ESG Conference 2025: a conversation with Mariana Herrero

Sara Carnegie (SC): Mariana Herrero is a leading Mexican environmental lawyer. She holds extensive expertise on wildlife protection, waste regulation and environmental law, integrating insights from projects, litigation and M&A. As the first female partner at her firm, she champions diversity, equity and inclusion, having led the firm’s DE&I Committee and co-founded Abogadas MX to promote women in legal leadership. Mariana is widely recognised by Latin Lawyer and other international publications. She spoke at the IBA ESG Conference session ‘ESG: The Brussels Effect at a Crossroads’, focusing on EU directives’ impact in Latin America.

Thank you very much for agreeing to speak with us today, Mariana. It was interesting to hear your comments in the session just now, but we’d really like to just expand and hear about your thoughts on the rise of sustainability reporting and due diligence legislation and its extraterritorial reach. And we know that applies to the CSRD and the CSDDD and how that affects companies that are based in Mexico or Latin America and your thoughts on that, please.

Mariana Herrero (MH): Sure. And thank you for having me in this podcast. Obviously, we were keeping an eye on the EU and then realised that there was almost a tsunami of regulation that would have effects on Mexico and other Latin American countries, and the impact is clear. I mean it's not immediate but you can’t start complying with these complex regulations from one day to the other so it is I guess a bit of a relief that there's a slowdown in the EU regulations that will allow Latin American companies and Mexican companies to start working on preparing the information they need and to understand what they will need to comply in order to be able to keep trading with European companies, which is the main risk, right? They need to become or stay relevant in the market and they will not be able to stay relevant in the market if they want to trade with Europe without being aware of the regulations and start changing things in their companies to comply.

SC: Will that mean, am I right in thinking, that you’ll end up having to essentially serve two masters because you’ll have a different set of regulations required for working with particularly the US and then a whole raft of additional issues to deal with in terms of working with the EU and entities within the European Union?

MH: Yes, true. And not also in the US, but local regulations, like this time has allowed governments in different Latin American countries to issue their own regulation. Like, for example, in Mexico, we have a new regulation that applies both to public entities and to private entities. And yes, public entities will have to follow IFRS, which is already a bit more known. But for private entities, it's a completely new specific Mexican standard. So it's a new set of regulations that now companies will need to understand. And obviously it's a watered down version of, I guess, a mix of other reporting guidelines, but still different and they still need to figure out how to match the global reports they have to now a new local one that needs to refer to the specific Mexican entity operating in the country.

Emily Morison (EM): Mariana, you’ve practised across such a range of areas, from waste to wildlife protection. I’m interested in your reflections on the landscape of environmental law in Mexico and how you’re working with clients to embed sustainable and environmental practices within their organisations.

MH: The environmental framework in Mexico, the legal and institutional framework is very mature because it really started developing very strongly when we first signed NAFTA because it was a fair competition requirement that we had strong environmental regulation that wouldn’t allow for unfair competitive advantage to Mexican companies or companies operating in Mexico. So our regulation is robust. We’re still lacking some regulation in certain areas that are relevant now, like circular economy. We don’t have a circular economy law. We don’t have regulation on efficient use of raw materials, for example, but I think we have a good framework. I think, we have led the Latin American market in terms of developing environmental regulation. And in Mexico right now, the current president is a lot more aware of environmental issues, and I think that’s going to be good for the country. She has an environmental background, actually, and she’s a scientist, so she understands the environmental issues and she has a huge focus on water issues. Water is a huge problem in Mexico and so we will be seeing new regulations, especially on water. But still areas to develop, but a mature scenario, I would think.

EM: We haven't spoken much about water in the context of this conference, but it’s obviously so deeply linked with the climate change crisis that we’re facing. Do you have any reflections on how lawyers in your jurisdiction might be working with companies or government to improve water regulation?

MH: The problem is, in Mexico, a lot of the country is already under a water stress situation. So, that is one thing that companies need to be aware of if they are going to expand, for example. Try to find a place that has enough water for your operations. And we've seen a clear example now; Heineken has a big presence in Mexico, obviously and they’re based in the north of the country, but now they've just announced a new bottling facility in Yucatán, which is the southeast, which has plenty of water. As opposed to another company that wanted to establish their facility in the north of the country, very dry area, it’s a desert. And obviously the project was cancelled eventually by the government because it was not possible and they were forced to relocate after spending a lot of money in trying to develop a plant where there was no water.

EM: That's really interesting to hear such a practical example. How does that then play out with local sort of community needs for water access? Is that creating tensions?

MH: It does create tension. In Mexico, under the constitution, access to clean water is a human right. And then there’s also the recognition of indigenous communities to access resources. And then obviously you have the agricultural sector that uses 70 per cent plus of the total water in the country. They don’t pay for the water. They don’t pay water rights and there's a huge problem in terms of the efficiency and the technology they use for irrigation and then the regulatory burden is focused on the industrial users. But the industrial users are not the ones that are using most of the water, yet the focus of new regulation is still being on ‘punishing’ the industrial sector and the mining sector greatly, instead of doing a more comprehensive management allowing the agricultural sector to have access to technology, innovation, training etc. There is a new law to govern water coming soon, and the federal government, has agreed with private sector to recover millions and millions of cubic metres of water granted under concession. So we’ll see what’s going to happen, but it’s a huge topic at the moment and yes, it creates a lot of tension.

Also, for example, our agreements with the US to deliver water to them for the transboundary bodies of water, Rio Bravo and others, under certain agreements that we signed many, many, many years ago, we are forced to give them a certain volume of water from these points of water, and obviously, the communities in the area are angry because they feel like they're taking their water away.

EM: Thank you so much for speaking with us, Mariana.