IFRS S2 Scope 3 Transition Relief in Mexico: What It Means and Why You Should Start Now

IFRS S2 Scope 3 Transition Relief in Mexico: What It Means and Why You Should Start Now

Mexico's CNBV adopted IFRS S2's transition relief for Scope 3 emissions: companies are not required to report Scope 3 GHG emissions for their first year of compliance (FY2025). Scope 3 reporting becomes mandatory starting FY2026, with those disclosures filed in 2027. However, 75% of Mexican companies currently don't measure Scope 3 at all — and building that capability takes 12-18 months. Companies that haven't started their Scope 3 program today will not be able to report it accurately in 2027, the same year limited assurance begins.

What Is the Scope 3 Transition Relief?

IFRS S2 includes several transition reliefs to help companies build capacity gradually:

For Mexican listed companies, "year 1" means FY2025 (data from January–December 2025), with the report filed in 2026. Starting FY2026, Scope 3 is no longer exempt.

What Is Scope 3 and Why Is It Difficult?

Scope 3 covers all indirect GHG emissions in a company's value chain — everything that happens outside your direct operations or energy purchases. The GHG Protocol defines 15 Scope 3 categories.

Upstream categories (supply chain):

1. Purchased goods and services (often the largest category for manufacturers)

2. Capital goods

3. Fuel and energy-related activities (not in Scope 1/2)

4. Upstream transportation and distribution

5. Waste generated in operations

6. Business travel

7. Employee commuting

8. Upstream leased assets

Downstream categories:

1. Downstream transportation and distribution

2. Processing of sold products

3. Use of sold products (often largest for automotive, appliance, electronics)

4. End-of-life treatment of sold products

5. Downstream leased assets

6. Franchises

7. Investments

Why it's difficult:

• Data comes from hundreds or thousands of external parties (suppliers, logistics, customers)

• Emission factors vary by geography, energy mix, and product

• No single system owns all the data

• Suppliers may not track or share their emissions data

The Timeline Problem — Why Relief Doesn't Mean "Wait"

The 2027 limited assurance requirement is the critical constraint. For Scope 3 to survive an external assurance review in 2027, you need:

• At least 12 months of data collection and refinement (2026)

• Documented methodology and data governance

• Supplier engagement that takes time to build

Companies that start their Scope 3 program in January 2026 will have 12 months of data collection before the assurance review, no opportunity to refine the methodology before external scrutiny, and no baseline year comparison. Companies that start in early 2025 will have 2+ years of data, refined processes, and a validated methodology before assurance begins.

Priority Scope 3 Categories for Mexican Companies by Sector

Rather than tackling all 15 categories at once, focus on material categories first:

How to Build Your Scope 3 Program — Practical Steps

Phase 1: Screening and materiality (2-3 months)

• Map all 15 categories against your business model

• Estimate relative magnitude using spend-based proxies

• Identify the 3-5 categories that represent >80% of your Scope 3 footprint

• Prioritize those for detailed measurement

Phase 2: Data collection infrastructure (3-6 months)

• Integrate ERP, procurement, and logistics data for upstream categories

• Deploy supplier engagement program (questionnaires, data portals)

• Connect product lifecycle data for downstream categories

Phase 3: Calculation and verification (3-6 months)

• Apply activity data x emission factors

• Document methodology for each category

• Internal review and validation

Phase 4: Disclosure-ready (ongoing)

• Annual data collection cycle

• Progressive improvement in data quality

• Prepare for assurance by documenting everything

What If You Can't Report Scope 3 by FY2026?

If a company cannot report all Scope 3 categories in FY2026, IFRS S2 allows for explanation:

• Disclose which categories are excluded and why

• Provide a timeline for when those categories will be included

• Explain the methodology being developed

However, complete absence of Scope 3 in FY2026 without explanation would be a compliance gap. Regulatory scrutiny and investor pressure will increase rapidly after the first mandatory reporting cycle.

The NIS B-1 Scope 3 Relief — Same Timeline

NIS B-1 (applying to all NIF companies, not just listed) also granted a Scope 3 transition relief through FY2026. The same logic applies: start measuring now to be ready for FY2026 reporting. Limited assurance isn't required for NIS B-1 yet, but voluntary assurance is emerging as a market expectation.

Frequently Asked Questions

Does the Scope 3 transition relief apply to NIS B-1 companies too?

Yes. CINIF's NIS B-1 also granted a transition period for Scope 3 through the end of 2026. The first mandatory Scope 3 disclosure under NIS B-1 covers FY2026 data.

Which Scope 3 categories are companies most likely to omit?

Category 15 (investments) for financial institutions, Category 11 (use of sold products) for complex manufacturers, and Category 3 (fuel and energy related activities) are commonly excluded initially due to data complexity.

Can we use spend-based emission factors for Scope 3?

Yes, spend-based methods are acceptable for categories where primary supplier data isn't available. They're less accurate but sufficient for initial reporting. Progress to activity-based methods for material categories is expected over time.

How does Scope 3 interact with science-based targets (SBTi)?

If you set an SBTi target, Scope 3 must be included in the target boundary if it represents more than 40% of your total Scope 1+2+3 emissions. IFRS S2 requires disclosure of climate-related targets including any SBTi commitments.

Climatta helps Mexican companies build their Scope 3 data collection program from the ground up — connecting procurement, supplier portals, and logistics data to give you audit-ready value chain emissions. Request a demo.