Taxonomy Foundations
Please feel free to answer only the questions that are of the most interest and relevance to you.
It is proposed that the design and implementation of the Canadian taxonomy be informed by the following six principles: Credible; usable; interoperable; dynamic; regionally specific; and prioritized.
2a. Do you agree or disagree with these proposed principles as the foundation for the taxonomy?
Select
Do No Significant Harm and Minimum Social Safeguards
Please feel free to answer only the questions that are of the most interest and relevance to you.
The proposed taxonomy framework for Canada includes a set of Do No Significant Harm (DNSH) criteria and Minimum Social Safeguards (MSS), which will be designed to ensure that climate mitigation objectives do not adversely impact other environmental and social values, or legal rights. It is proposed that issuers must disclose the extent to which they meet specific criteria for both DNSH and MSS in order to claim taxonomy alignment.
4a. Do you agree or disagree with the proposed partial alignment approach, which would require entities to disclose the extent to which DNSH/MSS criteria are or are not met rather than requiring full alignment with all DNSH/MSS criteria?
Strongly disagree
4b. Please explain your answer in the space below
DNSH/MSS aim to ensure that activities do not have a negative social or environmental impact that would make it much more difficult to reach related goals. As such they are a prerequisite to taxonomy alignment and merely requiring entities to provide information on the extent to which they meet them is insufficient. Taxonomy alignment should require a full alignment with DNSH/MSS.
5a. Do you agree or disagree with the proposed scope of objectives to be covered under the DNSH and MSS frameworks?
Select
6a. Do you agree or disagree with the proposed approach to grounding the DNSH/MSS frameworks in Canadian legislation and going beyond existing laws and standards where necessary?
Select
8a. Do you agree or disagree that different DNSH/MSS standards should apply to projects or entities of different sizes? E.g. more comprehensive disclosures required for larger projects and/or entities, with more streamlined disclosures for smaller projects and/or entities?
Select
Section 3: Activity Classification Framework
Please feel free to answer only the questions that are of the most interest and relevance to you.
The activity classification framework proposes that the green category should be limited to activities with zero or near-zero emissions that make a substantial contribution to climate change mitigation or to activities that directly enable zero to near-zero emissions climate solutions (e.g., electric vehicle manufacturing facilities)
12a. Do you agree or disagree with this approach?
Strongly agree
The framework proposes that the transition category should include activities that have materially high emissions today but have the potential to decarbonize sufficiently to align with the green definition (i.e., zero to near-zero emissions) by 2050. These activities are likely to experience stable or growing demand in Paris-aligned representative pathways due to a lack of technically feasible low-carbon substitutes (e.g., major decarbonization investments in steel, cement, and chemicals manufacturing).
13a. Do you agree or disagree with this approach?
Strongly agree
14a. Do you agree or disagree that the proposed guardrails for the transition category (both for the whole-of-activity and measures pathways) are sufficient to protect the science-based credibility of the category and reduce the risk of carbon lock-in, while supporting usability?
Disagree
14b. Please explain your answer in the space below
Proposed guardrails are relevant but insifficient to ensure the credibility of the framework. Indeed, in order to avoid labelling as "transition" financing that would ultimately derail the transition, the framework state that "transition" activities must "avoid locking into dead-end pathways that are not compatible with achieving net zero emissions
by 2050". This essential requirement requires identifying so-called "dead-end pathways". Yet, depending on the scenario used and its underlying assumptions, such pathways will considerably vary. For example, if assumptions enable for extensive use of carbon dioxyde removal (CDR) some fossil-based solutions can appear not to be "dead-ends" despite scientific evidence showing the need to phase-out fossil fuels and the many failures of CDR to deliver. To avoid such an outcome, the framework should clarify that: 1) it takes a precautionary approach to identifying "dead-end pathways", thus excluding technologies and solutions that are highly speculative and uncertain; 2) fossil-based solutions and any solution that could extend the use of fossil fuels are excluded.
The report proposes that initial research on the abatement measures category should be conducted in 2027 and include select emissions-reduction measures for activities that have high Scope 1 emissions today and are unable to achieve the life cycle emissions reductions necessary to align with Paris-aligned pathways (e.g. major decarbonization investments in the upstream production, refining, and distribution of oil and gas). These are activities that are highly likely to experience declining demand as the world transitions to clean energy and alternative technologies.
15a. Do you agree or disagree that the taxonomy should include a third “abatement” category, as proposed, that covers demand-decline activities?
Strongly disagree (i.e., disagree on fundamentals)
15b. Please explain your answer in the space below
Global research from the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC) shows that oil and gas production must be rapidly phased down to limit global warming to well below 2°C. Similarly, research show that, even if all other emissions stopped, consuming already exploited coal, oil and gas reserves would exhaust the remaining carbon budget to keep global warming below 2°C. The abatement category is fundamentally misaligned with these evidence and risk prolonging the production and use of fossil fuels.
The framework should consider the fact that:
– Oil and gas companies are still massively developing production. If they sometimes adopted climate commitments, these commitments were very partial – for example covering a fraction of their emissions (scope 1 and 2 only) – and never adressed the need to progressively reduce production. Furthermore, they have a long track record of backtracking on these insufficient commitment.
– Emission reductions in the fossil fuel sector can be achieved without taxonomy-labeled financing and are already part of the voluntary commitments of oil and gas gas companies. They are also the topic of regulations and new rules.
– Many measures touted by the oil and gas industry as solutions to drastically reduce emissions have continuously failed to deliver. This is especially the case of carbon capture and storage. Exxon Mobil, historically one of the biggest promoter of CCS, is now suing the EU for new requirements that would require it to expand CCS capacity, revealing the use of this technology as a massive greenwashing tool and not a real solution.
The above elements highlight that the abatement category is – by definition – a category that promotes carbon lock-in, and thus is incompatible with the goals of the taxonomy.
The report proposes an illustrative list of guardrails for the abatement measures category that, if formally developed and finalized, would be designed to prevent carbon lock-in and ensure the abatement measures category remains credible within a Paris-aligned framework. When thinking about the taxonomy’s credibility and usability, please provide feedback on this illustrative list of guardrails.
16. Should any additional guardrails be considered?
The proposed guardrails for the abatement measures category face a number of challenges regarding their scientific validity and practicality. First, they do not address downstream (Scope 3) combustion emissions, the vast majority of the oil and gas sector's climate impact (Suzuki, 2025). Second, the guardrails rely on activity-level criteria but ignore entity-level transition credibility. Fossil fuel companies can invest in abatement while simultaneously expanding production. To date, no Canadian oil and gas companies have acknowledged the need for a managed decline. Third, distinguishing between "existing" and "new" infrastructure is nearly impossible because oil and gas operations often expand incrementally. Similarly, it is unclear how eligible activities could be limited to those that do not extend the lifetime of existing assets – CCUS is shown to prolong the life of fossil fuel infrastructure (Davoodi et al., 2024). The only credible guardrail to protect the taxonomy’s credibility is exclusion of oil and gas.
Section 4: Technical Screening Criteria
Please feel free to answer only the questions that are of the most interest and relevance to you.
18a. Do you agree or disagree with the proposed approach for developing technical screening criteria?
Select
19. Please rate each of the proposed elements for the screening criteria on a scale from “very important” to “not at all important.”
- Forward-looking wherever possible
- Very important
- Include sunset and/or sunrise dates where relevant
- Very important
- Revise as necessary during regular review periods
- Important
- Primarily use quantitative metrics
- Important
- Primarily focus on Scope 1 emissions but address Scope 2 and 3 emissions where feasible and/or material
- Very important
- Informed by a range of robust methods
- Important
Final questions
22. Overall, how satisfied are you with the proposed sustainable finance taxonomy framework?
Select