OSFI consultation on climate-related risks in the financial sector [Completed]
Next steps: |
OSFI agrees guidance on climate-related risks should be principles-based and consider the Canadian context as well as international developments. Taking these factors into account, OSFI expects to communicate next steps on its climate-related policy work early in 2022. |
Last updated: |
October 2021 |
Overview
On January 11, 2021, the Office of the Superintendent of Financial Institutions (OSFI) launched a three-month consultation with the publication of a discussion paper, “Navigating Uncertainty in Climate Change: Promoting Preparedness and Resilience to Climate-Related Risks”. The paper focuses on risks arising from climate change that can affect the safety and soundness of federally regulated financial institutions (FRFIs) and federally regulated pension plans (FRPPs). Comments are requested by April 12, 2021.
Through this consultation, OSFI is seeking to engage FRFIs, FRPPs and other interested stakeholders in a dialogue on climate-related risks. OSFI is interested in how FRFIs and FRPPs define, identify, measure and build resilience to climate‑related risks. OSFI is also seeking feedback on how it can facilitate FRFIs' and FRPPs' preparedness for, and resilience to, these risks. This input will guide the development of regulatory and supervisory approaches that meet OSFI's mandate of protecting depositors, policyholders and private pension plan beneficiaries while allowing institutions to compete and take risks.
Review the consultation material on the OSFI's website.
On October 12, 2021, OSFI issued a letter summarizing the responses received in respect of this consultation. OSFI received feedback from over 70 respondents, including FRFIs, FRPPs, industry and professional associations, interested organizations and individuals.
Respondents to the Discussion Paper generally support OSFI’s focus on climate-related risks. Many FRFI and FRPP respondents indicated they are in the early stages of assessing and quantifying these risks. There was general agreement that any new OSFI climate-related guidance be principles-based and aligned with global standards where they exist, while considering the Canadian context. OSFI also received a range of suggestions on climate-related scenario analysis, disclosure, taxonomy, and measurement metrics, among other things.
OSFI agrees that guidance on climate-related risks should be principles-based and consider the Canadian context as well as international developments. Taking these factors into account, OSFI expects to communicate next steps on its climate-related policy work early in 2022.
Other developments
October 2021
On October 12, 2021, OSFI issued a letter summarizing the responses received in respect of this consultation.
January 2021
On January 11, 2021, OSFI issued a discussion paper on climate-related risks in the financial sector entitled, “Navigating Uncertainty in Climate Change: Promoting Preparedness and Resilience to Climate-Related Risks”.