 00:02:23,400 --> 00:02:27,400 Speaker 4: is not going to be reverted easily. And you also 47 00:02:27,840 --> 00:02:30,920 Speaker 4: increasingly need to show that the project comes with a 48 00:02:30,919 --> 00:02:34,120 Speaker 4: lot of co benefits. Not only are you se questioning 49 00:02:34,160 --> 00:02:37,280 Speaker 4: carbon from the atmosphere, but you're also giving a positive 50 00:02:37,320 --> 00:02:44,040 Speaker 4: contribution in other aspects, such as promoting an increase in 51 00:02:44,080 --> 00:02:49,079 Speaker 4: biodiversity or generating sustainable opportunities for the communities around. But 52 00:02:49,440 --> 00:02:52,280 Speaker 4: I would complement that a little bit. I think the 53 00:02:52,320 --> 00:02:54,639 Speaker 4: answer that I just gave to you right now, it's 54 00:02:54,639 --> 00:02:57,080 Speaker 4: a very obvious answer. It's the traditional one that you 55 00:02:57,120 --> 00:02:59,800 Speaker 4: get if you ask chat GPT, for example. 56 00:03:00,919 --> 00:03:02,360 Speaker 5: I think there's one thing that makes a lot of. 57 00:03:02,360 --> 00:03:07,480 Speaker 4: Differences, sort of the level of professionalism that your company has. 58 00:03:08,440 --> 00:03:10,040 Speaker 5: You were showing this graph up. 59 00:03:09,960 --> 00:03:13,400 Speaker 4: Here where you plotted the carbon intensity of the companies 60 00:03:13,480 --> 00:03:16,560 Speaker 4: and the profitability, and regardless of which one of those 61 00:03:17,280 --> 00:03:20,040 Speaker 4: squares you choose to play in, these are all very 62 00:03:20,120 --> 00:03:22,800 Speaker 4: large companies. These are companies that are used to buying 63 00:03:23,000 --> 00:03:27,160 Speaker 4: very large amounts of lots of products from very professional suppliers. 64 00:03:27,639 --> 00:03:28,840 Speaker 5: And I think, at least in. 65 00:03:28,800 --> 00:03:32,799 Speaker 4: The restoration space, traditionally this was the sector that was 66 00:03:32,880 --> 00:03:38,480 Speaker 4: led by entrepreneurs, ecologists, people that had a real passion 67 00:03:38,640 --> 00:03:42,920 Speaker 4: for actually nature, which is extremely important, but not necessarily 68 00:03:43,320 --> 00:03:46,920 Speaker 4: we're thinking about building these very large professional companies. They 69 00:03:46,960 --> 00:03:49,360 Speaker 4: had more of a philanthropic where ecological bent to it. 70 00:03:49,800 --> 00:03:51,800 Speaker 4: I think today, in order to be a player in 71 00:03:51,840 --> 00:03:54,640 Speaker 4: this market, you also need to have that corporate structure. 72 00:03:54,960 --> 00:03:58,600 Speaker 4: You need to have executives and finance people and lawyers 73 00:03:59,080 --> 00:04:01,680 Speaker 4: and financing struct You need to understand the contract so 74 00:04:01,680 --> 00:04:03,800 Speaker 4: that you can sit across from one of these big 75 00:04:03,840 --> 00:04:06,360 Speaker 4: companies and actually negotiate I'm not going to say on 76 00:04:06,360 --> 00:04:07,800 Speaker 4: an equal to equal basis. 77 00:04:07,440 --> 00:04:09,720 Speaker 5: But at a level sort of a level playing ground. 78 00:04:10,040 --> 00:04:12,480 Speaker 4: I think this adds a lot of credibility and gives 79 00:04:12,680 --> 00:04:15,520 Speaker 4: a lot of a comfort to whoever's negotiating with you. 80 00:04:15,920 --> 00:04:16,120 Speaker 6: Yeah. 81 00:04:16,200 --> 00:04:18,000 Speaker 2: No, I think that's a really great point. I know, 82 00:04:18,080 --> 00:04:20,359 Speaker 2: like some of the media outlets have even referred to 83 00:04:20,360 --> 00:04:22,800 Speaker 2: some of the kind of legacy company companies in this 84 00:04:22,839 --> 00:04:25,680 Speaker 2: space as carbon cowboys, right, And how this market is 85 00:04:25,680 --> 00:04:28,200 Speaker 2: closer to the wild West, for example, so that that 86 00:04:28,320 --> 00:04:31,680 Speaker 2: level of professionalism and that corporate structure is really important. 87 00:04:31,800 --> 00:04:35,279 Speaker 4: And the carbon cowboys, it's sort of of a negative 88 00:04:35,279 --> 00:04:37,920 Speaker 4: bent to it, and there's certainly that type of actor, 89 00:04:38,160 --> 00:04:39,720 Speaker 4: but I think there's a lot of really. 90 00:04:39,480 --> 00:04:40,600 Speaker 5: Good actors. 91 00:04:41,920 --> 00:04:45,840 Speaker 4: Who are you know, ecologists or had it in their 92 00:04:45,880 --> 00:04:47,599 Speaker 4: hearts that they wanted to do this, And this is 93 00:04:47,640 --> 00:04:49,960 Speaker 4: very important. You need purpose in the companies. We have 94 00:04:50,040 --> 00:04:52,320 Speaker 4: tons of people have dedicated their own whole life to it. 95 00:04:52,520 --> 00:04:54,000 Speaker 4: But I think what we need to do and what 96 00:04:54,000 --> 00:04:55,960 Speaker 4: we try to do with agree is sort of combine 97 00:04:56,320 --> 00:04:59,920 Speaker 4: that sense of purpose, that pioneering spirit, that love for nature, 98 00:05:00,120 --> 00:05:03,159 Speaker 4: with a professional kind of management style as well in 99 00:05:03,240 --> 00:05:04,480 Speaker 4: order to do these big deals. 100 00:05:04,720 --> 00:05:08,800 Speaker 2: Yes, absolutely, And Fabiana maybe going to you now. So 101 00:05:09,200 --> 00:05:12,080 Speaker 2: Rabobank is looking to be an anchor investor in a 102 00:05:12,160 --> 00:05:15,760 Speaker 2: large scale nature restoration project in Brazil. What characteristics do 103 00:05:15,800 --> 00:05:17,800 Speaker 2: you all look for when you're thinking about those projects. 104 00:05:19,000 --> 00:05:22,279 Speaker 7: Yes, indeed, we are willing to be the anchor investor 105 00:05:22,320 --> 00:05:25,839 Speaker 7: in this large scale restoration project, preferably be on the 106 00:05:25,880 --> 00:05:31,640 Speaker 7: Amazon BioMA for four reasons. First, we want to enhance 107 00:05:33,040 --> 00:05:37,680 Speaker 7: the fact that large scale restoration projects are viable and second, 108 00:05:37,720 --> 00:05:42,080 Speaker 7: a's credible investors we want to contribute to if unlocking 109 00:05:42,120 --> 00:05:48,440 Speaker 7: the Cabo market offering carbo integrity and high quality. Third, 110 00:05:49,839 --> 00:05:53,360 Speaker 7: we believe that restoration and preservation are key for our 111 00:05:53,400 --> 00:05:58,640 Speaker 7: climate resilience and therefore very important for our clients business 112 00:05:58,720 --> 00:06:04,080 Speaker 7: resilience as well. Fourth, because this type of project can 113 00:06:04,160 --> 00:06:08,880 Speaker 7: have an incredible not only environmental but social impact, and 114 00:06:09,040 --> 00:06:12,200 Speaker 7: especially on Amazon, we deem that this is key to 115 00:06:12,320 --> 00:06:18,520 Speaker 7: hout deforestation. So together with Biomas, the company in which 116 00:06:18,600 --> 00:06:23,680 Speaker 7: we are shareholders, together with other financial institutions and large 117 00:06:24,200 --> 00:06:29,240 Speaker 7: companies as well, we are trying. We are looking at 118 00:06:29,279 --> 00:06:35,600 Speaker 7: and originating a degradated landing Amazon where we can provide 119 00:06:35,640 --> 00:06:43,159 Speaker 7: all these elements, and we are also looking at investors 120 00:06:43,160 --> 00:06:48,360 Speaker 7: to join us on that mission. So indeed, we are 121 00:06:48,680 --> 00:06:54,160 Speaker 7: really serious about offering the first fifty million dollars for 122 00:06:54,240 --> 00:06:59,240 Speaker 7: this project. But you know, in order to deliver all 123 00:06:59,279 --> 00:07:04,680 Speaker 7: these elements, we need more investors to come together, and 124 00:07:04,720 --> 00:07:07,720 Speaker 7: that's the main purpose, like we need to help to 125 00:07:07,800 --> 00:07:13,320 Speaker 7: unlock this market. Of course, these projects will have all 126 00:07:13,600 --> 00:07:18,880 Speaker 7: the requirements that the chag will just mentioned, but it's 127 00:07:18,920 --> 00:07:21,600 Speaker 7: a great move. I think it's a bold move that 128 00:07:21,760 --> 00:07:26,920 Speaker 7: Rubble Bank is intending to and we hope that we 129 00:07:27,160 --> 00:07:30,760 Speaker 7: will be able to have This project is structured to 130 00:07:30,880 --> 00:07:35,760 Speaker 7: be announced on the cop the upcoming copy in Brasum. 131 00:07:36,440 --> 00:07:39,240 Speaker 2: And you mentioned those other investors. How do you get 132 00:07:39,240 --> 00:07:42,520 Speaker 2: them excited about a project like this, right, you do 133 00:07:42,680 --> 00:07:44,880 Speaker 2: have a you know, a large bank with a great 134 00:07:44,920 --> 00:07:47,640 Speaker 2: reputation in rubber Bank being that kind of anchor investor, 135 00:07:48,000 --> 00:07:50,320 Speaker 2: But how else do you get them excited about carbon 136 00:07:50,360 --> 00:07:52,000 Speaker 2: credits specifically and getting involved? 137 00:07:53,080 --> 00:07:59,560 Speaker 7: Well, I think all the aspects that Chago mentioned basically 138 00:07:59,560 --> 00:08:04,800 Speaker 7: requirement that you need to prove. Of course, you know, 139 00:08:05,240 --> 00:08:10,960 Speaker 7: being able to execute your project is also key, uh 140 00:08:11,040 --> 00:08:16,000 Speaker 7: and providing the you know, the the legal and fund 141 00:08:16,000 --> 00:08:19,800 Speaker 7: diary comfort is also one of the main challenges that 142 00:08:19,880 --> 00:08:24,680 Speaker 7: we have in Brazil for this type of projects. But overall, 143 00:08:24,840 --> 00:08:31,880 Speaker 7: I think there is an aspect regarding with regarding to Brazil. 144 00:08:32,080 --> 00:08:35,319 Speaker 7: I mean, as you mentioned, Brazil it's a key player 145 00:08:35,400 --> 00:08:39,800 Speaker 7: on this on this market, so we need to use 146 00:08:40,040 --> 00:08:44,240 Speaker 7: our connection power in the rubble Bank network to attract 147 00:08:44,240 --> 00:08:51,360 Speaker 7: off takers and to attract other investors because Brazil must 148 00:08:51,520 --> 00:08:55,320 Speaker 7: be a main player in this market. 149 00:08:55,640 --> 00:08:58,720 Speaker 2: Right well, speaking of main players in this market, Angela, 150 00:08:58,720 --> 00:09:00,160 Speaker 2: I would love to turn it over to you and 151 00:09:00,520 --> 00:09:03,360 Speaker 2: look at this from the buyer's perspective. Now, So in 152 00:09:03,679 --> 00:09:06,720 Speaker 2: nota sure A's long history of purchasing carbon credits, what 153 00:09:06,720 --> 00:09:07,920 Speaker 2: are the characteristics that you. 154 00:09:07,920 --> 00:09:08,640 Speaker 3: All look out for? 155 00:09:09,280 --> 00:09:11,959 Speaker 8: Yes, for me, the first thing is to guarantee a 156 00:09:12,040 --> 00:09:15,800 Speaker 8: very good governance and accountability inside of the company, you know, 157 00:09:16,400 --> 00:09:19,560 Speaker 8: guaranteeing that you have a clear footprint for your carbon 158 00:09:20,040 --> 00:09:23,760 Speaker 8: but also understanding how much you're going to upset and 159 00:09:23,800 --> 00:09:29,120 Speaker 8: how the reports related with that. But specifically for the projects, 160 00:09:29,360 --> 00:09:33,280 Speaker 8: I think the key criteria is to guarantee permanent removal 161 00:09:34,400 --> 00:09:38,680 Speaker 8: of the emissions, removal or reduction of these emissions. The 162 00:09:38,760 --> 00:09:43,800 Speaker 8: second one we look for clear core benefits for people 163 00:09:44,000 --> 00:09:49,040 Speaker 8: and biodiversity, and also we understand that infect people, biodiversity 164 00:09:49,200 --> 00:09:54,440 Speaker 8: and climate walk altogether in this history. The third one 165 00:09:54,600 --> 00:09:59,880 Speaker 8: is to improve income for the local communities in order 166 00:10:00,080 --> 00:10:06,360 Speaker 8: to strength the social development for people. And also one 167 00:10:06,440 --> 00:10:09,559 Speaker 8: that is important and Fablus is going to talk about 168 00:10:09,640 --> 00:10:13,960 Speaker 8: this is also we try to invest in low carbon 169 00:10:14,520 --> 00:10:16,920 Speaker 8: new technologies projects as well. 170 00:10:17,360 --> 00:10:22,440 Speaker 9: Besides that, for us is crucial that the projects that. 171 00:10:22,400 --> 00:10:27,000 Speaker 8: Are related with nature based solutions, giving the roots of 172 00:10:27,080 --> 00:10:31,319 Speaker 8: our company. So, as I said previously, this project that 173 00:10:31,360 --> 00:10:37,880 Speaker 8: we have of in seting for carbon in our partner communities. 174 00:10:38,880 --> 00:10:42,280 Speaker 8: The idea is up to twenty thirty to have fifty 175 00:10:42,320 --> 00:10:48,440 Speaker 8: percent of our projects returning these investments in projects to 176 00:10:48,640 --> 00:10:54,800 Speaker 8: improve and to support the conservation of standing forest within 177 00:10:54,920 --> 00:10:56,040 Speaker 8: our communities. 178 00:10:56,559 --> 00:10:59,600 Speaker 2: And that co benefits point is so important. I think 179 00:10:59,600 --> 00:11:02,400 Speaker 2: it's so often overlooked in this market as well. Right, 180 00:11:02,400 --> 00:11:05,079 Speaker 2: we spend so much time thinking about whether the tree 181 00:11:05,120 --> 00:11:06,720 Speaker 2: is actually sequestering carbon. 182 00:11:07,040 --> 00:11:08,720 Speaker 3: But if you look at a plot of land. 183 00:11:08,480 --> 00:11:10,800 Speaker 2: With a tree and you look at the overall stack 184 00:11:10,840 --> 00:11:14,000 Speaker 2: of theoretical revenue sources, sure a large chunk of that 185 00:11:14,200 --> 00:11:17,480 Speaker 2: comes from carbon sequestration. But as you mentioned, Angela, there's 186 00:11:17,480 --> 00:11:21,920 Speaker 2: also benefits to local communities. There's preservation of biodiversity, there's 187 00:11:21,960 --> 00:11:24,760 Speaker 2: agriculture co benefits. Right, all of these things add up, 188 00:11:25,000 --> 00:11:26,719 Speaker 2: and we need to take into account all of these 189 00:11:26,760 --> 00:11:29,600 Speaker 2: things in order to again scale up markets like Brazil. 190 00:11:29,880 --> 00:11:30,400 Speaker 1: Exactly. 191 00:11:30,720 --> 00:11:31,640 Speaker 9: That's true. 192 00:11:32,120 --> 00:11:34,120 Speaker 2: So we've spent obviously a lot of time talking about 193 00:11:34,200 --> 00:11:38,160 Speaker 2: nature based solutions Fabio. Obviously your organization is looking at 194 00:11:38,360 --> 00:11:40,560 Speaker 2: many other different sources of carbon credits. 195 00:11:40,840 --> 00:11:42,160 Speaker 3: Can you walk us through some of those in a 196 00:11:42,200 --> 00:11:43,479 Speaker 3: little bit more detail. 197 00:11:44,000 --> 00:11:46,240 Speaker 6: Yes, just to get the last point here, to be 198 00:11:46,320 --> 00:11:51,480 Speaker 6: part of the discussion when we talk about carbon markets, 199 00:11:51,600 --> 00:11:54,280 Speaker 6: I believe in terms of global carbon marked or the 200 00:11:54,320 --> 00:11:59,080 Speaker 6: Brazilian carbon marked, we need to have in mind what 201 00:11:59,240 --> 00:12:02,440 Speaker 6: kind of carbon market we are talking about. With carbon 202 00:12:02,520 --> 00:12:06,480 Speaker 6: market we are talking about because the Guardian article made 203 00:12:06,559 --> 00:12:10,680 Speaker 6: a very huge watershed between the one point zero carbon 204 00:12:10,760 --> 00:12:13,720 Speaker 6: marked and the two points zero carbon marked. The one 205 00:12:13,720 --> 00:12:20,120 Speaker 6: point zero was made by low governance, low traceability, low transparency, 206 00:12:21,000 --> 00:12:24,960 Speaker 6: a lack of KPIs and so on, and that's the 207 00:12:25,120 --> 00:12:29,240 Speaker 6: point what we have very large scandals on it. But 208 00:12:29,520 --> 00:12:33,360 Speaker 6: after that, since twenty twenty one, we have a two 209 00:12:33,400 --> 00:12:36,480 Speaker 6: point zero carbon marked. We have a lot of new 210 00:12:36,600 --> 00:12:42,920 Speaker 6: companies established since twenty twenty one, a Green Future, Climbed, Biomas, 211 00:12:43,160 --> 00:12:45,680 Speaker 6: Mumbaik and a lot of the one. 212 00:12:45,920 --> 00:12:47,480 Speaker 9: We have a new supply chain. 213 00:12:47,800 --> 00:12:52,360 Speaker 6: We have a new framework because ICVCM, the Inteprety Comes 214 00:12:52,520 --> 00:12:56,920 Speaker 6: for Voluntary Carbon Market and Core Carbon Principles are creating 215 00:12:57,080 --> 00:12:58,800 Speaker 6: a good framework. 216 00:12:58,480 --> 00:13:01,200 Speaker 9: To all the standards. We have new methodologies. 217 00:13:01,520 --> 00:13:05,640 Speaker 6: We have the rating agencies madeing a very good job 218 00:13:05,720 --> 00:13:09,040 Speaker 6: in terms of quality. We have a lot of different 219 00:13:09,440 --> 00:13:13,320 Speaker 6: players work in this market. So when we talk about 220 00:13:13,360 --> 00:13:17,760 Speaker 6: carbon market, we need to answer these question which carbon 221 00:13:17,840 --> 00:13:20,560 Speaker 6: market are you talking about? Because the first one have 222 00:13:20,720 --> 00:13:25,560 Speaker 6: some characterists, but the second one is moving forward very well. 223 00:13:25,720 --> 00:13:26,240 Speaker 9: We are not. 224 00:13:27,679 --> 00:13:32,400 Speaker 6: Done because that's a rolling basis work, but we are 225 00:13:32,400 --> 00:13:36,080 Speaker 6: doing a very good job in Brazil and all around 226 00:13:36,080 --> 00:13:39,360 Speaker 6: the world. So it's good to be in mind which 227 00:13:39,480 --> 00:13:43,320 Speaker 6: kind of carbon market we are talking about. And in 228 00:13:43,440 --> 00:13:48,880 Speaker 6: terms of Portofolio, I believe Kyo Brazil could play a 229 00:13:49,040 --> 00:13:49,960 Speaker 6: very very. 230 00:13:49,800 --> 00:13:53,400 Speaker 9: Good role as a global powerhouse. 231 00:13:52,800 --> 00:13:57,880 Speaker 6: Supplier because we have in our development economics sector three 232 00:13:58,559 --> 00:14:03,600 Speaker 6: very huge sector. First one, it's our vocation in nature 233 00:14:03,640 --> 00:14:10,120 Speaker 6: based solutions projects conservation for three hundred million actors of 234 00:14:10,280 --> 00:14:14,079 Speaker 6: standing forests and restoration are kind of one hundred million 235 00:14:14,160 --> 00:14:19,840 Speaker 6: actors of debradated pastures. So it's very huge when we 236 00:14:20,000 --> 00:14:23,320 Speaker 6: talk about nature based solutions products. But it's not only 237 00:14:23,680 --> 00:14:28,480 Speaker 6: not only nature based solutions products. Brazil have a very 238 00:14:28,600 --> 00:14:32,440 Speaker 6: huge sector in terms of energy transition, and we have 239 00:14:32,680 --> 00:14:41,040 Speaker 6: the possibility to create and generate carbon credits on solar, wind, biofuels, biogas, 240 00:14:41,320 --> 00:14:48,080 Speaker 6: waste of energy, green hydrogen, sustainable aviation fuels, all switched 241 00:14:48,240 --> 00:14:53,480 Speaker 6: fossil fuels sources could generate carbon credits in good standards 242 00:14:53,520 --> 00:14:58,120 Speaker 6: and good methodology, and Brazil could play a very pivot 243 00:14:58,160 --> 00:15:03,160 Speaker 6: point role in terms of agribusiness because we could be 244 00:15:03,640 --> 00:15:08,600 Speaker 6: the first one in terms of agriculture land management, especially 245 00:15:08,720 --> 00:15:12,640 Speaker 6: if we bet a lot in terms of agro forests 246 00:15:12,680 --> 00:15:17,680 Speaker 6: and in terms of regenerative agriculture. And I would like 247 00:15:17,960 --> 00:15:21,440 Speaker 6: just to highlight three different projects that we are running 248 00:15:21,440 --> 00:15:22,160 Speaker 6: here in Brazil. 249 00:15:22,560 --> 00:15:25,320 Speaker 9: The first one is the first back project. 250 00:15:25,200 --> 00:15:29,000 Speaker 6: In Latin America bio energy, carbon capture and storagy in 251 00:15:29,040 --> 00:15:34,040 Speaker 6: Mato Grosso State. The second one is a huge regenerative 252 00:15:34,120 --> 00:15:37,480 Speaker 6: agriculture with a huge bank here in Brazil. And the 253 00:15:37,520 --> 00:15:41,200 Speaker 6: third one is a spoiler. It's the partnership between Natura 254 00:15:41,320 --> 00:15:45,360 Speaker 6: and Future Climate running the biochar agenda here in Brazil, 255 00:15:45,720 --> 00:15:49,800 Speaker 6: CO investing, CO developing not just to remove all carbon 256 00:15:49,840 --> 00:15:54,200 Speaker 6: credits to the atmosphere, but much more than this, investing 257 00:15:54,320 --> 00:15:58,640 Speaker 6: on the economicy and social development of poor region here 258 00:15:58,800 --> 00:15:59,560 Speaker 6: in our country. 259 00:16:00,080 --> 00:16:01,720 Speaker 9: That's the overview, and. 260 00:16:01,560 --> 00:16:06,960 Speaker 6: That's why Brazil could be divisiversified powerhouse of carbon credits 261 00:16:07,000 --> 00:16:08,720 Speaker 6: for export to the world. 262 00:16:09,200 --> 00:16:11,760 Speaker 2: Yeah, and I think the word you used before methodologies 263 00:16:11,840 --> 00:16:14,720 Speaker 2: is really key here, right, because there's all these theoretical 264 00:16:14,800 --> 00:16:17,880 Speaker 2: sources of carbon credit creation, and many of them are 265 00:16:17,920 --> 00:16:20,920 Speaker 2: completely legitimate, but unless you have some type of scientific 266 00:16:20,960 --> 00:16:24,400 Speaker 2: framework and a standardized framework for creating those, you're still 267 00:16:24,400 --> 00:16:26,480 Speaker 2: going to run into some of those reputational risks, right, 268 00:16:26,520 --> 00:16:28,160 Speaker 2: And so I think that's going to be kind of 269 00:16:28,400 --> 00:16:30,320 Speaker 2: you know, you mentioned VCM two point zero. I think 270 00:16:30,360 --> 00:16:33,200 Speaker 2: that could be VCM two point five is expanding these 271 00:16:33,240 --> 00:16:35,680 Speaker 2: methodologies to really, you know, kind of look into some 272 00:16:35,720 --> 00:16:39,360 Speaker 2: of these new areas fabio. Another thing that you mentioned before, 273 00:16:39,360 --> 00:16:41,920 Speaker 2: obviously there's this little Guardian article that came out a 274 00:16:41,920 --> 00:16:44,200 Speaker 2: couple of years ago. What it said is that ninety 275 00:16:44,240 --> 00:16:47,840 Speaker 2: percent of rainforest projects that we're creating carbon credits, we're 276 00:16:47,840 --> 00:16:51,440 Speaker 2: effectively creating bogus ones. And that led to a massive 277 00:16:51,520 --> 00:16:54,600 Speaker 2: hit in the reputation of the voluntary carbon credit market. 278 00:16:54,840 --> 00:16:56,160 Speaker 2: So Angela, I want I want to go back to 279 00:16:56,200 --> 00:16:58,640 Speaker 2: you now, as as a public company, right that you 280 00:16:58,720 --> 00:17:00,200 Speaker 2: need to go to your investors, you need to go 281 00:17:00,240 --> 00:17:02,480 Speaker 2: to management and say, well, we need to maintain this 282 00:17:02,760 --> 00:17:06,160 Speaker 2: carbon neutrality goal that we continue to do or continue 283 00:17:06,200 --> 00:17:09,120 Speaker 2: to hit. How has that conversation changed over time? How 284 00:17:09,200 --> 00:17:13,520 Speaker 2: is perception both publicly and then internally around carbon credits 285 00:17:13,560 --> 00:17:14,560 Speaker 2: change for your organization. 286 00:17:15,160 --> 00:17:19,119 Speaker 8: Well, firstly, we firstly we have lots of investors that 287 00:17:19,320 --> 00:17:23,280 Speaker 8: are very focused on the sustainability gender and also it's 288 00:17:23,359 --> 00:17:27,639 Speaker 8: important the second thing I think for Natura this is 289 00:17:27,680 --> 00:17:31,600 Speaker 8: always come as a challenge, that is to transform social 290 00:17:31,840 --> 00:17:37,600 Speaker 8: environmental challenges into business opportunities. So our agenda is completely 291 00:17:37,640 --> 00:17:41,480 Speaker 8: integrated to the business now. So when I'm talking about 292 00:17:41,680 --> 00:17:47,879 Speaker 8: investing communities and implementing nineteen small factories in these cooperatives 293 00:17:47,960 --> 00:17:51,240 Speaker 8: to produce soio for our supply chain, this is not 294 00:17:51,359 --> 00:17:58,800 Speaker 8: only reducing carbon foot printing but also contributing to conserve 295 00:17:59,000 --> 00:18:02,360 Speaker 8: for the conservation of two million actors of the standing forest. 296 00:18:03,119 --> 00:18:07,199 Speaker 8: But it also generated a new total new line of 297 00:18:07,359 --> 00:18:11,320 Speaker 8: products that is echos line in Brazil that has not. 298 00:18:11,440 --> 00:18:13,760 Speaker 9: Heaven us bigger than one. 299 00:18:13,600 --> 00:18:17,840 Speaker 8: Billion hair eyes per year. So I think for the 300 00:18:17,920 --> 00:18:24,960 Speaker 8: business it's crucial to have the discussions of sustainability together 301 00:18:25,080 --> 00:18:30,160 Speaker 8: with the financial aspectors integrated to the business. No, and 302 00:18:30,240 --> 00:18:34,560 Speaker 8: in my perspective, I think how the regulatory agenda that 303 00:18:34,600 --> 00:18:37,800 Speaker 8: we are facing, such as i FRS that is coming 304 00:18:38,240 --> 00:18:43,040 Speaker 8: will help us even more and further to connect these 305 00:18:43,080 --> 00:18:46,320 Speaker 8: two agendas, because you are going to talk about risks 306 00:18:46,359 --> 00:18:52,199 Speaker 8: and opportunities facing the impacts in the business. So it 307 00:18:52,280 --> 00:18:59,080 Speaker 8: couldn't be just a sustainability to ideology, but it got 308 00:18:59,160 --> 00:19:02,160 Speaker 8: to be connected with the business absolutely. 309 00:19:02,240 --> 00:19:04,480 Speaker 2: And that point about risk is so big because that 310 00:19:04,920 --> 00:19:06,560 Speaker 2: goes far beyond just carbon credits. 311 00:19:06,640 --> 00:19:06,840 Speaker 3: Right. 312 00:19:07,040 --> 00:19:11,240 Speaker 2: The sustainability and ESG discussion within organizations has very much 313 00:19:11,280 --> 00:19:14,119 Speaker 2: turned to one that's thinking about risks and opportunities, right, 314 00:19:14,240 --> 00:19:16,680 Speaker 2: rather than just carbon emissions. As my colleague Tiffin mentioned 315 00:19:16,680 --> 00:19:20,400 Speaker 2: earlier Chiago, maybe jumping back to you now, I showed 316 00:19:20,440 --> 00:19:23,119 Speaker 2: that scatterplot earlier of kind of the companies in the 317 00:19:23,119 --> 00:19:25,560 Speaker 2: bottom right, the Microsoft's of the world, if you will, 318 00:19:25,760 --> 00:19:28,520 Speaker 2: that will always buy these carbon credits. I think the 319 00:19:28,600 --> 00:19:30,280 Speaker 2: concern for a lot of folks in the market is 320 00:19:30,320 --> 00:19:32,720 Speaker 2: that every time an article from the Guardian or another 321 00:19:32,840 --> 00:19:35,919 Speaker 2: organization comes out, one of those blue bubbles disappears from 322 00:19:35,960 --> 00:19:38,760 Speaker 2: that chart, right, because that demand goes away due to 323 00:19:38,840 --> 00:19:42,520 Speaker 2: reputational risk. So what is your organization doing, and more broadly, 324 00:19:42,560 --> 00:19:45,600 Speaker 2: how can Brazil unlock that second tier of companies that 325 00:19:45,640 --> 00:19:48,480 Speaker 2: are maybe less profitable and have higher emissions. 326 00:19:50,400 --> 00:19:53,560 Speaker 4: So before you know addressing your question, I think the 327 00:19:53,560 --> 00:19:56,240 Speaker 4: first thing I would say is, you know those blue 328 00:19:56,280 --> 00:19:59,640 Speaker 4: dots in the lower right hand side of the graph 329 00:19:59,680 --> 00:20:02,960 Speaker 4: where the big tech and pharmase that's a big market 330 00:20:03,000 --> 00:20:07,080 Speaker 4: by itself. A company like Microsoft has been working feverishly 331 00:20:07,160 --> 00:20:10,199 Speaker 4: at reducing their footprint. They're very serious about it. You know, 332 00:20:10,280 --> 00:20:13,120 Speaker 4: not only do they buy a lot of high quality 333 00:20:13,160 --> 00:20:17,720 Speaker 4: projects like ours, but they're also trying to reduce their emissions. 334 00:20:18,160 --> 00:20:20,400 Speaker 4: Yet over the last few years, I think the last 335 00:20:20,440 --> 00:20:22,639 Speaker 4: three or four years, their emission's gone up thirty percent, 336 00:20:23,440 --> 00:20:25,440 Speaker 4: in large part because of the investments they are making 337 00:20:25,440 --> 00:20:27,840 Speaker 4: in data centers for AI. So I don't want to 338 00:20:27,880 --> 00:20:31,280 Speaker 4: minimize the size of that market because it's already very large. 339 00:20:31,280 --> 00:20:34,760 Speaker 4: It can support several regreens. But I do agree that 340 00:20:34,800 --> 00:20:37,879 Speaker 4: if we think bigger, if we think about a global market, 341 00:20:37,920 --> 00:20:40,399 Speaker 4: if we think about billions and eventually trillions, we're going 342 00:20:40,440 --> 00:20:41,879 Speaker 4: to need a lot of those blue dots, a lot 343 00:20:41,920 --> 00:20:44,400 Speaker 4: of those companies to come online. And I think there's 344 00:20:45,080 --> 00:20:48,639 Speaker 4: two things that need to happen. I think first is 345 00:20:48,720 --> 00:20:52,679 Speaker 4: we need to increase the cost of inaction, you know, 346 00:20:52,800 --> 00:20:57,439 Speaker 4: either through regulation or even through pressure from stakeholders. It 347 00:20:57,480 --> 00:21:00,560 Speaker 4: needs to become you know, a bigger part of a 348 00:21:00,680 --> 00:21:04,680 Speaker 4: company's mandate to reduce their emissions. Today, I think even 349 00:21:04,720 --> 00:21:07,679 Speaker 4: with some of the political climate that we're facing, companies 350 00:21:07,680 --> 00:21:10,399 Speaker 4: are even having more of a justification to sit on 351 00:21:10,440 --> 00:21:14,720 Speaker 4: the sidelines and wait until things are sorted out. So 352 00:21:14,760 --> 00:21:17,680 Speaker 4: I think we need to connect you know, the cost 353 00:21:17,760 --> 00:21:20,000 Speaker 4: of carbon emissions a little bit more to the operations 354 00:21:20,000 --> 00:21:24,080 Speaker 4: of the company and you know, either through stakeholder pressure 355 00:21:24,200 --> 00:21:28,120 Speaker 4: or through regulation, get them to act. By doing that, 356 00:21:28,240 --> 00:21:30,760 Speaker 4: you know, those blue dots cannot disappear from the graft. 357 00:21:30,800 --> 00:21:31,520 Speaker 3: They need to be there. 358 00:21:32,080 --> 00:21:34,560 Speaker 4: But I don't think it's it can be magic either, right, 359 00:21:34,600 --> 00:21:37,479 Speaker 4: I mean, it needs to have some sort of financial sense, 360 00:21:38,119 --> 00:21:41,320 Speaker 4: and that's where I think we need to evolve also 361 00:21:41,359 --> 00:21:45,359 Speaker 4: from a cost perspective. And I'll stay within my lane 362 00:21:45,400 --> 00:21:48,760 Speaker 4: here and talk about restoration. This is an activity that 363 00:21:48,960 --> 00:21:52,680 Speaker 4: has never been done at a quote unquote industrial scale. 364 00:21:53,040 --> 00:21:54,960 Speaker 4: This is something that in the past has always been done, 365 00:21:55,320 --> 00:21:57,359 Speaker 4: you know, in a more amateurish kind of way. 366 00:21:57,920 --> 00:21:58,440 Speaker 5: And if we. 367 00:21:58,440 --> 00:22:02,080 Speaker 4: Look in the last fifty years, pretty much every commodity 368 00:22:02,119 --> 00:22:06,960 Speaker 4: at which Brazil is a leader at, take for example, eucalyptus, 369 00:22:06,960 --> 00:22:10,040 Speaker 4: which we talk a lot about the productivity of a 370 00:22:10,119 --> 00:22:12,280 Speaker 4: hector of eucalyptus has gone up by a factor of 371 00:22:12,320 --> 00:22:15,320 Speaker 4: four to five in the last fifty years. We've learned 372 00:22:15,320 --> 00:22:17,520 Speaker 4: how to grow eucalyptus a lot better than we used 373 00:22:17,520 --> 00:22:19,280 Speaker 4: to do in the past. I think we can do 374 00:22:19,320 --> 00:22:24,920 Speaker 4: the same too to growing native forests. You know, epei 375 00:22:25,119 --> 00:22:28,360 Speaker 4: or jateauba or jikichibai grows the same way today as 376 00:22:28,359 --> 00:22:31,480 Speaker 4: it grew in fifteen hundred and peduavires cap landed here 377 00:22:32,400 --> 00:22:34,640 Speaker 4: and I think there's lots that we can do through science, 378 00:22:35,160 --> 00:22:38,639 Speaker 4: through kind of continuous improvement of our operations and management 379 00:22:38,880 --> 00:22:40,800 Speaker 4: in order to make that a lot more efficient and 380 00:22:40,920 --> 00:22:44,840 Speaker 4: passed some of the cost onto the project itself. Another 381 00:22:44,920 --> 00:22:48,160 Speaker 4: important factor just to finish is financing. We haven't talked 382 00:22:48,160 --> 00:22:50,720 Speaker 4: a lot about this. I know the previous panel here 383 00:22:50,760 --> 00:22:53,840 Speaker 4: talked a lot about financing. A very large portion of 384 00:22:53,880 --> 00:22:57,399 Speaker 4: my costs is capital costs. You know, these most of 385 00:22:57,440 --> 00:23:01,240 Speaker 4: these carbon projects there are capital intensive. They have you know, 386 00:23:01,320 --> 00:23:03,960 Speaker 4: paybacks that are long. I invest a lot in the 387 00:23:04,000 --> 00:23:06,280 Speaker 4: first year, first two years in the project, and I 388 00:23:06,320 --> 00:23:09,320 Speaker 4: generate a carbon captured the last fifty years. So the 389 00:23:09,400 --> 00:23:13,439 Speaker 4: lower those capital costs are, the lower I can charge 390 00:23:13,680 --> 00:23:16,760 Speaker 4: for you know, the asset that I'm generating, and therefore, 391 00:23:17,160 --> 00:23:20,439 Speaker 4: the more companies can participate in actually buying credits and 392 00:23:20,480 --> 00:23:25,000 Speaker 4: doing their part, they're part of the responsibility for reducing emissions. 393 00:23:25,600 --> 00:23:27,160 Speaker 2: Yeah, these are all great points, and you can make 394 00:23:27,480 --> 00:23:30,439 Speaker 2: very similar parallels, for example, to the scaling up of 395 00:23:30,480 --> 00:23:33,720 Speaker 2: clean energy procurement among corporations around the world. Right that 396 00:23:34,119 --> 00:23:39,080 Speaker 2: cost of capital, access to projects, right government governance structure. 397 00:23:39,200 --> 00:23:40,720 Speaker 3: All that's really important. 398 00:23:40,440 --> 00:23:43,000 Speaker 5: And just a compliment. Yesterday I was at Petrobras. 399 00:23:43,080 --> 00:23:46,360 Speaker 4: There was a big announcement between Petrobras and BNDS where 400 00:23:46,400 --> 00:23:50,160 Speaker 4: Petrobize is going to open a public bid where they're 401 00:23:50,200 --> 00:23:53,880 Speaker 4: willing to buy i think five million tons of carbon 402 00:23:54,359 --> 00:24:00,159 Speaker 4: with twenty five year contracts, you very standardized contract and 403 00:24:00,200 --> 00:24:04,080 Speaker 4: where BNDS is coming in with resources from the beginning 404 00:24:04,480 --> 00:24:07,760 Speaker 4: from Funduklima at very attractive rates. So that type of 405 00:24:07,760 --> 00:24:11,120 Speaker 4: thing will obviously crowd in more investors, will crowd in 406 00:24:11,280 --> 00:24:13,879 Speaker 4: more companies that will seek to participating in this bid 407 00:24:14,080 --> 00:24:16,360 Speaker 4: and will help us get the wheels moving the same 408 00:24:16,359 --> 00:24:18,240 Speaker 4: way they did it, and they use this example a lot. 409 00:24:18,280 --> 00:24:20,439 Speaker 4: A lot of the people that were there announcing this 410 00:24:20,520 --> 00:24:24,240 Speaker 4: project were pioneers in the renewable energy. They talk about 411 00:24:24,240 --> 00:24:27,680 Speaker 4: Prayinfa and what they did with solar power twenty years ago, 412 00:24:27,720 --> 00:24:29,040 Speaker 4: and it was a very similar kind of. 413 00:24:29,080 --> 00:24:32,399 Speaker 2: Process exactly the power purchase agreement model, and now you 414 00:24:32,400 --> 00:24:35,879 Speaker 2: have the emission reduction purchase agreement. Maybe, staying on the 415 00:24:35,920 --> 00:24:39,399 Speaker 2: topic of banks and financing, Fabiana, can you talk a. 416 00:24:39,359 --> 00:24:39,920 Speaker 3: Little bit more. 417 00:24:39,960 --> 00:24:42,200 Speaker 2: I think when you think about a bank's role within 418 00:24:42,520 --> 00:24:45,320 Speaker 2: the carbon market, there's so many roles that it can play, right. 419 00:24:45,359 --> 00:24:46,880 Speaker 3: It could be a potential buyer of. 420 00:24:46,840 --> 00:24:50,600 Speaker 2: Credits, there's a trading desk element, there's an advisory perspective. 421 00:24:50,800 --> 00:24:52,399 Speaker 2: What are some of the challenges that you all have 422 00:24:52,440 --> 00:24:54,879 Speaker 2: faced and how have those changed over time? But then 423 00:24:54,880 --> 00:24:57,280 Speaker 2: also what are you hearing from your clients on this market, right, 424 00:24:57,280 --> 00:24:58,919 Speaker 2: has their perception of the market changed? 425 00:25:00,720 --> 00:25:00,920 Speaker 4: Well? 426 00:25:02,000 --> 00:25:07,080 Speaker 7: First of all, I think the financial industry is highly regulated, 427 00:25:07,200 --> 00:25:12,440 Speaker 7: right so, and it has been called to incorporate sustainability 428 00:25:12,440 --> 00:25:17,480 Speaker 7: into the traditional risk return balance. But in order to 429 00:25:17,760 --> 00:25:21,080 Speaker 7: deliver that, we need to count on transparency, on a 430 00:25:21,160 --> 00:25:29,680 Speaker 7: regulatory framework, and especially on green washing guardios. So if 431 00:25:29,680 --> 00:25:34,600 Speaker 7: you take the sustainability perspective, well, the investments and the 432 00:25:34,680 --> 00:25:41,440 Speaker 7: projects being large scale projects or being projects from our clients. 433 00:25:41,800 --> 00:25:44,560 Speaker 7: By the way, we are focused on the agribusiness in pursue, 434 00:25:44,720 --> 00:25:50,520 Speaker 7: so many of our clients have must do some restoration 435 00:25:50,640 --> 00:25:56,360 Speaker 7: and preservation projects by the FOE pull the projects they 436 00:25:56,480 --> 00:26:01,399 Speaker 7: need to demonstrate their impact. Right that we need proper 437 00:26:01,880 --> 00:26:06,800 Speaker 7: taxonomy and proper regulation to be clear and to be transparent. 438 00:26:07,640 --> 00:26:12,440 Speaker 7: And from the risk perspective, not only the project execution capabilities, 439 00:26:12,440 --> 00:26:16,159 Speaker 7: but the regulatory framework is it due to be improved 440 00:26:16,280 --> 00:26:22,720 Speaker 7: in this country. Proper pro public data, legal and fungiary 441 00:26:23,280 --> 00:26:27,640 Speaker 7: safety are basic requirements that are not fully met yet. 442 00:26:29,359 --> 00:26:34,119 Speaker 7: Land ownership and compliance especially are critical for integrity and 443 00:26:34,200 --> 00:26:38,200 Speaker 7: Brazil has not yet finalized its car it's land registration 444 00:26:39,160 --> 00:26:46,359 Speaker 7: so this definitely can be an impediment to project financing 445 00:26:46,440 --> 00:26:52,840 Speaker 7: pipeline to take off, especially large scale projects which bring 446 00:26:53,280 --> 00:27:00,360 Speaker 7: you know, additional risk and returns. The third aspect, it's 447 00:27:00,400 --> 00:27:03,600 Speaker 7: the economic feasibility. Of course, the carbon prices needs to 448 00:27:03,640 --> 00:27:08,800 Speaker 7: better reflect the impact of those projects to assure proper returns. 449 00:27:09,160 --> 00:27:13,159 Speaker 7: So as much as the financial industry is being called 450 00:27:13,200 --> 00:27:16,000 Speaker 7: the once and has the opportunity to step into this 451 00:27:16,600 --> 00:27:23,280 Speaker 7: equation bringing the sustainability to the strategic level of our 452 00:27:23,359 --> 00:27:30,359 Speaker 7: investments and also bringing these to our clients as a 453 00:27:30,800 --> 00:27:37,560 Speaker 7: new license to operate. We still face many challenges to 454 00:27:37,640 --> 00:27:44,119 Speaker 7: be bold on that segment. Our clients perception is also 455 00:27:44,920 --> 00:27:49,560 Speaker 7: related with that cable one point zero and two point zero. 456 00:27:49,640 --> 00:27:52,640 Speaker 7: They are really willing to see the cabin two point 457 00:27:52,760 --> 00:27:59,960 Speaker 7: zero taking off and heavy their initiatives reflected the impact 458 00:28:00,080 --> 00:28:04,080 Speaker 7: of their initiatives reflected on a revenue stream, which is 459 00:28:04,119 --> 00:28:10,360 Speaker 7: not fully the case yet. So all you know, I 460 00:28:10,400 --> 00:28:15,280 Speaker 7: think the financial industry in Brazil will have a major role, 461 00:28:15,440 --> 00:28:21,960 Speaker 7: of course, but also it is our job and it 462 00:28:22,200 --> 00:28:28,200 Speaker 7: is expected that we coordinate some efforts in order to 463 00:28:28,240 --> 00:28:33,760 Speaker 7: make some systemic changes that are necessary for us to 464 00:28:33,880 --> 00:28:37,160 Speaker 7: play our role in that segment. 465 00:28:37,640 --> 00:28:40,240 Speaker 2: Yeah, and the systemic changes is really important, right, because 466 00:28:40,240 --> 00:28:42,600 Speaker 2: I think that's a perfect segue to broaden this discussion 467 00:28:42,600 --> 00:28:46,280 Speaker 2: out beyond just the voluntary market for corporations and start 468 00:28:46,280 --> 00:28:48,360 Speaker 2: to think about some of those other off rams that 469 00:28:48,400 --> 00:28:51,520 Speaker 2: I mentioned before. Right, So of course he article sets 470 00:28:51,560 --> 00:28:52,040 Speaker 2: et cetera. 471 00:28:52,840 --> 00:28:53,240 Speaker 3: Fabio. 472 00:28:53,440 --> 00:28:56,760 Speaker 2: Back back to you. You mentioned that you guys have offices. 473 00:28:56,800 --> 00:28:59,080 Speaker 2: Now in the UK, you have an office and I 474 00:28:59,120 --> 00:29:02,000 Speaker 2: think in the Middle East. What are your thoughts on 475 00:29:02,360 --> 00:29:06,440 Speaker 2: Article six Corsia. Are you pulish on future demand from 476 00:29:06,480 --> 00:29:09,000 Speaker 2: those markets, and then what can Brazil best due to 477 00:29:09,000 --> 00:29:10,920 Speaker 2: position itself for those markets. 478 00:29:11,640 --> 00:29:15,200 Speaker 6: Well, I believe in the voluntary carbon market side, we 479 00:29:15,440 --> 00:29:19,760 Speaker 6: have some potential buyers outside Brazil looking for investing here 480 00:29:19,800 --> 00:29:24,600 Speaker 6: in Brazil, especially because we have of course quality carbon creds. 481 00:29:24,640 --> 00:29:27,680 Speaker 6: But much more than this, we have the challenge to 482 00:29:27,720 --> 00:29:32,480 Speaker 6: develop our country and develop our social KPIs. So it's 483 00:29:32,520 --> 00:29:35,600 Speaker 6: a threepo investment in terms of climate, in terms of 484 00:29:36,560 --> 00:29:39,440 Speaker 6: a development country, in terms of economicy and especially in 485 00:29:39,560 --> 00:29:43,680 Speaker 6: terms of social development. But I believe we have the 486 00:29:44,000 --> 00:29:48,360 Speaker 6: four different boosters for the market. The first one, of 487 00:29:48,480 --> 00:29:52,880 Speaker 6: course is the Brazilian regulated the ETS, because we will 488 00:29:52,880 --> 00:29:57,000 Speaker 6: have an obligation for the companies to have their compensation 489 00:29:57,160 --> 00:30:00,400 Speaker 6: in terms of carbon creds. And here inside Brazil zillion 490 00:30:00,800 --> 00:30:05,800 Speaker 6: ETS will have the interoperability between the voluntary carbon market 491 00:30:05,800 --> 00:30:08,840 Speaker 6: and the regulated carbon market, so it could boost the 492 00:30:08,920 --> 00:30:14,560 Speaker 6: voluntary carbon market, depends on the criteria. The second one 493 00:30:14,720 --> 00:30:18,520 Speaker 6: is the Corsia because Corsia could double or triple the 494 00:30:18,600 --> 00:30:24,200 Speaker 6: marked if it's real. And my back is especially on 495 00:30:24,240 --> 00:30:31,840 Speaker 6: the Article six because Brazil has a clear vocation to 496 00:30:31,960 --> 00:30:35,760 Speaker 6: be an exporter of commodities, and carbon credits is a 497 00:30:36,080 --> 00:30:37,960 Speaker 6: natural commodity, so. 498 00:30:38,360 --> 00:30:40,640 Speaker 9: Brazil could pay play this good rule. 499 00:30:41,000 --> 00:30:45,080 Speaker 6: I believe Article six point two much more than six 500 00:30:45,120 --> 00:30:50,280 Speaker 6: point four could create the bileral agreements, especially between Brazil 501 00:30:50,440 --> 00:30:54,880 Speaker 6: and the country that have less of natural resource as 502 00:30:54,880 --> 00:31:00,920 Speaker 6: well as Japan, Singapore unite them rates Saudia. I believe 503 00:31:00,960 --> 00:31:05,480 Speaker 6: a lot in this Golden breedge between Brazil and Middle East, 504 00:31:05,600 --> 00:31:09,560 Speaker 6: or Brazil in Asia or Switzerland that they are playing 505 00:31:09,560 --> 00:31:11,840 Speaker 6: a good role in terms of Article six. And I 506 00:31:11,880 --> 00:31:20,400 Speaker 6: believe in the group of countries creating their combination between 507 00:31:20,800 --> 00:31:21,880 Speaker 6: regulated the marks. 508 00:31:21,880 --> 00:31:23,320 Speaker 9: It's a kind of a it's not. 509 00:31:23,280 --> 00:31:26,320 Speaker 6: A global carbon marks, but it's a pool of countries 510 00:31:26,520 --> 00:31:29,120 Speaker 6: that would like to move the agenda forward. 511 00:31:29,440 --> 00:31:31,120 Speaker 9: As well as the Breeks. 512 00:31:31,880 --> 00:31:36,280 Speaker 6: We are discussing here with the Brazilian government potential breaks 513 00:31:36,360 --> 00:31:40,800 Speaker 6: carbon marks to create this combination between them under a 514 00:31:40,840 --> 00:31:43,680 Speaker 6: good regulation. So I believe we have good trends to 515 00:31:43,840 --> 00:31:45,920 Speaker 6: boost these marks on the next decade. 516 00:31:46,240 --> 00:31:47,800 Speaker 3: Yeah, and especially for Article sex. 517 00:31:47,920 --> 00:31:50,720 Speaker 2: In order for Article sex to be successful, right, you 518 00:31:50,840 --> 00:31:53,400 Speaker 2: need the support and the backing of the Brazilian government. 519 00:31:53,480 --> 00:31:55,960 Speaker 2: And so I think that brings me to my final question, 520 00:31:56,000 --> 00:31:57,640 Speaker 2: And I'll just throw this one out there and you 521 00:31:57,720 --> 00:32:00,360 Speaker 2: guys can whoever wants to grab it can. What role 522 00:32:00,520 --> 00:32:02,400 Speaker 2: do we need to see from the Brazilian government to 523 00:32:02,440 --> 00:32:03,080 Speaker 2: help support you? 524 00:32:03,120 --> 00:32:03,520 Speaker 3: All right? 525 00:32:03,800 --> 00:32:05,920 Speaker 2: You're all from the private sector, right, A lot of 526 00:32:05,920 --> 00:32:08,560 Speaker 2: the activity in this market has been private sector to 527 00:32:08,600 --> 00:32:12,560 Speaker 2: private sector. What examples do we have of public private partnerships? 528 00:32:12,760 --> 00:32:15,959 Speaker 2: What examples have we seen more enthusiasm from the Brazilian government? 529 00:32:16,000 --> 00:32:17,920 Speaker 3: Do we need to see more? What are you what 530 00:32:17,920 --> 00:32:18,760 Speaker 3: are you expecting here? 531 00:32:20,720 --> 00:32:22,960 Speaker 4: And if I may, I just gave in my last 532 00:32:22,960 --> 00:32:25,880 Speaker 4: answer a quick example about Petroblaz and B and d 533 00:32:26,000 --> 00:32:27,960 Speaker 4: as partnership that was announced yesterday. I think that's a 534 00:32:28,000 --> 00:32:31,440 Speaker 4: great example, but I wanted to complement something that's not 535 00:32:31,560 --> 00:32:33,040 Speaker 4: just for Brazil. But I think it has to do 536 00:32:33,080 --> 00:32:36,560 Speaker 4: with all of these regulated markets. I see it the 537 00:32:36,600 --> 00:32:39,200 Speaker 4: same way as Fabia, with a lot of excitement to 538 00:32:39,240 --> 00:32:42,600 Speaker 4: see these additional off ramps coming online. But I worry 539 00:32:42,680 --> 00:32:46,280 Speaker 4: a lot about where do we set the quality standards, 540 00:32:46,600 --> 00:32:49,760 Speaker 4: because once you start obligating companies to buy a certain 541 00:32:49,800 --> 00:32:52,120 Speaker 4: number of credits and not doing that again for the reputation, 542 00:32:52,240 --> 00:32:55,560 Speaker 4: because they voluntarily have chosen it, kind of the incentive 543 00:32:55,600 --> 00:32:57,880 Speaker 4: that you create if you don't, if you don't you know, 544 00:32:57,920 --> 00:33:01,160 Speaker 4: act very carefully, is to have a to the bottom 545 00:33:01,640 --> 00:33:05,760 Speaker 4: and then all those words that I mentioned in the beginning, additionality, permanence, 546 00:33:06,200 --> 00:33:09,120 Speaker 4: co benefits, they're out the window. So I think Brazil, 547 00:33:09,240 --> 00:33:11,640 Speaker 4: you know, we talk a lot about developing markets. I 548 00:33:11,640 --> 00:33:13,720 Speaker 4: think one thing that Brazil could do and the other 549 00:33:13,720 --> 00:33:16,920 Speaker 4: countries could do that are establishing regulated markets, is to 550 00:33:17,040 --> 00:33:20,080 Speaker 4: ensure that we have a high standard for quality and 551 00:33:20,120 --> 00:33:23,040 Speaker 4: that we don't fall into the trap of you know, 552 00:33:23,720 --> 00:33:26,840 Speaker 4: VCM two point zero becoming you know, another bust, and 553 00:33:26,880 --> 00:33:29,120 Speaker 4: then we have to talk about VCM three point zero 554 00:33:29,200 --> 00:33:30,840 Speaker 4: and it's never fixed. 555 00:33:31,480 --> 00:33:34,560 Speaker 3: It's a great point. Anyone else any thoughts here on governance? 556 00:33:35,480 --> 00:33:39,320 Speaker 8: No, I couldn't agree more with chiagu No. I think 557 00:33:39,560 --> 00:33:43,880 Speaker 8: we needed to guarantee quality, integrity for the carbon emissions. 558 00:33:43,920 --> 00:33:47,640 Speaker 8: Otherwise we can lose trust in the whole process and 559 00:33:48,240 --> 00:33:51,600 Speaker 8: lose this power that Brazil can play as. 560 00:33:51,680 --> 00:33:52,720 Speaker 9: A major. 561 00:33:54,520 --> 00:33:59,040 Speaker 8: Commodity. How can I see supplier for other countries. 562 00:33:59,160 --> 00:33:59,520 Speaker 2: No, but. 563 00:34:01,280 --> 00:34:04,360 Speaker 8: What we've learned from our history now today is that 564 00:34:05,280 --> 00:34:11,160 Speaker 8: to do the right things, guaranteeing the process, it's what. 565 00:34:12,640 --> 00:34:15,640 Speaker 9: Gave us credibility, right, yeah. 566 00:34:15,480 --> 00:34:17,560 Speaker 2: And you know we talked about keeping those blue dots 567 00:34:17,640 --> 00:34:20,719 Speaker 2: on the on the scatter plot, and that ultimately comes 568 00:34:20,719 --> 00:34:22,640 Speaker 2: down at the end of the day to proper governance, 569 00:34:22,680 --> 00:34:24,560 Speaker 2: whether that is in the form of an ETS or 570 00:34:24,600 --> 00:34:28,440 Speaker 2: a carbon tax or something else. Government support here is 571 00:34:29,160 --> 00:34:31,880 Speaker 2: you know, the most important backstop tom, ensuring that not 572 00:34:31,920 --> 00:34:35,440 Speaker 2: only is there a healthy demand signal, but there's also consistent, 573 00:34:35,520 --> 00:34:38,200 Speaker 2: high quality, high integrity supply coming out into the market. 574 00:34:39,440 --> 00:34:43,880 Speaker 7: Well, to add upon that, I echo everything that was 575 00:34:43,920 --> 00:34:51,479 Speaker 7: already said, but I think the government it's fundamental as 576 00:34:51,520 --> 00:34:57,440 Speaker 7: providing the enablers for the market like capacity building, technology, 577 00:34:59,080 --> 00:35:02,160 Speaker 7: regulatory in work, as I already said, the legal and 578 00:35:02,239 --> 00:35:08,200 Speaker 7: fundiary safety. So those are the enablers that the private 579 00:35:08,280 --> 00:35:12,560 Speaker 7: sector must count and it's the government job to provide 580 00:35:14,520 --> 00:35:20,240 Speaker 7: for formenting developing. This is a very good table two. 581 00:35:20,120 --> 00:35:24,640 Speaker 8: Point because for Amazon rainforest the lended tenure documentation and 582 00:35:24,680 --> 00:35:28,879 Speaker 8: now also to have out the documentation regarding the environmental 583 00:35:28,920 --> 00:35:32,640 Speaker 8: registration so far so on for the Forest Code and 584 00:35:32,760 --> 00:35:37,040 Speaker 8: permanent areas. It's quite important and it's something that the 585 00:35:37,280 --> 00:35:41,719 Speaker 8: government and private sector can work together to enhance and 586 00:35:41,840 --> 00:35:45,360 Speaker 8: to spit up the whole process because it can be 587 00:35:45,440 --> 00:35:46,360 Speaker 8: a constraint. 588 00:35:47,280 --> 00:35:50,560 Speaker 2: The capacity building point is an excellent one. Well, we 589 00:35:50,600 --> 00:35:53,399 Speaker 2: are at time here, so everyone, thank you so much 590 00:35:53,440 --> 00:35:55,319 Speaker 2: for the discussion today and if everyone can please join 591 00:35:55,360 --> 00:36:04,640 Speaker 2: me in making my panelists. 592 00:36:05,719 --> 00:36:08,880 Speaker 6: Today's episode of Switched On was produced by Cam Gray 593 00:36:09,080 --> 00:36:11,440 Speaker 6: with production assistance from Kamala Shelling. 594 00:36:11,560 --> 00:36:14,759 Speaker 1: Bloomberg NIF is a service provided by Bloomberg Finance LP 595 00:36:14,920 --> 00:36:17,960 Speaker 1: and its affiliates. This recording does not constitute, nor should 596 00:36:17,960 --> 00:36:21,279 Speaker 1: it be construed, as investment advice, investment recommendations, or a 597 00:36:21,320 --> 00:36:24,800 Speaker 1: recommendation as to an investment or other strategy. Bloomberg ANIF 598 00:36:24,800 --> 00:36:27,840 Speaker 1: should not be considered as information sufficient upon which to 599 00:36:27,880 --> 00:36:29,200 Speaker 1: base an investment decision. 600 00:36:29,320 --> 00:36:32,279 Speaker 9: Neither Bloomberg Finance LP nor any of its affiliates makes 601 00:36:32,320 --> 00:36:36,040 Speaker 9: any representation or warranty as to the accuracy or completeness 602 00:36:36,040 --> 00:36:39,040 Speaker 9: of the information contained in this recording, and any liability 603 00:36:39,080 --> 00:36:41,759 Speaker 9: as a result of this recording is expressly disclaimed.