Canada has unveiled its inaugural sustainability disclosure standards, CSDS 1 and CSDS 2, now part of CPA Canada’s Sustainability Handbook. These standards, developed by the Canadian Sustainability Standards Board (CSSB), align with the global ISSB framework while incorporating Canadian-specific priorities.

“The new sustainability standards set by the Canadian Sustainability Standards Board mark a pivotal moment for Canadian businesses. These guidelines will provide a clear, consistent framework for reporting environmental and social risks, which are essential for informed investment decisions. Businesses should approach adoption with a strategic mindset, ensuring they integrate these standards into their operations in a way that aligns with their long-term sustainability goals.” said Katie Dunphy, Partner, National ESG Reporting Transformation Leader, KPMG in Canada

Significant Transition Relief

To facilitate seamless adoption, the CSSB has introduced transition relief measures:

A one-year extension for reporting non-climate sustainability issues.
An additional year to disclose Scope 3 GHG emissions.
Three years of relief for quantitative scenario analysis requirements.
Compliance deadlines extended by two years, requiring alignment within six months post-year-end.

“These standards represent a significant milestone in promoting consistency and comparability in sustainability reporting,” stated a CSSB spokesperson.

The CSSB explained: “These changes provide flexibility while maintaining the goal of comprehensive sustainability disclosure.”

Focus on Canadian Context

The CSSB has introduced the Criteria for Modification Framework, ensuring international standards are tailored to address national priorities. This approach fosters a seamless integration with IFRS guidelines while maintaining relevance across Canadian industries.

Support for Early Adoption

To encourage early adoption, CPA Canada offers free access to the Sustainability Handbook until March 31, 2025, ensuring businesses can leverage these essential resources.

Takeaway

The launch of CSDS 1 and CSDS 2 is a critical step for Canada in achieving transparent and comparable ESG reporting. By balancing flexibility with robust expectations, these standards prepare Canadian organizations for a sustainable future.