B-15 Is More Than a Compliance Obligation:
It’s a Strategic Imperative for Canada’s Financial Institutions

Abstract: OSFI’s updated Guideline B-15 reinforces the importance of climate risk management and disclosure for Canada’s federally regulated financial institutions. While the core requirements remain unchanged, the recent revisions extend the timeline for Scope 3 emissions disclosure to fiscal year-end 2028, providing more time to improve data quality and reporting infrastructure. However, institutions are urged to act now—building internal capacity, defining roadmaps, and investing in robust data systems—to meet future requirements and mitigate risks, including potential greenwashing litigation. With increasing alignment across federal and provincial regulators and global standards, climate disclosure is fast becoming a strategic imperative rather than a compliance checkbox.

In the rapidly evolving world of climate risk and sustainability regulation, Canada’s federally regulated financial institutions are standing at a critical crossroads. The latest updates to OSFI’s Guideline B-15—Canada’s flagship climate risk management and disclosure regulation—offer not just a revised set of expectations, but a clear signal: climate-related financial disclosures are no longer optional, and procrastination is no longer a viable strategy.

B-15 is grounded in two pillars: governance and management of climate-related risks, and public disclosure. While the expectations around climate governance and management remain consistent, the recent revisions—announced by OSFI in March 2025—have fine-tuned the implementation timelines, particularly around the most complex aspect of disclosure: Scope 3 emissions.

Let’s be clear—these updates aren’t a watering down of standards. They’re a recognition of the heavy lift required to collect credible emissions data and integrate it into capital planning and financial decisions. Scope 3 emissions, especially financed emissions (category 15), represent the lion’s share of total emissions for financial institutions. While the public disclosure deadline for these metrics has now been pushed to 2028, institutions should not mistake delay for dismissal. The journey to robust and reliable climate data is long—and it must begin now.

As Canada moves toward aligning its frameworks with global standards, notably the IFRS Sustainability Disclosure Standards (S1 and S2), regulators are encouraging consistency and coherence. The Canadian Sustainability Standards Board (CSSB) has closely followed the ISSB’s lead, and provincial regulators like Quebec’s AMF are also issuing aligned guidelines. The message is clear: whether you’re governed by OSFI, the AMF, or eventually the Canadian Securities Administrators, the direction of travel is the same—toward transparency, comparability, and accountability in climate-related financial disclosures.

Yet timelines tell only part of the story. What truly matters is execution. Financial institutions—particularly those not among the “big six” banks or large insurers—must build readiness now. That means creating a climate data roadmap, investing in internal capacity, and integrating sustainability into risk management processes. For many, this will require new operating models, system upgrades, and a cultural shift in how climate risk is understood across the organization.

It also means engaging your value chain. For lenders, your borrowers’ disclosures are a key input for your disclosure. The upcoming climate disclosure rule from the Canadian Securities Administrators could further bridge this gap, helping to reduce the information asymmetry that currently plagues Scope 3 reporting.

Another emerging consideration is legal and reputational risk. Greenwashing is no longer just a consumer trust issue—it’s increasingly a litigation risk. Institutions need robust internal controls and verification mechanisms to ensure the accuracy of their sustainability claims and disclosures. The race to meet regulatory expectations must be matched by an equally rigorous commitment to internal controls.

If B-15’s extended timelines offer one gift, it’s breathing room—not to slow down, but to prepare properly. The complexity of climate risk disclosure demands time, effort, and investment. Institutions that treat this as a last-minute compliance exercise will fall behind. Those who treat it as a strategic priority will be better positioned not only to meet regulatory requirements, but to manage risk more effectively and unlock long-term value.

Canada’s financial regulators are giving the sector a chance to lead—not just follow—on climate. Let’s not squander it.

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