The fund is designed to back socio-environmental initiatives in Brazil, aiming to turn them into sustainable enterprises that create positive effects while safeguarding Petrobras' invested capital. Image by GummyBone via iStock
Petróleo Brasileiro S.A. has partnered with Régia Capital to launch what they called the Impact Fund for Bioeconomy and Nature-Based Solutions Socio-Environmental Projects (Petrobras Bioeconomy Fund). Petrobras said in a media release that the partners each allocated BRL 50 million ($8.6 million) to the fund.
This initiative represents Petrobras' voluntary socio-environmental investment, enhancing the company's other social responsibility efforts, it said. The fund is designed to back socio-environmental initiatives in Brazil, aiming to turn them into sustainable enterprises that create positive effects while safeguarding Petrobras' invested capital. Petrobras added that any financial gains obtained will be reinvested to expand socio-environmental advantages from these initiatives.
The Petrobras Bioeconomy Fund will concentrate on supporting projects in key areas crucial for combating climate change and conserving biodiversity, including in the Amazon. It will focus on initiatives in regions facing deforestation pressures, efforts that positively influence job creation and income generation, and projects capable of producing high-integrity carbon credits. Additionally, it will support biodiversity credits alongside the restoration of fauna and flora, Petrobras said.
The fund is the first in Brazil to adopt the Impact Linked Compensation model, aligning financial incentives with sustainability objectives, according to Petrobras.
The fund has its own governance framework for selecting projects, taking into account indicators of economic, social, environmental, innovation, and sustainable development impacts, Petrobras said. Through these innovative financial methods, the fund seeks to establish itself as a scalable support center for advancing Brazil's bioeconomy sector, it said.
Brazil's state-owned energy major chose Régia Capital as manager of the Petrobras Bioeconomy Fund through a competitive process. It said in its statement that it received proposals from various institutions. Régia Capital is a sustainable investment platform created by JGP and BB Asset, Petrobras said.
The establishment of the fund is in line with Petrobras' Strategic Plan for 2050 and Business Plan for 2025-2029, which feature directives aimed at fostering conservation and environmental restoration efforts throughout Brazil, the company said.