ESG and Sustainability Standards

Learn more about the new landscape of Environmental, Social and Governance (ESG) reporting, the development of international sustainability standards and how professional accountants are uniquely positioned to enhance reliability of ESG information for decision making.

The International Public Sector Accounting Standards Board (IPSASB) launched global consultation on public sector sustainability reporting

The objective of the consultation is to gauge stakeholder interest for sustainability reporting guidance for the public sector.

 This Consultation Paper proposes the IPSASB:

  • Serve as the standard setter for global public sector specific sustainability guidance,
  • Develop initial guidance focused on general disclosure requirements for sustainability-related information and climate-related disclosures with release by the end of 2023.

 Comment period is open until September 9, 2022.

Canada Introduces Mandatory Climate Disclosures for Banks, Insurance Companies Beginning 2024

The federal government budget 2022 introduced requirements for federally regulated financial institutions to report climate-related risks based on the Task Force on Climate-related Financial Disclosure framework beginning 2024.

ISSB published exposure drafts on climate and general sustainability disclosures

The International Sustainability Standards Board (ISSB) published two exposure drafts:

  • General Requirements for Disclosure of Sustainability-related Financial information
  • Climate-related Disclosures

The deadline for submitting comments is July 29, 2022 for both exposure drafts.

SEC proposes climate-related disclosure requirement

The Securities and Exchange Commission (SEC) is proposing rule changes that would require registrants to disclose climate-related information including:

  • Certain climate-related financial statement metrics and related disclosures in a note to its audited financial statements;
  • Climate-related risks and their material impacts on the registrant’s business, strategy, and outlook;
  • Climate-related risks and relevant risk management processes;
  • Greenhouse gas emissions; and
  • Information about climate-related targets and goals, and transition plan, if any.

Comments are due 30 days after its publication in the Federal Register or May 20, 2022, whichever is later

Proposed national instrument 51-107, disclosure of climate-related matters

The Canadian Securities Administrators has proposed a new National Instrument (NI 51-107), in response to institutional investors requests with respect to climate change. Key points in the proposal include:

  • requiring an issuer to disclose certain climate-related information mainly on governance, strategy, risk management and metrics and targets.
  • introducing disclosure requirements for climate-related matters in certain regulatory filings of reporting issuers (other than investment funds).
  • non-venture issuers - comply for financial years beginning on or after January 1 of the first year after the effective date of the proposed instrument (one-year transition phase);
  • venture issuers - comply on or after January 1 of the third year after the effective date of the proposed instrument (three-year transition phase).

Comment period for the proposed NI 51-107 closed on February 16, 2022. NI 51-107 is anticipated to be effective by December 31, 2022.

New non-authoritative guidance on applying CSAE 3000 to extended external reporting assurance engagements (EER)

EER encapsulates many different forms of financial or non-financial reporting including ESG reporting, corporate social responsibility reporting, integrated reporting, and greenhouse gas statements.

To provide support for key challenges commonly encountered on EER assurance engagements, the IAASB published its non-authoritative guidance on applying ISAE 3000 (revised) to EER assurance engagements.

The AASB supports the AASB’s EER Guidance and issued an additional document explaining the differences between ISAE and CSAE.

Key differences include:

  • There is a separate Canadian standard for direct engagements (CSAE 3001), whereas ISAE 3000 can be used for both attestation and direct engagements.
  • Canadian practitioners need to comply with the relevant ethical requirements in their jurisdiction as per CSAEs.

Additional Non-authoritative Guidance

To stay ahead of the curve, find additional non-authoritative guidance to help you navigate the new landscape of ESG standards, reporting, attestation, and how ESG information can help investors identify and understand ESG risks as part of their decision making.

ESG ReportESG Reporting

ESG reports communicate a company’s environmental, social, and governance performance. Learn more about the ESG reporting frameworks that companies are using to disclose their ESG information.

ESG AssuranceESG Assurance

As a global system for sustainability-related reporting continues to gain momentum learn about how CPAs can play a key role in increasing the reliability of sustainability information through assurance services. 

ESG RatingsESG Ratings, Investor Analysis and Governance

Investors and analysts are looking to understand how companies manage their ESG risks. Strong oversight and accountability are crucial to the management of material ESG risks and long-term business strategy. Learn more about ESG risk rating, corporate governance ratings and how boards can exercise oversight of ESG matters by implementing an ESG oversight framework.

ESG Thought LeadershipESG Thought Leadership

Responding to pressure from shareholders and customers, more companies are beginning to report on social metrics and set targets for social change beyond what the law requires. Learn how professional accountants and finance experts can play a valuable role in adding rigor, accuracy and consistency to social measurement and reporting, just as they do to financial reporting.

ESG Training

Investors, employees, and consumers alike are expecting companies to provide greater transparency around their environmental, social and governance issues. Access relevant training on how CPAs can play a role in helping companies demonstrate their value to stakeholders and the broader society.

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