OTTAWA/TRADITIONAL, UNCEDED TERRITORY OF THE ALGONQUIN ANISHNAABEG PEOPLE — Environmental law charity, Ecojustice continues to express disappointment in the Office of the Superintendent of Financial Institution (OSFI)’s choice to delay reporting requirements for the Scope 3 greenhouse gas emissions of federally regulated financial institutions.
Today, OSFI published the changes to its Guideline B-15: Climate Risk Management that it announced in a letter to industry on February 20, 2025.
The Guideline, initially published in March 2023, outlines the minimum requirements that banks and insurance companies are expected to follow to manage and increase their resilience to the threats that climate change poses. One of these requirements was for banks and insurance companies to publicly disclose key metrics on climate-related risks, like their greenhouse (GHG) gas emissions. Ecojustice’s initial reaction to the letter to industry can be found here.
The current revisions to the Guideline delay when big banks and insurance companies need to publicly disclose climate metrics, specifically implementing:
- 3-year delay (from 2025 to 2028) to disclose their Scope 3 absolute GHG emissions. This is important because Scope 3 emissions (i.e., the indirect emissions that occur as a result of the institutions financing, including financing of fossil fuel companies) the largest portion of banks’ and insurance companies’ carbon footprint, that on average are over 700 times larger than their direct emissions.
- 4-year delay (from 2025 to 2029) to provide additional and specific information on Scope 3 disclosure for asset management activities; and,
- 3-year delay (from 2025 to 2028) to disclosure industry-based metrics.
More minor changes in the Guideline include removing the word ‘mandatory’ from the standard and largely replacing it with ‘expected’ and requiring institutions to specify items that it has not disclosed and explain the corresponding rationale.
Ecojustice’s lawyer and Sustainable Finance Project Lead, Karine Peloffy shared: “OSFI has demonstrated leadership in upholding climate risk management guidelines amidst the rampant backsliding taking place in the United States. Canada needs a stronger climate framework, now. Instead, we got more delays on critical Scope 3 emissions data — by far the largest and most concerning source of financial institutions’ emissions, particularly those tied to fossil fuels.”
Ecojustice points to the fact that Canada’s largest banks have net-zero commitments but continue to fund climate chaos through their fossil fuel investments, while neglecting to adequately finance clean energy alternatives and repeatedly undermining their own net-zero pledges.
Peloffy adds: “Canada’s financial institutions remain among the world’s worst financiers of fossil fuels. If Bay Street was a country, it would be the world’s fifth largest emitter and Bloomberg NEF’s latest report ranked a Canadian bank as the worst in the world in terms of the ratio of clean energy to fossil fuel funding among major global banks.
The current international and national disclosure rules, based on the outdated Greenhouse Gas Protocol (2004), allow major emitters like the fossil fuel sector to bypass accountability on emissions data and leave a critical gap that undermines trust in the accuracy of Scope 3 emissions data for financial institutions regulated by OSFI. Even when financial institutions begin disclosing their Scope 3 emissions under the Guideline, we anticipate significant gaps in its reliability, particularly as it relates to the financing of the fossil fuel sector.” (see background).
“Let’s keep in mind that we are not even talking about importing rules about climate action; this is just disclosure. The federal government has a responsibility to legislate the financial institutions that are actively working against us by continuing to fuel the climate crisis. Ecojustice has been calling on the federal government to future-proof our economy years, and calls on all political parties to step forward and include climate-aligned finance in their upcoming election platforms.”
Ecojustice finance lawyer, Tanya Jemec adds: “While weakening the timeline for GHG emissions disclosure is disappointing, OSFI’s Guideline B-15 is still a positive measure that can help our financial institutions maintain strength in responding to the climate emergency. What the Guideline needs now is to define science-backed requirements for climate transition plans. Our financial institutions need to have credible plans and shift away from financing fossil fuel infrastructure to supporting and harnessing opportunities in clean energy at scale. Canada needs a climate-aligned financial system to future-proof our economy.”
About
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.
Background
Find additional background here.
