The government is ready to move forward with developing a classification system for investors on what counts as “green” business practices. The rules—which will ultimately be crafted by a third-party, arms-length organization—will help mitigate greenwashing and funnel money into assets that help achieve net-zero emissions. The government also said it will move forward on creating mandatory climate-risk reporting rules for large, federally incorporated private firms. (The Logic)

Talking point: The news from the federal Finance Department comes two years after the Sustainable Finance Action Council (SFAC) submitted its recommendations to the government on what Canada’s green taxonomy should look like. During that time, Canada has fallen behind other regions, including Australia, which has adopted some of SFAC’s recommendations. In a press release Wednesday, Ottawa said Canada should include a “transition” category in its taxonomy, which would let investors back high-emissions companies that are credibly trying to decarbonize their businesses. The government said taxonomies for two or three priority sectors will be released within a year of the arms-length organization beginning its work.