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The CCFV’s request for climate risks disclosure in Mexico

This week I am going to briefly discuss the request to public issuers regarding their disclosure of climate risks that was published by the Green Finance Advisory Council (CCFV for its acronym in Spanish) in Mexico.

But first, who is the CCFV in Mexico? According to Mexico’s Central Bank (Banxico), the CCFV is a an organism which represents the segment in Mexico’s financial sector which wants to promote both funding for projects and investment in assets which generate positive environmental impacts. It was created voluntarily in 2016 and to date it is presided by Afore XXI Banorte and Afore SURA. It has alliances with institutions as the BMV, BIVA, PRI, among others. Within its members, there are sectoral associations (like AMAFORE), insurance companies, investment banks, investment funds, retail banks, development banks, and even public issuers.


With this in mind, and to better understand the initiative I want to discuss, I had a conversation with Irving Vázquez, Head of ESG Integration in Afore SURA and coordinator of the CCFV’s working group focused on “Definitions and Taxonomies”, and who supported this request from its early stages.


Where did you get the idea to make this request to public companies?


From the need to have more information for our ESG integration processes, as well as to urge companies in which we invest to adopt a strategy that mitigates climate change as well as incorporate risks and opportunities that come from it. As an AFORE (pension fund), this is a fundamental topic for our investment processes as it is our responsibility to consider all the associated risks in our investments.


Why do it under the CCFV?


Trying to solve the problem, the first couple of questions were how do we reach companies? And what should we be asking? There is no consensus on the best methodology globally, but as we dug deeper we saw that SASB and TCFD would be better than other standards for our investment decisions.  Through the CCFV we have a great platform to build a consensus and invite investors to join the initiative. We believe this makes sense for all and we need to form a united front so that companies realize that reporting ESG information is important to their investors and the best way to do it is to use international standards.


What comes next after making this public request?


We are in the process of talking to different institutional investors associations so that they can distribute this request to their members and the members who want to join the movement can sign it. We already have several insurance companies and investment funds on board, and we hope to see this list grow bigger over the coming days. Ideally, we would like to have the biggest number of signatories possible by July 30th and then organize a virtual event where we can formally announce this institutional investor front to the financial market. Afterwards we will signatories to really commit to permeate these notions to their investment and risks teams and keep it front and center during their meetings with public companies. Otherwise it will be difficult to achieve a real change.


Anything else you would like to add?


This request is focused on climate change, but the international reporting standards which we are asking companies to adhere to also consider social and corporate governance factors, which should be considered in their sustainability strategy.  Furthermore, in the request we speak about the minimal characteristics for ESG information which is disclosed by issuers such as consistency and comparability, reliability (that information is audited or verified by an independent party), temporality (that ESG information covers the same periods that the financial information and that both are disclosed at the same time), balance (publish both risks and achievements, not only achievements), and that information is quantifiable or that both risks and opportunities are measured in monetary terms as much as possible.


It will be interesting to the see the reaction from both investors with exposure to Mexican public companies and the companies themselves to this initiative. I have always believed that investors are the best lever to generate a real change in companies given the power they have in the funding process. Hopefully this effort leads to more companies having better disclosure and with it a better chance for investors to measure both risks and opportunities of ESG factors, especially now that there are new dedicated ESG active funds in Mexico.


I hope you found this useful. 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