The report found that voluntary responses by Canadian businesses
to the Investor Carbon Disclosure Project (CDP) varied widely
by sector. For example, the financial services and insurance sector
tended to report high levels of perceived risk and perceived
opportunity in a wide range of areas. The natural resources and
mining sector showed moderate concern and were more likely to focus
on the impact of physical changes, such as limited access to
facilities due to unreliable use of winter roads or potential
opportunities in warmer Arctic weather. The energy sector was the
least likely to report possible opportunities, and it was not
uncommon for firms in this sector to be more concerned with the
risks of GHG mitigation policy than the risk of possible physical
This mixed awareness of risks is particularly interesting, from
a legal perspective, in light of the requirement that publicly
traded companies must report material risks and associated
management actions to investors under continuous disclosure
"Our analysis of 2010 annual securities filings of 35
issuers across seven industries revealed limited climate change
disclosure, including of physical climate change risk and
adaptation strategies. Even when issuers discuss how severe weather
events or water availability affect their business operations, they
rarely link these to broader climate trends, despite the weight of
scientific evidence on current and projected climate change
impacts. In some cases, businesses acknowledge climate
change-related risks in voluntary reports, providing only minimal
or boilerplate disclosure in their mandatory reports."
This section of the report concludes:
"Insufficient disclosure presents information challenges
for investors and enforcement questions for securities regulators.
For investors to make informed decisions about the risks a business
faces from a changing climate (let alone attempt to influence such
positions), businesses must disclose these risks and their
management strategies to investors in their mandatory financial
filings. Relative to risks from GHG emissions mitigation policy,
risks from future physical impacts of climate change are becoming
increasingly certain, at least in a directional sense. A rise in
demand for greater disclosure on adaptation by the investing public
and other stakeholders is soon to follow. Limited recognition of
material risks from a changing climate by the insurance companies
assessed is a particular concern since failure to incorporate
climate change risk in underwriting could have knock-on
implications for the performance of investments."
As we have written before, regarding
municipal liability for flooding, where a climate related risk
is foreseeable, it may give rise to a claim in negligence. This
report further emphasizes the importance of understanding,
managing, and reporting climate related risk for Canadian
The federal Conservatives are eliminating the National Round
Table on Environment and Economy, presumably because the NTREE has
persistently taken the climate change issue seriously. It will be
The Climate Change Lawyers Network, which assisted
with portions of the report , will be hosting an evening with the
NRTEE and Ceres
to discuss the report on June 5, at 5:30 at 199 Bay Street, Suite
4000, Commerce Court West, Toronto. All are welcome.
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Ontario's Ministry of the Environment and Climate Change continues to roll out its Climate Change Action Plan with its proposed GHG guide for projects that are subject to the province's Environmental Assessment Act.
The Imperial Oil refinery pled guilty to one offence for discharging a contaminant, coker stabilizer, thermocracked gas, into the natural environment causing an adverse effect and was fined $650,000...
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