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Perspectives: Navigating sustainable infrastructure transition with Grupo Mexico
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Irma Potes, Director of Community Outreach, Grupo Mexico, Paulina Serrano, Deputy Director of Sustainability, Grupo Mexico, joins Natalie Blyth, Global Head of Sustainable Finance & Transition, HSBC and Jose Carlos Sanchez, Mexico Chief Economist, HSBC Global Investment Research, to discuss Grupo Mexico's innovative approach to sustainability transition as well as their impact on communities and the environment.
This episode was recorded on 16 October 2025.
Disclaimer: Views of external guest speakers do not represent those of HSBC.
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Transcript
Podcast Introduction
00:00:00
Speaker
Welcome to HSBC Global Viewpoint, the podcast series that brings together business leaders and industry experts to explore the latest global insights, trends, and opportunities.
00:00:12
Speaker
Make sure you're subscribed to stay up to date with new episodes. Thanks for listening, and now onto to today's show.
00:00:20
Speaker
Hi, everyone. Thank you so much for joining us.
Guest Introductions and Sustainability Focus
00:00:24
Speaker
This time we are in conversation with Grupo México. We are delighted to have Irma Potes and Paulina Serrano from Grupo México. And we are also pleased to have Natalie Bleeth from HSBC.
00:00:38
Speaker
ah This time, we decided to take a deep dive into Grupo Mexico's sustainability actions over the last few months and what could be plans for the next few months.
00:00:49
Speaker
ah Thank you so much, Irma. Thank you so much, Paulina. ah Why don't we kick off ah introducing yourselves? What are your roles at Grupo Mexico and what have been the main actions you have been taking at the company over the last few months?
00:01:06
Speaker
I'm Paulina Serrano. I'm the Sustainability Deputy Director. I have been five years in the company, and my area is in charge of ah integrating all the sustainability strategy and the climate change strategy within the company.
00:01:24
Speaker
Thank you. Thank you so much, Natalie. Thank you so much, Jose Carlos, for having us. And thank you, HPC, for this incredible initiative on providing visibility and sustainable practices for companies, especially for sectors like mining. My name is Irma Potes, and I'm the Director of Community Development for Grupo Mexico. And I oversee more than 30 communities that are all over the sites that we operate, our mining and infrastructure divisions.
00:01:53
Speaker
And I've been 18 years in the company now. It's a lot. Next year, almost 19. So very pleased to be here. Thank you, Airam. Nathalie?
00:02:03
Speaker
Yeah, Natalie Blythe, Global Head of Sustainable Finance and Transition at HSBC. I've also been at HSBC 18 years, um but a banker for 32 years. And the last sort of five have been really focused on sustainability, developing our strategy and indeed
Grupo Mexico's Community and Sustainability Efforts
00:02:22
Speaker
delivering our strategy. Thank you so much. ah Why don't we start talking about this focus that you have on community development, because that was a driver of the award you had last year.
00:02:35
Speaker
Why don't you tell us what has been happening from 12 months ago until today in that specific area, what progress you have been making and what continuity has been on on that front? Yes, we were awarded last year in and we prioritize community development in mining. And that is because our industry, we find the metals where they are on earth. So we don't decide where to put a plant. So the metals are driving us where we should start digging and in in having the metals.
00:03:07
Speaker
And therefore, we need to build communities around them. So we need to take people there so they can work on the mines and therefore they have children and in families and and we need to provide for all the services and start making the communities.
00:03:22
Speaker
So it is very important that even we start a new community. around the mine or we are being hosted by a community that is already there near the mine, we need to specially provide all the things that make that community thrive as we want thrive in our business. No business can thrive if their communities or the people around them are not thriving as well.
00:03:50
Speaker
But that that also entails and in in takes into account all the environmental aspects, because every environmental aspect will it is not well taken or or impacts in in different times will impact the social part of it.
00:04:08
Speaker
So what's new over the last 12 months and what we have been working about? Well, I'll talk in three levels. One is our social programs.
00:04:21
Speaker
We have different social programs such as cultural and and sports programs. And we started them so many years ago. But we, this year, the last 12 months, have been being very professional with this program. So what we've been been doing is to choose the best people in those communities to be awarded and to push them to have scholarships in the best universities or places in the world that they can pursue and aspirational for the rest of the people that are coming you know behind. The other aspect that we have been in that we have been improving It's the everything about suppliers, as small suppliers in the supply chain. we
00:05:01
Speaker
By nature, we develop so small suppliers in the communities that we operate. But right now, we have a very well-put and very organized program so we can develop those small suppliers in the communities. And we are very proud of what they're doing Because these people from the communities have never maybe dreamed of providing such a big companies like Grupo and to get into all this training and in having their companies you know grow and their families grow as well. So we are very proud of this small supplier program, which is ah taken care by Grupo Mexico.
00:05:42
Speaker
And the third thing that i will say that is important for us is we are trying to measure and focus more accurately the social license to operate.
00:05:53
Speaker
And we develop our our own internal index to measure that. And that takes into account the socioeconomic context of each community, Also, the stake the any stakeholder or workforce engagement that we have, the perception the perception of the company, and any grievance ah or complaint that we have. So all that mixed and and together in an index, we have now a very professional measure and that implies also the qualitative part of business.
00:06:29
Speaker
interacting with communities, but also the numeric part, so we can we know now where do we have to enhance to get a more accurate social license to operate.
00:06:39
Speaker
So those three things, I will say in a nutshell, that's what we have been working on.
HSBC's Role in Energy and Supply Chain
00:06:44
Speaker
No, thank you so much and congratulations. I think it's very, yeah it's great to hear that these actions are having a social impact. Probably now it's a good transition to to know a bit more of how HSBC is ah supporting clients in some specific thing. For example, energy security, new economy innovations, ah supply chain resilience,
00:07:11
Speaker
What kind of actions the the bank is taking for supporting clients on these three parts? So it is um it's a pretty exciting time to be in my role. So we have just, through the bank, developed and had approved right at the board a pretty bold and ambitious new strategy which covers sustainability, transition, and indeed, obviously, infrastructure. And the three levers that we've got now are I think, really key.
00:07:39
Speaker
So the first one is we want to be a leading bank for those fast growing ecosystems for the transition. And there are three of them in particular. You talked about energy security. So clean energy, the electrification of transport and indeed data centers and AI.
00:07:56
Speaker
But that the energy component of that, what we see around our clients is they vary on a triangulation of three things, security, pricing, and the the sort of the cleanliness of the energy. So they want clean energy. Mm-hmm.
00:08:11
Speaker
um So that's pretty exciting. And the infrastructure, we are doubling down on our capabilities, building teams out with much more infrastructure, including here in Mexico, which is absolutely brilliant. We've been with a number of clients this week and it's infrastructure, project finance and so on. So that's pretty exciting.
00:08:31
Speaker
that's driver one. Driver two is really around quite a lot of the hard to debate and make sure that we are that trusted strategic sort of relationship partner to help the client sort of transition from wherever we are they are. We meet them where they are and try and take them to the the new world order of low economy, low low carbon economy. And then the third driver is the innovation that you were talking about. So we, and we want to be, we are the bank of choice for the nascent climate tech. And these are a Venn diagram, overlapping circles. They reinforce each other.
00:09:12
Speaker
And Sightline has now declared us to be the lead bank from pre-seed right through to IPO of these nascent climate tech companies. And what we can see is that those are the technologies that our clients in driver one and our clients in driver two need.
00:09:29
Speaker
And so we can be the money. We can be the de-risker. You know, it's very risky for these clients. They're startups. They have to get through that valley of death.
00:09:39
Speaker
And we can be the kingmaker by helping scale them up into those, um let's face it, quite a lot of clients that we have, millions of clients that we have, who will need these technologies going forward. And you talked about supply chain resilience, absolutely critical. You talked about what Grupo Mexico are doing for the the small suppliers. Small suppliers can really be exposed here around the globe and here in Mexico as well.
00:10:07
Speaker
um They can be exposed to policy shocks. They can be exposed to supply chain shocks where a big client arrives. Big corporate looks at their supply chain and say, oh, no, no, no, you don't qualify. You can't you can't demonstrate now what your carbon footprint is and so on. So we help them be ready for that.
00:10:25
Speaker
And we provide tools, free carbon calculators, other partnerships that enable them to stay in and be critical parts of that supply chain. And that makes that whole supply chain much more resilient.
00:10:37
Speaker
Got it. And it's fun. How do you see or how do you think ah it's viable to have a climate transition ah as a commercial opportunity for the
Grupo Mexico's Climate Transition Strategies
00:10:49
Speaker
company?
00:10:49
Speaker
We see us as enabler enablers of the transition. And we have three divisions. We have a mining division, transportation division, and infrastructure division.
00:11:05
Speaker
And then we have a philanthropic foundation. Mm-hmm. And it in the the work we do, we are key players. We are top producers in Mexico and in Peru.
00:11:21
Speaker
And it
00:11:25
Speaker
we are also... producing the metal that is needed for the transition. And it's it the electrification needs a lot of copper.
00:11:37
Speaker
And indeed, a artificial intelligence will need a lot of copper. So there's a lot of demand of of the product that we have. So we are enablers in that sense. For example, to give you just an idea,
00:11:51
Speaker
our regular el leg A combustion car has between 15 and 20 kilograms of copper, whereas an electric car has four times more.
00:12:04
Speaker
Or, ah for example, ah one megawatt produced with gas. A wind turbine has 1.6 tons of copper, whereas if you produce it with a a solar farm, you have three times more.
00:12:22
Speaker
So the demand of copper is going to be very important. And so we are really enablers. And we're also enablers in the our transportation division.
00:12:34
Speaker
We do cargo transportation in trains. We have 11,000 lines of a trains, train lines. And, for example, that train can it have the equivalent load of 300 trucks.
00:12:53
Speaker
So, and it its emissions are three times lower than the the the one that would be on roads. So we see us enablers, and then we have the infrastructure division where we have now two wind farms, and we have energy projects.
00:13:11
Speaker
Got it. So it seems that there's opportunity within the divisions of of the company. And now that you said that, um let me ask you about what are the pillars of your sustainability plans um and and how do you think they are going to continue to deliver value to the to the company, as you have already mentioned that on these opportunities?
00:13:36
Speaker
So the main pillar that we have is prevention. And Irma can tell you, it's risk prevention through all the activities we do. But especially, we have been working the last years in critical risk registry. looking for opportunities to minimize risk and prevent and mitigate any unwanted with event from the environmental side or for the health side.
00:14:06
Speaker
That's something that is important. At the top, ah we reported at the top of of the company to the board. That's a one pillar. The other pillar we have is best practices. We have been following best practices, and we are guided and committed also to the some United Nations frameworks. So with the Paris Agreement, the Sustainable Development Goals, the principles of the Global Compact,
00:14:38
Speaker
They guide us, but then we are looking also at best practices within our sector. And we were following many of the best practices of the International Council of Minerals and Metals. The next pillar that we have is third-party verification.
00:14:57
Speaker
A third-party verification, it's important a for us to have best practices because, as we see, there are best practices. And we have then been moving to have certified all our units on the copper mark.
00:15:15
Speaker
The Copper Mark is a responsible production a certification. We have already certified all of our units in Sonora, in the north of Mexico, and we have done them in Peru, and we will mo will be moving to other of our units.
00:15:32
Speaker
Natalie, let me get back to you. Listening from Paulina, from Irma, a You have already told us about ah these three um channels, right?
00:15:43
Speaker
But more specifically, how can HSBC, given the significant milestones it has been achieving, how can HSBC support clients as Grupo Mexico's on taking advantage of these commercial opportunities that we were just
HSBC's Support for Sustainable Commercial Opportunities
00:16:01
Speaker
discussing?
00:16:01
Speaker
I'm glad you sort of called it commercial opportunity because I think this year has been very pivotal for all of us in the sort of focus area of sustainability, where it's moved from being, we've got to do this, we've got to report, we've got to tick this box, and we've got to talk about this, to, oh this actually makes really good commercial sense. And it's now fundamentally part of the part of the sort of the the business And really what we have to do is take our leadership position here as very serious in terms of responsibility and make sure that we're providing the clients, learning from clients um and colleagues at sort of Rupa Mexico and others and making sure that we can share that thought leadership content, make sure that our bankers feel confident to be having the conversations with clients and Thank you.
00:16:55
Speaker
And, uh, but you know, what are the next steps or the most recent steps you are taking as part of your transition plans? So we have been focusing scope-to-emissions that, for for those who don't know, are a electricity.
00:17:12
Speaker
So we're moving to have renewable electricity. We have two wind farms. One of them just started operating last year and is delivering the energy to our underground mines.
00:17:27
Speaker
a So far this year, we have reduced our emissions, a
00:17:36
Speaker
180,000 tons this year, and we expect to have 250 tons by the end of the year. So that's the our first step. And also been working on efficiency, a energy efficiency. And we have a some projects in Sonora,
00:17:57
Speaker
in our solvent and extraction and electropenning processes, where we are incorporating a ah solar panels to heat the electrolyte of it within the system. And for example, in Buena Vista del Cobre, we're incorporating a traces too for heating traces that it's also helping for reducing our emissions.
00:18:27
Speaker
And ah another example are in our transportation division. We have been moving, looking at opportunities for electrifying our jarred locomotives.
00:18:43
Speaker
And some of the locomotives that are go go through the throughout the country, some of them we have done some and retrofitting, so they be able to have a natural gas and diesel at the same time. And of course, ah that also has an impact on communities because we share with communities, we share with the mayors, we share with the different authorities, and also with the users in the communities. How can they help us to reduce our our emissions, our footprint? So all this language that is very maybe sophisticated for regular people that are out there in the streets about climate change and everything, they might not know the exact word for it, but everybody's feeling it.
00:19:27
Speaker
We're working also on trying to reduce our scope three emissions. It's a long journey. We're at the beginning, but we have been engagement engaging being with clients and but yeah a our providers. And ah we ah have also been looking at the different routes of the industry.
00:19:50
Speaker
the trains to see what routes we can use them more to switch to train rather than road. You can see that we're very passionate about this topic, but I will add also that our strategy in biodiversity and all the the the nature initiatives that we are trying that we are pushing already in the communities because for mining land, it's ah it's a thing. you know we We have Great extensions of land.
00:20:19
Speaker
And we don't use it sometimes. We protect it and we are just preserving that and counting it on it to enhance that land and and also to give a service for the environment. I've always been very impressed with um the way Grubla Mexico has been ah approaching the the nature side of it as well, actually.
00:20:38
Speaker
Yeah, it's super. Thank you. So from your point of view, which are these challenges in the climate transition a theme that that you are probably addressing in a closer way or that you think it's important to to keep in in mind?
Technological Challenges in Decarbonization
00:20:55
Speaker
So first of all, we are an an industry that has and very important challenges yeah because we have a trucks that are 200 tons and that you want to decarbonize and some of them are 400 tons. So the challenge is that the technology is not yet there.
00:21:18
Speaker
is being underdeveloped. We have agreements with the producers and we have meetings with them at least twice a year with each of them to find out how fast are they moving forward.
00:21:30
Speaker
So that's one of our biggest challenge. And then in it it's a little bit similar also with the locomotives, steaks.
00:21:41
Speaker
We have having these locomotives that have a natural gas and diesel, but well, in the long run, we would like them to be net zero.
00:21:53
Speaker
so So we're in that process looking at those opportunities. Excellent. Excellent. And then in Mexico, we see e the grid in Mexico hasn't been yet completely renewable, and it's taking more longer than many of us expected. Got it.
00:22:12
Speaker
Got it. Okay. And now, hold on, I have to ask on on the baina Paulina's comments. um Sometimes it's easier to understand with some examples, no? So can you share with us some examples so on how HSBC is supporting clients in addressing these climate transition challenges?
00:22:36
Speaker
yeah's sure Yeah, sure. But Paulina, I recognize those challenges. And they they are really difficult. And a lot of the stuff that we know we need is just not happening fast enough.
00:22:48
Speaker
um But I do think together we can we can make a real difference. So, yeah, happy to give examples around our three drivers. So you've heard Grupo Mexico is absolutely central to the transition. So when we talk about our driver one and those ecosystems, Grupo Mexico is right in there.
00:23:08
Speaker
So anything that we do to help Grupo Mexico qualifies. so And we want to play a major role in in this sort of clean infrastructure in in Mexico. um And, you know, some of the needs that you have are, you know, really quite complex, but we're we're here to support that.
00:23:26
Speaker
On driver two, there's a really good example that we did actually um earlier this year, which is a steel mill in Sweden, which used to run by fossil.
00:23:38
Speaker
And it's electrified through state-of-the-art electric arc mini mills. And the impact of this has been to reduce the emissions from that steel mill site by 90%, with the whole of Sweden's by 7%.
00:23:52
Speaker
Yeah, that is quite cool. And then on that, the climate tech, we really are becoming a flywheel. So Infinium, US company, eFuels, we have helped them do their first of a kind project yeah in the US, but they couldn't have done it had we not several months before um financed electric hydrogen.
00:24:15
Speaker
um which is a company that enabled them to have the kit for Infinium to do what they're doing, which then the off-takers are our clients in Drivers 1 and 2. So it's evidence that it's happening, but we still need more to happen and faster. Got it.
00:24:31
Speaker
Maybe start wrapping up ah the the podcast and taking advantage of what you just mentioned, Natalie. And also i'm going to ask Ido or Paulina, probably first you, Natalie, what a piece of advice would you give to companies that are pursuing this transition phase given the the broad view you have at the bank and the visibility that you have in many regions, which would be maybe in...
Advice for Sustainable Transitions
00:25:00
Speaker
couple of sentences. ok that is or yes I think the important thing is for everybody to to understand they're not alone. okay yeah And you can't solve it on your own. And therefore lean in and develop relationships and sort of partnerships. And then the second advice is Be really bold and courageous here.
00:25:21
Speaker
Yeah. Really courageous and ambitious. um No little incremental change here. Think really big. Think out of the box and and go for it.
00:25:32
Speaker
Amazing. Yeah, yeah. Right. You know what? I love that you that you said, think really big and be bold and courageous. Our founder always said, it's important to think big, but to add big as well.
00:25:46
Speaker
And we love that that statement in in our company. So ah talking about community development, which is the area that I'm passionate about, it is the regional development. And also, I think mine has also a challenge on diversity.
00:26:05
Speaker
That's something that we can learn a lot ah ah from people. from the financial system, from you guys, because we we are trying to push more and to attract more talent, diverse talent, where especially women into mining.
00:26:18
Speaker
And that's something that we, Paulina and I, are very committed about, of course. in And we we have something to learn from other companies as well. Amazing. Thank you.
00:26:29
Speaker
Paulina, any final remark?
Closing Remarks
00:26:31
Speaker
but As for myself, I would say that make the transition part of the culture of the company and be sure that the board is engaged in it.
00:26:42
Speaker
Absolutely. That would be my piece of advice. Absolutely. No, I mean, thank you so much. I think that's ah a great way to to close this conversation. Again, we were delighted to have you here, Irma, Paulina, Natalie.
00:26:57
Speaker
It was an amazing conversation to learn from what you have been doing. Thank you, everyone, for joining us in this conversation with Grupo Mexico. And looking forward to resume the conversation soon. Thanks.
00:27:12
Speaker
Thank you so much, guys. Thank you, Deb. Thank you. Thank you for joining us at HSBC Global Viewpoint. We hope you enjoyed the discussion. Make sure you're subscribed to stay up to date with new episodes.