Canada launches Sustainable Finance Action Council
May 12, 2021 - Ottawa, Ontario - Department of Finance Canada
Around the world, investors and governments recognize that key to a sustainable economic future are sustainable financial investments. Sustainable finance is about incorporating environmental, social and governance factors into investment decisions and is a fast-growing market that is gaining speed as more and more businesses address climate change and transition to a low-carbon economy and seize the economic opportunities it presents.
Today, the Deputy Prime Minister and Minister of Finance, the Honourable Chrystia Freeland, and the Minister of Environment and Climate Change, the Honourable Jonathan Wilkinson, launched the Sustainable Finance Action Council.
The council will bring together public and private sector financial expertise to support the growth of a strong, well-functioning, sustainable finance market. Financial sector leaders will provide input on the foundational market infrastructure needed for a stable and reliable sustainable finance market in Canada that will boost investor confidence and drive economic growth. Mobilizing capital is a critical part of Canada’s work to meet its 2030 Paris target, achieve net-zero emissions by 2050, and ensure that Canada continues to have a prosperous economy.
Kathy Bardswick is today named as the inaugural Chair of Canada’s Sustainable Finance Action Council and will invite a regionally diverse group of leading financial sector organizations to participate as members of the council. Participants will include a broad representation of Canadian banks, insurance companies and pension funds. A public sector coordinating group will play a role in observing council meetings and advising the chair. The first meeting is expected to take place in early June, at which point confirmed participants will be announced. Other organizations and individuals from academia, think tanks and industry groups with expertise in sustainable finance will be engaged for their advice and input.
The Government of Canada also recognizes that sustainable finance incorporates representative decision-making. The work of the council will also therefore include a focus on gender and diversity reporting across the public and private sector.
Establishing a well-functioning sustainable finance market will give investors confidence in Canada, protect the resilience of the Canadian financial sector in the years ahead, and ensure Canada’s broader long-term economic strength.
“The global economy is turning swiftly, decisively, and irreversibly green. It is essential for the prosperity of the next generation of Canadians – and indeed, for those of us working today – for Canada to be at the forefront of this great transformation. Our government knows that the only choice for Canada is to be in the vanguard – and prioritizing sustainable finance is central to this objective. We want to ensure Canada is the best place to invest and to secure the long-term growth of our economy. I am grateful that Kathy Bardswick has agreed to lead the Sustainable Finance Action Council and bring leading financial sector organizations together to make sustainable finance standard industry practice in Canada.”
The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance
“As financial systems around the world are increasingly looking to measure, price and disclose climate risk, the Sustainable Finance Action Council will help ensure Canada stays ahead of the curve. There is no question that climate change presents unprecedented risks and economic opportunities. The sooner we understand and disclose them, the more effectively we can address and seize them. Taken with other measures our government has announced, these measures will help accelerate the flow of capital to investments needed for a sustainable economy. This is what global investors are looking for, what Canadians expect, and what will set our businesses up for success in the 21st century.”
The Honourable Jonathan Wilkinson, Minister of Environment and Climate Change
In the July 2020 Economic and Fiscal Snapshot, the Government of Canada announced funding of $7.3 million over three years for the Sustainable Finance Action Council.
The council’s early emphasis will be on enhancing climate-related financial disclosures in Canada’s private and public sector, aligned with the recommendations of the Task Force on Climate-related Financial Disclosures. The council will also prioritize gender and diversity reporting.
The council’s principal mandate is to make recommendations on critical market infrastructure needed to attract and scale sustainable finance in Canada, including: enhanced assessment and disclosure of climate risks and opportunities; better access to climate data and analytics; and common standards for sustainable and low-carbon investments. These areas respond to the recommendations of the Expert Panel on Sustainable Finance.
The council will work in close collaboration with Canada’s new and independent Net-Zero Advisory Body to ensure climate considerations are reflected in public and private financial decision-making.
Budget 2021 announced that Crown corporations with assets over $1 billion would begin annual climate-related financial disclosure starting in 2022, with smaller Crown corporations following by 2024. The Canadian Net-Zero Emissions Accountability Act also proposes to legislate this for Crown corporations.
The Canadian Net-Zero Emissions Accountability Act will require the Minister of Finance, in cooperation with the Minister of Environment and Climate Change, to publish an annual report on action the federal government has taken to manage the financial risks and opportunities related to climate change.
From 2015 to 2019, the federal government has invested $60 billion towards climate action. Since October 2020, the federal government has committed an additional $53.6 billion towards a green recovery that will build a clean economy, fight and protect against climate change, and create good middle-class jobs.
On April 22, 2021, the Government of Canada announced a new climate target of reducing Canada’s emissions by 40 to 45 per cent below 2005 levels, by 2030, exceeding and replacing Canada’s previous target under the Paris Agreement of 30 per cent.
In February 2021’s Roadmap for a Renewed U.S.-Canada Partnership, Prime Minister Trudeau and President Biden agreed to work with Canadian and American public and private financial institutions to advance the adoption of climate-related financial risk disclosure and align financial flows with climate goals, including the achievement of a prosperous net-zero emissions economy.
In December 2020, the Government of Canada released its strengthened climate plan, which includes a proposal to continue to put a price on pollution post-2022 through to 2030 in a manner that is predictable for investors and affordable for households.
- Budget 2021: A Recovery Plan for Jobs, Growth, and Resilience
- Roadmap for a Renewed U.S.-Canada Partnership
- Fall Economic Statement 2020
- Economic and Fiscal Snapshot 2020
- Final report of the Expert Panel on Sustainable Finance
- Strengthened Climate Plan: A Healthy Environment and a Healthy Economy
- Government of Canada delivers on commitment to appoint an independent net-zero advisory body
Media may contact:
Deputy Prime Minister's Office
Office of the Minister of Environment and Climate Change
Department of Finance Canada
Report a problem or mistake on this page
- Date modified: