Canada’s CSSB Releases IFRS-Based Sustainability and Climate Reporting Standards
The Canadian Sustainability Standards Board (CSSB) announced the publication of its finalized Canadian Sustainability Disclosure Standards (CSDSs), largely aligned with the global standards released by the IFRS Foundation’s International Sustainability Standards Board (ISSB), but adding more time for companies to prepare for some key elements of reporting, such as on value chain GHG emissions, compared to the ISSB standards.
The release of the new standards marks a significant step in the multi-year process towards establishing a new sustainability reporting system in Canada, beginning in 2021, with a directive from Prime Minister Justin Trudeau to cabinet ministers to move towards a system of reporting based on the Task Force on Climate-related Financial Disclosures (TCFD). Most recently, in October, the government announced plans to introduce mandatory climate-related reporting for large companies, with smaller companies to be encouraged to voluntarily provide climate-related disclosures.
The CSSB was formed in 2022 to work with the ISSB, and to support the uptake of ISSB standards in Canada. The new standards include CSDS 1, General Requirements for Disclosure of Sustainability-related Financial Information, and CSDS 2, Climate-related Disclosures, which correspond with the ISSB’s IFRS S1 (sustainability-related) and IFRS S2 (climate-related) standards, while including modifications “reflecting the Canadian context.”
The CSSB initially released proposed sustainability and climate reporting standards in March 2024, which included a series of modifications from the ISSB standards, most notably pushing off the effective date by a year, and extending 1-year reliefs provided by the ISSB for reporting on sustainability matters beyond climate and on Scope 3 value chain emissions to 2 years.
Following feedback on the draft proposals, the finalized standards included additional reliefs, including extending period before requiring Scope 3 emissions reporting and disclosure on matters beyond climate to 3 years, as well as two additional years to align the timing of sustainability and financial reporting, and allowing 3 years for companies to begin quantitative climate-related scenario analysis to assess climate resilience.
CSSB Interim Chair Bruce Marchand said:
“Today’s announcement signifies our commitment to advancing sustainability reporting that aligns with international baseline standards – while reflecting the Canadian context. These standards set the stage for high-quality and consistent sustainability disclosures, essential for informed decision-making and public trust.”