Please choose between the following three options for navigation.
We have prepared a summary of the latest Canadian and global sustainability reporting developments, including an update on the development on assurance on sustainability reporting.
In recent years, there have been critical global and national developments in sustainability reporting, including the creation of the International Sustainability Standards Board (ISSB) under the International Financial Reporting Standards (IFRS) Foundation.
An increasing number of entities reporting within Canada provide information on their sustainability performance. As reporting increases and momentum continues toward a global sustainability reporting system, Canadian entities must be familiar with the changing sustainability reporting landscape.
CPAs will need to understand the reporting requirements and be capable of identifying risks and opportunities that exist for their organizations and clients.
Outlined below are key updates from the profession, standard setters and regulators, which will provide you with an understanding of the ongoing developments.
This page captures developments as of November 1, 2023.
As part of the IRCSS’ recommendations, the CSSB was formally announced in June 2022. The CSSB will work with the ISSB to support the uptake of ISSB standards in Canada, highlight key issues for the Canadian context, and facilitate interoperability between ISSB standards and any forthcoming CSSB standards. The CSSB’s December 2022 appointment to the Sustainability Standards Advisory Forum will support these mutual objectives. In April 2023, the CSSB’s first-ever chair and initial members were appointed, setting the stage for an operational board in tandem with the release of the ISSB’s inaugural standards – IFRS S1 and IFRS S2. For more information, you can visit: Canadian Sustainability Standards Board.
Updates on the IRCSS in Canada can be accessed on their website.
On June 26, 2023, the ISSB issued its first two IFRS Sustainability Disclosure Standards:
For responses to frequently asked questions about the IFRS Sustainability Disclosure Standards, their adoption in Canada and related assurance requirements, CPA Canada has prepared this FAQ that was published on June 26, 2023. A roadmap of activity leading up to the release of these two standards and next steps can be found here.
Please refer the IFRS Foundation’s project summary document for an overview of the requirements in these Standards. Please refer to the ISSB webpage for comprehensive information.
On May 4, 2023, the ISSB published the Request for Information Consultation on Agenda Priorities to seek feedback on its priorities for its next two-year work plan. Based on research into the information needs of investors, the ISSB is seeking feedback on potential research projects focused on:
The comment period is now closed.
On May 11, 2023, the ISSB published for comment an Exposure Draft of Methodology for Enhancing the International Applicability of the SASB Standards and SASB Standards Taxonomy Updates. The comment period is now closed.
Information on the ISSB, including meeting agendas and papers can be found on its website.
On December 16, 2022, the final text of the Corporate Sustainability Reporting Directive (CSRD) was published in the Official Journal of the European Union. The CSRD will extend to large and listed EU companies. Additionally non-EU entities having at least one subsidiary or branch in the EU and generating net turnover of EUR 150 million in the EU will be subject to the sustainability reporting requirements. On January 5, 2023, the Corporate Sustainability Reporting Directive (CSRD) entered into force. The reporting requirements will be phased in over time for different kinds of companies with the first set of companies being required to apply the standards in financial year 2024, for reports published in 2025.
The final CSRD confirmed the role of the European Financial Reporting Advisory Group (EFRAG) as the technical advisor to the European Commission developing draft European Sustainability Reporting Standards (ESRS) along with their basis for conclusion, cost-benefit analysis and guidance for Digital Reporting. The CSRD requires in-scope companies to report on sustainability-related issues based on detailed disclosure standards developed by European Financial Reporting Advisory Group.
In October 2022, the Canadian Securities Administrators (CSA) announced that it is actively considering the impact of international developments and how they may impact or further inform the proposed climate-related disclosure rule which was published in October 2021. More recently, on July 5, 2023, the CSA issued a statement indicating that CSA staff intend to conduct further consultations to adopt disclosure standards based on ISSB standards, with modifications considered necessary and appropriate in the Canadian context, and that a further market update from the CSA will follow in the coming months.
In a recent Staff Notice on its continuous disclosure review program activities for the years ended March 31, 2022 and 2021, CSA staff indicated that they have observed an increase in “greenwashing” in continuous disclosure documents as well as voluntary documents, such as sustainability or ESG reports and public surveys. CSA staff note that when describing current and proposed ESG related activities, issuers should avoid using misleading promotional language. Further, the staff notice highlights that statements regarding carbon neutrality will generally constitute forward-looking information (FLI). The issuer must have a reasonable basis for the FLI, identify the material risks factors that could cause actual results to differ materially, state the material factors or assumptions used to develop the FLI and describe its policies for updating the information.
In April 2023, the CSA announced that it is seeking public comment on proposed amendments to corporate governance disclosure rules and policy relating to the director nomination process, board renewal and diversity. The proposed amendments would require disclosure on aspects of diversity beyond the representation of women, while retaining the current disclosure requirements with respect to women. The comment period is now closed.
The SEC is considering feedback received on its proposes rules to enhance and standardize climate-related disclosures for investors, which was issued in March 2022.
In December 2022, the International Public Sector Accounting Standards Board (IPSASB) confirmed its role in advancing public sector sustainability reporting. It has decided to begin the scoping of three potential public sector specific sustainability reporting projects pending securing the resources needed to begin guidance development. The prioritized research topics for these projects are:
Following the scoping and research phase, the IPSASB decided to move forward with the development of a public sector specific Climate Related Disclosures standard at its June 2023 meeting and has published a Climate-Related Disclosures project brief.
In October 2023, IPSASB opened a consultation to hear stakeholder feedback on its proposed strategy and work program for the next five years (2024-2028). Comments are requested by February 15, 2023.
Please visit CPA Canada’s Sustainability assurance resources webpage.
November 6, 2023
Join us this November for timely updates, cutting-edge information on new technology, and quality networking with other forensic accounting and valuation professionals.
November 13, 2023
Come and join hundreds of accounting and finance professionals who are committed to creating an inclusive and equal profession, just like you.
November 22, 2023
On November 21, the Deputy Prime Minister and Minister of Finance released the federal government’s 2023 Fall Economic Statement (FES), which contained some new tax announcements along with an update on previously announced tax measures.