The chairperson of the Canadian Sustainability Standards Board (CSSB) says Canada could become less competitive than its peers in the global economy due to its relatively slow adoption of sustainable finance policies, including climate-related disclosures.
“I’ll be blunt: We are at serious risk of falling behind our global competitors. The world is moving on,” Wendy Berman said at EY’s 2025 Sustainable Finance Summit in Toronto on Monday. Berman stepped into the role of chairperson of the CSSB in May.
“And I’m not ignoring the giant to the south of us in this, where there are real risks and impediments faced by Canadian companies that have operations and business in the U.S., with the current polarization of sustainability issues and politicization of sustainability issues.”
Outside of North America, Berman said multiple jurisdictions are “seizing the day” on this front, regardless of U.S. actions. She cited a report from the IFRS Foundation, which states that 36 jurisdictions around the world have already adopted or are looking to adopt the International Sustainability Standards Board’s (ISSB) sustainability disclosure standards as of mid-2025.
“I think that’s about 60% of the world’s GDP. And if we take a look at [our] 10 largest trading partners beyond the U.S., the overwhelming majority have or will have mandatory sustainability disclosures,” she said.
“My view is that Canada can’t pause on its capacity building and its journey towards sustainability disclosures — we just don’t have the luxury of time to do that.”
The CSSB issued its first set of sustainability standards, which represented Canada’s effort to align with the global standards developed by the ISSB, last December. At that time, the Canadian Securities Administrators (CSA) said it was working on its own rules for climate-related disclosures, which would factor in the CSSB’s work. Without CSA rules, the CSSB standards remain voluntary.
But in April, the CSA paused its work on mandatory climate-related disclosures. It cited global economic and geopolitical developments for the decision, including in the U.S., where the U.S. Securities and Exchange Commission abandoned its own efforts to beef up climate-related disclosures just weeks earlier.
In announcing the pause, the CSA said it wanted to focus on making Canadian markets “more competitive, efficient and resilient.”
However, multiple sustainable finance experts and environmental advocacy groups have called for the resumption of this work, saying it actually makes Canada more competitive in the global economy.
The CEO of the Ontario Securities Commission has said the pause on this work is “not indefinite,” but it’s unclear when this work might continue.
Berman said that needs to happen sooner rather than later.
“I think pausing or lifting the foot off the pedal in terms of building capacity for these disclosures is not in the interest of building resilient Canadian companies,” she said.
She also said that the biggest misconception about sustainability disclosure standards is that these standards are about social or political agendas.
“They are not. They are about transparency … on issues that are really mainstream business issues. There is not a company in Canada that is not affected by climate change or by the transition,” Berman said.
“They’ll be affected by varying degrees,” she said, and for some of them, “it will be very material.”
Berman also pushed back against criticism that these disclosures are simply nice to have or look good, saying, “This is entirely about financial materiality and about increasing confidence and trust.”
Further, she noted that despite polarization of these issues south of the border, companies in the U.S. appear to still value sustainability.
She pointed to a recent report from The Conference Board, which found that while many U.S. companies are shifting away from using the term “ESG,” they aren’t backing away from their sustainability commitments. The report noted that 87% of S&P 500 firms disclosed climate-related targets in their 2024 public statements — on par with the year prior.
“Companies are continuing to report … all three scopes of [greenhouse gas (GHG)] emissions transition plans,” Berman said.
“So, they recognize that that information is crucial to the resilience of their company.”
Collaboration on best practices
Specifically in Canada, Berman said small- and medium-sized enterprises have cited some pain points related to sustainability reporting. This includes scope 3 GHG emissions, which are indirect emissions from a company’s value chain, and knowing what an adequate transition plan looks like and how to fulfill different goals in such a plan.
“So, we see those as pain points, but we also see increasing reliability of data,” she said. “What we need to do as a community within this financial ecosystem is eliminate some of those barriers.”
To arrive at best practices, Berman said the CSSB is working with and learning from different standard-setters around the world, including the ISSB, the U.K. Transition Plan Taskforce and Australia, which is now ahead of Canada on climate-related disclosures, along with groups like Business Future Pathways, which are working on creating tools for robust transition plans.
“I have been very encouraged by the willingness of other national standard-setters and financial authorities to share both the good and the bad about their experience,” Berman added.