IFRS S1 and S2 in Mexico: Complete Guide for Companies in 2026

IFRS S1 (General Requirements for Disclosure of Sustainability-related Financial Information) and IFRS S2 (Climate-related Disclosures) are mandatory for all companies listed on the Mexican Stock Exchange (BMV) and BIVA starting with fiscal year 2025, with the first report due in 2026. Mexico became the first country in North America to make ISSB standards mandatory, following the CNBV's amendment to the Circular Única de Emisoras on January 29, 2025.

What Are IFRS S1 and S2?

IFRS S1 establishes general requirements for disclosing sustainability-related financial information. It requires companies to disclose material information about sustainability-related risks and opportunities that could affect their cash flows, access to finance, or cost of capital.

IFRS S2 specifically addresses climate-related disclosures, built on the four pillars of the TCFD (Task Force on Climate-related Financial Disclosures):

Who Must Comply in Mexico?

Mexico's CNBV mandate covers approximately 86% of the IPC's market capitalization.

Key Deadlines and Timeline

Critical insight: The 2027 limited assurance deadline means your data needs to be audit-ready today. Manual Excel-based processes will not survive an external review.

The Four Pillars of IFRS S2 Explained

1. Governance

Disclose how the board and management oversee climate-related risks and opportunities. Required disclosures include:

• Board committees responsible for climate oversight

• Management's role in assessing and managing climate risks

• How climate is integrated into executive compensation (if applicable)

2. Strategy

Explain how climate-related risks and opportunities affect your business model, strategy, and financial planning. This includes:

• Short, medium, and long-term climate risks identified

• Impact on financial position, performance, and cash flows

• Transition plan and capital allocation for climate strategy

• Climate scenario analysis — at least two scenarios, including a 1.5°C or 2°C scenario

3. Risk Management

Describe the processes for identifying, assessing, prioritizing, and monitoring climate-related risks:

• Physical risks (floods, droughts, extreme heat) affecting Mexican operations

• Transition risks (carbon pricing, regulatory changes, stranded assets)

• How climate risk is integrated into overall enterprise risk management

4. Metrics and Targets

Report quantitative data on climate performance:

• Scope 1 GHG emissions (direct)

• Scope 2 GHG emissions (purchased energy)

• Scope 3 GHG emissions (value chain) — transition relief available through 2026

• Vulnerability to climate-related physical risks

• Climate-related targets and progress

Scope 3 Transition Relief — What It Means

IFRS S2 includes a one-year transition relief for Scope 3 emissions, extended in Mexico's CNBV mandate through 2026. However:

• Companies must disclose Scope 1 and 2 from year one (FY2025)

• Scope 3 must be included starting FY2026 (reported 2027)

• If you exclude Scope 3, you must explain why and when you will include it

The challenge: 75% of Mexican companies don't currently measure Scope 3. Building that capability takes 12-18 months minimum.

IFRS S2 vs GRI vs TCFD — Key Differences

Companies listed on BMV/BIVA must comply with both IFRS S1/S2 AND NIS A-1/B-1.

The Biggest Challenges for Mexican Companies

1. Data collection at scale: Companies with multiple subsidiaries, plants, and suppliers need automated systems to collect GHG data reliably.

2. Scope 3 complexity: 15 categories across the value chain, requiring data from hundreds of suppliers.

3. Audit readiness: Every data point must have documented methodology, source, and traceability.

4. Climate scenario analysis: A new capability most companies have never built.

5. Internal expertise: Few sustainability teams have both financial reporting and climate science expertise.

How to Prepare — 6 Steps for the 2026 Report

1. Assess your current state: What data do you already collect? Where are the gaps?

2. Map your emission sources: Scope 1, 2, and priority Scope 3 categories

3. Implement data collection systems: Connect ERPs, utility data, supplier portals

4. Conduct climate scenario analysis: Physical and transition risks under at least 2 scenarios

5. Complete materiality assessment (IFRS S1): Which sustainability topics are financially material?

6. Prepare the report: Draft, internal review, external assurance readiness

Frequently Asked Questions about IFRS S1/S2 in Mexico

Is IFRS S2 the same as the TCFD framework?

IFRS S2 is built on the TCFD's four-pillar structure but is more prescriptive and legally mandatory for BMV/BIVA issuers. TCFD was a voluntary framework; IFRS S2 has regulatory force in Mexico.

Do private companies in Mexico need to comply with IFRS S1/S2?

Not directly. IFRS S1/S2 applies to public companies listed on BMV or BIVA. However, all companies reporting under Mexican GAAP (NIF) must comply with NIS A-1 and NIS B-1 (CINIF standards), which require similar disclosures.

What happens if a listed company doesn't file its sustainability report?

The CNBV can impose sanctions under the Ley del Mercado de Valores. Beyond regulatory risk, non-disclosure signals poor governance to institutional investors and ESG rating agencies like MSCI and Sustainalytics.

What is the difference between limited and reasonable assurance for IFRS S2?

Limited assurance (required 2027) provides a moderate level of confidence that disclosures are free from material misstatement. Reasonable assurance (2028) is the same level as a financial audit — much stricter. This distinction determines what level of data infrastructure you need today.

Can we use our existing GRI report to comply with IFRS S2?

Partially. GRI uses double materiality (financial and impact), while IFRS S2 focuses on financial materiality. You'll need to supplement a GRI report with investor-focused disclosures, climate scenario analysis, and audit-ready data trails.

Get Audit-Ready for Your 2026 CNBV Report

Climatta automates GHG data collection across your subsidiaries and value chain — giving you audit-ready Scope 1, 2, and 3 data for your 2026 CNBV report. Request a demo to see how we can help your team comply with IFRS S1/S2 before the deadline.