2023 Canadian ESG Reporting Insights

Benchmark your performance using our analysis of sustainability reports and other disclosures from Canada’s largest public companies.

At a glance

  • Canadian companies are now talking about ESG reporting more seriously, but are unprepared for upcoming mandatory reporting requirements.
  • ESG and financial reporting are still treated as separate processes by many Canadian companies. This limits their ability to create value through integrated reporting.
  • Despite investors’ growing reliance on ESG reporting, Canadian companies are missing important opportunities to add credibility to their sustainability disclosures.

Canadian companies know their stakeholders expect environmental, social and governance (ESG) considerations to be integrated across their organization. But meeting those expectations requires more than simply saying the right things about your sustainability initiatives.

Investors, customers, employees and regulators are demanding ESG reports that are measurable, verifiable and complete.

Organizations without this proof of meaningful action that supports their commitments risk being accused of greenwashing.

These stakeholder expectations will soon rise even more. Regulators, including the Canadian Securities Administrators, U.S. Securities and Exchange Commission and European Commission, are developing or have already introduced mandatory ESG reporting requirements. But regulators aren’t the only driver. Other stakeholders are also asking companies to provide this information. It’s a significant shift—and one for which many Canadian companies are unprepared.

Against this backdrop, we’ve applied our PwC-developed framework for assessing ESG reporting maturity to the public disclosures of Canada’s top 250 publicly traded companies, as measured by revenue and market capitalization. For the second consecutive year, we’ve used our framework to examine the strategy, materiality, targets, metrics and key performance indicators (KPIs), assurance and other elements of ESG reporting in Canada.

We see Canadian organizations talking about ESG more seriously. But actual progress is failing to keep pace with rising stakeholder expectations in many cases.


of companies don’t disclose a Task Force on Climate-related Financial Disclosures (TCFD) report, leaving them potentially unprepared for mandatory reporting requirements underpinned by the TCFD framework.


of businesses don’t integrate their reporting by combining financial reporting with ESG disclosures and risk management. Investors are looking to understand how a company is identifying its material ESG risks and opportunities, the resulting commitments and progress on achieving them, including the linkage to the financial implications of those activities. This coherent story is the difference between a compliance-based approach to ESG and one that demonstrates true value creation.


of businesses only talk about their positive performance, missing opportunities to build trust with stakeholders through balanced and verifiable ESG reporting.


of Canadian companies are not obtaining reasonable or limited external assurance of their ESG reports—a powerful step that adds credibility to disclosures.

Embracing ESG reporting best practices

But there’s good news for organizations working to close these and other gaps in their ESG reporting, as well as for the stakeholders who rely on their disclosures:

Progress is being made toward greater standardization of ESG reporting frameworks

The move to mandatory reporting is pushing organizations toward specific globally recognized standards and away from a confusing patchwork of external and internal frameworks.

The number of companies with a net-zero commitment—while still low—is growing

Even more encouraging, many organizations that previously announced a net-zero commitment have since followed up with a plan for achieving their ambition and are providing historical data to demonstrate progress.

The finance function is increasingly playing a key role in organizations’ ESG reporting

They’re applying their background in financial reporting, risk management and data collection processes and controls to setting, measuring and reporting on ESG targets. They’re also bringing their experience verifying metrics and ensuring compliance with changing regulatory requirements. ESG reporting topics can be complex and unfamiliar to some finance professionals. But integrating ESG teams with finance teams to continue upskilling and gain a broader perspective of the risks and opportunities facing their organization benefits the entire business.

Canadian companies need to accelerate their efforts to seize these opportunities. It takes time to correctly instill the right governance structures, data-collection systems and internal controls—all of which need to be in place before ESG reporting becomes mandatory. Meeting these upcoming requirements, as well as the rising expectations of clients, suppliers, employees and other stakeholders, requires companies to act now.

Key ESG focus areas

Our analysis takes a closer look at several ESG themes commonly prioritized by stakeholders.

The majority of Canadian companies are still working to understand their greenhouse gas inventory, including calculating their scope one, two and three emissions, and produce climate disclosures that will meet stakeholder expectations and mandatory reporting requirements.

Stakeholders are demanding companies go beyond emissions reductions and make net-zero commitments to meaningfully address the problem of climate change. Nearly a third (30%) of the companies in our analysis have a net-zero target. That’s an important step. But it’s important for organizations to go further by disclosing plans to achieve those targets as well as historic data points to communicate progress.

Gaps also exist in how Canadian companies are integrating their climate-related risk management process into their overall risk management process. This is important because it helps companies understand the specific risks that impact their bottom line. For example, only 48% of Canadian companies report their process for identifying, assessing and managing climate risks. Even fewer (15%) disclose climate opportunities and the possibilities they present for their organization. This makes it harder for investors to understand how investments in various ESG initiatives create a more sustainable business—both in terms of values and value.

One technique to assess climate-related risks and opportunities is a climate-change scenario analysis. The top ten Canadian companies with the highest level of ESG reporting maturity in our review all perform this analysis and communicate the results in their disclosures. But it’s not a widespread practice. Fewer than a quarter (22%) of all companies include a climate-change scenario analysis in their ESG reporting, despite it being part of the TCFD disclosure recommendations.

Nature and biodiversity are fundamental considerations in addressing climate change. And, with a significant share of the global economy dependent on the assets and services that nature provides, they’re also crucial to the operational resilience of many businesses. Nature and biodiversity will be core topics at both the COP27 climate change conference and COP15 biodiversity conference, shining an even brighter spotlight on topics that are already an area of focus for regulators.

The International Sustainability Standards Board is considering the inclusion of a biodiversity thematic standard as part of its next wave of exposure drafts. And the Taskforce on Nature-related Financial Disclosures (TNFD) is developing a global risk management and disclosure framework for reporting and acting on nature-related risks. The TNFD framework contains disclosure requirements aligned to those of TCFD—the standard that’s forming the foundation of mandatory climate reporting requirements around the world. But relatively few Canadian companies are integrating nature and biodiversity risks and opportunities into their ESG reporting.

Most Canadian leaders in ESG reporting disclose their natural capital risk. Specifically, eight of the top ten performers in our analysis evaluate their potential dependencies on natural capital and ecosystem services. Among all companies, that figure falls to 48%. Organizations further along in their ESG reporting journey also disclose their expectations of future restrictions on the availability of their natural capital and their strategy for managing this scarcity—something only 36% of the companies in our analysis are doing.

Canada is one of the most culturally diverse countries in the world. Stakeholders expect to see this diversity reflected in the nation’s largest companies.

Canadian companies’ diversity reporting is focused on gender and LGBTQ2+ inclusion, with limited disclosures for Indigenous peoples, individuals with disabilities and visible minorities. The number of companies outlining LGBTQ2+ inclusion policies increased from 18% in 2021 to 28% this year. But progress has stalled in other areas. Similar to last year, 56% of companies disclose a gender diversity policy, but only 25% are at a stage in their journey where they can set and report against measurable targets.

Stakeholders are also interested in other areas of an organization’s operations, such as how inclusion and diversity policies influence supply chain decisions. Just 30% of companies disclose this information—effectively unchanged from last year.

The Truth and Reconciliation Commission of Canada’s final report contained 94 calls to action. That included an appeal for Canadian companies to adopt the UN Declaration on the Rights of Indigenous Peoples as a reconciliation framework and apply its principles, norms and standards to corporate policies and core operational activities involving Indigenous peoples as well as their lands and resources.

Even though this landmark report was released in 2015, many Canadian companies have yet to adopt a reconciliation framework. Fewer than one in five (19%) of the companies in our analysis discloses a reconciliation action plan. That’s roughly the same proportion as last year. And only 38%—up from 27% in 2021—disclose policies around Indigenous relations, such as training and upskilling programs, community investments and mechanisms for Indigenous communities to raise complaints, grievances or other issues.

Unlocking the benefits of sustainability reporting

Canadian companies are operating in an environment in which their long-term success depends on certain non-financial factors that increasingly have a financial impact. Stakeholders want to know how these factors affect your business. They also want to have confidence that your disclosures are consistent, credible and comparable.

But high-quality ESG reporting is about more than communicating with stakeholders.

Identifying your organization’s ESG risks and opportunities, as well as strategies to manage them, is critical to sustaining your company’s ability to deliver outcomes that fulfill its purposes and secure its financial success. It takes what we call a community of solvers: experts both within and outside your organization working together to create high-quality ESG disclosures. Making meaningful sustainability commitments, setting relevant targets and tracking your progress with metrics, data-collection tools and validation processes help build trust with stakeholders—a key source of sustained value creation.

Benchmark your ESG reporting

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  • Map your organization’s level of ESG reporting maturity
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