Skip to main content

SHIFT Happens: Five Pressing ESG Issues Canadian Companies Will Face in 2024

Emerging environmental, social, and governance (ESG) issues continue to form a dynamic and ever-changing business environment for Canadian companies.

2024 will be a turning point, with coming under the spotlight as part of a more comprehensive ESG framework that is emerging in Canada.

This week’s article explores the top five ESG issues that we believe will shape the overall strategies of Canadian companies in 2024.

1. The Climate Mandate: Real Action On Decarbonization

The summer of 2023 can be considered a call to action, with record-breaking heat in Canada and elsewhere in the world. The impact on the health of our planet and the human cost of fires, drought and famine, hurricanes and other manifestations of climate related impacts has made this a pressing call to action.

Although COP28 experienced relative success, there is significant pressure for the adoption of a more aggressive decarbonization. Canadian businesses are expected to continue improving their performance related to reducing carbon footprint across their operations. This doesn’t involve merely meeting government and stakeholder expectations—it also means leading the charge with bold initiatives and novel technology solutions.

Although the task ahead is comprehensive, it is doable. Canadian businesses must streamline their production processes and supply chains, implement energy-saving measures, and invest in renewable energy resources. In addition, the urges companies to factor resilience and adaptability into their business models as the impacts of climate change become increasingly pronounced.

The sense of urgency is clear.

2. Valuing Human Capital Amidst the New Normal

The COVID-19 pandemic has permanently changed the conversation around company culture, worker well-being, and work-life balance. The “new normal” is becoming the norm in the workplace as 2024 draws near; it is no longer novel. Businesses in Canada and worldwide are realizing that their human capital—rather than merely their product line or intellectual property—is their most significant asset. It is more crucial than ever to value people as the primary forces behind innovation and expansion.

Expectations from businesses have increased as a result of the continuous global dialogue on mental health and the value of work-life balance. Canadian businesses must address these needs by crafting workplaces that prioritize employee well-being. This entails taking into account not just the physical health, but also the mental and emotional well-being of the workforce.

Organizations that see their personnel as a dynamic and essential component of their success formula will be at the forefront in 2024. These businesses stand to gain from their dedication to the all-around growth of their workforce in the form of increased productivity, creativity, and competitive advantage.

To put it simply, appreciating human capital in the context of the new normal entails adopting a thorough worker engagement, support, and growth strategy to maintain a dynamic and adaptable workforce.

Kids picking bottle in junk pile

3. Modern Slavery In Canadian Supply Chains: A Defining Human Rights Concern

Following the implementation of , businesses are leading the charge in the vital battle against human rights abuses in supply chains. Canadian businesses must actively identify and report against the likelihood of modern slavery within their sphere of influence.

Companies are required by the Act to submit an annual report detailing their steps to avoid and lower the risk of child labour and slavery in their supply chains and activities. Businesses are now more obligated to do due diligence, strengthen supply chain transparency, and enhance reporting procedures. The stakes are considerable as businesses manage this new era of increased scrutiny.

As an innovator of sustainable solutions, including the development of a technological platform that incorporates artificial  intelligence, Shift Critical assists companies to identify and manage supply chain risk and create effective mitigation plans. The extensive staff training programs   offered through the  Shift Critical Learning Academy assists in providing businesses with the tools necessary to foresee and proactively address the threats of modern slavery.

4. ESG Integration: Cutting Through Complexity

The adoption of ESG disclosure frameworks are becoming a core business strategy.  This is despite the competing perspectives and complex regulatory frameworks that have emerged in 2023 as critical components for sustainable business growth.

Canadian firms need to continue integrating ESG into their operations—smartly navigating through the growing regulatory and stakeholder pressures, focusing on merging sustainability with long-term profitability.

Shift Critical offers customized services to identify and manage the risks and the opportunities to capitalize on this shift. Our innovative solutions help businesses secure investor confidence, enhance enterprise value, and build a cohesive network of stakeholder advocates.

Financial Reporting

5. Evolving Sustainability Disclosures: A Question of Transparency

With sustainability disclosure shifting from voluntary to mandatory, Canadian businesses must be prepared for more in-depth disclosures that encompass revised Sustainability measures. The trend influenced by other global phenomena brings companies under the microscope, where they must report climate, nature, and social performance faitfully to avoid accusations of greenwashing.

According to Denton’s – Canadian organizations, as well as their directors and officers, should now be well aware that stakeholders, regulators, and consumers expect ESG considerations to be fully integrated across Canadian organizations’ operations and that failing to meet such expectations with measurable, verifiable and complete actions is increasingly likely to lead to regulatory action, enforcement or litigation.

In Canada, The Competition Act, which applies to advertising claims, is expected to be amended as part of legislation making its way through Parliament. The proposed changes would require businesses that claim a product has environmental protection or climate change benefits to be able to back up their statements with “an adequate and proper test.

Proactivity is Key

Being proactive in these areas is not just a matter of compliance; it’s a strategic imperative that can define a company’s reputation, risk management, and competitive advantage.

Canadian companies that anticipate and address these challenges will contribute to a more sustainable and equitable world and be poised to thrive in the evolving global marketplace.

For businesses, the message is clear: evolving, adapting, and integrating these ESG principles into their operations and ethos is no longer a future concern—it’s today’s pressing mandate.

Let's Discuss Your Sustainability Strategy Today