A Comparative Analysis of Sustainable Finance Policies and Practices of Canadian Development Financial Institutions and Multilateral Development Banks

This study conducts a comparative analysis of Canadian development finance institutions (DFIs) and international multilateral development banks (MDBs). It examines the integration of environmental, social, and governance (ESG) principles into investment decisions and the alignment of impact reporting with the Sustainable Development Goals. The study conducts a detailed content analysis of the sustainability, annual, or ESG reports of selected institutions from fiscal year 2021 to fiscal year 2023, highlighting distinct thematic differences using a mixed-methods approach. Canadian DFIs prioritize social inclusion, gender equity, and Indigenous economic development, whereas MDBs focus more on climate risk, biodiversity, and green finance. Although both demonstrate collective efforts toward sustainability, Canadian DFIs are still behind on themes such as Scope 3 emissions (value-chain) disclosure, biodiversity finance, and impact measurement. The findings identify two key opportunities for Canadian DFIs: (a) to advance ESG integration by adopting international best practices, including just transition frameworks, grievance mechanisms, and impact dashboards, and (b) to improve sustainability reporting via standardized frameworks such as the Global Reporting Initiative and Task Force on Climate-Related Financial Disclosures.