Ignoring Environmental Threats Could Spell Trouble for Mexico

As customers become increasingly concerned about climate change, companies are increasingly embracing the sustainability solutions that their clients demand. The main concerns include biodiversity loss, climate change and responsible resource usage and failing to align with environmental threats poses risks for Mexican businesses.

Recognizing the urgent need to address these issues, the Mexican Council of Sustainable Finance (CMFS) emphasizes that the conservation and preservation of the environment hold not only ecological significance but also economic and social value. Alba Aguilar Priego, Director General, CMFS, stresses that players within the financial system pla0y a pivotal role in driving the transition toward an economy that is less resource-intensive and prioritizes sustainable growth and development.

To navigate these challenges, it is key to promote financial education on sustainability, biodiversity and climate change. Macro trends dictate new practices that require the integration of environmental, social and governance (ESG) information, tools and methodologies into risk analysis, decision-making processes and capital allocation.

A particular risk looms if Mexico does not take steps towards energy transition while its trading partners forge ahead in implementing regulations on clean energy, as highlighted by CMFS. Such a scenario may result in these trading partners demanding components and services that Mexico is unable to provide. As a consequence, Mexico could find itself unable to meet the demands of the global market.

Aguilar explains that despite Mexico's lack of strict regulations or public policies regarding Energy Transition, its trading partners will continue to implement them. Sooner or later, they could impose requirements with which Mexico, having fallen behind, could struggle to comply.