A group of 34 sustainable-finance experts says Canada has been too slow to adopt the 15 recommendations made two years ago by Ottawa’s Expert Panel on Sustainable Finance.
A group of 34 sustainable-finance experts says Canada has been too slow to adopt the 15 recommendations made two years ago by Ottawa’s Expert Panel on Sustainable Finance.
A group of 34 sustainable-finance experts says Canada has been too slow to adopt the 15 recommendations made two years ago by Ottawa’s Expert Panel on Sustainable Finance.
The panel, which included Tiff Macklem, now the governor of the Bank of Canada, urged policymakers to incentivize the transition from fossil fuels to clean energy and integrate sustainability into the financial system. The report published by Queen’s University’s Institute for Sustainable Finance (ISF) identified “moderate” progress on six recommendations, “marginal” progress on five and “minimal” progress on three items. Just one recommendation—to create the Canadian Sustainable Finance Action Council—gleaned “significant” progress status. Here’s what else you need to know:
Canada is trailing its peers: Interviewees’ most common concern was that Canada had fallen behind Europe and the U.K. on sustainable-finance issues, and that the U.S. may be pulling ahead, too, on policies and practices related to the role of finance in the climate crisis. “Canada is making the right noises and starting, but it really does feel, because we are risk-averse and resource-heavy, we are taking longer to start, and longer to catch up,” said Pamela Steer, who sits on the ISF’s advisory board. “That is troubling.”
The private sector is outpacing regulators: The report found a “general consensus” that the private financial sector was implementing sustainable-finance measures amid inertia from governments and regulators. While private institutions have made progress in areas like climate risk disclosure and setting net-zero targets, the report suggested that isn’t enough: “The government needs to set the framework and standards for the private sector to respond and to attract investment for industry to transition.”
There’s demand for mandatory disclosure: The expert panel’s recommendation to mandate financial climate-risk disclosure “was recognized as the most important initiative to advance in the near term,” the report reads. But two years later, it’s still up to companies to volunteer information deemed critical to mitigating global warming. In the meantime, the U.K. and New Zealand have moved ahead with mandatory-disclosure rules, and the G7 has stated support for such moves. However, while disclosure remains voluntary in Canada, there’s been a deluge of firms reporting—to some extent—their risks related to a warming climate and how they plan to operate in a net-zero economy.
Companies need better information: The government has yet to establish the Canadian Centre for Climate Information and Analytics, a centralized data hub where firms, investors and other stakeholders would be able to access information about how to evaluate, report and mitigate climate risk. “This is unfortunate since data issues are frequently raised in discussions regarding impediments to allocating capital to sustainable-finance solutions,” the report notes. However, there have been some efforts made in the spirit of the proposed centre: the government in 2019 launched climatedata.ca, which hosts information on climate adaptation, and the ISF is developing a Climate Finance Data Lab with a similar goal.
Loading...
You have shared 5 articles this month and reached the maximum amount of shares available.
CloseIf you would like to purchase a sharing license please contact The Logic support at [email protected].
CloseYou have gifted 0 article(s) this month and have 5 remaining.
Recipients will be able to read the full text of the article after submitting their email address. They will not have access to other articles or subscriber benefits.
Get up to speed in minutes with insights and analysis on the most important stories of the day, every weekday.
See the bigger picture with reporters and industry experts in subscriber-exclusive events.
Membership provides access to our popular Slack channel, participation in subscriber surveys and invitations to exclusive events with our journalists and special guests.