Canada sustainability reporting rules: CSDS 1, CSDS 2 and OSFI B-15

Canada has two national sustainability disclosure standards, but their publication did not create one filing obligation for every Canadian company. Canadian Sustainability Disclosure Standards (CSDS) 1 and 2 are available for voluntary use. Listed issuers remain subject to existing securities-law requirements for material climate information after securities regulators paused work on a new climate rule. Federally regulated banks and insurers have a separate mandatory route under Guideline B-15.

The first question is therefore not whether Canada has adopted sustainability standards. It is which regulator, law or contract governs the entity. A bank, a public issuer and a private manufacturer can all refer to the same standards while facing different reporting duties.

Canada does not have one reporting rule for every company

This division is easy to miss because the Canadian Sustainability Standards Board issued standards before Canadian securities regulators settled a new national filing rule. The standards set out a reporting basis. They do not decide every company's legal scope.

What CSDS 1 and CSDS 2 contain

The Canadian Sustainability Standards Board (CSSB) issued CSDS 1 and CSDS 2 on 18 December 2024. They were added to the sustainability section of the CPA Canada Handbook and are effective for annual reporting periods beginning on or after 1 January 2025.

CSDS 1 covers sustainability-related financial information across risks and opportunities that could affect an entity's prospects. CSDS 2 concentrates on climate-related risks and opportunities. Both are based on the International Sustainability Standards Board standards, IFRS S1 and IFRS S2, with Canadian transition arrangements.

Effective does not mean compulsory. A Canadian company can use the standards voluntarily, but CSDS 1 and CSDS 2 become a filing obligation only when an authority with jurisdiction requires them or when another binding arrangement incorporates them.

Voluntary use can still create real work. A company claiming compliance needs a defensible reporting boundary, evidence for material judgements and controls over the data placed alongside financial information. The reporting team should decide whether it is making a full compliance statement, using selected concepts or preparing for a future mandate. Those are different claims.

The CSA paused its proposed climate rule

Canadian securities regulators had been developing a new mandatory climate-disclosure rule for public companies. On 23 April 2025, the Canadian Securities Administrators (CSA) paused that work, citing changes in global economic and geopolitical conditions.

The pause did not remove existing disclosure duties. The CSA said securities law already requires issuers to disclose material climate-related risks in the same way as other material information. An issuer cannot treat the absence of a new dedicated climate rule as permission to omit information that is material under the rules already in force.

The CSA also encouraged issuers that report voluntarily to consider the CSSB standards. That creates a choice of reporting architecture, not an exemption from materiality. A public company still needs to connect its climate disclosures with risk factors, management discussion and analysis, financial statements and other market communications.

The CSA's 2025 to 2028 business plan says regulators will monitor voluntary adoption and international developments. Companies should therefore maintain a change watch rather than build a filing calendar around an assumed future start date.

Banks and insurers follow OSFI B-15

Federally regulated financial institutions have a more direct timetable. The Office of the Superintendent of Financial Institutions (OSFI) uses Guideline B-15 to set expectations for climate-risk management and public disclosure.

Domestic systemically important banks and internationally active insurance groups entered the disclosure timetable for financial years ending in 2024. Other federally regulated banks and insurers followed for financial years ending in 2025. The disclosure expectations apply at the highest consolidated level of the institution.

OSFI updated B-15 after the final Canadian standards were issued. Most Scope 3 emissions disclosure is expected from financial years ending in 2028. Scope 3 emissions associated with off-balance-sheet assets under management follow from financial years ending in 2029.

That later timing does not make financed-emissions preparation optional until 2028. Banks and insurers need methods, ownership and source data before the first public figure is due. The Partnership for Carbon Accounting Financials (PCAF) guide covers the accounting approach, while the sustainability reporting controls guide shows how to retain evidence and review judgements.

The practical timetable depends on the reporting route

For a federally regulated bank or insurer, B-15 supplies the starting point. For a public issuer, the starting point is existing securities-law materiality and continuous disclosure. For other companies, the starting point may be voluntary CSDS adoption, a parent company's reporting policy or a request from a lender or customer.

A Canadian subsidiary of an overseas group may contribute information to reporting under the EU's Corporate Sustainability Reporting Directive or another parent-level framework. That group request does not automatically create a separate Canadian statutory filing. The local company should record which disclosures serve the parent, which satisfy a Canadian duty and which are voluntary.

The same separation applies to assurance. A parent-level assurance engagement may test Canadian data without creating a Canadian public assurance opinion. Reporting teams should define the entity, report, period, evidence boundary and intended user before deciding how much assurance work is needed.

A reporting check for Canadian companies

1. Identify the entity and regulator. Record listing status, province or territory, sector regulator and whether the entity is federally regulated.
2. Separate law from voluntary standards. Note the existing legal disclosure duty before selecting CSDS 1, CSDS 2 or another reporting framework.
3. Test materiality in the right place. Public issuers should connect material climate information with their wider securities filings rather than treating sustainability reporting as a stand-alone publication.
4. Build the timetable by disclosure layer. For B-15 institutions, distinguish current disclosures from the later Scope 3 phases.
5. Document every external demand. Keep parent, lender, customer and voluntary reporting requests separate from statutory Canadian filings.
6. Maintain a regulatory watch. Recheck CSA policy, OSFI guidance and CSSB amendments before each reporting cycle.

Canada's reporting framework is not empty, but it is split. CSDS 1 and CSDS 2 provide a national baseline, existing securities law governs material disclosure by public issuers, and OSFI B-15 sets the clearest mandatory sustainability-related timetable. A reporting plan is reliable only when it names which of those routes it is following.

Sources

• Canadian Sustainability Standards Board: final CSDS 1 and CSDS 2 announcement
• CPA Ontario: Canadian Sustainability Disclosure Standards
• Canadian Securities Administrators: 2024 to 2025 Year in Review
• Canadian Securities Administrators: 2025 to 2028 Business Plan
• Office of the Superintendent of Financial Institutions: Guideline B-15 Climate Risk Management
• Office of the Superintendent of Financial Institutions: B-15 update following final CSSB standards