Over the next ten years, the North-South divide will be the dominant cleavage impeding collective action to address climate change. To date, the international climate change negotiations have side-stepped this conflict by assigning reduction targets to industrialized countries only. With the Kyoto Protocol?s entry into force, the international community will commence negotiations on a second round of commitments to reduce greenhouse gas emissions, with reduction targets for both industrialized and developing countries. As has been the case in industrialized countries, the fossil fuel industry is likely to be a central political actor influencing a developing country?s decision to accept or reject a binding emissions reductions target. This paper uses an in-depth case study of the climate policy decisions of Petroleos Mexicanos (Pemex), Mexico?s national oil company, to document the diffusion of climate protection norms from the North to the South, through private sector channels. Theoretically, the paper contributes to the literature on international norm dynamics by focusing on the private sector as a key channel of norm diffusion and by exploring how and why transnational oil industry policy networks promoting action on climate change were more effective than those promoting an adversarial approach in the Pemex case. In the mid-1990s, Pemex faced a strategic choice to interpret climate change either as a business opportunity or as a threat to its operations. Pemex chose the former strategy and currently stands apart from its peers as the only nationally-owned, developing-country oil company that has adopted a company-wide carbon dioxide emissions reduction target. This paper examines Pemex?s choice. First, it demonstrates that standard models of firm environmental behavior as a response to government pressure, social pressure, and/or market forces do not explain the Pemex case. Rather, Pemex?s decision to support action on climate change was the result of efforts by climate policy entrepreneurs within its environment division, who framed climate change as a business opportunity for Pemex. Second, the paper argues that the interpretation of climate change as a business opportunity by Pemex managers was the result of their participation in transnational oil industry policy networks. In particular, Pemex managers focused on British Petroleum as the leading oil corporation in the field of climate policy and explicitly rejected the adversarial approach championed by ExxonMobil. ..PAT.-Conference Proceeding [ABSTRACT FROM AUTHOR]