On March 13, the Canadian Sustainability Standards Board (CSSB) released Canadian Sustainability Disclosure Standards (CSDS) for public consultation. These standards are based on the standards released by the International Sustainability Standards Board (ISSB) last June.
Comments are requested by June 10, 2024 on the following materials:
- Exposure draft – CSDS 1, General Requirements for Disclosure of Sustainability-related Financial Information
- Exposure draft – CSDS 2, Climate-related Disclosures
- Criteria for Modification Consultation Paper
What does it all mean?
The only changes to the ISSB proposals in the exposure drafts relate to effective dates and transition relief. However, concerns have been raised on provisions within the global standards. Consequently, the CSSB has requested specific comment on the following topics:
- scope of proposed CSDS 1
- timing of reporting
- climate resilience
- Scope 3 greenhouse gas (GHG) emissions
The CSSB has published a very helpful and clear overview of the exposure drafts and the specific areas where they seek comment.
Will the Canadian Sustainability Disclosure Standards be mandatory?
No. The proposed standards would become voluntarily effective for annual reporting periods beginning on or after January 1, 2025.
To become mandatory in Canada, the CSSB standards would need to be incorporated into a CSA rule. In other words, once the CSSB consultation is complete and its standards are finalized, the CSA would need to seek comment on a rule setting out sustainability disclosure requirements. Moreover, the CSA has stated that it anticipates adopting only those provisions of the sustainability standards that are necessary to support climate-related disclosures.
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