In our September 27, 2024 response to the public consultation on the Competition Act greenwashing provisions, we indicated our support for the Bureau’s goals of reducing greenwashing in the commercial sphere but noted the significant challenges the Competition Act greenwashing provisions represent for the investment sector. We urged the Bureau to create a carve-out for disclosures that are overseen by the CSA and global entities that supervise voluntary disclosure frameworks.
Our key concern is that the Competition Act requirements will have unintended consequences, including limiting the quality of disclosures that corporate and other issuers provide to investors with respect to sustainability metrics and goals, for fear of legal and regulatory repercussions. This disclosure is essential for asset managers to make informed investment decisions, and in some cases is required by provincial securities laws, regulation and guidance.
We have had the opportunity to review the response to the public consultation on the Guidance provided by the Canadian Coalition for Good Governance (CCGG) dated February 27, 2025. We agree with the comments provided in the letter and endorse all of the CCGG’s recommendations therein.
Scope of representations
The Guidance appears to provide a limited exception for representations made in the regulatory context (“to investors and shareholders in the context of securities filings”, for example). This clarification is appreciated, but we remain concerned that promotional communications, which are under the supervisory authority of members of the CSA, may still be the subject of scrutiny under the Competition Act, which represents a regulatory risk for corporations and investment funds that may lead to green hushing.
Internationally recognized methodology
We previously expressed concern with the term “internationally recognized methodology” and urged the Bureau to take a principles-based approach in its interpretation. In our view, the Guidance does not provide clarity about the application of this requirement and may cause further confusion. We urge the Bureau to reconsider its approach to internationally recognized methodologies and to consult further with stakeholders on how best to interpret this requirement.
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