Bolsa Mexicana de Valores: Driving Sustainable Finance

The impact of climate change is one of the greatest challenges facing humanity. Without immediate action, it will significantly alter life for large parts of the planet and hinder socioeconomic development. The transition to a low-carbon economy requires efforts from governments, companies across all sectors, investors and key stakeholders to foster adaptation and resilience in a rapidly changing environment. 

Acknowledging our position as a stock exchange in allocating capital toward sustainable investments that contribute to climate mitigation and adaptation, Grupo Bolsa Mexicana de Valores (BMV) has developed a strategy focused on three key areas: 

1. Facilitating financing to achieve environmental goals 
2. Promoting transparency in environmental risk management  
3. Strengthening ESG capabilities to identify environmental opportunities and risks 

Facilitating Sustainable Finance 

After the Paris Agreement, in 2016, Mexico’s development bank issued the first green bond as a decisive step to channel resources toward renewable energy infrastructure. This issuance funded the development of nine wind farms across Mexico, which continue to generate renewable energy and provide positive regional impacts. 

Eight years have passed since that issuance, and Mexico has seen increasing interest in financing projects that reduce emissions and promote the transition to clean energy. By September 2024, Grupo BMV had issued 115 labeled bonds, totaling 378 billion pesos, with the following key results: 

• 90 percent of the bonds are linked to environmental projects or indicators. 
• The main projects include infrastructure development, biodiversity conservation, sustainable water management, renewable energy, energy efficiency and clean transportation. 
• Key sustainability indicators for the bonds include carbon emissions reduction (supporting the transition to Net Zero), waste management and environmental certifications. 

In 2020, ESG debt at BMV Group reached 12 percent of outstanding total debt, compared to 2 percent in 2019. Since then, demand has increased steadily. By the end of Q3 2024, ESG debt represented 32 percent of the total long-term debt issued through the exchange. 

In addition to labeled bonds, we have developed sustainable indices that attract capital toward companies with strong environmental performance, fostering the transition to more sustainable business models. We currently offer three indices: 

• S&P/BMV Total Mexico ESG Index
• S&P/BMV IPC ESG Tilted
• S&P/BMV CompMx Rentable ESG Tilted. 

One of these indices is linked to an investment vehicle: the MEXTRAC ETF. 

We also operate an environmental markets platform (MéxiCO2), which promotes voluntary and regulated carbon markets, creating a connection between certified companies and projects to support the transition to carbon neutrality.  

Promoting Transparency in Environmental Risk Management and Strengthening ESG Capabilities 

Companies that disclose information in a standardised  and comparable manner over time enable better understanding of climate risks and opportunities and  facilitate investor decision-making. At Grupo BMV, we are committed to providing the right environment for the growth of the ESG market in Mexico, aligned with best practices as well as local and global disclosure frameworks. 

With the creation of the International Sustainability Standards Board (ISSB) and the introduction of IFRS S1 and S2 Standards, we have served as a bridge between issuers and the CNBV (National Banking and Securities Commission) to ensure optimal adoption. We participate in working groups and offer workshops and conferences with experts to help companies understand the implications of these new standards. 

In collaboration with the Mexican Council of Financial and Sustainability Reporting Standards, we also promote the NIS A-1 and B-1 standards. From January 2025, companies following Mexican financial standards will include 30 qualitative and quantitative indicators in their financial statements; over half of them focused on environmental issues. This marks a milestone in Mexico by enhancing certainty and traceability, paving the way for increased investment and financing opportunities. 

Based on the previous points, enhancing environmental capabilities becomes increasingly significant. To address this, we have launched various initiatives available to the market, including: 

• Sustainability Guide for Listed Companies 
• Carbon Neutrality Guide 
• Sustainable Support Program: A diploma in sustainability led by experts, available to listed companies and their supply chains 
• Carbon Markets Diploma: Led by MéxiCO2 in Mexico and Latin America 
• Sustainable Finance Diploma: Taught by the Mexican Stock Exchange School 

In collaboration with the Sustainable Stock Exchanges (SSE) Initiative, we have helped create reference documents for other stock exchanges. 

Leading by Example 

We were one of six stock exchanges to initially join the Net Zero Financial Alliance. We have measured our carbon footprint since 2019. Furthermore, we achieved complete measurement across Scopes 1, 2, and 3 emissions in 2023. We have identified our climate risks and opportunities and report them in accordance with TCFD recommendations. We are developing a science-based emissions reduction strategy and setting targets accordingly. In 2024, we conducted a Double Materiality Analysis

Through these efforts, the Mexican Stock Exchange plays a crucial role in aligning capital markets with sustainable goals, driving green investments and strengthening financial resilience to address the challenges posed by climate change. We are confident that, by working towards a common goal, we will make significant progress towards a brighter future.