Anticipating the Effects of the Brazilian New Business Environment Law's Corporate Governance Provisions on Minority Shareholder Protection

To encourage minority shareholder protections and public investment in Brazilian corporations, Brazil passed the New Business Environment Law. The New Business Environment Law’s Corporate Governance Provisions require that all corporations have at least one independent board member, have different individuals serving as their CEO and board chairperson, and grant increased power to the general shareholders’ meeting. This Note predicts that the New Business Environment Law’s Corporate Governance Provisions will have an inconsequential effect on Brazilian minority shareholder protections. Traditional American means of achieving minority shareholder protections may be ineffective in Brazil, due to legal, institutional, and cultural differences between the United States and Brazil. Therefore, this Note recommends that Brazil implement higher independent board member requirements, require that corporations select independent nominating committees to choose corporate board and executive management candidates, mandate larger boards, and stagger policy changes pursuant to the existing Novo Mercado system.