OSFI B-15 and the Global Sustainability Shift: Why Compliance Maturity Still Matters

Over the past year, expectations around climate and sustainability risk have continued to evolve. In Canada, OSFI’s B-15 guideline was introduced as a milestone in how banks and insurers are expected to manage and disclose climate-related risks. It signaled shift, from reporting climate as a standalone issue to embedding it into governance, risk, and business strategy.

But in recent months, there’s been a recalibration.

Institutions are navigating a moving target: regulatory expectations that are converging globally but remain inconsistent locally, especially in Canada. Leaders are weighing how much to disclose, how fast to build, and whether their efforts are aligned, or overshooting. These are the real operational decisions facing CFOs, CROs, and CCOs today.

OSFI B-15 in Practice

OSFI B-15 outlines how federally regulated financial institutions (FRFIs) should integrate climate-related risks into their operations. While not prescriptive, the principles-based framework includes:

• Governance: Clear accountability at Board and executive levels

• Scenario analysis: Testing business resilience under climate stressors

• Integration: Embedding climate risk within broader enterprise risk frameworks

• Disclosure: Aligning to global standards like the Task Force on Climate-related Financial Disclosures (TCFD) and the International Sustainability Standards Board (ISSB).

TCFD guides climate-related risk and opportunity disclosures. ISSB’s S1 and S2 form the global baseline, with S1 covering general sustainability and S2 focused on climate.

A clearer view through a shifting global sustainability framework.

Global Standards Are Still Marching Forward

While Canada may be tempering its pace, global regulation continues to move quickly:

• ISSB S1 & S2 are in effect globally, with S3 in development and expected to broaden sustainability scope into human capital and biodiversity

• Singapore’s MAS and the Philippines SEC require emissions disclosure, climate scenario analysis, and governance accountability

• Australia’s mandatory climate disclosure regime began rolling out in 2025

• The EU’s Corporate Sustainability Reporting Directive (CSRD) and the U.S. SEC’s climate rules continue to push large multinationals toward standardised, assured disclosures

For institutions with cross-border operations or global capital exposure, staying aligned with these regimes remains critical, even if the Canadian context is still settling.

What Compliance Maturity Looks Like, In This Moment

The fundamentals remain, regulators, here and abroad, are still asking:

• Do you have control objectives tied to regulatory requirements?

• Can you show evidence of how you’re meeting them?

• Is there auditability and traceability across your systems and business lines?

• Do you have clear ownership, especially in the first line of defense?

Declaring assumptions and being transparent about estimates is what’s expected at this stage. It’s the time to calibrate and build scalable frameworks, align to global baselines, and make measured, evidence-based decisions.

The institutions that will lead will be the ones calibrating their response, aligning to the evolving regulatory landscape, while building internal clarity, scalable frameworks, and evidence-based capability.

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