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Details
- Mexico
Deep dive
Background
Mexico's Normas de Información de Sostenibilidad (NIS) (English: Sustainability Disclosure Standards), introduced in May 2024, represent a significant advancement in the country's commitment to integrating sustainability into corporate reporting. Developed by the Consejo Mexicano de Normas de Información Financiera y de Sostenibilidad (CINIF), the NIS comprises standards NIS A-1 and NIS B-1, which establish guidelines for measuring and disclosing sustainability information in private companies. These standards aim to ensure that reported data are transparent, comparable, and relevant to stakeholders. The implementation of the NIS is structured in two phases: the first phase, commencing in 2025, focuses on key metrics to assess sustainability risks and opportunities; the second phase, expected around 2027, will incorporate strategies for risk management, governance, and financial planning. The NIS builds upon earlier policies, such as Mexico’s 2012 Ley de Cambio Climático (Climate Change Law), which set emissions reduction targets (30% by 2020, 50% by 2050). It also fits within Mexico’s broader climate strategy, including commitments under the Paris Agreement and the United States-Mexico-Canada Agreement (USMCA), which emphasize environmental accountability and sustainable development.
Reporting Requirements
Under the new regulations, issuers are required to prepare and publish an annual sustainability report, separate from their financial statements, starting with the 2025 fiscal year to be presented in 2026. The report must include detailed information on governance, strategy, risk management, and metrics related to sustainability, particularly focusing on climate-related risks and opportunities. Specifically, companies must disclose greenhouse gas (GHG) emissions data, encompassing Scope 1 (direct emissions), Scope 2 (indirect emissions from purchased energy), and Scope 3 (other indirect emissions in the value chain). While Scope 3 reporting is encouraged, it becomes mandatory starting with the 2026 fiscal year report, to be submitted in 2027. Additionally, the CNBV has established a phased approach for external assurance of these reports: no assurance is required for the 2025 report; limited assurance is required for the 2026 report; and reasonable assurance is mandated for reports from 2027 onward.
Covered Entities
The disclosure requirements apply to all entities with securities registered in Mexico's National Securities Registry (RNV), including both domestic and foreign issuers. Foreign issuers may comply with their home country's sustainability reporting standards, provided these are equivalent to the IFRS standards. Certain entities, such as financial institutions and entities predominantly engaged in financial activities, must adhere to the legal frameworks applicable to their specific sectors. Federal entities and municipalities are exempt from these reporting obligations. This comprehensive approach ensures that a broad spectrum of market participants contributes to the nation's sustainability goals.
Penalties for Noncompliance
Noncompliance with the new sustainability reporting requirements may result in regulatory actions by the CNBV, including administrative sanctions. While specific penalties have not been detailed, the CNBV emphasizes the importance of adherence to these standards to maintain market integrity and investor confidence. To facilitate compliance, the CNBV has provided guidance and resources to assist issuers in understanding and implementing the new reporting obligations. This regulatory development underscores Mexico's commitment to aligning its financial markets with global sustainability practices.
