The Autorité des marchés financiers’ Climate Risk Management Guideline is an important acknowledgement that climate-related risks can significantly affect the safety and soundness of Québec-regulated financial institutions, in turn affecting the integrity of the Canadian financial system.

The Canada Climate Law Initiative has three recommendations that will amplify Autorité des marchés financiers’ (AMF) protection of the financial system by offering clear guidance to Québec-regulated financial institutions on managing climate-related financial risks and building resilience in the transition to a decarbonized economy:

1. Amend the requirement for a climate transition plan to require an objective of transition to net-zero greenhouse gas (GHG) emissions, which would strengthen the governance, risk management, and strategic planning of supervised financial institutions.
2. Amend the Guideline to expressly adopt the disclosure requirements issued by the International Financial Reporting Standards (IFRS) International Sustainability Standards Board (ISSB) in IFRS S2 Climate-related Disclosures (IFRS S2), including disclosure of Scope 1, 2, and 3 GHG emissions, so that Québec-registered financial institutions keep pace with financial institutions globally in climate-related risk management and disclosure.
3. Amend the Guideline to make climate-related disclosures part of annual financial reporting, including requiring third-party assurance.