Canada has implemented the Canadian Sustainability Disclosure Standards (CSDS), marking a major step toward consistent climate and sustainability reporting across its capital markets.
The standards, created by the Canadian Sustainability Standards Board (CSSB), include CSDS 1 (General Requirements for Disclosure of Sustainability-related Financial Information) and CSDS 2 (Climate-related Disclosures). They are based on the ISSB’s IFRS S1 and S2, the global foundation for sustainability reporting, and adapted to Canada’s market environment.
Starting January 1, 2025, large public companies and federally regulated financial institutions will be required to disclose sustainability and climate-related information. Smaller reporting issuers will follow in later phases. The Canadian Securities Administrators (CSA) and the Office of the Superintendent of Financial Institutions (OSFI) are coordinating enforcement.
The CSDS highlights climate-related risks and opportunities, building on the Task Force on Climate-related Financial Disclosures (TCFD) framework. Companies will need to provide information on governance, strategy, risk management, and metrics such as emissions, decarbonization goals, and adaptation plans.
According to CSSB Chair Charles-Antoine St-Jean, the new standards will enhance Canada’s competitiveness in global markets: “By aligning with ISSB standards, Canadian companies can provide investors with comparable, reliable information while staying in step with international peers.” Canada’s adoption aligns with similar moves in the UK, Brazil, Nigeria, Australia, and Japan. It ensures interoperability with the EU’s Corporate Sustainability Reporting Directive (CSRD).
Institutional investors have welcomed this development, noting that standardized sustainability reporting will enhance transparency on climate-related risks in areas such as the energy transition, physical impacts, and resilience planning. Starting in 2025, Canada positions itself as an early adopter of global standards, enhancing its reputation for financial transparency and leadership in sustainable investment.
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