“They’re going to say this is the year when the world pivoted to a green economy – and Canada has to be there.”
These were the bold words of Canadian finance minister Chrystia Freeland when asked at the UN COP26 climate conference as to how people would look back on 2021.
While Canada certainly is playing its part, it is nowhere near the front of the pack. In fact, a report from Carbon Brief noted that the country produces more harmful emissions per person than any other country. Likewise, based on a report detailing the distribution of sustainable funds across the globe, Canada only got $1.6 billion out of the global total of $139 billion.
Analysts say that the country needs to invest at least $70 billion into green tech annually if it is to meet its climate targets. Unfortunately, Canada’s total investment in technologies like renewable power production and the development of electric vehicle infrastructure currently stands at a measly $10 billion per year. In which case, climate change champions have called upon the private sector to step in and lend a helping hand.
Over the past year, several leading Canadian companies, including Blackberry, Canada Goose, and Telus, have committed to carbon-neutrality goals, several of which have also backed up their commitments with significant investments. Likewise, Canada’s five largest banks have also pledged to sell their oil assets by next year. But critics will only believe in them if they honor these commitments.
Sean Cleary, executive director at the Institute for Sustainable Finance (ISF) has pointed out that the United Kingdom and much of the European Union are well ahead when it comes to achieving their environmental goals. Likewise, Cleary and the ISF have spent the greater part of the past two years asking Canadian financial experts as to what’s keeping them from going green.
Based on the interviews he’s done, Cleary notes that a lack of education regarding specific climate goals is what has held the private sector back from going all-in. “[Canadian financial leaders] tell me that capital is locked, loaded, and ready to go,” he says, “but they need better information.”
Sustainability advocates are also asking relevant government agencies for more substantial information when it comes to environmental, social, and governance (ESG) disclosures, as well as reliable climate data. ESG disclosures, in particular, now need to become mandatory, with companies and investors being called upon to give complete and consistent information regarding their ESG activities. Just last month, the Canadian Securities Administrators proposed that climate-related corporate disclosures be made mandatory by 2023.