The Pension Investment Association of Canada is urging the Canadian Securities Administrators to work closely with its international counterparts to ensure consistency in regulations on climate-related disclosure.
In an open letter to the Ontario Securities Commission, the PIAC called on the CSA to align its climate regulations with the U.S. Securities and Exchange Commission and the International Sustainability Standard Board. Last year, the SEC proposed a new regulation around climate disclosure, while the ISSB issued draft disclosure standards.
“With Canadian, U.S. and international markets being so interconnected and with many cross-listed companies, it is imperative that there is a globally harmonized framework for climate disclosures and that the standards are as consistent as possible,” wrote Peter Waite, executive director of the PIAC, in the letter. “Ideally, there should be one global standard so that companies could apply a single set of rules to their climate disclosure regardless of the jurisdiction of regulation.”
While the SEC’s proposed regulation suggests a mandatory disclosure of Scope 1 and 2 emissions, the CSA’s proposed regulation suggests either a ‘comply or explain’ approach or a mandatory disclosure of Scope 1 with a comply or explain model for Scopes 2 and 3, according to the letter, which noted the ISSB’s draft regulation could also serve as a common set of standards allowing rules in different jurisdictions to be reconciled.
“The SEC’s proposed regulations are more rigorous than the CSA’s and compliance with the SEC’s proposed rules will cover almost all of CSA’s rules, with a few exceptions. However, they are far from what Europe is introducing, making it difficult for multinational companies to comply with different standards.
“We encourage the CSA to revise its proposal so that it includes more stringent climate disclosure requirements, preferably in line with those in the U.S and elsewhere in the world.”