Biva seeks to accelerate the adoption of ESG principles between public and private companies

through the Chief Sustainability Officer Acceleration Program (CSO), the Institutional Stock Exchange (BIVA) seeks to accelerate the integration of corporate sustainability among companies listed on the market as well as among private ones, explained Santiago Salinasdirector of Institutional Relations and Government and BIVA Institute.

In an interview, he explained that this is the first program of its kind in Mexico, and after concluding the first edition, the second generation was launched on September 23 with 45 participants.

“What we did was develop skills and tools for a sustainable corporate transition, so that employees can promote and execute these issues at the ‘management’ level and the board of directors,” said the manager.

This role did not exist in Mexico with these capabilities and tools, many of the environmental, social and governance issues did not have a unified vision in most companies.

Santiago Salinas spoke about the results of the first call for the CSO Program. There were 38 participants from 25 different institutions, such as Alsea Group, Televisa, Volaris, VivaAerobus y FIRA (Trusts Instituted in Relation to Agriculture).

After having taken this acceleration program, 8 companies are already working on structuring a thematic bond. Two of them are about to be launched on the market.

In addition, two other companies incorporated the new role of Chief Sustainability Officer in their respective boards.

One of the objectives is also to trigger the thematic bond issuance market (focused on financing projects under an environmental, social and governance -ESG- scheme).

“The relevance of creating this program is also because Mexican companies have many capacities to reach the market, obtain successful structures and financing under an ESG approach,” Santiago Salinas pointed out.

Then he referred to the results of a survey conducted last year by BlackRockone of the largest asset managers in the world, which indicated that 92% of institutional investors seek that the investments they make have a positive impact and, in addition, 425 investment funds plan to double their exposure to ESG initiatives in the coming years. next five years.

He even assured that through Biva more than 50 billion pesos have been financed with the placement of sustainable instruments (such as green, sustainable social and sustainability-linked bonds). In the last year alone, around 50% of the issues listed on the Institutional Stock Exchange correspond to this type of offering.

“We have seen that the amounts placed in labeled bonds have increased up to seven times since 2015 in the local debt market and only last year we had a growth of 170% compared to 2020. We see that there is a growing opportunity on the side of investors to find these companies and these instruments to such a degree that the excess demand that exists is on average 2.7 times the total amount issued by the companies and we have seen cases where the excess demand reaches 6 times the total amount,” he said.

However, he acknowledged that in order to avoid the so-called greenwashing or “greenwashing” (when companies claim that a project is sustainable, but it is not) reporting information can help mitigate it.

Satiago Salinas said that instruments such as bonds linked to sustainability impose penalties in case companies do not meet their goals or KPIs proposed within their framework of action. “Depending on their compliance, the interest rate for issuers is reduced or increased,” he pointed out.

The Chief Sustainability Officer Acceleration Program has the support of 40 allies, including institutional investors, multilateral development banks, brokerage houses, rating agencies, public and private companies.

The duration of the program is 60 hours and is divided into five modules focused on how companies can develop an ESG strategy; how to measure, report and identify the most ideal instrument to raise sustainable capital.

The goal is to launch the call twice a year, said the director of Institutional Relations and Government and BIVA Institute.