ESG Development in the Public Equity Market – 2023 report

Hope you are doing well and a happy new year! Welcome back to our brief thoughts on ESG.

This week we are sharing our annual update of the Mexico: ESG Development in the Public Equity Market – 2023 report, covering the 2022 annual reporting season for publicly listed companies in Mexico. There is lots of interesting data and, once again, continued progress. We are pleased to note the sustained efforts showcased in this year’s report, reflecting the ongoing commitment of Mexican companies to elevate their sustainability initiatives.

We recommend reading all of it, but for now, we leave you with a few key highlights:

• Almost all sectors in the Mexican market made progress on their ESG strategies and communication efforts over 2022, but we still see room for improvement in ESG Development, especially in some sectors.
• SASB adoption continued this reporting cycle. 81% of sustainability reports in Mexico now include SASB (vs. 70% in 2022, 40% in 2021, and 10% in 2020). It will be interesting to start tracking this year the adoption of ISSB’s new standards. 
• Based on our heatmaps, the most ESG-mature sectors in Mexico are Transportation, FIBRAs, and Capital Goods. The least ESG-mature sector in Mexico is still Commercial Services Supplies.
• It is easy to understand why larger companies (with more resources, larger teams) usually rank higher than smaller companies within the same industry, but ESG strategies can be tailored to different budgets. Smaller companies should not shy away from ESG just because of constrained resources.

• ESG KPIs are becoming much more popular. This year we saw several companies launching a full set of performance indicators to measure all their material topics, most of them with goals for those indicators.

• The adoption of international initiatives (such as TCFD or the UN’s Global Compact) continues to increase, but at a slower pace. We would expect over time companies will stick to what they see gets more recognition from investors and drop initiatives that get left behind. 

I hope you found this interesting. As usual, if there is anything we can help you with, or if there is an ESG topic you would like to know more about, please let us know.

Best,

Marimar

CEO, Miranda ESG