Stay Clean, Don't Wash: CSA Comments On Artificial Intelligence And Climate Disclosures

On November 7, 2024, the Canadian Securities Administrators (CSA) released CSA Staff Notice 51-365 Continuous Disclosure Review Program Activities for the Fiscal Years Ended March 31, 2024, and March 31, 2023(Notice). The Notice summarizes the findings from the CSA's Continuous Disclosure Review Program, highlights common disclosure deficiencies, and, in some cases, provides illustrative examples to guide issuers in addressing these issues effectively.

As always, the CSA is particularly focused on requiring issuers to provide disclosure that is true, balanced and not misleading to investors. Recently, artificial intelligence (AI) "washing" and "greenwashing" have each represented critical areas where issuers must exercise caution, as overly-promotional or unsubstantiated material claims risk both regulatory action and findings of liability to investors.