The report focuses on IFRS Accounting Standards and does not consider sustainability reporting standards such as the European Sustainability Reporting Standards (ESRSs) or standards issued by the International Sustainability Standards Board (ISSB).

According to the report, minor amendments in the following areas would have positive implications for financial stability:

• The application of the materiality principle in IAS 1 may need to be enhanced, as even if the transaction involved is immaterial in quantitative terms, user expectations or peer practice may justify information on it

• The addition of climate factors to the list of indicators of impairment of non-financial assets in IAS 36
• How provisions and contingent liabilities should be recognized according to IAS 37, given climate-related risks
• Additional disclosure requirements, examples and guidance on how climate-related risks should be incorporated into estimating expected credit losses and the fair value of financial instruments.

In addition, the ESRB recommends that the IASB prioritize the work on pollutant pricing mechanisms. This project is currently on the IASB's reserve list.

Access the report on the ESRB’s website.

The Independent Review Committee on Standard Setting in Canada recommended that an effectiveness review be conducted with the assistance of an independent third party to help streamline and harmonize oversight activities and processes. In response to the results, the Effectiveness Review Joint Taskforce and the current oversight councils approved that a single council be created to oversee standard setting for accounting, audit and assurance, and sustainability.  

This decision consolidates the activities of three oversight bodies – the Auditing and Assurance Standards Oversight Council (AASOC), Accounting Standards Oversight Council (AcSOC), and the Canadian Sustainability Standards Board (CSSB) Implementation Committee – streamlining the processes and activities for accounting, audit, assurance, and sustainability standard setting.

The Oversight Council is effective from April 1, 2024, and will focus its initial work on establishing its operations and governance processes. It will begin its formal oversight work on July 1, 2024. The current oversight bodies will conclude their operations on June 30, 2024.

Access the press release on the FRASCanada website.

Covering double materiality, due diligence, and the Corporate Sustainability Reporting Directive (CSRD), each publication emphasizes the pertinence of the topic and the significant role played by the globally adopted GRI Standards in helping address them: 

• Double materiality: The interconnectedness of a company's impacts on society and the environment with its financial performance. GRI reporting prepares companies for double materiality, given that impacts are the basis for determining associated financial risks and opportunities.  
• Due diligence: How a business prevents, mitigates and accounts for its impacts. Due diligence is integrated into the GRI Standards, with reporting requirements aligned with authoritative intergovernmental instruments. 
• CSRD: The benefits for policymakers in harmonizing their sustainability disclosure regulations with the EU. The GRI Standards are closely aligned with the new European Sustainability Reporting Standards (ESRS), with collaboration continuing to ensure they remain so in the future. 

Access the press release on the GRI’s website.

The guidance contains the following sections:

• Section 1 discusses the general reporting requirements in the ISSB standards and ESRS and explains the extent to which the standards are compatible with each other in terms of materiality, presentation and disclosures on non-climate-related sustainability topics
• Section 2 provides a paragraph-by-paragraph analysis of the climate-related disclosure requirements of the ISSB standards and the ESRS in a tabular format
• Section 3 lists reporting elements and areas for which ESRS preparers may need to provide additional disclosures in order to comply with the climate-related disclosure requirements in the ISSB standards
• Section 4 lists reporting elements and areas for which IFRS preparers may need to provide additional disclosures in order to comply with the climate-related disclosure requirements in ESRS

Access the press release on the IFRS’s website.

The updates ensure that the expectations for federally regulated financial institutions (FRFIs) in the Guideline’s Annex 2-2 align with the International Sustainability Standards Board’s final IFRS S2 Climate-related Disclosures standard.

This streamlines climate disclosures and promotes transparency of climate-related risks.

OSFI is also releasing new Climate Risk Returns that will collect standardized climate-related data on emissions and exposures from FRFIs. These forms are being released after an extensive consultation. OSFI is also publishing a What We Heard Report with the feedback it received. The data provided will allow OSFI to implement evidence-based policy development, regulation, and supervision related to climate risks.

Access the press release on the OSFI’s website.

The podcast discusses the following:

• the ISSB’s work with jurisdictions around the world;
• the recent SEC ruling;
• key takeaways from the SSAF meeting, the ISSB meeting and the TIG meeting;
• the ISSB's strategic direction and balance of activities for the next two-year work plan;
• the IFRS Sustainability Disclosure Taxonomy; and
• further ISSB activities in March.

Access the press release on the IFRS Foundation website.

The GHG Protocol secretariat solicited stakeholder feedback between November 2022 and March 2023 on the use of the Corporate Value Chain (Scope 3) Accounting and Reporting Standard (the “Scope 3 Standard” or “Standard”) and the Technical Guidance for Calculating Scope 3 Emissions (the “Scope 3 Technical Guidance” or “Technical Guidance”) to understand user needs, identify topics which may warrant updates or guidance, and solicit recommendations for specific updates or new guidance.

Approximately 350 individuals and/or organizations provided responses to the scope 3 survey. In addition to the scope 3 survey, respondents were given the opportunity to submit proposals.

The inclusion of feedback in the summaries does not indicate that a recommendation will be implemented or reflected in updates to either the Scope 3 Standard or Scope 3 Technical Guidance. Instead, the GHG Protocol secretariat and governance bodies are prioritizing which topics to address in the update process, including the scope of work for updates and additional guidance and resources.

According to the draft summary report, any updates will aim to align with best practice approaches to ensure that the GHG Protocol standards for corporate accounting and reporting are effective in providing a rigorous and credible accounting foundation for businesses to measure, plan, and track progress toward science-based and net-zero targets in line with the global 1.5°C goal. Any future updates will seek harmonization and interoperability with accounting rules under development through major disclosure initiatives.

Access the Summary of Scope 3 Proposals and the Detailed Summary of Scope 3 Stakeholder Survey Responses on GHG Protocol’s website.

The package comprises three consultation papers:

• Proposed Criteria for Modification Framework
• Proposed CSDS 1 General Requirements for Disclosure of Sustainability-related Financial Information
• Proposed CSDS 2 Climate-related Disclosures

The proposed Criteria for Modification Framework presents the basis on which the CSSB could introduce changes to the ISSB standards. These criteria ensure that Canadian standards align with international standards while addressing Canadian public interest.

The proposed CSDS 1 and CSDS 2 are based on IFRS S1 and IFRS S2 with the following modifications: 

• The proposed effective dates for CSDS 1 and CSDS 2 have been extended by one year compared to that of IFRS S1 and IFRS S2 (i.e. the proposed standards would become voluntarily effective for annual reporting periods beginning on or after 1 January 2025);
• The proposed transition relief for disclosures beyond climate-related risks and opportunities has been extended from one year to two years;
• The proposed requirements to disclose comparative information have been changed to align with the proposed modification for the transition relief; and
• The proposed transition relief for disclosure of Scope 3 GHG emissions has been extended from one year to two years.

Please click to access the following on the Financial Reporting and Assurance Standards (FRAS) Canada website:

• Press release
• Proposed Criteria for Modification Framework
• Proposed CSDS 1
• Proposed CSDS 2
• In Brief — A plain and simple overview of the recently issued Exposure Drafts

Note: On 10 April 2024, the CSSB offers a webinar on the proposed new standards. Please click for more information here.

For Canadian securities legislation to mandate compliance, the CSSB standards need to be integrated into a CSA rule. Following the completion of the CSSB consultation and standardization, the CSA intends to solicit feedback on a revised rule outlining climate-related disclosure obligations. The proposed CSA rule will align with final CSSB standards, possibly with tailored adjustments for Canadian markets, focusing primarily on provisions relevant to climate disclosures.

The CSA continues to monitor and assess international developments in this area, including the United States Securities and Exchange Commission (SEC)’s climate-related disclosures rule approved on March 6, 2024.

Access the press release on the CSA’s website.

The final rules reflect the Commission’s efforts to respond to investors’ demand for more consistent, comparable, and reliable information about the financial effects of climate-related risks on a registrant’s operations and how it manages those risks while balancing concerns about mitigating the associated costs of the rules.

According to a fact sheet posted by the SEC, the final rules will require a registrant to disclose, among other things:

• material climate-related risks;
• activities to mitigate or adapt to such risks;
• information about the registrant's board of directors' oversight of climate-related risks and management’s role in managing material climate-related risks; and
• information on any climate-related targets or goals that are material to the registrant's business, results of operations, or financial condition.

In a major change to the proposed rule, the SEC has decided to remove the requirement to disclose Scope 3 greenhouse gas (GHG) emissions and only require disclosure of Scope 1 and/or Scope 2 GHG emissions on a phased-in basis by certain larger registrants when those emissions are material.

All domestic and foreign registrants, except for asset-backed issuers, must provide the

disclosures. smaller reporting companies (SRCs), emerging growth companies (EGCs), and nonaccelerated filers are exempt from the Scope 1 and Scope 2 GHG emission disclosure requirements but must provide all other disclosures.

The final rules will become effective 60 days after publication in the Federal Register, and compliance will be phased in from 2025 to 2033.

Access the final rule,  fact sheet and  press release on the SEC’s website.