CAIXA Econômica Federal (2025)

Governance and Organization of Social, Environmental and Climate Risk at CAIXA

The management of social, environmental and climate risks (SECR) at CAIXA Econômica Federal is structured within the Risk Vice Presidency, with specialized technical oversight provided by the National Department of Special Risks (GEREP), which operates under the National Superintendency for Specialized Risks (SURES).

GEREP holds an institutional mandate to develop methodologies, models, guidelines and instruments for managing social, environmental and climate risks, as well as to monitor and report these risks across CAIXA’s Prudential Conglomerate. The unit is also responsible for the implementation and governance of the Equator Principles (EPs), to which CAIXA has been a signatory since 2009. GEREP develops socio-environmental models and guidelines applicable across the entire bank and is responsible for the Equator Principles framework within CAIXA.

At the end of 2025, there were 17 staff members across three teams dedicated to social, environmental and climate risk functions.

In 2025, relevant actions were incorporated into CAIXA’s SECR management framework, including:

• CAIXA engaged a specialized environmental and social consultancy to strengthen its capacity for appraisal and monitoring of projects financed under the Equator Principles. The consultancy performs technical due diligence, periodic monitoring, and issues compliance reports, providing strategic support for credit decision-making and risk management;
• Integration of climate-related variables into reverse stress testing scenarios and into capital plan projections (ICAAP), considering phenomena such as El Niño and La Niña. In addition, preliminary work has begun on the implementation of climate stress testing, focusing on portfolios with higher exposure to climate risk;
• Engagement of specialized technical consultancy to expand climate stress testing across strategic sectors within the credit portfolio, with the objective of enhancing the methodology for assessing portfolio vulnerability under changing climate patterns, identifying segments with higher exposure and potential impacts, and supporting business decisions, risk management and capital planning;
• CAIXA established a partnership with the World Bank, through the International Bank for Reconstruction and Development (IBRD), for three strategic programs: Urban Electromobility, Ecohab, and Digital Acceleration. To support these initiatives, CAIXA developed a customized Social, Environmental and Climate Risk assessment tool, essential for project appraisal, ensuring environmental and social compliance, technical robustness, and strengthened ESG governance;
• Launch, at COP30, of a protocol for response to climate and environmental disasters, aimed at mitigating impacts and strengthening CAIXA’s response capacity, as well as the Net Zero Housing Coalition 2050, with the objective of decarbonizing the Brazilian housing value chain by 2050.

SECR governance is integrated into the corporate risk management framework and includes strategic, tactical and operational layers, ensuring periodic reporting to Senior Management and relevant governance bodies, such as: the Board of Directors, which deliberates on matters submitted for decision-making; the Audit Committee; the Sustainability Committee, which provides advisory support on sustainability and social, environmental and climate responsibility matters;
and the Independent Risk and Capital Committee, which advises the Board of Directors on risk and capital management.

At the executive management level, governance includes the Executive Board; the Vice Presidents’ Committee, notably the Risk and Capital Committee; and Executive Directors’ Committees, with emphasis on the Procurement and Sustainability Committee.

Internal Processes and Policies

The management of social, environmental and climate risks is one of the cornerstones of CAIXA’s Social, Environmental and Climate Responsibility Policy (PRSAC), which guides the actions of the Institution and its subsidiaries, as well as employees, officers, board members, partners and service providers, as applicable.

The PRSAC establishes guidelines for the systematic integration of social, environmental and climate responsibility across strategy, governance, business lines, products, services, processes and operations, fostering sustainability and the long-term viability of banking activities.

In addition, the Risk and Capital Management Policy include specific provisions related to SECR, ensuring that its management is commensurate with the complexity of CAIXA’s activities and fully integrated into the overall corporate risk framework. Risk management encompasses identification, measurement, assessment, monitoring, control, mitigation and reporting, considering:

• sectors and activities with higher potential for social, environmental and climate impacts;
• regulatory, policy, technological and market developments;
• impacts associated with extreme climate-related events.

Material exposures are continuously monitored and, where appropriate, limits may be established in line with the Risk Appetite Statement (RAS). The current RAS includes specific indicators related to social, environmental and climate risks, reinforcing the integration of these themes into corporate strategy and capital planning.

Equator Principles (EPs)

In financing projects classified under the Equator Principles, CAIXA adopts as reference the IFC Performance Standards on Environmental and Social Sustainability and the World Bank Group’s Environmental, Health and Safety (EHS) Guidelines.

Projects are assessed through CAIXA’s proprietary environmental and social risk categorization matrix, which considers potential impacts on:

• the environment and climate change;
• workers’ health and safety;
• affected communities and populations.

This risk matrix is based on environmental impact assessment protocols commonly used by regulatory authorities and environmental and social consultancies to evaluate project impacts. It assesses each type of impact in terms of its scope, duration, significance, reversibility, magnitude, and associated mitigation measures. At the end of the process, a risk classification is assigned to each thematic area, enabling the bank to establish tailored safeguards where more critical issues are identified.

The consolidated outcome results in four risk categories, aligned with the Equator Principles: High Risk (Category A); Substantial Risk (Category B with independent consultancy); Moderate Risk (Category B without consultancy); and Low Risk (Category C).

For all Category A projects, and for Category B projects when deemed necessary, CAIXA requires an independent environmental and social assessment, conducted by a specialized consultancy prior to financial close. This assessment covers, among other aspects:

• environmental and climate regulatory compliance;
• impacts on communities, including traditional communities;
• occupational health and safety management;
• impacts on biodiversity and critical habitats;
• compliance with environmental licensing conditions;
• mitigation and compensation plans for social, environmental and climate impacts;
• environmental and social management systems (ESMS), stakeholder engagement processes, and grievance mechanisms.

Based on risk assessment, environmental and social covenants proportional to the project’s risk level are incorporated into financing agreements, enabling systematic monitoring of compliance throughout the entire project lifecycle. These covenants are tailored to the project’s risk profile, allowing for ongoing monitoring of the client’s and the project’s environmental and social performance, benchmarked against IFC safeguard requirements. In addition to monitoring conducted by the contract manager, high- and medium-risk projects are subject to dedicated environmental and social monitoring under the Equator Principles framework, with specialized teams responsible for assessing compliance throughout the life of the financing agreement.

Environmental and social monitoring takes place during both the construction and operational phases, with at least annual frequency, which may vary depending on the project’s risk level and specific characteristics. This monitoring includes periodic reports from independent consultants, evaluation of corrective action plans, reassessment of identified risks, and site visits, where applicable. In specific cases, the bank may engage more closely with clients to support the achievement of environmental and social compliance and the long-term viability of the project.

Non-compliance with environmental and social obligations, human rights violations, environmental damage, or operations inconsistent with the Equator Principles or CAIXA’s PRSAC may trigger the adoption of contractual remedies, including suspension of disbursements or acceleration of the loan.

GEREP periodically reviews internal Equator Principles standards to strengthen environmental and social risk management and ensure robust project appraisal. Business areas are responsible for screening transactions, submitting them for GEREP assessment, and conducting all negotiations with project sponsors (including procurement of due diligence, independent environmental and social consultancy, and contractual covenants). They are also responsible for compliance with Principle 8 and for monitoring environmental and social covenants throughout the duration of the financing agreement. In 2025, the internal standards and instruments related to environmental and social risk under the Equator Principles were reviewed and enhanced.

CAIXA provides a public summary for clients seeking financing under the Equator Principles, available on its website: https://www.caixa.gov.br/Downloads/sustentabilidade/Resumo-ao-Empreendedor-PrincIpios-do-Equador.pdf. This document aims to provide an overview of EP requirements, links to official documents (such as the Equator Principles, IFC Performance Standards, and EHS Guidelines), and the bank’s internal processes, giving project sponsors visibility on the subsequent steps of the financing process.

Regarding capacity building on social, environmental and climate risks, the “Risco Talks” initiative was implemented within the Risk Vice Presidency, consisting of internal training workshops. The first session focused on a large hydropower project case study in which CAIXA applied Equator Principles requirements to ensure environmental and social compliance, delivering positive outcomes for affected communities, the environment, and workers.

In terms of external training, the team participated in the Corporate Training Program on Climate Transition Analysis (provided by Climate Finance Hub Brasil); Training on Climate and Environmental and Social Risk and Opportunity Management in the Brazilian Financial Sector (provided by Soluções Inclusivas Sustentáveis); Environmental and Social Risk Management training (delivered by the Inter-American Development Bank – IDB); and training on the use of the AdaptaBrasil platform for climate adaptation planning (developed by the National Institute for Space Research – INPE), demonstrating CAIXA’s commitment to continuous capacity building for teams responsible for the appraisal and monitoring of Equator Principles projects.

Equator Principles Transactions – 2025

In 2025, CAIXA reached financial close on two projects classified under the Equator Principles, structured as Project Finance transactions, in the energy and infrastructure (sanitation) sectors.

The distribution of projects by environmental and social risk category was as follows:

Category A: 1 project

Category B: 1 project

Category C: 0 projects

Both projects were subject to independent environmental and social assessment and are now part of CAIXA’s ongoing environmental and social risk monitoring framework.

In addition, under the Project Finance Advisory Services mandate, CAIXA supported a public-private partnership (PPP) project in the solid waste management sector.

No transactions were executed under the “Project-Related Refinance and Project-Related Acquisition Finance”, “Bridge Loans” or “Project-Related Corporate Loans” modalities.

In total, 23 project monitoring activities were carried out in 2025. These monitoring activities covered large-scale projects financed in sectors such as power generation -including hydropower plants such as Belo Monte, Jirau, and Santo Antônio – as well as concession-based infrastructure projects, including highways, ports and airports, and sanitation infrastructure.

Independent Review of Equator Principles Implementation

CAIXA conducted an Independent Review in accordance with the Equator Principles Guidelines, covering the assessment of the Bank’s internal procedures and a representative sample of mandatory transactions from 2024 onwards, carried out by its Internal Audit. The review also included the evaluation of projects contracted in previous periods, encompassing different financed sectors. Gaps were identified in the implementation processes, along with recommendations for improvement, which have been incorporated into the Bank’s internal systems, requiring the development of an Action Plan for the full remediation of non-compliances.

A new Independent Review of the implementation of the Equator Principles is scheduled to be conducted within three (3) years.

Transparency and Data Disclosure

CAIXA’s website provides information on social, environmental and climate risks. The Equator Principles section includes an environmental and social information questionnaire required for all project finance transactions classified under the EPs, the terms of reference for hiring independent environmental and social consultants, and a summary guide for project sponsors, available at:
https://www.caixa.gov.br/sustentabilidade/riscos-socioambientais/Paginas/default.aspx

With regard to reporting and data disclosure, CAIXA publishes the Social, Environmental and Climate Risks and Opportunities Report (GRSAC), aimed at ensuring formal disclosure, standardization, and quality assurance of internal and external reporting related to social, environmental and climate risk data. The 2025 GRSAC report is publicly available at:
https://www.caixa.gov.br/Downloads/sustentabilidade/GRSAC-2025.pdf

Annually, GEREP reports on the Equator Principles to senior governance bodies, including the bank’s Risk Superintendency, to which it is subordinated, and the General Secretariat, which is responsible for institutional engagement with external stakeholders. GEREP is also responsible for CAIXA’s annual Equator Principles reporting to the EP Association, as well as contributing to the Bank’s Integrated Report and Sustainability Report.

Further information on CAIXA’s environmental and social responsibility, its management of social, environmental and climate risks, and the projects classified under the Equator Principles in 2025 can be found in its Sustainability Report:
https://www.caixa.gov.br/sustentabilidade

For access to the Integrated Report, please visit:
https://ri.caixa.gov.br/en/company/integrated-report/