Prepare for Canada’s New Sustainability Reporting Requirements
A Proactive Approach for Seamless Integration of Canadian Sustainability Disclosure Standards (CSDS)
The Canadian Sustainability Standards Board (CSSB) is setting a new benchmark for environmental, social, and governance (ESG) reporting in Canada with its proposed Canadian Sustainability Disclosure Standards (CSDS). Early adoption of these standards will ensure a smooth transition to the expected mandatory reporting requirements in the future. Discover how your organization can start preparing to be at the forefront of ESG disclosures.
Understanding the Canadian Sustainability Disclosure Standards CSDS
The Canadian Sustainability Disclosure Standards (CSDS) are the Canadian adaptation of the International Sustainability Standards Board (ISSB) global reporting standards (read Advancing Sustainability Leadership: The Critical Role of ISSB Reporting Standards for Your Organization blog post). They consist of two proposed standards:
- CSDS 1: General Requirements for Disclosure of Sustainability-related Financial Information: Outlines the general requirements for preparing and presenting sustainability-related financial disclosures, covering governance, strategy, risk management, metrics, and targets.
- CSDS 2: Climate-related Disclosures: Includes reporting on climate resilience, greenhouse gas emissions, and climate-related targets.
These standards largely align with International Sustainability Standards Board ISSB’s IFRS S1 – General Requirements and IFRS S2 – Climate-related Disclosures, but with some key differences and extended transition reliefs.
Notably, the proposed Canadian Sustainability Disclosure Standards (CSDS) effective date for voluntary adoption is January 1, 2025, with transition reliefs granting entities additional time for certain disclosures, such as those beyond climate-related risks and opportunities and Scope 3 GHG emissions, deferred until the reporting period beginning on or after January 1, 2027.
A Proactive Approach is Required
Taking proactive steps to align with the Canadian Sustainability Disclosure Standards (CSDS) now not only ensures a seamless transition to potential mandatory ESG reporting but also positions your organization as a leader in sustainability.
Key steps for start ESG reporting include:
- Familiarize Yourself with the Standards: Read and understand CSDS 1 and CSD2 and stay informed about ongoing developments and announcements by CSSB.
- Assess Your Current State: Conduct a thorough gap analysis of your existing ESG reporting practices against CSDS requirements, focusing on materiality assessment.
- Develop an Implementation Plan: Ensure robust data collection, and management systems, integrate sustainability reporting into your governance structure, and actively engage with stakeholders throughout the process.
Climate Action is Key
While the CSDS encompass a broad range of ESG factors, climate-related disclosures are a central focus. CSDS 2 (as IFRS 2) requires detailed reporting on greenhouse gas (GHG) emissions, climate-related risks and opportunities, and strategies for managing climate impacts.
For organizations, this means prioritizing the development of robust climate strategies and carbon accounting processes. Key steps include understanding your organization’s carbon footprint, identifying climate risks and opportunities, and setting ambitious emissions reduction targets. These actions also open doors for identifying areas of operational improvement and potential cost savings.
Blackstone Energy Can Help You
For over 20 years, Blackstone Energy has helped numerous companies and organizations manage, conserve, and report on their carbon emissions to ensure they comply with current regulations.
Our experts are ready to guide you through CSDS compliance, climate strategy development, and carbon accounting to achieve your sustainability goals. Contact us to learn more: policyandregulatory@blackstoneenergy.com
