Background
In December 2024, the Canadian Sustainability Standards Board (CSSB) released its inaugural standards, Canadian Sustainability Disclosure Standard (CSDS) 1, General Requirements for Disclosure of Sustainability-related Financial Information, and CSDS 2, Climate-related Disclosures.
During the consultation on CSDS 1 and CSDS 2, there was a call for support in adopting a climate-first approach.
In response, the CSSB decided to provide a two-year transition relief on CSDS 1 giving entities time to prepare for broader reporting under CSDS 1. This guide also addresses market feedback, while acknowledging the International Sustainability Standards Board’s (ISSB) foundational work. It includes sections from the ISSB’s educational material Applying IFRS S1 when reporting only climate-related disclosures in accordance with IFRS S2, published in January 2025.
New Guide Released
Guide on Adopting a Climate-first Approach in Sustainability Reporting.
This guide helps entities and their advisors comply with CSDS 1 and CSDS 2 when using the transition relief and disclosing information on climate-related risks and opportunities only, in accordance with CSDS 2 (often referred to as a “climate-first” approach). To adopt a climate-first approach, the entity must apply certain requirements in CSDS 1 (the “applicable CSDS 1 requirements”) and the requirements in CSDS 2.
Recent regulatory developments have created uncertainty around mandatory climate disclosure rules. Nonetheless, investor demand for climate information remains strong and entities that voluntarily respond to this demand face a range of opportunities, in terms of enhanced risk management and competitiveness.
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