The debate about the role of the State and the economy in Brazil led to a series of studies, mainly from the 1980s, and it continues at present, especially about the state’s role such as regulation and deregulation issues (Evans, 1995 1). Overall, the 1980s were characterized by a neo-conservative wave and its proposal of a minimal state. In 1990s, when the neoliberal proposal became less acceptable, the movement toward reform, or more specifically, the state reconstruction began to be a dominant program (Bresser-Pereira, 1997 2). According to Bresser-Pereira and Grau (1999), the globalization process from the 1990s also required new methods of more efficient public administration; consequently, it increased the importance of new actors to implement social services that was guaranteed by the State.
At this same time, the State was seen as inefficient and corrupt, in which political and economic reforms were being discussed to change this scenario. However, this situation created a new dynamic, which provided the rise of new agents and organizations, for example, the growth of non-governmental organization (NGOs) and self-help groups that were concerned about bringing social and economic development to Brazilian nation (Bresser-Pereira; Grau, 1999 3).
These developments help us understand not only the reform of the State but also the development of the Brazilian financial market and the emergence of corporate governance issues in Brazil (Grün, 2003). Corporate governance, which is shaped by the financial sphere, appeared as a requirement for transparency via society, emerging as a criticism of the Brazilian bureaucratic model. The corporate governance movement was supported during the Fernando Henrique Cardoso government (1995-2002) and was tied to the privatization issues, because talking about transparency was essential to warm up the capital market and to attract investors. The government needed to be transparent to increase investors’ confidence in the privatization process, which means that the government was required to adopt corporate governance to be perceived as transparent institution (Grün, 2003).
Carvalho (2002) 4 argues that it is possible to observe modifications of institutional investor’s attitudes during the Fernando Henrique Cardoso government. As a result, important facts emerge, such as, the internationalization of the Brazilian capital market, the increasing number of companies accessing international market through American Depositary Receipt (ADR) 5 - ; the opening of the financial system for multinational institutions, and the increasing importance of foreign investors in the domestic stock market.
In 2002, the principal candidate for the Presidency, Luiz Inácio Lula da Silva, who represents the left and unionism, went to Bovespa (the principal stock exchange in Brazil). At that time, he wanted to demonstrate adherence to economic and corporate governance practices established in the financial market. As a symbolic approach, it is possible to argue that corporate governance has gained huge attention in the nation (Grün, 2003).
It is important to highlight, according to Sá (2003), that the corporate governance discourse is associated with economic progress, and that the financial actors claim that it is through the economic growth that Brazilian society will achieve social development. In general, social and economic development became to be seen as part of the same political approach.
Therefore, corporate governance becomes a great solution for Brazilian society. It is recognized not only as a neoliberal prescription to solve the problem of companies’ capitalization, but also as a means to enlarge both financial markets, and the Brazilian economy and social field (Grün, 2004).
In this sense, Brazil, like other emerging nations, is experiencing rapid financialization. This process is shaped by financial changes in the global financial market and involves restructuring of the country’s financial organization through privatization, fiscal and monetary reform and the creation of new programs and institutions that encourage economic growth and popular investment (Grün, 2009). Financialization includes not only financial intermediaries but also self-help deals (Leite, 2012 6).
The financialization processes is formed by an interesting dynamic in Brazil, in which corporate governance practices gain significance in the context of the critique of the inefficient state. Here, it is possible to observe the rise of new economic actors that appeared as a solution to change the “uncertainty” of the economic and political scenarios.
Thus, the pathway of corporate governance, which goes through the economic and political issues to the capital market in Brazil, opens a new way to understand how actors try to change the traditional perception of the market through their symbolic strategies (Grün, 2007). Moreover, regarding the popularization of financial market issues, the Brazilian state is watching its expansion, but to some extent, without control over the situation.
At the same time, that the financial market is being reshaped, it is possible to notice the rise of personal finance and entrepreneurial discourses that it is linked to self-help schemes in Brazil. An interesting evidenece of this scenario comes from the bookstores’ shelves that are filled with books and releases that deal with money and financial advices.
McGee (2005) 7 explains that in a period of declining security, there is no surprise if one finds a marked increase in the number of self-help titles. In this way, McGee emphasizes how the promise of self-help can lead individuals into a new sort of enslavement, into a cycle where the self is not improved but endlessly belabored.
Simultaneously, it allocates to the individual sphere the need to rely on private financing, rather than relying on the government. It formed the basis for the development of a new way of thinking in Brazil, the stimulus to economic growth by individuals through the ideals of self-help, that means – “if success is solely the result of one’s own efforts, then the responsibility for any failure must necessarily be individual shortcomings or weaknesses” (McGee, 2005 8:13). This movement seeks to reach the general population, it is not restricted to a portion of society able to innovate, save and invest in the markets.
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