Department of Finance Canada announced that the Canadian Climate Institute would lead development of made-in-Canada sustainable investment guidelines.
The guidelines are also known as a taxonomy. They are intended to identify green and transition investments in a way that investors, lenders, companies, and other market participants can compare.
Budget 2025 had reconfirmed federal support for arm's-length development of the guidelines and committed to selecting an external organization to lead the work by the end of 2025.
The Canadian Climate Institute will work with Business Future Pathways, an investor-led initiative that brings together financial institutions and technical experts.
The next step is to establish an independent Taxonomy Council. Finance Canada said the council and advisory groups would include independent experts, financial-sector representatives, climate scientists, civil-society members, academia, and Indigenous representatives.
The governing council is expected to finalize guidelines for three priority sectors by the end of 2026 and complete three more priority sectors by fall 2027.
Finance Canada also said it remains committed to regular green bond issuances and will explore a Sustainable Bond Framework aligned with the guidelines.
The guidelines are voluntary, but they could affect how capital is directed. Clearer definitions of green and transition investments can influence disclosure, financing costs, investment decisions, and the credibility of future sustainable-finance claims.