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?
Select
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?
Select
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?
Select
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?
Select
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
Seniors for Climate Action NOW! (SCAN!) strongly supports the development of a credible Canadian Sustainable Finance Taxonomy that directs investment toward activities aligned with Canada’s climate commitments and the Paris Agreement.
However, we do not support the creation of a third Abatement category. A sustainable finance taxonomy should only include, and distinguish between, activities that are already compatible with a 1.5°C pathway – Green – and activities that have a credible and demonstrable pathway to becoming compatible – Transition.
The proposed Abatement category would instead recognize investments within activities that cannot themselves become compatible with a 1.5°C pathway – including, most notably, fossil fuel production, refining and distribution, whose products continue to generate greenhouse gas emissions when used.
Reducing emissions from these activities is an important public-policy objective, particularly as part of a managed and orderly phase-out of fossil fuel production. However, those reductions should be pursued through regulation and other appropriate policy instruments – not by recognizing investments in fundamentally misaligned activities as climate-aligned within the taxonomy.
Moreover, the evidentiary, methodological and enforcement challenges involved in demonstrating that an abatement investment does not prolong an asset, enable additional production, increase downstream emissions or displace cleaner alternatives (potential guardrails suggested in the draft report) are so substantial that SCAN! does not believe the proposed category provides a viable or credible basis for taxonomy classification.
Canada should adopt a taxonomy that is scientifically credible, internationally interoperable and consistent with leading international practice.
SCAN! has attached a submission providing the full rationale for this position.
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?
SCAN! does not believe that additional guardrails can resolve the proposed category’s fundamental problem: it would recognize as taxonomy-aligned investments within activities that cannot ultimately become compatible with a 1.5°C pathway.
Even if an Abatement category were accepted in principle, its implementation would require independently verifiable evidence that an investment produces substantial absolute emissions reductions across its full lifecycle; does not increase production, associated infrastructure or asset life; is accompanied by a binding retirement schedule; does not materially displace or delay investment in zero- or near-zero-emission alternatives; and remains consistent with a sector-wide decline pathway aligned with 1.5°C, as per the potential guardrails suggested in the draft report. The methodological, evidentiary, monitoring and enforcement challenges involved in establishing these conditions are so substantial that SCAN! does not believe the proposed approach is viable. Additional guardrails would not overcome the underlying difficulty of classifying a limited emissions-reduction measure within a fundamentally misaligned activity as climate-aligned.
SCAN!’s primary recommendation therefore remains that the Abatement category not be adopted. Please see our attached submission for further explanation.
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
Final questions
22. Overall, how satisfied are you with the proposed sustainable finance taxonomy framework?
Select
23. Is there any other feedback you would like to provide on the methodology report as a whole that has not already been covered?
SCAN! is pleased to submit these comments for your consideration. SCAN! asks to be proactively included in future consultations on this and other climate action issues.