The Canadian Securities Administrators (CSA) has issued some assistance in helping companies identify and improve their disclosure of material risks posed by climate change.

The latest notice doesn’t create any new legal requirements, but does clarify some current ones.

Many investors, particularly institutional investors, have become increasingly focused on climate change-related risks and have expressed concern to their respective regulators that they aren’t receiving enough disclosure of these risks from issuers.

Investors seeking more disclosure on climate change

“We encourage directors and senior management of issuers to consider our guidance with respect to climate change-related risks,” said Louis Morisset, CSA chair, president and CEO of the Autorité des marchés financiers (AMF). “Many investors are seeking improved disclosure on the material risks, opportunities, financial impacts and governance processes related to climate change. The guidance provided by both of these notices will enable issuers to improve their disclosure of material climate change-related risks affecting their business."

The CSA said it recognizes that the disclosure is important for investors to make informed decisions, but also presents challenges and potential burdens for all issuers, especially smaller issuers with more limited resources. “This notice is intended to help issuers, particularly smaller issuers, by providing guidance on preparing the disclosure of material climate change-related risks.”