In a speech, Canada's Office of the Superintendent of Financial Institutions (OSFI) highlighted the publication of its Climate Risk Return report and positioned the new supervisory returns as a milestone in measuring and disclosing climate-related financial risks. For the first time, major banks and insurers submitted detailed physical and transition risk exposure data to OSFI, linking climate risks to credit, market and insurance metrics and embedding them in governance and risk management, with submissions intended for supervisory use only rather than public disclosure. OSFI said the initial returns show progress but also persistent gaps in data availability, granularity and consistency, and framed the work as building a prudential data infrastructure to move from anecdotal to measurable insights. The Superintendent also pointed to alignment with the Canadian Sustainability Standards Board and International Sustainability Standards Board, and described OSFI’s approach as treating climate risk as a financial risk alongside complementary initiatives such as the Bank of Canada’s scenario work. On implementation, OSFI said Guideline B-15 disclosure expectations coming into force in 2025 for small- and medium-sized deposit-taking institutions and other insurers are being supported through technical briefings and bilateral discussions, with a proportionate supervisory approach. On scenario analysis, OSFI reiterated findings from the Standardized Climate Scenario Exercise conducted with the Autorité des marchés financiers, which engaged over 250 banking and insurance institutions and helped build foundational capabilities such as geocoding and the use of flood and wildfire hazard maps. Reported experience with these maps prior to the exercise was 15% for deposit-taking institutions, 23% for life insurers and 56% for property and casualty insurers; OSFI said results indicated institutions could absorb climate-related losses in the short to medium term but warned that longer-term physical hazards could intensify non-linearly and that firms need to better integrate climate risk into underwriting, strategic planning and enterprise risk management. OSFI also flagged the potential role of a Canadian climate taxonomy in supporting risk classification and assessment, including the possibility of differentiated risk weightings, and said the current work is laying the groundwork for extending climate risk returns to all federally regulated financial institutions ahead of 2026.
Office of the Superintendent of Financial Institutions 2025-11-25
Canada's Office of the Superintendent of Financial Institutions reports first Climate Risk Return submissions and sets direction for broader climate disclosures
Canada's Office of the Superintendent of Financial Institutions (OSFI) published its Climate Risk Return report, marking a milestone in measuring climate-related financial risks. Major banks and insurers submitted detailed risk exposure data, revealing progress but also gaps in data consistency and granularity. OSFI emphasized integrating climate risk into financial risk management and highlighted ongoing alignment with Canadian and international sustainability standards.