Taking action to protect the planet
The effects of climate change are becoming more evident every year. That makes it vital to do everything we can to prevent and mitigate those effects while also adapting to make our world more resilient to them. SCC is at the forefront of supporting the development of standards that offer specific metrics for evaluating Canada’s green initiatives and provide globally applicable benchmarks and strategies.
Leading the way on global ESG tools
In response to climate change and other global challenges, organizations and municipalities are making sustainable and positive advances on environmental, social and governance (ESG) activities. Investors, regulators and the public all want to know what progress is being made on those commitments. But without globally accepted frameworks for measuring ESG initiatives, reporting can be inconsistent, making it harder to tell what’s real and what’s “greenwashing.” Standards bring rigour and methodology that go beyond simple disclosure.
In June 2023, we published Beyond Disclosure: Driving Performance & Trust in ESG. This report outlines issues with the current fragmentation in reporting requirements and inconsistencies in approaches. It also recommends actionable strategies to improve trust in ESG reporting through standards — for example, extending reporting tools to organizations of all types and sizes, including those not being served by existing frameworks and standards.
To that end, we have been working with the World Council on City Data and conducting extensive cross-Canada engagement with financial institutions and city leaders to develop a new international standard that will help municipalities mobilize the capital needed to fund sustainable infrastructure and services such as affordable housing and public transit. Published in spring 2024, ISO 37125 (Environmental, Social and Governance Indicators for Cities) provides an internationally accepted way to measure a city’s ESG performance. An accompanying conformity assessment program, which will be available later in 2024, will enable cities to access more and higher quality venture capital opportunities by allowing for the benchmarking and measurement of sustainability performance of those investments.
This report provides a solid foundation to bring rigour to ESG reporting through standardization. One of the things we’re looking into now is how to provide consistent ways of measuring performance across ESG frameworks on key areas, such as net-zero emissions and environmental stewardship. We are also exploring how we can help ensure standards that support ESG users incorporate inclusion, diversity, equity and accessibility principles and reflect Indigenous perspectives and priorities.
We’re also trying to make standards themselves more accessible, especially for smaller companies that lack the resources to meet all the requirements of ESG frameworks. That might mean advo¬cating for ESG standards that let companies report at varying levels depending on their size and capacity, offering a stepped path toward compliance that meets them where they are while encouraging them to go farther. Or it might be as simple as improving standards databases with better tagging and the enhancement of publicly available information to make the standards more visible and searchable, as organizations are more likely to use them if they know they exist.
— Ulrikke OernholtSector Specialist Standardization Services Branch, SCC
More and more cities are looking for help measuring their ESG performance. As they become increasingly active in the ESG ecosystem, they require high-calibre, globally standardized data. Local, regional, provincial and national governments alike need trusted data to avoid the risks of so-called greenwashing; to support their credit ratings; and to measure progress on their commitments to become more environmentally sustainable, socially inclusive and well governed. SCC was instrumental in setting up consultations with cities and banks across Canada to get their input to help develop the key performance indicators in the ISO standard. And, looking forward, SCC is already on board to help set up a certification protocol for the standard.
This work also led to SCC nominating me as co-chair of the ISO coordinating committee on ESG in partnership with representatives from the UK and Brazil. In this role, I’m going beyond cities to develop ESG frameworks for corporations, especially smaller companies around the world. SCC’s leadership in this field is remarkable.
— Patricia McCarney CEO, World
Building climate-resilient communities
In 2023, we received additional funding under the National Adaptation Strategy to augment our Standards to Support Resilience in Infrastructure Program with 50 new standardization strategies. These projects will address key priority areas including building climate-resilient transportation infrastructure, strengthening assets against climate risks such as urban heat and flooding, expanding green and natural infrastructure, and developing new materials for low and embodied carbon in the construction sector.
Verification of clean fuel claims
In 2023, in partnership with Environment and Climate Change Canada, we began formally accrediting verification and validation bodies to assess organizations’ compliance with the Clean Fuel Regulations (CFR) and their eligibility for credits under that program. To reduce emissions and advance the adoption of clean technologies, the CFR encourages fuel producers to use accredited verification and validation bodies to confirm that their clean fuels meet the regulations. Interest in the program has been very strong since its inception, and over the course of the year, we more than doubled our pool of accredited verification and validation bodies to help drive innovation and meet the growing demand for the program’s incentives.