📈 Climate Cents: The Good, The Bad, and The Carney in Canadian Climate Finance
Canada’s (soon to be) Second Most-Read Newsletter About Finance 🤠😉
#1 The Quick Stuff
Last week, Canadian banking megapower RBC silently abandoned all of its sustainable finance goals in its (now ironically titled) ‘2024 Sustainability Report’. Buried on page 42 is the decisive line that RBC is “retiring our sustainable finance commitment.” This is the most concrete example to date of a Canadian bank backtracking on its climate promises ⏮️ To add insult to injury, RBC specifically cited the recent crackdown on greenwashing in the 2024 Competition Act as a reason for abandoning its targets. This is RBC acknowledging that their climate promises were greenwashing anyway! 🤦 Seems to us like it is time for some regulation?
In amongst the tariff-centric news cycle, CBC put together this great piece on Canada’s solar market. It highlights how a Toronto-based developer worked with a solar manufacturer just 15 minutes away: lowering shipping costs and emissions, supporting the domestic solar economy and allowing engineers to visit the building site. Most of Canada’s solar panels are imported from Vietnam. The piece highlighted the need for more government support for Canada’s burgeoning solar industry. We agree!
A landmark case (Mathur et. al v. His Majesty the King in Right of Ontario) from youth climate activists against the Government of Ontario has made a positive turn! The back and fourths of this case are a touch complicated so here’s the recap:
🟢 2019 → Youth climate activists file a lawsuit arguing Ontario’s weakened climate targets violate their Charter rights (life, security, equality)
🔴 Ontario Superior Court April 2023 → Dismisses the case; finds no Charter breach 🤬
🟢 Ontario Court of Appeal October 2024 → Overturns dismissal; says climate targets must comply with the Charter
🔴 December 2024 → Ontario seeks to appeal to the Supreme Court of Canada
🟢 Supreme Court of Canada May 2025 → Refuses the appeal; Court of Appeal decision stands 🎉(<< This is the big news of the week!)
🟢 Next Step → Case returns to Superior Court and Ontario government must determine how they will ensure future generations have the same rights to life, security and equality (hopefully through climate action!)
#2 Digits!
$382,000 🤑
This is how much money former UK 🇬🇧 Prime Minister Tony Blair’s businesses were paid by PetroSaudi in 2010 to help the Saudi company break into the Chinese markets. Completely unrelatedly, last week the Tony Blair Institute came out with a “muddled and misleading” report criticizing current climate action. Some of his absolutely lukewarm takes include:
“any strategy based on either “phasing out” fossil fuels in the short term or limiting consumption is a strategy doomed to fail"
"We should put carbon capture – directly removing carbon as well as capturing it at source – at the centre of the battle."
A man that was once paid lots of money to help Saudi Arabia expand its oil and gas market is now coming out with a prolific report against fossil fuel phaseout? Shocker.
#3 Not all doom and gloom
The University of Guelph (U of G) has come good on its 2020 goal to divest the university's assets from all companies that hold fossil fuel reserves. U of G is fossil free! This commitment came after pressure from the student-led organisation Fossil Free Guelph, alongside ongoing efforts from the university. It just goes to show that kicking up a fuss can lead to real change! Congratulations to the university and all those who fought hard for this change.
#4 The Long(er) Read
Election Special
Welcome to our Climate Cents Election Special following Monday’s federal election results, we're providing our analysis on Mark Carney's climate finance credentials and what his leadership might mean for Canada's climate policy going forward.
Born in Fort Smith, Northwest Territories, he played between the pipes 🏒 for one game (he was a hockey goalie) for Harvard University during the 1985-86 NCAA hockey season. After working as an investment banker at Goldman Sachs, he secured a leadership position at the Bank of Canada. His secret candidacy led to his surprising appointment as Governor of the Bank of England in 2012, a position he held until 2020. He then worked in international climate finance and as vice chairman of Brookfield Asset Management, a major Canadian asset manager. In March 2025, he succeeded Justin Trudeau as Canada's Prime Minister before calling a snap election.
He will now resume his position as Prime Minister of Canada with a minority government, but a clear mandate to lead Canada.
There are two things you should know about Mark Carney’s attitude to climate change: 1) he understands that it is a very serious crisis and 2) he prefers voluntary measures over regulatory obligations: a point on which we disagree.
Mark Carney’s green credentials are clear. In 2020 he became the United Nations Special Envoy for Climate Action and Finance in 2020 (earning a whopping salary of $1). Whilst in this role, he was the architect of the global ‘Glasgow Financial Alliance for Net Zero’ (GFANZ).
This alliance is actually an alliance of alliances, including the Net-Zero Asset Managers Initiative (NZAMI), the Net-Zero Asset Owners Alliance (NZAOA) and the Net-Zero Banking Alliance (NZBA) – a Matryoshka doll (Russian doll 🪆) of acronyms. These alliances are voluntary initiatives which convene the biggest financial institutions in the world, to set goals and strategies to reach net-zero in their business activities. GFANZ signed up an impressive list of members, but there was early skepticism as to whether it would lead to a significant shift in financial flows or reduce emissions. The point is now moot, given that the alliance imploded shortly after Trump's election. The uncertainty around GFANZ’ efficacy and its sudden implosion both point to the need for mandatory measures, i.e. regulations. We wrote about Canada’s contribution to this disintegration in Climate Cents #3.
Carney speaks unequivocally about the risks of climate change, and about how it is already happening. From his infamous 2015 ‘Tragedy of the Horizons’ speech presented to the global insurance company Lloyds:
“The challenges currently posed by climate change pale in significance compared with what might come. The far-sighted amongst you are anticipating broader global impacts on property, migration and political stability, as well as food and water security.”
At the same time, he is very explicit about what he determines the financial solutions to the climate crisis are. In that same Lloyds speech in 2015, Carney shared that:
“Any efficient market reaction to climate change risks as well as the technologies and policies to address them must be founded on transparency of information.”
In other words, he suggests that the way the financial sector should deal with addressing the risks of and solutions to climate change is…. more information. Although Carney does advocate for government intervention to increase climate disclosure and reporting, he puts significant weight into the market correcting climate change. Alas, information and clarity do not equal action.
Here at Climate Cents, we understand that, while helpful, disclosure and information will not magically align Canada’s financial sector with climate action. Disclosure and information are tantamount to counting the holes in a sinking ship as water flows in. The Canadian financial system, as it stands, will not plug those holes of its own accord.
Carney’s Lloyd's speech contains a moment of irony that perfectly captures his discordant perspectives on climate finance. Carney invokes Say’s Law of economics – the idea that supply creates its own demand – to argue that supplying more climate risk data will create more demand from investors for transition finance. Meanwhile, he doesn’t apply this concept to the supply of fossil fuels, not mentioning how continued fossil fuel supply maintains our collective demand. You can’t out-disclose a crisis you’re still funding.
Action is needed, as well as disclosure. The government needs to set new rules that require financial institutions to address climate change in their business activities. These include: requiring all major financial institutions to implement a credible climate transition plan that demonstrates how they will reduce their emissions by 2050; a fossil-free green investment labelling scheme written by climate experts; comprehensive legislation to streamline and climate-align financial regulations, tantamount to the Climate-Aligned Finance Act; and the use of all legislative and regulatory tools to align Canada’s financial system with the Paris Agreement on Climate Change.
If we look at the 2025 Liberal Party Platform, we see a lite version of two-and-a- half of these recommendations:
Implement Canada’s clean investment labeling scheme: Finalize and implement the voluntary made-in-Canada sustainable investment guidelines for every priority sector by fall 2026 (see here for an explanation)
Improve climate disclosure: Establish broad coverage of climate risk disclosure for companies across Canada. We will prioritize working with provincial, territorial, and international partners to enhance transparency for investors, better assess climate risks and opportunities, enable the development of transition plans
From what we see in the Liberal party platform, Prime Minister Carney’s government is planning to take important first steps towards creating a financial system that is more informed about climate change - but not necessarily one that is aligned with climate action, or that is resilient to the related climate risks. We are looking forward to working with the new Government of Canada to advance a secure and sustainable economy through smart rules and strong accountability. We will be advocating for the rules listed above, and hope you all will too.
Thank you for reading! This newsletter will arrive in your inbox every other week, bringing you fresh insights into the climate and finance landscape.
Have thoughts about today’s issue? Questions you’d like answered in future editions? We’d love to hear from you - drop us a comment below and let’s continue the conversation!
See you in two weeks!