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- CSA pauses efforts to finalize mandatory climate disclosure rules, citing global uncertainty and economic pressures.
- CSSB sustainability standards remain voluntary, offering guidance aligned with international norms.
- CSA commits to monitoring issuer disclosures and revisiting climate and diversity rules in future years.
CSA Backs Away From Mandatory Climate Rules—for Now
The Canadian Securities Administrators (CSA) announced it is pausing its work on implementing mandatory climate-related disclosure requirements, citing heightened economic and geopolitical uncertainty. The decision also includes a pause on changes to diversity-related disclosure rules.
“In recent months, the global economic and geopolitical landscape has rapidly and significantly changed, resulting in increased uncertainty and rising competitiveness concerns for Canadian issuers,”
Said Stan Magidson, Chair of the CSA and CEO of the Alberta Securities Commission.
“In response, the CSA is focusing on initiatives to make Canadian markets more competitive, efficient and resilient.”
The CSA emphasized that while mandatory rules are on hold, climate-related risks remain a mainstream business issue. Canadian securities laws already require disclosure of any material climate-related risks under existing regulations.
CSSB Standards Remain Voluntary Guidance
The move comes just months after the Canadian Sustainability Standards Board (CSSB) introduced CSDS 1 and CSDS 2, Canada’s first-ever sustainability disclosure standards, in December 2024. These voluntary standards are aligned with international frameworks, including those from the IFRS Foundation’s International Sustainability Standards Board (ISSB).
Wendy Berman, incoming Chair of the CSSB, reaffirmed the board’s commitment to transparency in capital markets:
“These standards were developed to serve the Canadian public interest, ensuring investors and other parties receive the critical information necessary to assess climate and other sustainability-related risks and opportunities.
We recognize that regulatory approaches may evolve in response to market conditions, but the demand for credible, comparable sustainability information continues to grow – both globally and at home.”
The CSSB said it will continue to support the voluntary adoption of its disclosure standards, helping Canadian companies remain competitive and aligned with international investor expectations.
RELATED ARTICLE: Canadian Sustainability Standards Board Appoints Wendy Berman as Permanent Chair
Diversity Disclosure and Enforcement Still in Effect
While new diversity-related amendments are also on hold, existing requirements under National Instrument 58-101 remain in place. These require non-venture issuers to disclose the representation of women on boards and in executive officer positions.
The CSA added it will continue to monitor climate and diversity disclosures and issue guidance or enforcement actions where necessary, including addressing misleading disclosures and potential greenwashing.
The CSA will revisit both the climate and diversity disclosure initiatives “in future years” and has committed to providing issuers with appropriate notice before restarting rulemaking efforts.
Background: The CSA is an umbrella group comprising the securities regulators of Canada’s provinces and territories. It is responsible for harmonizing securities regulation across Canadian capital markets.