2017

COSO and WBCSD Sign Memorandum of Understanding

Apr 07, 2017

On April 7, 2017, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and the World Business Council for Sustainable Development (WBCSD) recently completed a Memorandum of Understanding (MoU) aimed at working together to help businesses identify and prioritize issues related to sustainability and enterprise risk management.

COSO will work with WBCSD to develop interpretive guidance on how to embed sustainable development issues into COSO’s Enterprise Risk Management Framework as a foundation to bridge the gap between the way companies consider sustainability issues in their risk management processes and how they disclose these risks to investors, facilitating effective decision making within and out with the company.

Review the press release on the COSO's website.

COSO Issues Important Update to ERM Framework

Sep 06, 2017

On September 6, 2017, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) released its highly anticipated ERM Framework "Enterprise Risk Management–Integrating with Strategy and Performance."

This new document builds on its predecessor, Enterprise Risk Management–Integrated Framework, one of the most widely recognized and applied risk management frameworks in the world. The updated edition is designed to help organizations create, preserve, and realize value while improving their approach to managing risk.

The update highlights the importance of enterprise risk management in strategic planning. It also emphasizes embedding ERM throughout an organization, as risk influences strategy and performance throughout the organization.

Review the press release, an executive summary and FAQ on the COSO's website.

Could blockchain be an enabler for climate action?

Dec 14, 2017

On December 14, 2017, CPA Canada released a summary of an expert panel session it held, in collaboration with the University of Toronto’s Environmental Finance Advisory Committee (EFAC), to discuss whether blockchain as a decentralized, peer-to-peer ledger technology could transform carbon markets by providing a transparent and reliable way to track carbon emissions and credits.

Blockchain could begin an economic revolution, experts say. It initially caught attention as the technology supporting the digital currency Bitcoin. Now it’s being applied in the environmental space, most recently gaining recognition from the United Nations Framework Convention on Climate Change for its potential to boost climate action.

Review the summary and a short video on the CPA Canada's website.

Could Disclosing Climate-related Financial Information Become the New Normal?

Oct 17, 2017

On October 17, 2017, the International Federation of Accountants (IFAC) released an article on how climate change disclosures in corporate reports are common, including disclosure of greenhouse gas (GHG) emissions and other metrics measuring the impact of an organization on the environment. But that what is often missing is the link to the financial implications of climate change, both current and in the future.

GHG disclosures in themselves are not adequate enough for investors to fully understand a company’s exposure to climate-related risks and opportunities as well as its strategies for managing them. And a recent global survey found that 56% of investors surveyed considered disclosures on climate-related risk “highly inadequate.”

Review the full article on the IFAC's website.

Countries sign multilateral tax treaty agreement to fight BEPS

Jun 07, 2017

On June 7, 2017, the Organisation for Economic Co-operation and Development (OECD) announced that the ministers and high-level officials from 76 countries and jurisdictions have signed or formally expressed their intention to sign an innovative multilateral convention that will swiftly implement a series of tax treaty measures to update the existing network of bilateral tax treaties and reduce opportunities for tax avoidance by multinational enterprises.

The new convention will also strengthen provisions to resolve treaty disputes, including through mandatory binding arbitration, thereby reducing double taxation and increasing tax certainty.

The first modifications to bilateral tax treaties are expected to enter into effect in early 2018.

Review the press release and the convention on the OECD's website.

CPA Canada releases two articles on climate change

Aug 17, 2017

In August 2017, CPA Canada released two articles on climate change, which discusses how one of the biggest risks facing businesses, economies and societies around the world is climate change and the impact climate change can have on business models and strategy.

The article It’s time to make climate change a business issue notes that the business cost of climate change is real and growing, but that not everyone is aware of the issues.

The article Planning for climate change and a carbon-reduced economy discusses the impact of climate change on business models and strategy. While some traditional business plans include instruments to deal with extreme weather events, many rely on historical data. They do not account for climate change, which heightens the unpredictability of intense environmental conditions. That’s why a long-term approach that addresses the implications of global warming is so critical. It can increase your organization’s resilience, protect profits and make risk management strategies more effective.

Review It’s time to make climate change a business issue and Planning for climate change and a carbon-reduced economy on CPA Canada's website.

Data Breach Reporting Requirements

Sep 02, 2017

On September 2, 2017, the Government of Canada published proposed new regulations (“Regulations”) in the Canada Gazette, which provides an update and sets out details regarding the mandatory data breach reporting requirements (“Data Breach Reporting Requirements”) under the Personal Information Protection and Electronic Documents Act (“PIPEDA”).

The Data Breach Reporting Requirements were passed in June, 2015 but are not yet in force.

With the implementation of Division 1.1 of PIPEDA, organizations that experience a data breach will have certain obligations including:

  • the organization must determine if the breach poses a “real risk of significant harm” to any individual whose information was involved in the breach by conducting a risk assessment;
  • if the organization considers that a breach is posing a real risk of significant harm, it must notify affected individuals and report to the Privacy Commissioner of Canada (Commissioner) as soon as feasible;
  • the organization must notify any other organization that may be able to mitigate the harm to affected individuals; and
  • the organization must maintain a record of any data breach that it becomes aware of and provide it to the Commissioner upon request.

The Regulations will require organizations to maintain sufficient information in a data breach record to demonstrate that they are tracking data security incidents that result in a breach of personal information, and require that organizations hold data breach records for a minimum period of time, specifically 24 months.

Review the regulations on the Government of Canada's website and an article on Lexology's website.

Directors’ Alert 2017

Jan 31, 2017

Is your board ready to take advantage of disruption? Prepare your board for disruption by downloading the Deloitte's Directors' Alert.

Independent board directors join Deloitte specialists from around the globe to share their insights into the challenges facing boards today and the strategies they can employ to overcome those issues.

Review the Directors’ Alert.

Divergent Regulatory Approaches to Cryptocurrency Offerings: Developments in Canada, the United States, and China

Oct 04, 2017

In October 2017, McMillan LLP released a bulletin that considers the statements made by regulators as they adopt their respective mechanisms for dealing with cryptocurrency as a new investment vehicle.

The issuance of cryptocurrency has become more common as a capital raising mechanism, which has caused considerable attention to be paid to cryptocurrency offerings by both the investing public and the governmental authorities responsible for securities regulation in various jurisdictions around the word.

The Canadian approach to cryptocurrency offerings appears to be to apply the current regulatory system for securities to the offerings, once the test for a security has been met on the basis of the individual set of facts related to the type of cryptocurrency and the offering itself.

Review the bulletin on McMillan LLP's website.

ESG Integrated Ratio Guideline

Dec 15, 2017

On December 15, 2017, the Centre for Environmental, Social and Governance (ESG) Research released the "Integrated Ratio Guideline", which aims to be a practical formula collection for companies, investors and analysts, to help them calculate a number of non-financial and integrated ratios, and notably what investors and analysts can use these ratios for to evaluate companies’ performance and risk profiles.

Today, there are no standardized non-financial ratios – or ESG ratios (Environmental, Social and Governance) as they are called in investor circles – nor any integrated ratios, which is the term for mixing financial and non-financial indicators when calculating ratios. This makes it difficult for users of financial statements, such as investors, banks, assets managers, and insurers, to use the extra information that stems from ESG data directly in their analyses of performance and risk profiles of companies.

In the guideline, a suggestion for new standard ESG and integrated ratios and notes will be defined.

This guideline is not a replacement of existing financial, non-financial, or integrated reporting frameworks, but rather a guideline on how to use the data that has already been published in accordance with these frameworks.

This guideline includes the definitions, ratios, and standard notes that were deemed useful and valuable by the end of 2017 by the Center for ESG Research.

Review the guideline on the ESG Research's website.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.