OTTAWA/TRADITIONAL, UNCEDED TERRITORY OF THE ALGONQUIN ANISHNAABEG PEOPLE — Ecojustice is raising concerns following the Department of Finance quietly publishing the long-awaited Report on Federal Climate-Related Risk Management.
The report was added to the Department of Finance’s website without announcement and environmental groups warn it is missing any real structural measures which would indicate the federal administration has a good grasp of climate-related financial risks. Climate-aligned finance is a key missing piece to Canada’s climate plans — this report shows that the federal government still has significant work to do to comprehensively understand the financial impacts of climate change.
Ecojustice and other environmental organizations have been calling for this report for years. The obligation to produce this report became effective almost two years later than the rest of the Canadian Net-Zero Emissions Accountability Act, and the report itself should have first been released in 2024 but was delayed without explanation.
Under section 23 of the Canadian Net-Zero Emissions Accountability Act, the Minister of Finance, in cooperation with the Minister of the Environment and Climate Change Canada, are required to prepare an annual report detailing the key measures taken by the federal public administration to address financial risks and opportunities associated with climate change. This report must be made publicly available.
Ecojustice’s Sustainable Finance Project Lead, Karine Peloffy shared:
“This report is an important first step in the federal government assessing the real risks of climate change on federal institutions, and the billions of taxpayers’ dollars they represent. Unfortunately, this first version of the report falls short on addressing the federal government’s exposure to climate risk.
In addition to the lack of content, the fact that the report was released without fanfare and buried on a website makes one thing clear: the federal government does not have a real plan to address the financial risks posed by climate change.
What we have been given is the bare minimum: a superficial set of small measures that do little more than pay lip service to climate risks.
At a high-level, the report recognizes that the government needs to take action to reduce risks associated with climate change and that climate change impacts financial asset value. However, in a critical oversight, the report fails to address how the government’s own role in financing fossil fuel supply and expansion is increasing the climate-related risks to the assets the government holds. Indeed, a joint report from the Bank of Canada and the Office of the Superintendent of Financial Institutions warns that transition risks are of particular significance for Canada given its endowment of carbon-intensive commodities. Make no mistake, climate-fueled disasters are the result of actions taken by the fossil fuel industry, and by governments funding them.
What we need is a comprehensive package of measures to align Canada’s public and private finance with our climate commitments, as the Climate-Aligned Finance Act proposed. In this critical moment, failing to plan means planning to fail — and we simply cannot afford to fail.”
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Ecojustice uses the power of the law to defend nature, combat climate change and fight for a healthy environment. Its strategic, public interest lawsuits and advocacy lead to precedent-setting court decisions, law and policy that deliver lasting solutions to Canada’s most urgent environmental problems. As Canada’s largest environmental law charity, Ecojustice operates offices in Vancouver, Calgary, Toronto, Ottawa and Halifax.