Bank of Canada Disclosure of Climate-Related Risks 2025

Message from the Chief Operating Officer

I’m pleased to present the Bank of Canada’s annual climate disclosure report.

As a Crown corporation and Canada’s central bank, we are committed to reducing our climate footprint. This report demonstrates that commitment by sharing our goals and transparently reporting on our progress, in keeping with the federal Greening Government Strategy.

The most direct way we reduce our climate footprint is by finding ways to lower our greenhouse gas emissions, cut water use and decrease waste at our facilities. In 2025, we made notable progress on reducing our water use. In particular, we lowered the amount of water our core building systems require by upgrading equipment and finding operational efficiencies.

We also manage climate-related risks associated with investments held in the Bank of Canada Pension Plan on behalf of the employee and retiree members. 

Finally, given our unique role as Canada’s central bank, we also measure and report on climate-related financial risks from the assets we hold on our balance sheet on behalf of Canadians.

We have streamlined how we deliver this annual report. By focusing on operational areas where our actions have the most direct impact, we aim to present an even clearer picture of the progress we are making.

Alexis Corbett
Chief Operating Officer

About this report

The Bank of Canada’s annual climate disclosure report is published in accordance with the Government of Canada’s directive that Crown corporations:

• align with the federal Greening Government Strategy, including targeting net-zero emissions by 2050 where relevant and working to enhance their organization’s climate resilience
• publish information on their commitments, including their greenhouse gas emissions footprint in their significant areas of operations
• adopt the Task Force on Climate-related Financial Disclosures (TCFD) standards

The TCFD standards and the more recent International Financial Reporting Standards for Sustainability Disclosure lay out four areas for organizations to make climate-related disclosures:

• approaches to governance
• relevant strategies
• risk management practices and processes
• metrics and targets used to assess and manage climate-related risks and opportunities

In 2025, there were no significant changes to the Bank of Canada’s strategic priorities, governance or risk management practices for climate-related risks. As a result, this report focuses on the Bank’s performance in managing climate-related risks and progressing towards its targets. For information about the governance, strategy and risk management aspects of this work, please see Bank of Canada Disclosure of Climate-Related Risks 2024.

All financials are in Canadian dollars and information in this report is as of December 31, 2025, unless otherwise noted.

Scope

This report looks at the Bank’s targets and metrics in three key areas:

• physical operations
• balance sheet (financial operations)
• the Bank of Canada Pension Plan (Pension Plan)

The Bank has set commitments aligned with those of the federal government, including a target of achieving net-zero emissions by 2050. Specific additional targets are laid out in the Metrics and targets section. The scope in each of the three areas in this report is outlined below.

Physical operations

This report covers the climate-related impacts of operating the Bank’s owned buildings and vehicle fleet as well as from producing and distributing bank notes.

In addition to setting targets to reduce the climate impact in these areas, the Bank continually works to strengthen the resilience of its physical operations. This includes having:

• decentralized operations and backup facilities where possible, so that the Bank can continue to serve Canadians during a disruptive event
• safeguards against supply chain disruptions, demand shocks and climate-related risks that could affect the production and distribution of bank notes

The Bank conducts regular risk assessments to ensure its physical operations and infrastructure remain resilient to evolving environmental and climate-related risks.

Balance sheet

As Canada’s central bank, the Bank has a balance sheet that differs from other financial institutions. Its assets and liabilities are not held to generate profits. Rather, they help ensure the Bank’s independence in conducting monetary policy and fostering a stable financial system.

While the Bank measures and reports climate-related financial risks from its market operations, the Bank cannot easily diversify its assets and mitigate exposures to these risks. Further, the Bank’s mandates determine the size and makeup of the balance sheet’s assets.

As at December 31, 2025, Government of Canada securities made up 84.8% of the Bank’s assets that are disclosed in this report (Table 1).1 The remaining assets are:

• Investments in provincial bonds, which were about 2.8% of assets. These were acquired as part of the Bank’s response to the COVID-19 pandemic and their share on the balance sheet is expected to continue to decline.2
• Loans and receivables that include securities purchased under resale agreements, which represent about 12.4% of assets. These assets are used to reinforce the Bank’s target for the overnight interest rate, manage the Bank’s balance sheet and promote the orderly functioning of Canadian financial markets.

Bank of Canada Pension Plan

Bank of Canada Pension Plan assets are held in trust in the Pension Fund and invested according to a strategy overseen by the Bank’s Board of Directors. Third-party asset managers are evaluated based on the degree to which they integrate material sustainability factors, including climate change, into the investment decision-making process. Integrating these factors enhances the Plan’s resilience and long-term value.

The Pension Fund assets that are relevant for this report totaled $2.5 billion as at December 31, 2025 (Table 2). Data are limited for the Pension Fund’s remaining private holdings ($64 million), which is why these assets are excluded from this report.

Note: Figures may not sum to their respective totals due to rounding.

Metrics and targets

Physical operations

The Bank’s sustainability targets, outlined in Figure 1, are aligned with those of the Government of Canada.

Figure 1: The Bank of Canada’s sustainability targets

More details on the Bank’s metrics and related data are available in the Appendix.

Greenhouse gas emissions

Following the internationally used Greenhouse Gas Protocol, the Bank reports its greenhouse gas emissions from:

• sources it controls, known as scope 1 emissions
• the energy sources it purchases, known as scope 2 emissions
• sources it may be indirectly responsible for, known as scope 3 emissions

The Bank reports all scope 1 and 2 emissions and currently reports scope 3 emissions only from its bank note supply chain.

The Bank’s scope 1 and scope 2 emissions are presented in Chart 1.

The Bank’s efforts to reduce scope 1 and 2 emissions have focused on reducing emissions from its buildings. These emissions increased slightly in 2025 because of:

• an increase in heating demand due to colder temperatures
• a temporary increase in energy use as the Bank transitioned to a new, more efficient low-temperature hot water system

Overall, emissions from buildings have dropped by close to 60% from 2018 baseline levels—putting the Bank well on its way to the target of an 80% reduction by 2030.

The Bank has achieved these reductions by:

• improving its heating, ventilation and air conditioning systems and upgrading to energy-efficient lighting
• purchasing renewable energy certificates to continue meeting the target of using 100% renewable electricity in Bank-owned buildings

The Bank continues to review planned improvements and explore additional actions to meet its targets.

The Bank’s scope 3 emissions in its bank note supply chain are presented in Chart 2. The most recent results for the bank note supply chain have a one-year delay because of the time required to collect data from suppliers.

More details and annual results are available in the Appendix.

Water and waste

Water use decreased in 2025 because of a series of equipment upgrades and operational efficiency improvements at the Bank’s facilities. These enhancements reduced the amount of water required for core building systems. Chart 3 presents the annual water use at Bank facilities.

Details about the Bank’s annual water use as well as data on the amount of water used and waste generated from producing and distributing bank notes are available in the Appendix.

To divert more of the waste generated in its facilities, in 2025 the Bank:

• launched a staff awareness campaign about properly sorting waste at disposal stations to reduce the amount of recyclable and compostable materials going to landfill
• reduced the use of single-use packaging in food services and promoted reusable or sustainable alternatives
• conducted follow-up waste audits at its facilities to learn how much non-hazardous operational and plastic waste each facility generates with the aim of identifying opportunities to divert more waste

Balance sheet

The Bank uses the weighted average carbon intensity (WACI) to assess and measure its exposure to climate risks from its balance sheet (Chart 4).3 The WACI rises or falls as the Bank’s portfolio becomes more or less weighted toward assets from relatively carbon-intensive sectors.

For more information on the data and methodology, see the Appendix.

Investments

The WACI figures for investments reported in the 2024 disclosure have been updated to reflect revisions from Statistics Canada for gross domestic product (GDP) and greenhouse gas emissions.

The WACI of Government of Canada securities decreased by 3% between 2024 and 2025 because GDP increased as emissions declined. At 274 tCO₂e/$million, the WACI of these securities remains significantly higher than the average of all G7 nations (169 tCO₂e/$million) based on reported data and estimates.4 This is primarily because of the relatively large size of Canada’s natural resource sector.

The WACI of provincial bonds decreased marginally between 2024 and 2025. If the makeup of provincial holdings remains the same, the WACI for these assets should decrease as Canada continues to transition to a low-carbon economy.

Loans and receivables

Securities are purchased under resale agreements to reinforce the Bank’s target for the overnight interest rate, manage the Bank’s balance sheet and promote the orderly functioning of Canadian financial markets. In 2025, the WACI of the counterparties to these agreements stood at 1 tCO₂e/$million.

Pension Plan

The International Sustainability Standards Board says that asset managers should report their financed emissions in climate-related disclosures. The Pension Fund’s financed emissions are its scope 3 emissions, including greenhouse gas emissions primarily related to its investment portfolios. The scope 3 emissions act as a substitute for a carbon footprint of the Pension Fund’s investment portfolios.

Between 2024 and 2025, the WACI of Pension Fund assets that are in scope for this report (Chart 5) changed as follows:

• Government of Canada securities decreased by 3%.
• The provincial bonds portfolio increased by 1% due to changes in the composition of the portfolio.
• The corporate bonds portfolio increased by 6% due to changes in the makeup of the Pension Plan’s portfolios.
• Public equities increased by 19%, mainly because of slightly higher weights to more carbon intensive sectors—such as materials, energy and utilities—as well as a change in the Pension Fund’s investment portfolio.
• The private debt portfolio increased by 62%, reflecting a change in reporting methodology by a third-party asset manager.

The Bank reports both absolute emissions and intensity metrics for the Fund’s real estate and infrastructure assets. The reason is that the Pension Fund’s third-party managers typically use the WACI for public portfolios and intensity metrics for private asset classes.

The level of greenhouse gas emissions and revenue intensity metric for the real estate portfolio decreased in 2025 partly because of capital expenditures programs initiated by the Pension Fund’s third-party asset managers to decarbonize assets. At the same time, the floor area intensity metric increased, mostly due to a correction in the reported number of square metres of floor area (Table 3).

* Emissions decreased substantially in 2024 because one of the third-party asset managers changed its reporting methodology.
† The Pension Fund’s share of greenhouse gas emissions is based on its percentage of ownership in each underlying fund.
‡ Weighted average intensities are based on the Pension Fund’s investment in each underlying fund.
Note: tCO₂e is tonnes of carbon dioxide equivalent; kgCO₂e is kilograms of carbon dioxide equivalent. Metrics are based on the most recent data available from the Pension Fund's third-party asset managers and may not align with reporting years.

The emissions intensity for the Pension Fund’s infrastructure portfolio decreased between 2024 and 2025 due to measures to decarbonize some assets and changes to how emissions data are calculated (Table 4).

* The Pension Fund’s share of greenhouse gas emissions is based on its percentage of ownership in each underlying fund.
† Weighted average intensities are based on the Pension Fund’s investment in each underlying fund.
Note: tCO₂e is tonnes of carbon dioxide equivalent. Metrics are based on the most recent data available from the Pension Fund's third-party asset managers and may not align with reporting years.

For more information on the data and methodology, see the Appendix.

Appendix

Physical operations

Greenhouse gas emissions

Table A-1 outlines the Bank of Canada’s inventory of greenhouse gas emissions, which includes emissions from its owned buildings and vehicle fleet, as well as from producing and distributing bank notes.

The following are notes related to the data on greenhouse gas emissions presented in Table A‑1:

• These results conform with the standards set by the World Business Council for Sustainable Development and the World Resources Institute.5
• As underlying data and methodologies for calculating and reporting emissions continue to evolve, the Bank will adapt its methodology to align with best practices to ensure transparency, consistency and accuracy.
• The Bank’s current scope 1 and 2 emissions do not include emissions from leased spaces, which account for 4% of the Bank’s overall footprint of buildings.
• The World Resources Institute’s Greenhouse Gas Protocol Scope 2 guidance provides two methods for calculating scope 2 emissions. The location-based method accounts for emissions from the electricity grid, while the market-based method considers the impact of the purchase of energy attributes on emissions. This distinction in methods applies only to scope 2 emissions.6
• The Bank has purchased renewable energy certificates since 2022 to achieve 100% renewable electricity at the four Bank-owned buildings in Ontario and Quebec, in line with the Government of Canada's commitment to using 100% renewable electricity. This caused the Bank’s scope 2 market-based emissions to decline.
• Annual variations in the Bank’s energy use can be attributed to fluctuations in seasonal weather as well as equipment replacement and recalibration.
• The most recent inventory results for the bank note supply chain have a one-year delay because of the time required to collect data from suppliers.
• Individual figures may not sum to their respective totals due to rounding.

Table A-2 outlines the annual amount of greenhouse gas emissions from Bank-owned buildings.

Note: tCO2e is tonnes of carbon dioxide equivalent. Emissions from buildings include the following sources: natural gas, diesel generators, fugitive emissions from refrigerants, electricity, steam and chilled water. The Bank’s historical emissions have been updated in line with Canada’s 2025 National Inventory Report. Scope 2 emissions for electricity are calculated and reported using the market-based approach, whereby procurement of renewable electricity using renewable electricity certificates is taken into account. For more, see M. Sotos, GHG Protocol Scope 2 Guidance: An Amendment to the GHG Protocol Corporate Standard, World Resources Institute (2015).

Procurement of renewable electricity

Table A-3 outlines the amount of renewable electricity the Bank’s purchases annually to power its facilities using 100% renewable energy.

Water use

Table A-4 outlines the annual amount of water used at Bank facilities.

Bank notes

Table A-5 outlines the greenhouse gas emissions released, water used and waste generated from producing and distributing bank notes.

* Figures reflect a correction to the 2023 published numbers.
Note: tCO₂e is tonnes of carbon dioxide equivalent; m³ is cubic metres. Figures may not sum to their respective totals due to rounding.

The following are notes for the data presented in Table A-5:

• The number of new bank notes produced each year varies due to demand. This affects the annual amount of greenhouse gas emissions, water and waste associated with producing and distributing bank notes.
• Emissions declined in 2024 because:
  • no new bank notes were printed for wholesale distribution
  • production volumes declined for raw materials
  • energy use at the Bank Agency Operations Centres declined

Balance sheet and Pension Plan

Quality of data

For 2025, assets reported for the Pension Fund include some estimates based on modelling of the data that vendors supply for this report (Table A-6).

Also, parent mapping has been used to provide estimates for securities on the balance sheet that were purchased under resale agreements and for the Pension Fund’s corporate bond portfolio.

Note: Figures may not sum to their respective totals due to rounding.

Endnotes