Overview
Introduced: October 2023 (initial framework); October 2024 (updated guidance)
Effective from: Ongoing
Region(s): Canada
About
The Made-in-Canada Sustainable Investment Guidelines are a principles-based framework developed by the Government of Canada to mobilize private capital in support of the country’s transition to a net-zero economy by 2050. Designed for financial institutions, asset managers, pension funds, and large corporates, the guidelines aim to clarify what qualifies as credible climate-aligned investment in the Canadian context.
These voluntary guidelines establish clear guardrails to help distinguish genuine transition finance from greenwashing, supporting investor confidence, regulatory transparency, and Canada’s broader climate policy objectives.
Disclosure requirements
Entities are encouraged to follow the Guidelines when developing and marketing sustainable investment products. Recommended alignment includes:
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Science-based pathways: Investments must align with credible transition pathways consistent with Canada’s climate targets (e.g., a 1.5°C scenario, net-zero by 2050).
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Material impact: Activities must demonstrate clear and measurable contributions to emissions reductions or climate resilience.
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Robust governance: Investment strategies should be governed by strong internal oversight, with climate expertise at the decision-making level.
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Credible plans: Transition investments must include time-bound plans to phase out high-emitting activities or assets, not simply offset them.
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Transparency: Clear, accessible disclosures are expected, particularly on fund objectives, exclusions, methodologies, and performance against climate goals.
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No greenwashing: The guidelines explicitly caution against overuse of terms like “green” or “net-zero” unless backed by evidence and measurable progress.
Who needs to comply
These guidelines are intended for—but not limited to—the following actors in Canada’s capital markets:
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Asset managers, pension funds, and insurers
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Public and private companies marketing green or sustainable finance instruments
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Financial institutions designing or distributing ESG products
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Investment funds labeling portfolios as transition-aligned or net-zero focused
While voluntary, the guidelines are expected to influence future regulatory frameworks and investor expectations.
Compliance timeline
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2023: Initial principles introduced by Department of Finance Canada
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2024: Updated guidelines published following stakeholder consultations
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2025+: Ongoing adoption by financial institutions and anticipated alignment with international sustainable finance frameworks
Third-party assurance
While the guidelines do not mandate third-party assurance, they recommend:
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Voluntary assurance of sustainability claims to ensure credibility
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Use of independent reviewers or alignment with frameworks like the Canadian Sustainability Standards Board (CSSB) or ISSB
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Integration with climate-related disclosures under NI 51-107 and OSFI Guideline B-15
Penalties for non-compliance
As these are non-binding guidelines, there are no direct penalties for non-compliance. However:
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Misleading use of sustainable finance labels could lead to regulatory scrutiny under existing securities or advertising laws
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Loss of investor trust and reputational damage may occur if products marketed under the guidelines fail to meet expectations
