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The recently announced Large Employer Emergency Financing Facility (LEEFF) will require loan recipients to report on climate change and sustainability-related risks and opportunities. This reporting will likely require companies to develop forward-looking plans to contribute to Canada meeting its net-zero by 2050 goal under the Paris Agreement.

Key takeaways

  • Loan recipients will be required to publish an annual report consistent with the recommendations of the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD Recommendations).
  • Reporting will be required so long as LEEFF loans remain outstanding.
  • The LEEFF’s terms and conditions together with the TCFD Recommendations require employers to identify climate-related opportunities that will contribute to Canada achieving its net-zero by 2050 commitments under the Paris Agreement.
  • In sum, the LEEFF program will require companies not only to identify their climate-related risks, but also to develop forward-looking plans to promote sustainability and reduce their climate impact.

Background on the LEEFF

On 11 May 2020, the Federal Government announced the LEEFF, which will provide bridge financing for large Canadian employers. Generally, eligible employers are those which:

  • Have significant operations or workforce in Canada.
  • Can demonstrate approximately CAD 300 million or more in annual revenues.
  • Require a minimum loan size of CAD 60 million.

The Canada Development Investment Corporation (CDEV) will deliver the program. CDEV has announced that LEEFF loans will be subject to commercial terms and conditions. (Note: companies found guilty of tax evasion are not eligible for LEEFF.)

Climate-related reporting and planning

Mandated under LEEFF’s terms and conditions

CDEV has published some of the key terms and conditions of LEEFF loans. These include the requirement to publish: “an annual climate-related financial disclosure report, highlighting how corporate governance, strategies, policies and practices will help manage climate-related risks and opportunities; and contribute to achieving Canada’s commitments under the Paris Agreement and goal of net zero by 2020.”

This requirement will be in force so long as the loan is outstanding.

The Federal Government has indicated that such reporting must be in accordance with the TCFD Recommendations.

Reporting under TCFD Recommendations includes forward-looking planning

The TCFD Recommendations are a thorough set of disclosure standards developed by an industry-led task force at the request of the G20 Finance Ministers. It makes general and sector-specific recommendations for effective climate-related reporting. It recommends reporting under four categories:

  1. Governance
  2. Strategy
  3. Risk management
  4. Metrics and targets.

Notably, the TCFD Recommendations with respect to ‘strategy’ strongly suggest LEEFF loan recipients will need to develop forward-looking plans to promote sustainability and reduce carbon emissions.

In its guidance for all sectors, the TCFD recommends disclosure of “climate-related risks and opportunities, taking into consideration a transition to a lower-carbon economy.” This includes “how [an organization’s] strategies might change to address potential risks and opportunities.” The TCFD also provides ample technical guidance on forward-looking, scenario-based analysis to better identify and assess climate-related risks and opportunities.

The TCFD Recommendations include many examples of sustainability and climate-related opportunities and their potential financial impact. For example:

  • Use of lower-emissions sources of energy may reduce operational costs.
  • R&D into low emissions products and services may result in a better competitive position in light of changing consumer preferences.
  • Participation in renewable energy programs and adoption of energy-efficiency measures may result in increased market valuation through resilience planning.

Taken as a whole, the TCFD Recommendations strongly suggest that companies go beyond disclosing only climate-related risks to responses. Disclosure consistent with the TCFD Recommendations includes identifying opportunities to reduce climate-related risks, and articulating how to implement more sustainable and lower climate-impact strategies.


While the TCFD Recommendations are not drafted in legal, mandatory language, their inclusion into the LEEFF program’s requirements means that employers should be aware of its scope of reporting. The TCFD Recommendations go beyond mere disclosure and extend into planning. Loan recipients will have to assess risk and opportunities, and describe how their business strategies will change in light of Canada’s Paris Agreement commitments.



Jonathan Cocker heads Baker McKenzie’s Environment & Environmental Markets Practice Group in Toronto, where he also serves as chair of the Pro Bono Committee. He authored the Global Climate Change Law Guide, and has worked with the Management Board Secretariat of the Government of Ontario. Mr. Cocker has represented a wide range of clients before various administrative boards, the Superior Court of Justice and the Federal Court of Canada, among others.