Organization’s president says Canada should be moving forward on important issue
Last week, the Canadian Securities Administrators announced that it is pausing work on the development of a new mandatory climate-related disclosure rule and amendments to the existing diversity-related disclosure requirements.
This week, chartered professional accountants body CPA Canada has said it is disappointed in the decision and hopes it is only a temporary pause, stressing that being able to compare companies’ exposure to climate-related risks is becoming increasingly vital for investors to make informed decisions.
“Pausing progress on the climate disclosure rule is a disappointing step backward at a time when Canada must be moving forward,” said Pamela Steer, CPA Canada president and CEO. “In a global economy where assessing climate risk is increasingly a prerequisite for investment, this decision risks making our markets less attractive to international capital that we urgently need to drive innovation, competitiveness and economic growth.”
The CSA said it made the decision to support the Canadian markets and issuers as they grapple with recent developments in the US and other international markets.
“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 Chair and CEO of the Alberta Securities Commission. “In response, the CSA is focusing on initiatives to make Canadian markets more competitive, efficient and resilient.”
But Steer doubled-down on the importance of standardized requirements for Canadian companies’ climate-related disclosures, noting that institutional investors have already indicated that mandatory reporting would improve Canada’s standing in the race for global capital.
“Canada cannot afford to fall behind,” says Steer. “CPA Canada remains hopeful this is only a temporary pause, and that the CSA will soon renew its commitment to the consistency and clarity the market needs.”
CPA Canada is concerned that, while giving Canadian companies time to prepare for future reporting, momentum that has been gained may be lost in the meantime.
