AMF Issues Guide to Credit Assessment Agents, Mulls Climate Disclosure

The draft guideline for credit assessment agents provides credit assessment agents with the necessary information to determine the requisite strategies, policies, procedures, and processes and apply them based on the nature, size, and complexity of their activities. Credit assessment agents collect, use, compile, produce, and disclose consumer data in accordance with applicable legislation. Businesses such as financial institutions use the consumer credit data provided by credit assessment agents in their day-to-day operations. The draft guideline covers policies and processes related to governance, sound commercial practices, operational risk management, information and communications technology (ICT) risks, outsourcing and cloud computing risk management, business continuity, and related supervisory activities. The draft guide states that any outsourcing arrangement entered into with a service provider operating outside Canada or that processes, stores, or transfers data outside Canada is considered to be offshoring. Outsourcing or offshoring arrangements, as specified in the guideline, must be disclosed to AMF on request.

While assessing the proposed climate disclosure rule, the Canadian Securities Administrators (CSA) is actively considering international developments and how these developments may impact or further inform the proposed climate-related disclosure rule, which was published in October 2021. As part of an international development, the U.S. Securities and Exchange Commission (SEC) proposed amendments to rules, in March 2022, which would require registrants to provide certain climate-related information in their registration statements and annual reports. The International Sustainability Standards Board (ISSB) also proposed a general standard for the disclosure of sustainability-related financial information, in addition to climate-related disclosure standard. While the CSA, SEC, and ISSB proposals are all largely based on recommendations from the Task Force on Climate-Related Financial Disclosures (TCFD), some substantive differences exist. CSA plans to analyze the key differences and monitor evolution of these proposals. Moreover, CSA is revisiting the letters received during the 2021 consultation process, which included feedback on the two international proposals, and is also reviewing the Canadian stakeholder feedback that was submitted directly to the SEC and ISSB.

Keywords: Americas, Canada, Banking, Regtech, Climate Change Risk, SEC, ISSB, Disclosures, ESG, Operational Resilience, Credit Assessment, Lending, Quebec, AMF