Governance Insights 2026 A Preview of 2026: 10 Legal Updates GCs, Boards and Investors Need to Know
continuous disclosure requirements relating to a broad range of environmental matters, including climate change; and CSA Staff Notice 51-358 Reporting of Climate Change-related Risks (2019) is intended to assist companies in identifying and improving their disclosure of material risks posed by climate change. The CSA has also noted that the Canadian Sustainability Standards Board’s standards “provide a useful voluntary disclosure framework for sustainability and climate-related disclosure that issuers are encouraged to refer to when preparing their disclosures.” The CSA’s pause also does not affect issuers’ obligations to avoid greenwashing and other misleading climate-related disclosure. The CSA has raised concerns about issuers making unbalanced or embellished environmental and ecological claims to promote interest in their securities, cautioning issuers to ensure that their environmental-related disclosure is specific, factual, balanced and, where applicable, hews to the requirements for making future-oriented statements. We discussed the CSA’s guidance in respect of greenwashing in our Governance Insights article A Preview of 2025: 10 Legal Updates GCs, Boards and Investors Need to Know . As the saying goes, when the U.S. sneezes, Canada catches a cold. The return of President Trump to office in 2025 has resulted in a flurry of shifting political and economic priorities in Canada, including a renewed emphasis on major/“nation-building” projects and trade diversification. Remaining on the sidelines is the prospect of mandatory climate disclosure in Canada. Although the economic and political challenges facing Canadians are substantial and worthy of the attention they have received, it remains true today, as it was in 2021 when the draft mandatory disclosure rule was published, that climate risk is a business risk, and the need for consistent, comparable and investor-useful climate disclosure will only continue to grow. Capital Markets Burden-Reduction Efforts In the first half of 2025, the CSA implemented several exemptions. Of these, the most impactful was an elimination of the requirement for a third year of annual financial statements in the “long-form” prospectus used for a Canadian IPO. For more on this topic, see our bulletins Securities Regulators Reduce Friction for Capital Raising with Incremental Changes to Prospectus Rules, and Canadian Securities Regulators Boost Capital-Raising Capacity Under LIFE Exemption . In the second half of 2025, the CSA implemented a permanent “automatic” shelf prospectus regime for “well-known seasoned issuers” (WKSIs). This new WKSI regime permits eligible WKSI issuers to automatically qualify an unallocated shelf prospectus for an unspecified amount of securities without any regulatory review. As a result, it avoids any regulatory delay (and associated execution risks) on launching a public securities offering as well as the potential market overhang associated with a traditional shelf prospectus. In contrast with the temporary pilot program that the new WKSI regime replaces, a WKSI shelf is now automatically qualified, due to a deemed rather than actual receipt, and so can be used immediately after its filing without regulatory confirmation. However, an issuer must be
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