Our first ESG development heatmap for Mexico (FIBRAs)

This week I am doing something a bit different than other weeks. Over the past few months, we have heard from many people that they do not really know where to start when they are starting to build a company’s ESG strategy. ESG can be a bit overwhelming as it covers so many things, and companies are trying to get this right.  So where should they start?

Our answer is always the same: ideally start with a materiality analysis which will set the tone for the ESG efforts, and then develop the strategy for whatever topics come out as material. If you skip the materiality assessment, you can focus on whatever topics you choose (but you risk dedicating time and efforts to things that do not matter that much to your stakeholders). To develop the strategy, you need to define your KPIs (you can’t improve what you can’t measure), set goals for those KPIs, and push these goals down the organization. Finally, report your progress and ideally benchmark your results vs your peers so you can find the gaps for improvement.

Doing a materiality assessment itself is not trivial, but it should not be an expensive and complex process either. Companies must be careful that the right questions are asked so answers become useful and the overall exercise is helpful. It usually is wise to get help from ESG specialists (like Miranda ESG) to make this a simpler and smoother process.

Many companies in Mexico by now have “walked the walk” and established ESG teams and strategies. Some others have not even started. Since we believe eventually all companies will need to have at least a minimum ESG effort if they want to keep funding future growth in the public markets (be it debt or equity), we think it’s interesting to analyze where the different sectors in Mexico stand in terms of ESG strategy development. To do this, we will be sharing pretty simple sector heatmaps, based exclusively on information that is publicly available, to show the progress on 2 areas:

  1. ESG Strategy: we will measure if there is a formal ESG strategy developed (or in the process of being developed) and whether this strategy is aligned to global initiatives (such as the UN’s SDGs, TCFD, etc.).
  2. ESG Communication: we will measure how transparent is the communication regarding ESG and whether the company is reporting under recognized standards.

As the first heatmap of this series, we are looking at the Mexican FIBRAs (those who know me understand why… this sector is near and dear to my heart).

Five things we should read from this heatmap

  • We still see a lot of room for improvement (especially in the micro FIBRAs, which is understandable). We would expect this to change over the coming years as investors and even the AMEFIBRA have pushed for this improvement.
  • Not surprisingly, FIBRAs are pretty forthcoming with their corporate governance structure (since this topic has weighed so much on them for so long).
  • A third of the FIBRAs have gone through a materiality analysis and have generated sustainability or integrated reports.
  • No FIBRA has clearly defined goals for all their ESG KPIs (they don’t even have KPIs defined for all their material topics).
  • Only 3 FIBRAs report under GRI (1 more reports a GRI index alone) and 2 under SASB. For investors who want standardized data, this poses a big challenge.

As said before, we will be sharing over time more heatmaps for more industries in the Mexican market. There will likely be some industries that are more advanced in this than others (for structural reasons), but we would expect that initially there will still be a lot of room for improvement in this market. It is completely understandable. As more investors start with formal ESG integration processes, we believe companies will follow.

I hope you found this interesting. As usual, if there is anything we can help you with, please reach out.



Partner, Miranda ESG

Contacts in Miranda Partners

Damian Fraser
Miranda Partners

Marimar Torreblanca
Miranda ESG