Canada's big five banks are potentially misleading investors with their use of terms like sustainable finance, according to a complaint to securities regulators by a climate advocacy group. Banks are using the term "sustainable finance" too broadly and not backing up the claims with data, Investors for Paris Compliance said in its submission Tuesday to the Ontario Securities Commission and the Autorité des marchés financiers of Québec.
Canadian banks including RBC, TD, BMO, CIBC and Scotiabank have all made pledges on sustainable finance that together total $2 trillion by 2030. Sustainable finance covers a range of lending activities aimed at advancing mostly environmental and social causes. The financing can be anything from green bonds funding a specific renewable energy project to loans that go to general corporate use but are tied to sustainability-linked performance target