Canada has announced a pause on all mandated corporate climate disclosures, citing the unstable global economy and increased uncertainties that have arisen from recent geopolitical and economic shifts. This decision aims to alleviate financial pressures on domestic businesses amid ongoing tariff disputes, particularly with the United States.
Stan Magidson, chair of the Canadian Securities Administrators (CSA) and the Alberta Securities Commission, explained the reasoning behind the move in a statement: “In recent months, the global economic and geopolitical landscape has rapidly and significantly changed, resulting in increased uncertainty and rising competitiveness concerns for Canadian issuers. In response, the CSA is focusing on initiatives to make Canadian markets more competitive, efficient and resilient.”
The backdrop to this announcement includes a series of tariffs imposed on Canada by the Trump administration, such as a 25 percent tax on steel, aluminium, and goods linked to the fentanyl crisis. Canada responded with $21 billion in retaliatory tariffs on U.S. products. These trade tensions have contributed to concerns about profit margins and the affordability of complying with corporate climate disclosure requirements.
However, this decision has met with critical voices within Canada’s sustainability community. Wendy Berman, incoming chair of the Canadian Sustainability Standards Board—which finalised its sustainability disclosure standards in December 2024—commented: “We recognize that regulatory approaches may evolve in response to market conditions, but the demand for credible, comparable sustainability information continues to grow—both globally and at home.”
Canada’s pause on mandated climate disclosures aligns with similar recent developments internationally. Earlier in 2025, the U.S. Securities and Exchange Commission (SEC) suspended court proceedings backing its own corporate climate disclosure rules, while the European Union introduced a legislative package that scaled back elements of its Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive.
Despite the policy shift in Canada, certain regulatory requirements remain in force. At least 1,300 Canadian enterprises are still required to submit sustainability reports to the European Union within the next three years. Experts have advised continued efforts by companies to collect emissions data to satisfy shareholder expectations, given ongoing mandates such as the corporate climate reporting rules in California.
Environmental Defence Canada’s senior manager of climate finance, Julie Segal, expressed concerns about the potential consequences: “Postponing requirements for businesses to get prepared for climate change and align with positive climate action will only leave businesses less prepared, investors less informed and Canada’s economy less competitive.”
The Trellis Group reports that the full impact of Canada’s decision on business practices and climate accountability remains uncertain. Stakeholders are watching how firms will balance evolving regulatory demands with the financial and operational challenges posed by both market conditions and sustainability expectations.
Source: Noah Wire Services