Our Publications
Climate-related Legal Risks for Financial Institutions: Executive Brief
Introduction Financial sector risk leaders, risk managers, and board risk committees are increasingly aware of climate-related legal risks to financial institutions. In Canada, the Office of the Superintendent of Financial Institutions (OSFI) has identified liability risk as a source of climate-related financial risk facing deposit-taking institutions, insurance companies, and pension funds. These risks include regulatory […]
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Primer on Climate Change: Directors’ Duties and Disclosure Obligations
The evolution of our understanding of climate change from an ethical or environmental issue to one that presents foreseeable financial and systemic risks (and opportunities) over short, medium and long-term investment horizons has significantly changed its relevance to the governance of both corporations and investors. This evolution means there are serious implications for the duties […]
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On the Horizon – Briefing note on TCFD-aligned mandatory disclosure in New Zealand
Canadian and other regulators globally are considering how best to embed disclosure and governance of climate-related financial risks and opportunities into financial reporting. This briefing note canvasses recent legislative initiatives in New Zealand as another example of a regulatory path towards net zero. In April 2021, the New Zealand Government introduced the Financial Sector (Climate-related […]
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Following the Footpath to Mandatory TCFD Disclosure in the United Kingdom: Lessons for Canadian and Other Regulators
Regulators in Canada and elsewhere are considering regulatory changes to accelerate the transition towards net-zero carbon emissions. Part of that consideration is whether to adopt the Taskforce on Climate-related Financial Disclosures (TCFD) four pillar framework of governance, strategy, risk management, and metrics and targets. We can learn from regulators that have already adopted measures, in […]
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Climate Change: Legal Implications for Canadian Pension Plan Fiduciaries and Policy-Makers
According to a new legal opinion by Randy Bauslaugh, pension funds have a duty to understand and manage the financial risks and opportunities that climate change poses to funds and beneficiaries. Mr. Bauslaugh identifies the legal obligations of pension fiduciaries to consider and manage climate risks, as with any foreseeable financial risk, and discusses the […]
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Haida law of gina ‘waadluxan gud ad kwaagiida and Indigenous rights in conservation finance
Globally, we are facing an existential threat to biodiversity from human activities that have intruded into terrestrial, aquatic, and aerial ecosystems, exacerbating global warming. The Supreme Court of Canada has held that climate change “is a threat of the highest order to the country, and indeed the world.” Corporations and financial institutions increasingly recognize the […]
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Life, Health, Property, Casualty: Canadian Insurance Company Directors and Effective Climate Governance
The insurance sector is important because it provides the financial safety net for many Canadians suffering losses associated with climate impacts. Insurance coverage is the guarantee that policyholder losses will be indemnified; yet climate-related weather events are growing in severity and frequency. Severe weather damage in Canada caused $2.4 billion in insured losses in 2020, […]
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Directors’ Duties Regarding Climate Change in Japan
Authored by Dr. Yoshihiro Yamada, Vice Dean of College of Law at the Ritsumeikan University, Dr. Janis Sarra, Professor of Law at the University of British Columbia, and Dr. Masafumi Nakahigashi, Vice-President at Nagoya University, the report outlines the three primary duties for directors of Japanese companies: duty of loyalty; duty to be compliant with […]
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Duty to Protect: Corporate Directors and Climate-Related Financial Risk
Amid growing calls from regulators, financial standard organizations and institutional investors, Canadian corporations face pressure to adopt transparent climate-risk reporting. But first, they need greater clarity on the metrics and standards involved. Author Janis Sarra recommends that Canada clarify and adopt mandatory uniform reporting on climate metrics and finance, so that corporate officers and directors […]
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Audit Committees and Effective Climate Governance, A Guide for Boards of Directors
Authored by Dr. Janis Sarra, Professor of Law at the University of British Columbia, with contributing authors Meghan Harris-Ngae, Ernst & Young, Roopa Davé, KPMG, and Ravipal Bains, McMillan LLP, this guide draws together current legal standards and best practice guidance for Canadian audit committees, to assist them in taking a leadership role in effective […]
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The emergence of foreseeable biodiversity-related liability risks for financial institutions: A gathering storm?
Recent economic literature identifies liability as a key category of foreseeable financial risk associated with biodiversity loss. However, it has not, to date, provided further guidance on the nature and extent of litigation and legal risks that should be considered in determining the potential materiality of relevant risks for a given financial actor or system. […]
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‘Troubling Incrementalism’: Is the Canadian Pension Plan Fund Doing Enough to Advance the Transition to a Low-carbon Economy?”
A new legal analysis released by the Canada Climate Law Initiative “’Troubling Incrementalism’: Is the Canadian Pension Plan Fund Doing Enough to Advance the Transition to a Low-carbon Economy?” finds that the CPP’s approach to managing the financial risks of climate change may not be consistent with the best interests of Canadian beneficiaries and contributors. […]
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Putting Climate Change Risk on the Board Room Table
In her opinion, titled “Putting Climate Change Risk on the Boardroom Table,” Ms. Hansell clarifies the role of the corporate board with respect to climate change and how it is unequivocal about the responsibility of corporate directors to include climate change risks and opportunities in their oversight and strategic direction of the companies they serve. […]
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Time to Act: Response to questions posed by the Expert Panel on Sustainable Finance on Fiduciary Obligation and Effective Climate-related Financial Disclosures
The Expert Panel on Sustainable Finance has been commissioned by the Canadian Government to determine how best to generate sustainable finance, a significant challenge given the carbon intensity of Canada’s economy. The Expert Panel has defined sustainable finance as capital flows, risk management activities and financial processes that assimilate environmental and social factors as a […]
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Directors’ Liability and Climate Risk: Canada – Country Paper
The paper is a more accessible form of reporting the research in the first two papers. It is one of country studies from four jurisdictions, complemented by conferences in Australia (August 2016), Canada (October 2017), South Africa (January 2018) and the UK (June 2016). The national legal papers follow a uniform structure to facilitate comparison […]
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