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Canadian Sustainability Standards Board set to take up global ESG standards

CSSB will take on role of monitor, not enforcer

Canadian Sustainability Standards Board (CSSB) chair Charles-Antoine St-Jean. (Courtesy Canadian Sustainability Standards Board)
Canadian Sustainability Standards Board (CSSB) chair Charles-Antoine St-Jean. (Courtesy Canadian Sustainability Standards Board)

The Canadian Sustainability Standards Board (CSSB) is accelerating its mission of bringing Canada into alignment with international sustainability standards as laid down by the International Sustainability Standards Board (ISSB).

Last month, the CSSB announced it had appointed three new members to both broaden its geographical representation and add to its level of expertise.

Two of the three new appointees – Catherine Isabelle, senior director, sustainability and climate innovation at PSP Investments and Daniel Charron, VP of social engagement and public affairs at Fondaction – are based in Quebec. The third, Sandra Odendahl, senior VP and head, sustainability, diversity and partnerships, Business Development Bank of Canada, is based in Ontario. 

The newly formed CSSB became operational in June and now comprises 12 executive members. The appointments will enable the board to scale up its operations and lay the foundation for the adoption of international sustainability disclosure standards in Canada. 

"We are excited to welcome three additional, proven leaders in sustainability to our board, Lorraine Moore, chair of the Accounting Standards Oversight Council, and co-chair of the CSSB implementation committee, said.

Charles-Antoine St-Jean leading the effort

Leading the drive to bring Canada into harmony with ISSB standards is Charles-Antoine St-Jean, who was named CSSB chair in April. As the former interim head of the Chartered Professional Accountants (CPA) of Canada, St-Jean brings the requisite skill set to the challenge of bringing transparency and legitimacy to the notoriously fungible ESG reporting matrix.

"The partnerships and relationships being cultivated with organizations and people both here in Canada and internationally are critical to the CSSB's objective of ensuring sustainability standards work for our country," St-Jean said in a statement accompanying the September 15 announcement of the three new appointments to the board. 

"We are focused on ensuring meaningful engagement with those who are impacted and affected by the first international sustainability standards."

St-Jean was instrumental in push to adopt ISSB standards

The adoption and integration of ISSB standards would represent a critical step forward in not only putting Canada at the forefront of ESG reporting, but also serve as a signal to other western nations for the urgent need to harmonize and add legitimacy to the carbon trading market.

It was while working with his team at CPA that St-Jean led the original effort to realize the "dream" of helping set up the CSSB and bring ISSB standards to Canada.

"We all felt that it was a great opportunity to raise Canada’s profile in a positive way – and in an area where Canada had been viewed less favourably over the last years," St-Jean explained in an exclusive interview with SustainableBiz. 

"We got that done. The ISSB was set up, and Canada was chosen to be one of the two decision centres, creating opportunities for Canada to have a significant presence in the development of the global standards." 

The CSSB is actively engaged in supporting the uptake and implementation of IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and S2 Climate-related Disclosures in Canada. 

"The CSSB (now) sets and maintains high-quality sustainability disclosure standards for Canadian entities, building on the ISSB’s global baseline standards. We also play a key role in contributing to and influencing the global standardization of sustainability disclosures," St-Jean added. 

CSSB plays role in framing of ISSB global baseline standards

The board is also working in collaboration with various Canadian regulatory bodies which will ultimately be responsible for creating a consistent set of standards and reporting framework that governs sustainability reporting.

"One of the CSSB’s key roles is to contribute to and influence the work of the ISSB to ensure Canadian entity requirements are considered in the development of global baseline standards. We put this role into practice this summer when we consulted with Canadians on the ISSB’s recent Agenda Priorities project, which looked to the ISSB’s next two years of priorities," St-Jean said.

"What we heard in Canada during the consultation process was that implementation of the ISSB’s initial standards was (a top priority), encouraging the ISSB to provide interpretive guidance and examples, address implementation and applications and actively pursue interoperability with other jurisdictions to support successful implementation."

Accountability and the elimination of greenwashing

One of the underlying objectives of the CSSB is to introduce reporting standards that demand greater accountability form Canadian companies. Coordinating its efforts with the ISSB and thereby developing standards that are both fair and equitable for Canadian corporations will better enable this country to compete on an international level. According to St-Jean, this will require some deft diplomacy and negotiation.

"With the current climate emergency and the groundswell of market support for climate disclosure, there is an urgency for us to act on IFRS S1 and S2. At the same time, we need to be thoughtful about the needs of our Canadian market and fully understand the implementation needs of our country. We expect to consult with Canadians on IFRS S1 and S2 implementation in 2024," St-Jean said.

"When it comes to greenwashing, it’s important to note that IFRS S1 principles require the information to be verifiable, with audited disclosures playing one role in supporting trusted sustainability disclosures. The work of ensuring the reliability and integrity of the disclosures is currently underway by the International Auditing and Assurance Standards Board and, in Canada, the Auditing and Assurance Standards Board."

CSSB's role is that of a monitor rather than enforcer

Although the CSSB is not empowered to act as a regulator or enforcer, St-Jean nevertheless believes enormous benefit will come from the board's role as a strict monitor of Canada's ESG reporting landscape.

"In Canada, we’re lucky to operate in a stable, well-trusted system – within which many connected but independent processes operate. The CSSB’s role is not to enforce, but rather to ensure sustainability disclosures standards for use in Canada are fit for our purposes. And we will certainly be monitoring the use of these standards," St-Jean said.

"That said, the United Nations is clear: we have a small window of time to urgently make changes and achieve our 1.5 C target. Canada’s government has a 2050 net-zero strategy in place to ensure optimal decarbonization. Such programs and regulatory requirements will play a key role in continuing to foster economic growth – and it’s a race again time."

St-Jean is fully confident his organization can play a decisive part in making Canada a world leader in terms of ESG transparency and corporate accountability.

"Uniform standards, and the auditability of those standards, will usher a in a new age of integrity. The CSSB will be able to bring the same level of transparency and trust to sustainability disclosures as has been done with financial reporting."

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