Sustainable investing has become an increasingly important consideration for investors in recent years. In response, many countries are developing their frameworks for sustainable taxonomy to identify economic activities that positively impact the environment and society.
What’s sustainable taxonomy?
Sustainable taxonomy is an essential topic in the financial industry, and more and more countries are adopting their versions. In this article, we will provide information on sustainable taxonomy in Mexico.
Sustainable taxonomy is a classification system that identifies and defines sustainable economic activities. This is important for investors who are looking to invest in projects that have a positive impact on the environment and society. In addition, sustainable taxonomy allows investors and regulators to identify what activities are considered sustainable and which are not, helping to reduce the possibility of greenwashing or eco-deception.
Sustainable Taxonomy in Mexico
In Mexico, sustainable taxonomy is in its early stages of development. However, in 2020, the Ministry of Environment and Natural Resources (SEMARNAT) published a proposal for the taxonomy of the country based on the European Union’s Taxonomy and the guidelines of the United Nations Environment Programme Finance Initiative (UNEP FI).
The proposed taxonomy in Mexico includes six environmental objectives: mitigation and adaptation to climate change, sustainable use and protection of water and oceans, transition to a circular economy, prevention and control of pollution, conservation and restoration of biodiversity and ecosystems, and sustainable use and protection of soil.
In addition, the Mexican taxonomy proposal also includes social and governance criteria, such as the protection and promotion of human rights and gender equity, as well as the rise of responsible business management.
The Future of Sustainable Taxonomy
Once sustainable taxonomy is implemented in Mexico, investors and regulators can more clearly identify which economic activities are sustainable and which are not. This could also drive the development of sustainable projects in the country and improve companies’ transparency and disclosure of environmental and social information.