Mexico's Sustainable Taxonomy (TSM): What It Means for Your Company's Sustainability Reporting

Mexico's Sustainable Taxonomy (TSM) is the official system for classifying which economic activities count as sustainable, developed by the Ministry of Finance and Public Credit (SHCP) and published in its first edition in March 2023. It serves as the reference for sustainable finance, so it has direct implications for any company seeking green bonds, sustainable credit or sustainability-linked financing.

What makes the TSM different

Unlike other taxonomies focused solely on environmental criteria, the TSM integrates social objectives, such as gender equality, alongside climate mitigation and adaptation. It takes the structure of the EU taxonomy and the metrics of Colombia's taxonomy as references, which makes it easier for an exporting company or one with foreign investment to align its reporting across both frameworks without duplicating data work.

Objectives, sectors and activities

The SHCP document defines six environmental objectives (climate change mitigation, adaptation, management of water and marine resources, conservation of ecosystems and biodiversity, circular economy, and pollution prevention and control) and three social ones (gender equality, access to basic services related to sustainable cities, and health, education and financial inclusion). In this first stage it develops criteria for three of them: climate change mitigation and adaptation, gender equality and, as an annex still under construction, sustainable cities.

For the climate objectives it includes 124 eligible activities in six sectors, identified with the SCIAN 2018 classifier: agriculture, animal husbandry and forestry; generation, transmission and distribution of electricity and water supply; construction; manufacturing industries; transport; and waste management and remediation services. Gender equality is treated as an objective that cuts across the 20 sectors of the economy, through a gender index with three pillars: decent work, wellbeing and social inclusion.

How alignment is demonstrated

Each activity has technical screening criteria with four elements: a main parameter, substantial contribution measured with metrics and thresholds, do no significant harm criteria for the other objectives, and minimum safeguards on human rights, labour and governance. To claim alignment, a company must check, in that order, that its activity is on the list, that it meets the metrics and thresholds, that it satisfies do no significant harm and that it respects the safeguards. Once the four points are met, it can disclose the percentage of its sales, capital expenditure and operating expenditure aligned with the Taxonomy. For mitigation, the metrics revolve around the amount of CO2e emitted, the percentage reduction and emissions savings, in other words data that come straight out of a well-built carbon footprint inventory.

Its scope should be clear: the SHCP itself states that the Taxonomy is not a mandatory regulatory document and that its implementation and the disclosure of alignment are voluntary at this stage. It is an instrument on which investment strategies, thematic financial products, sustainable debt issuance frameworks and, where applicable, financial regulation can be built.

What this means for your company's reporting

• Access to sustainable finance: development banks and international funds ask for a recognised classification to assess whether a project qualifies as green or sustainable, and the TSM is the local reference for doing so. In January 2026 the SHCP itself updated its Sovereign Sustainable Finance Framework to incorporate the TSM for the first time, aligned with the 2025-2030 National Development Plan and with ICMA and LMA principles for green, social, blue and SDG-linked bonds.
• Consistency with other standards: the TSM does not replace frameworks such as IFRS S1 and S2, it complements them. A company already reporting under IFRS S1 and S2 has the data foundation it needs to align with the TSM as well.
• Verifiable evidence, not self-declaration: as with the rest of Mexico's regulatory ecosystem, starting with the General Law on Climate Change and the National Emissions Registry, what matters is being able to prove the data, not just report it. The do no significant harm criteria rely on legislation and standards in force, so complying with the COA, the RETC or the National Waters Law is part of the evidence.

The risk of not being ready

If your company plans to issue a sustainability-linked bond or seek green financing in the coming years, it needs carbon, water or waste footprint data that can be verified against criteria like the TSM's. Getting that data in order now, traceable by site or by project, is what separates a strong financing application from one that falls apart at the audit stage. The full picture of obligations and certifications is in the guide to environmental laws and certifications in Mexico.

Manglai centralises your company's carbon, water and waste footprint data in a format ready for reporting and audit. You can see it in Manglai's carbon footprint software.