In 2025, Mexico became the first country in North America to fully mandate ISSB-aligned sustainability disclosure standards. The IFRS S1 and S2 requirements are now part of the country’s general securities provisions, known as CUE, and apply to issuers of equity, debt, and other securities that are supervised by Mexico’s National Banking and Securities Commission (CNBV), with reporting starting in 2026 based on 2025 data.
With its adoption of mandatory standards aligned with the International Sustainability Standards Board (ISSB), Mexico has placed itself decisively at the forefront of climate disclosure in North America. It joins a growing group of jurisdictions globally that are coalescing around ISSB’s common reporting framework and language, with the goal of increasing transparency about the financial risks companies face as a result of climate change and sustainability issues.
In this article, we’ll do a deep dive into Mexico’s ISSB standards: What they require, why they were adopted, and how companies can prepare for reporting.
Background: What are the ISSB Standards?
Two standards, IFRS S1 and IFRS S2, were designed to create a global baseline for climate disclosure.
In 2021, the International Sustainability Standards Board (ISSB) issued two standards aimed at converging fragmented sustainability disclosure guidance and creating a global baseline for reporting: General Requirements for Disclosure of Sustainability-related Financial Information (IFRS S1) and Climate-related Disclosures (IFRS S2). To date, more than 30 jurisdictions around the world have partially or fully incorporated the ISSB standards into their regulations.
The ISSB built the standards on the foundation created by the Task Force on Climate-Related Financial Disclosures (TCFD), which has shaped climate reporting practices and regulations over the past decade. IFRS S1 and S2 draw on other well-known frameworks, including those from the Climate Disclosure Standards Board (CDSB) and the Sustainability Accounting Standards Board (SASB). They also provide options for companies to integrate disclosures based on the European Sustainability Reporting Standards (ESRSs) and the Global Reporting Initiative (GRI), as long as those disclosures are designed to meet investor needs.
The ISSB is an independent standard setter—it does not impose requirements on any jurisdiction or company. Its standards are designed to serve the markets and to provide a structure for consistent and comparable regulations across borders. However, a growing number of jurisdictions, including Mexico, are incorporating IFRS S1 and S2 into their mandatory financial reporting regulations.
Why did Mexico adopt the ISSB standards?
Alignment establishes a baseline to help companies meet global expectations.
Mexico’s implementation of ISSB requirements is part of a global trend. In the face of increasing investor demand for consistent, decision-useful sustainability information, countries around the world are adopting voluntary and mandatory ISSB-aligned reporting standards. There are several forces behind Mexico’s adoption of IFRS S1 and IFRS S2:
- Enhanced transparency and global capital access. Investors increasingly expect reliable, transparent, comparable sustainability information. IFRS S1 and S2 offer a global baseline for comparability, and adoption of the standards helps Mexican companies compete for global investment.
- Maturing sustainability reporting expectations. Mexico’s adoption of ISSB standards reflects a worldwide evolution away from narrative, generalized ESG reporting towards structured, data-backed sustainability risk disclosures linked to financial reports.
- National transition strategy. Mexico has committed to reaching net zero by 2050, with deep emissions cuts by 2035. The identification, management, and disclosure of corporate climate risks and opportunities play a critical role in meeting decarbonization goals.
- Aiming for minimal divergence from the global baseline. By fully adopting IFRS S1 and S2, Mexico reduces complexity for companies that operate internationally or report across multiple jurisdictions. Adherence to the global baseline also prevents Mexico from becoming an outlier with unique disclosure rules that investors have to learn.
What do Mexico’s sustainability standards require?
Companies must file annual sustainability reports.
In January 2025, Mexico’s National Banking and Securities Commission (CNBV) published modifications to its general securities provisions (known as Circular Unica de Emisoras, or CUE), stating that securities issuers must disclose sustainability-related financial information in accordance with ISSB standards.
Companies subject to the CUE provisions need to file separate annual ISSB-aligned sustainability reports in addition to their financial statements, starting in 2026. Assurance requirements will be phased in over time, with no assurance required in 2026, moving to limited assurance in 2027, then reasonable assurance in 2028.
What does it mean to apply IFRS S1 and S2?
Mexico has fully incorporated IFRS S1 and IFRS S2, which means issuers subject to the regulations need to include the following information in their annual sustainability reports:
IFRS S1 (General Requirements)
- Governance over sustainability-related risks and opportunities
- Strategy and how sustainability issues affect business model, strategy, and decision-making
- Risk management processes for identifying, assessing, and managing sustainability-related risks
- Metrics and targets used to monitor and manage sustainability-related risks and opportunities
- Stronger emphasis on financial materiality and connectivity to financial statements and enterprise planning
IFRS S2 (Climate-related Disclosures)
- Climate-specific governance, strategy, risk management, and metrics/targets
- Climate-related risks and opportunities (transition and physical)
- Emissions (Scope 1, 2, and 3)
- Targets, transition plans, and performance against those goals
- Scenario analysis and climate resilience (where applicable)
Who is subject to Mexico’s sustainability standards?
Domestic and foreign issuers must comply, but financial institutions are currently exempt.
Mexico’s sustainability reporting requirements apply to issuers of equity, debt, and other securities that are supervised by the National Banking and Securities Commission (CNBV), representing an estimated 86% of the market capitalization of Mexico’s main equity index.
The regulation also applies to foreign issuers, who have the option to comply with their own country’s standards as long as they provide documentation showing the equivalence of their jurisdiction’s framework with IFRS S1 and S2.
While financial institutions are not yet subject to the ISSB provisions, banking and securities regulators are in the process of determining how to establish equivalent disclosure requirements for financial institutions.
Entities without public accountability are not subject to the CUE regulations. However, Mexico’s national standard setter, CINIF, has published two separate sustainability information standards for private companies. NIS A-1 and NIS B-1, which incorporate key elements from ISSB, apply to non-public interest entities that issue financial statements in accordance with Mexico’s Financial Information Standards (NIF).
What is the timeline for disclosure?
Reports are due in 2026 based on 2025 data.
Mexico’s ISSB regulations took effect on January 29, 2025. They require all issuers (other than financial institutions, states, and municipalities) to produce sustainability-related financial disclosures beginning in 2026, using data from the 2025 fiscal year. Assurance requirements will be phased in, with no assurance required in the first year. In the second year, companies will have to secure limited assurance, followed by reasonable assurance in the third year and beyond.
How can companies prepare for ISSB reporting in Mexico?
A strong data management foundation will streamline disclosure.
If you’re subject to Mexico’s ISSB requirements, you’ll need to publish your first disclosure in 2026, and obtain limited assurance in 2027. You can follow the steps below to streamline the process and build confidence in your reporting.
1. Conduct a gap analysis
Start by conducting a structured gap assessment. Identify any annual reports, CDP reports, or other documents where you’ve already disclosed sustainability-related risks and opportunities, then map information to the IFRS S1 and S2 requirements. Document inconsistencies and areas where measurable data is still needed, especially in emissions reporting.
2. Build a foundation for reliable, robust data management
To meet Mexico’s new high bar for data accuracy and transparency, you’ll need to design strong data management processes. Start by establishing clear data ownership across teams (e.g., sustainability, procurement, finance, HR). Select data management software and tools to support accurate, efficient reporting. Review your emissions calculation methodologies for consistency.
3. Integrate climate risk into strategy and planning
Identify climate-related risks and opportunities that could reasonably affect your financial performance, position, or future prospects. Align your risk assessments with existing enterprise risk management and financial planning processes.
4. Establish governance, controls, and documentation
With the adoption of ISSB standards, sustainability information is under heightened scrutiny, and assurance requirements kick in next year. It’s important to begin formalizing internal controls. Start by clearly defining roles and responsibilities for data collection, review, and approval. Document the methodologies used for emissions calculations and prepare for auditing (in Mexico, limited assurance is required starting in 2027, evolving to reasonable assurance in 2028 and beyond).
5. Develop a plan for improving data quality
Create a multi-year roadmap that gradually builds the quality and scope of data. Your roadmap should prioritize high-impact disclosure areas first (e.g., emissions, governance, material climate risks) and prepare you for rapidly evolving regulatory guidance and investor demands.
Preparing for ISSB-aligned climate disclosure in Mexico
With the adoption of mandatory ISSB standards, Mexico has placed itself at the leading edge of climate disclosure in North America. Companies subject to Mexico’s requirements begin reporting in 2026, using information from 2025. By establishing reliable systems for data collection and calculation from the start, businesses in Mexico can smooth the transition to mandatory reporting, respond to stakeholder expectations, and lay the groundwork for compliance with future regulations.
Learn more about how Persefoni can help you prepare for climate disclosure in Mexico.
FAQs
Which ISSB Standards does Mexico’s framework adopt?
IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information, and IFRS S2 Climate-related Disclosures and all future ISSB Standards.
What information do companies have to disclose?
In-scope entities must report on sustainability-related risks and opportunities that could reasonably be expected to affect cash flows, access to finance, or the cost of capital over the short, medium, or long term.
How does Mexico intend to use the information that’s disclosed?
The information included in disclosures is intended for existing and potential investors, lenders, and other creditors.
Does Mexico require sustainability-related disclosures as part of general-purpose financial reports?
Under the law, organizations must include the information outlined in IFRS S1 and IFRS S2 as part of a separate annual sustainability report. Companies must publish their sustainability disclosures at the same time as related financial statements (subject to transition relief for the first reporting period).
Do the standards apply to foreign companies?
All foreign issuers must disclose in accordance with the ISSB standards or the applicable standards from their home jurisdiction. If they choose to follow their home standards, their disclosure must explain the interoperability or equivalence of the standards with ISSB.
Do financial institutions have to disclose in accordance with ISSB?
Financial institutions are not yet subject to the standards, but Mexico’s banking and securities regulators are in the process of evaluating how to establish equivalent requirements for financial institutions.
Are private companies subject to Mexico’s sustainability standards?
No, the ISSB standards in the CUE apply only to entities with public accountability. However, the Consejo Mexicano de Normas de Información Financiera (CINIF) published a set of local standards known as NIS A-1 and NIS B-1, which apply to non-public interest entities that issue financial statements in accordance with the Financial Information Standards (NIF).
