The Office of the Superintendent of Financial Institutions has brought Guideline B-15, its climate risk management framework, into force for Canada's six domestic systemically important banks and internationally active insurance groups headquartered in the country, with the requirements applying from fiscal year-end 2024. The guideline sets out supervisory expectations in two interrelated chapters, covering governance and risk management, and climate-related financial disclosures, including mandatory reporting on financed emissions attributed to lending and investment portfolios.
SCOPE AND STRUCTURE OF THE GUIDELINE
Guideline B-15 covers both physical climate risks — the potential financial losses arising from extreme weather events, rising sea levels, and longer-term environmental shifts — and transition risks stemming from the economy's move towards lower-carbon operations. Covered entities are required to embed these considerations into board-level governance and senior management accountability frameworks.
Foreign bank branches operating in Canada are excluded from the guideline. Smaller federally regulated financial institutions have been granted additional transition time, with a fiscal year-end 2025 deadline for their compliance obligations.
The guideline's disclosure expectations draw on the recommendations of the Task Force on Climate-related Financial Disclosures and the ISSB's climate disclosure standard, as well as on emerging guidance from the Basel Committee on Banking Supervision regarding the prudential treatment of climate-related financial risks. Institutions are expected to demonstrate that their risk identification and scenario analysis capabilities are commensurate with the scale and complexity of their climate-related exposures.
SUPERVISORY OVERSIGHT
Institutions must demonstrate to OSFI through the supervisory review process that their boards exercise adequate oversight of climate risk exposures.
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