Sustainability now—A preparer’s insights on reporting

0:02Hello, and welcome to PwC's accounting podcast.

0:11Today, we're taking a closer look at sustainability reporting from a preparer's perspective. As mandatory reporting requirements continue to evolve across jurisdictions, companies are navigating new challenges around emissions data, assurance, and reporting timelines.

0:41Hello, I'm Heather Horne, PwC's U.S. Sustainability Technical Leader, and welcome to our podcast. Today, we're taking a closer look at sustainability reporting from a preparer's perspective. As mandatory reporting requirements continue to evolve across jurisdictions, companies are navigating new challenges around emissions data assurance and reporting timelines. We'll hear insights on California's next reporting cycle, accelerating sustainability reporting processes, and lessons learned from navigating requirements across multiple jurisdictions. It's a big sale. So for today's episode, I'm happy to be joined by Janice Anderson, Senior Director of Technical Accounting and Sustainability Reporting at Nutrien.

1:23Thank you. Welcome. Who also served on the inaugural Canadian Sustainability Standards Board. So Janice, that is a lot of background. Yeah. So before we get started today, I think it would be interesting for our listeners to understand your background and the role that you're playing today. Yeah, excellent. So I'm PwC alumni and thank you very much for having me on the podcast. Yeah, so excited you're here. I know, I was like, I feel like I'm an inaugural listener when it was just US GAAP and I loved your podcast there and I love how it's branched into sustainability. So I spent my career as an accountant in technical accounting.

1:56I was there in Canada when we moved from old Canadian GAAP to IFRS. So I feel like I've always been on the forefront of learning standards, made it into your accounting consulting services, which I believe is called corporate reporting services now. So I spent the first 12 years of my career building it there with PwC, took a step and moved into the Alberta Securities Commission. So I became a securities regulator for five years. I actually built the U.S. has your non-GAAP rules. So we actually that was I was part of that big project to create our Canadian equivalent securities laws in that respect.

2:29So really learning IFRS, building security standards and learning how Canadian securities regulations work. And then I took a dip into industry. So now I've been with Nutrien for almost six years. And I started in their technical accounting and leading their technical accounting team. And it was probably back in 2021, 2022, when all of our regulators, both Canada and the U.S., said we're going to do climate reporting. and so when we looked at it as a function we said okay probably we need the CFO's office finance to step into climate reporting and so that's when I took both portfolios of technical accounting and leading that teams if you want to talk about embedded derivatives we can get into that I was like that everyone's tuning out right now and then so then really getting ready for all of the mandatory reporting and now I have both mandatory and voluntary reporting under my portfolio.

3:25Was Nutrien then preparing voluntary reporting before these proposed rules came into place? Yes. Okay. So we did. And I think like most companies, we do have, we had a standalone sustainability function. And I think with most, it's trying to figure out what does sustainability mean? What are sustainability topics? We were doing emissions reporting. And so that was a different team. And then over time, we've said, let's embed sustainability into the business. And so we did a big reorganization about two years ago and sustainability strategy went with strategy. Reporting went with the reporting function and then the sustainability professionals went and got embedded into the business.

4:05So I think we'll take a detour to talk about this since it came up, because I think that's a challenge for a lot of companies is how to bring together the historic voluntary sustainability reporting with additional rigor and otherwise from a reporting perspective coming from the controllers or chief accounting officer's department. And so any lessons learned or what you would share, feel comfortable sharing from your experience? Well, absolutely. And it was bringing two teams together. And so it was bringing teams that had really strong expertise in the report writing and figuring out how to tell our stories.

4:44And then you had our CFO's office and we're saying, okay, well, what standards are we reporting under? And when we dug into it, it was we were actually reporting under three or four different standards. We picked some SASB, we picked some GRI, you had TCFD in the background. And I think being obviously influenced by being on the Canadian Sustainability Standards Board, one of the first things that we did was let's pick one standard. And when we're looking at the frameworks, we then really took a step back and said, why are we doing sustainability reporting? Who is the key audience of who we're reporting to?

5:17And that is going to be to our investors. We were very strictly focused on having an investor focused report. So that helped us create a framework. And we're looking at the ISSB, CSSB standards to create that reporting framework. So then if we look at it from a change management perspective, we're taking our voluntary sustainability reporting team, and they're building up their knowledge into the framework. And then we're working with our enterprise risk management team to make sure we have alignment on what are sustainability related risks and opportunities and how do we bring that into a succinct report.

5:53So I think it was really bringing in that rigor of having a framework behind the scenes to help shape the report, build everybody up to speed. I've learned so much from that team about what is sustainability. We got to teach them about reporting standards and why we're reporting what we're reporting. Yeah, I mean, if you can collaborate well, you really get the benefit of both. And it sounds like that's the direction you guys have gone down then. It was critical to have leadership guidance on this piece. I think when we looked at the functions and overall organization structure, this was a big push from our executive leadership team.

6:31Let's no longer have different functions doing different things. Let's bring them in-house. And it was really their leadership and guidance that said, create a readable, shorter report. And so that's what we set out to do. So when you know you're supported from the tone of the top, I think that gave everybody the motivation to change. Yes, it definitely does. So then for the benefit of our listeners, can you share the reporting landscape in Canada right now from a sustainability perspective, where things stand? Yeah, so Canada, I think, actually came out with their proposed climate reporting six months before the U.S.

7:03And then just like the U.S., actually, I'd say the U.S. was really, really prompted Canada to have a reaction and we have paused our climate report. So it was National Instrument 52-107. That was very TCFD-like. Now, when they released that in 2021, that was at the same time as the Canadian Sustainability Standards Board was being formed. Taking a step back in Canada, we have really aligned our accounting and assurance frameworks with the international equivalents. So it just made sense that the Canadian Sustainability Standards Board, when we were formed, to bring the ISSB standards to Canada with the support of the Canadian regulators.

7:46And I think during this time, if we look back, we were really working together with our Canadian regulators and the board to come up with climate and a sustainability reporting framework to use. Now, I think everybody knows the geopolitical landscape has really shifted. Canada's capital market is very closely tied to the U.S. market. And I think if you take a step back, it's very difficult to put in a securities law that is stricter than the U.S. It just doesn't make for capital formation because why list in Canada? Yeah, if it's easier to list in the US. If it's easier to list in the US. And I think our regulators took a step back and said, this is not the time.

8:25So it has been paused. Now, our Canadian regulators have been very supportive of the CSSB in our work. And I think their views, and they've released it publicly and said, if you want to do a voluntary reporting in the Canadian capital market, use the CSSB, ISSB standard as your framework. This is what they're putting their weight against. And then maybe when things shift, the pendulum might swing again. I think they'd be ready to work again with the CSSB. And then the standards the CSSB put out, are they climate-only similar to what we see in Australia, or they were the full ISSB standards? They are the full ISSB standards.

9:05So when we set out, we did a great consultation. So we've created the CSDSs. We love our acronyms. They are very similar to the ISSB, the IFRS standards. We added some more transitional reliefs. I think that was important. I do CS1 and S2, and they have, you know, one year to scope three. I know, it's fast. That's fast. Yes. I can tell you, and we can get into this, our own experience in reporting scope three. It was a three to four year journey before we were ready to publicly release. So when I really took that experience on the CSSB and said, look, some of these harder parts of the standards, anticipated financial effects, scenario analysis, scope three, let's give a transitional relief.

9:52So we built in additional time. So I think at the end of the day, when you're adopting the standards, there's going to be just the time, but it is globally aligned. And I think that was so important for us. Yeah, no, definitely. So then are you seeing a lot of companies in Canada that are following these standards voluntarily or it's sort of mixed experience? I think it's a mixed experience. I think everyone's trying to say, OK, what's because it's a voluntary framework, what is the benefit of these standards? And I think you still have, you know, should we do something different? And it's OK, well, we have this report.

10:26We've been doing it for years. People like it. We at Nutrien have the impetus to say, OK, well, we've actually been asked for a shorter report. I was like, Janice, make it less than, make it less, make it readable in an hour. And I actually found the value in these standards to say, okay, when you start focusing on what is material, sustainability-related risk and opportunity, you don't actually have to do all of these topics. So we actually were able to cut our report down from 80 pages to 43. Oh, so much more readable. Much more readable. We went out with a lens of, okay, what do we actually have to say?

11:01and that came back to who are we writing to we're writing to earn investors so what is meaningful to them and when you keep that lens in we were able to just take apart some of these other topics and how we selected our sustainability topics that's where we use the SASB standards because SASB are now yes into the ISSB we follow to the frameworks we do chemicals because we create nitrogen fertilizer is a chemical. We have mining and manufacturing through our potash mining and our phosphate mining. So when we looked at the SASB standards, that helped us determine the topics. I know other companies have different reporting frameworks, but I kind of look at it and say, well, is it a SASB topic?

11:45Then it belongs in our sustainability report. And I think that cuts out the noise with some of these emerging topics about where do we talk about them. I'm trying to be very focused in what we report for a sustainability report. But I'll remind everybody that, you know, when we think about other emerging risks, AI, cyber, where should that belong? So in Canada, we have our annual information form, our AIF, very similar to your 10K. You know, if we're talking about some of the governance and risks, there's just other regulatory documents where they belong. So then when you guys went through your process of identifying the risks and opportunities, obviously from an IFRS S1 perspective, you start if there is a standard, so climate you would have, and then you look to the next step, which is referred to and considered the SASB standards, and you identified your two industries.

12:43And then are you reporting all of those topics, or then you went through your process, say these are the ones that are material for us? went through the process and what's material and we are trying to align and I think it's an interesting time because I really like the SASB modifications and their exposure draft. Yes. I think the exposure draft did a lot better job about talking more globally about some of these issues. Yeah obviously they started more from this U.S. perspective. Yes. So yes and so we're looking at not only where the current SASB standards are, where they're going. Water is an interesting topic.

13:16I think SASB, the original water topic, says water about one thing. They use the Aqueduct tool. Might not always be the most relevant way to assess your risks. And I think the new SASB exposure draft really captures that. So we're starting to look at those standards. So I guess I like playing around when it's still voluntary with some of this because we're really trying to report what is material to us. Yeah, and I mean, I think it's a good point is that even when, let's assume at some point it becomes mandatory, it is supposed to be your material risks and opportunities. So the ISSB does say you go down these steps and you would come to then, are there other ones?

13:55And it sounds like that's what you're doing as part of your process now. Yeah. And that's why I like the flexibility. And I think the ISSB did a good job of that. It said, these are what you should look at to even capture this realm of topics. And then if there's other topics, you know, how do we discuss that? So we're agriculture. We have a lot of things about, we talk about our sustainable agriculture and soil health. That's not necessarily built into the SASB topics, but we definitely bring that into our report. So that would be an example of, yes, other metrics that we want to talk about. Because I think if you pick up a report and you're not seeing anything about soil health and what we're doing there, you'd be surprised.

14:33Yes, yes. Well, and I think that's what's important in the end, right? You're really sounds like thinking about the user, your investor and saying, What information do they need to know about your sustainability practices? It's driven by our investors and our investor relation team plays a huge part in this because they're the ones meeting with the investors and we'll be a part of that sometimes. But they filter back to us. OK, here is what the investors are asking. How does that tie into a report? And we don't do selective disclosure. My security is regulatory. Yes. Yeah, you don't want to. I was like, we can't do.

15:04But what we do do is we take that feedback and say, okay, how do we enhance the next year's report to build in those investor questions that we're getting? Do you have a challenge then trying to, I'll say, contain the risks and opportunities that you're including? Or is it very clear once you go down the process and what's material and thinking about your business that there's not a lot of fringe items that you may consider including in the report? And I think it's the latter one. I think we're just being brave on this is what the report is today. We are getting questions internally. I've been saying, Janice, what about AI?

15:43What about AI? What would you like me to talk about AI? So it's a really good conversation to have the framework to say, has this become a topic for our sustainability report? What is the best disclosure document it belongs in? So that's one of the things we're considering today. Okay, how do we talk about AI, not just because it's a buzzword? Right. Are we talking about our use of AI and potentially the water and energy uses? Or are we thinking about it? Is there a sustainability opportunity because we're going to be using it, our digital tools in the field? So I think when we really, we try not to use buzzwords.

16:18Yes. And what is the actual sustainability related risk and opportunity? So I think that helps us be brave in what we're reporting. Well, and I think then that enhances the usability of the report. Back to the point you were making. So if we take a step back then, you're preparing this voluntary report that obviously sounds like it's gone through significant change from where things started. What other mandatory reporting is your company preparing? Yeah, absolutely. So we have a large operations in California. We have strawberry farmers. We have avocado farmers that we support. So we do do business in California.

16:53And so we will be reporting under CARB next week. The day of the day. Yes, the 10th. Yes, yes. So we're all ready to report. We will be using our 2025 sustainability report to meet that compliance. But we're almost done 2026. I'm already thinking about year two reporting there. Yeah. In top of California, we also have Australia. So Australia is an interesting jurisdiction because you don't have to have a listing to also be included. Same way with California. So we have two legal entities. So we've just completed year one of Australia reporting. And then we're already looking ahead to year two.

17:28and again Australia comes with assurance requirements as well limited to reasonable assurance by 2030 so my team is very focused on how do we meet those requirements on a timely basis and then last we have Europe we have some European operations and as a non-listed entity for Europe I'm cool I'm monitoring where we're at like are we in scope what does that mean why is it only impact materiality that just seems so opposite of what we're doing right now so I'm very curious on how that's going to evolve in terms of your court your consolidated reporting then from an EU perspective and then are you do you have European subsidiaries as well that are reporting or potentially reporting and potentially reporting it is smaller because they're more just trading arms than in Europe so I'm just watching yeah to figure out yeah what does that mean and what then what how does that how does that evolve from a reporting perspective so you may not be prepared to answer this question but since you mentioned the eu one of the big things with the comment process that just ended for 40a there's a lot of question for companies that are preparing an issb report of is it possible to use that report and then just add on is that something you guys started thinking to your point one is impacts one is risked opportunity So I struggle with that personally, but just curious, since you're actually having to face that, if you started thinking about it.

18:55I thought it, but I think you nailed it when this is just impact versus our investor based materiality. And so when I'm looking at, I believe where it's going to go down the path is to say, look, if you have EU operations in scope, you can just do impact for that European operations. Nutrien's just so big. and if I had to prepare a fully compliant CSRD report, even with that, I think we know the rigor between voluntary and mandatory. It's a big difference. It's a huge difference. Yeah. So I just... Yeah. So to your point, because you are thinking you'll meet the requirements to have that EU only, and it makes sense the way your company's organized that.

19:34Yeah, it suggests what is the impact of just our EU operations. I think that's just the least amount of reporting burden. Because it costs money. Every time you have a regulation, it costs money, time, effort, executive presence to figure out what we are reporting. It's not just money, it's time. So we really have to be selective in what our reporting approach is going to be. Yeah. And so how are you balancing then all these different obligations and then watching as things continue to evolve? It's a lot. I mean, you also have financial reporting and there's obviously changes happening on the financial reporting side as well.

20:09So how do you have your team organized or could you share how you're keeping up on all of these requirements? Yeah, that's great. So my team's responsible, ignore the technical accounting team who worked with IFRS 18. It's a very fun time. From our sustainability reporting team, what we do is we partner with the rest of the business. So we actually have a huge organization. Our environmental footprint team, for example, does the actual calculations. So we've partnered with them from an internal control perspective, from our timely reporting. We manage the auditor relationship, but it's really a cohesive team effort to get the actual numbers for our report.

20:47And then from a risk perspective, we partnered with our enterprise risk management team. And so when we're partnering with these big organizations to come up with these lofty goals of timely reporting, We kind of all come together to make sure that everybody knows roles, responsibilities, controls, timelines to be able to meet all of these reporting requirements. And if I take a step back, and a lot of it is the climate and emissions and risk reporting, it's coming down to using the same frameworks or using the same core information. And that's what we spent years developing so that we are prepared to slice and dice data to meet the different reporting jurisdictions.

21:25And I think that's maybe reflecting why we've also selected the ISSB standards for our voluntary reporting. So again, we're using consistent methodologies, thought process. Materiality might be different at a statutory reporting threshold, but it's the same rigor and processes that we're going through. Yeah, so then in particular, your Australian reporting then is a subset of what you're reporting more broadly instead of being something unrelated. Yeah. But I would say like for year one out of Australia, where everyone was trying to figure it out, we had actually we've done scenario analysis. PwC was our partner in looking at that back in 2022.

22:01And so that was the basis for our Australian reporting. Although now that we're looking at year two and it's going to be subject to additional limited assurance, has there been changes? we're putting time and effort into saying okay well what additional work do we need to do to really understand our risk and resilience that's been a focus of our effort and rigor so again we're trying to do everything that we've done from a global basis at that standalone entity level when we know the auditors are going to be looking with a lot different level of materiality yeah i mean i think we've seen we have a lot of u.s clients as well that have those subsidiaries in australia And I do think navigating through all of this is a challenge as companies keep adding these additional requirements.

22:45Hopefully, if we fast forward, say, five years, there'll be more stability, at least what companies knowing what they need to report. And I think about that even when, I mean, I started my career and that's where we started this conversation. When we had to move to Canadian Gap, to IFRS, and everyone's trying to understand how do we do this or how do we adopt a new accounting standard? And now we know. Like once you set up those reporting, those processes. And I think that's where Australia reporting is coming along. Same with California. It's just the initial heartache going through all of these initial processes.

23:18So if we think about California, then you mentioned that you're using your 2025 report for your reporting that's due in a week. But as we look ahead, the 2026 reporting in 2027, then are you thinking you'll be preparing a standalone GHG report or you'll just incorporate all those elements into your voluntary report? We're going to do the latter. We're going to incorporate all of these elements into the current voluntary report. So I think from a timeline perspective, I think it's interesting that we're still going through what does that look like. It would be really great if CARB could just figure out what we want instead of just having webinars to try to teach people.

23:58But I'll put that aside. Yeah. Yeah. So we're already looking ahead. I think we've identified a couple key differences that we need to fix for fix, change, modify for 2026 report. Scope 2 would be a big one. We prepare our scope 2 emissions on location-based emissions. Well, that's what's required for IFRS 2. IFRS 2. Yes. We're trying to align with IFRS 2. Yeah. And so now, as we have to have market-based locations, not that different because we don't have a lot of contracts and we operate in jurisdictions that don't have some of these big grid and rec differences. So we're going to have our both location and market-based and have our assurance providers assure both of them.

24:41Scope 3 is going to be another challenge. Yes, I was going to ask you about scope 3. So how are you thinking? You mentioned earlier, I think you said it was the 3 to 4, maybe you said 2 to 3. your journey. So maybe share a little about the journey and then how you're looking ahead to California. And I think ultimately that journey was because we saw California, our Canadian and US regulators saying we want scope three. And so actually the journey started with what is scope three? And PwC was a huge support of that whole initiative. It was a four-year journey. So Colin, who's a frequent podcaster on here, he was a key player in even helping us understand what is scope three how do we calculate it how do we measure it because our big scope three footprint comes from two main sources we have our category one which is when we purchase largely nitrogen fertilizer because we do do purchase for resale but then our big one is category 11 and that's when farmers use our nitrogen fertilizer on their farm and it emits nitrous oxide so if you can imagine those calculations what farmers are we selling to yes what field what's the growing how much am I putting on each field I would assume it's a huge yeah huge estimate yes processes controls and rigors when I say this is why it was a four-year journey it was even developing what does that process look like was year one like what does the number and then the year two was how do we bring it in-house and how do we teach our own employees to be able to calculate this what are the data and systems that need to feed in to have that calculation.

26:14Year three was then preassurance with our auditors. I think one of the things we set out is whether you believe in scope three emissions or not and whether you should report it, it was a key question from our investors. What is your scope three footman? They want to understand your risk. And so we kept driving this information, but before we wanted to share that number, it was like it needs to be high quality process controls we want the assurance behind it so yes we knew assurance was coming yes but we got that pre-assurance and then the next year we were able to achieve limited assurance not only did we do our 2025 emissions we did our 2024 comparatives okay and had it signed off by february 15th wow so the four-year journey culminated into limited assurance a month and a half after um after our financial year-end reporting so it was a journey but something we're extremely proud of.

27:07Yes, you definitely should be. So I was thinking while you were speaking for a listener that hasn't had this foresight to go on a four-year journey and is looking ahead. Are there any pieces of that that you would recommend as sort of the key steps then of in an accelerated timeframe, how you could get ready to report this information with limited assurance? Yeah. I mean, consultants obviously help. One of the things that we're looking at, I think critically when you're thinking about scope three is going through that relevance assessment. And I think maybe we can talk a little bit about how CARB is talking about disclosures.

27:40But what a relevancy assessment is, is looking at all the 15 categories. And it really is a good framework under the GHG protocol to say, what category should I calculate? So for Nutrien, employee commuting, business travel is just not material. And we're not calculating it. I think when we initially scoped it out, I think it was 0.00004%. And we're like, okay, we're never We're never calculating it again. So it's going through the relevancy assessment, figuring out which categories are material. And I would say doing the spend-based approach right now is just the most effective, practical method of doing it.

28:18I think as a company, you're going to have to determine whether you're going to set a scope three target. I think right now some of the measurement standards behind the scenes aren't really conducive to setting a target. So if you just want to know quantitatively, directionally, what is your scope through emissions, using the spend base, using information from your financial statements, finding the appropriate emissions factors, and just going through and understanding it's an estimate. And you just need strong processes and controls. How are we calculating it? Is it repeatable? And then here's what the number is.

28:49And then disclosure, right? Here's the disclosure. And here's some of the disclosure estimates that we need to say that was baked into our calculation. Have you gotten a lot of questions then on your scope three or no? We got to thank you for disclosing it. Well, that's good. Which is great. That's good feedback. We disclosed it. Thank you. Yes, yes. Interesting. So you mentioned CARB and this has been very interesting that for our viewers and listeners that aren't aware, CARB came out with, I guess, a proposal to say they were just going to say is five categories. These are the five you have to disclose.

29:24to your point, two of them are not at all material for your company. So how are you guys thinking about this proposal? And did you respond to any of the requests for feedback? We didn't respond. We advocated through other methods on there. But I think this is our challenge right now. So right now, when we're following ISSB standards, it says just disclose scope three okay great so that's what we did and our issb standards say then qualitatively discuss what are your relevant categories okay category one category nine um and so when we look at this year's reporting i think what we're going to do is we're going to disaggregate and just put the information by the categories we've calculated okay is my current approach if someone has a better idea please come chat with me but when i'm looking at i think it's categories five and six that aren't material.

30:20I think I want to try to figure out how I say NA not relevant. I think fundamentally, just because CARB said that on a webcast, hasn't been built into legislation. So, I'd rather just follow the GHG protocol and the ISSB as the best reporting decision now. And I guess as more information comes about, and ultimately, if I have to do some separate reporting to CARB in 2027, so be it. Yes. Yeah. And I mean, that's definitely what we're recommending to our clients as well, because we've seen this with some of the other card proposals. Well, any standard setting proposal, they evolve. And so you don't want to totally pivot your reporting based on to your point of webinar that, you know, be aware, keep track of it, but, you know, be prepared, I guess, that maybe things could change.

31:07So can I rewind then? You mentioned that you are submitting your current voluntary report. You plan to do the same next year. we definitely are getting a lot of questions around should I pull out this information should I submit my report when you were going through that process of deciding did you think about doing a separate report or again back to your point on time effort oversight it just made more sense you already have this report just put that one in yeah we're trying to do that that perspective in the same way I think most companies even for CDP reporting we're now just saying like okay enough madness of reporting all of these different things to different people yes yes when you're doing multiple reports something might go wrong yeah so we're trying to use the one report to meet all of the regulatory requirements as we can i think we all saw that excel spreadsheet that car released they're like here's what you have to disclose and for listeners it's i think it had maybe a hundred lines of data that they wanted you to repose but when you looked at the legislation it's just follow the ghg exactly we have the same reaction to that.

32:10So, and I even saw the voluntary portal. Again, I think the voluntary portal looked great, but it's still asking for additional information. And so I think we're just trying to follow the legislation. What does that say? But, you know, a lot of what Carr has been saying in these webinars is use your 2025 report, use what you have. So here you go. So that's, I think, our reporting approach right now. And we'll submit that. And then we look forward to see how California evolves over the next year. So timing, you mentioned your scope three, six weeks. Amazing. How about overall, how have you thought about timing and meeting all these different deadlines?

32:47And well, maybe California, so you have enough time. But yeah, November. But big picture, getting things done timely, integrating all these processes, getting all the information for all these different reports. How have you thought about that as a company then? Well, and it was really about speeding up the timeframe. So I think, again, we were very inspired when Canada and the U.S. said, look, we want your report, ISSB, we want your report at the same time as financial reporting. So we said, okay, what would hold up doing it that way? What are the key issues and challenges that we have with doing timing?

33:20And if I could tell a little bit of a story. So I remember when the SEC came out with the report, it was like, how do we get our emissions done at the same time, which is the end of February? And so I didn't even know what an emission was at the time. Like I'm a technical accountant and I was like, oh, what is an emission? So I went and sat with our engineers and they said, okay, well, most of our emissions for scope one and two come from the purchase of electricity and natural gas, where we use it to calculate our invoices and our emissions factor. And I was like, hold on, we use invoices? And so that started getting me really thinking about what is this calculation?

33:56And I said, okay, well, what would hold us up from reporting by the middle of February to get it signed off? Right. And they're like, well, Dennis, like we get invoices and like the invoices for December don't come until the end of January. We cannot possibly report. And I was like, my little accountant. Accruals. It's an accrual world out there. But it was like, but what I learned was, A, we're all talking different languages when we're talking about measurement and reporting. and the teams preparing the scope one and scope two calculations, we're also doing it to meet our regulatory filings where every decimal place matters.

34:33Yes. Yes. Like our tax books. And so I's like, no, no, no, this is just going in a report. We can, we can round up. Right. And we can estimate. And we can estimate. And I was like, we do this all the time for financial reporting. And they're like, you do? Do your, do your auditors know that? I'm like, they do. Yes. I was like, this is, this is commonly built into financial statements. And I think that was a really good takeaway to learn like we're all coming about this from different lenses and different backgrounds and if I can build in some of our traditional financial reporting processes into this we can do it timely so we built in monthly reporting controls quarterly sign-offs we brought in interim reviews from our auditors oh wow so our auditor they're actually already auditing our first half of scope one two and three as we speak I believe they're in the office uh today so they report and they're auditing our first half of the year they'll finalize the work in December so that by the middle of January, it's mostly done.

35:27And they're just checking our estimates. We have a background process to make sure that the estimate we did for December matched the actuals. And if there's a difference, we'll deal with it if it's material, but that didn't stop providing the information to our auditors to get it audited. So this process worked well, and it was just built on the fundamentals of how we've learned in accounting. Yeah. So it really sounds like then it's almost like replicating how you've approached things from accounting, but with a lot of education. Yes. Yeah. So it was just, and then just building, building the teams up and a lot of change management.

35:59We had to go to each of the sites. The sites are the ones responsible for preparing all of the detailed information. So we went site to site. Our team has a motto, make friends and influence people. Sometimes it's a good motto. Sometimes when you just buy somebody like somebody a meal and like, Hey, this is why we're here. This is what we're trying to build. And I think we have so many different manufacturing and potash sites. What we were able to also identifies how to streamline the processes. We took the best of the best from each of the sites and helped shape the different processes to say like, hey, this site probably had the best process and most timely.

36:33And then certain information we knew that was coming from a centralized team, and everyone was just grabbing it and using the information differently. Okay, well, let's start to streamline that information, bring the synergies, really standardize everything. And then that also sped up their reporting. All right, definitely a lot to think about. And I think maybe, what, streamline, standardize. What was the third one? There was three S's there. But it was a great motto that you had. You can go back and look at the course. Yeah. But anyway, so no, definitely it sounds like that replication. But if I take a step back and think overall, it sounds like a big part of your message is actually understanding what the requirements are and understanding all the people involved in the process so that you can make sure that it's all, there's one overall process that's producing all the different information.

37:22Yeah. So, and I even think about that, and that's, again, going back to our accounting thoughts, we always have our accounting books and our textbooks. Yes. And we always now have our regulatory records and now for reporting of our voluntary and mandatory emissions. So, they all come from the same baseline data, whether we do topside entries to make timely reporting for me, or whether they're doing final reporting and estimates for the EPA, or in Alberta, we have a system called TIER. so whether we're doing those books, but they're all coming from the same data, the same rigor, the same processes now.

37:55And so now they can be used for multiple purposes. Very interesting. So before we wrap things up, I did want to rewind your experience working on your sustainability standards board. And I think there's always interest from people who haven't been involved on that side of standard setting of from a process point of view, what are some of the types of things you guys thought about? And was it hard to come forward with the recommendation to follow the ISSB or any backstory you'd be willing to share? Yes, it was hard. No, it was great. I think this was very interesting for me because I come from the accounting standard background.

38:33Although when the CSSB was designed, it was designed with different individuals who had different backgrounds. We had engineers, we had scientists, a lot of investors on the board. I probably was the board member with the most experience in securities regulation accounting and standard setting. So, they had a group of humans who had to come together to figure out, okay, well, first of all, what is our mission? What is our vision? What are our governance documents? When I say I was on the inaugural board, we named the thing. We had to come up with a lot of information. Now, the reason the CSSB existed, and it was part of this overall recommendation to improve standard setting in Canada.

39:11So, there was already a North Star put out there that look, we're looking to align with the ISSB. But what does that mean for Canada? So then at the CSSB, we went through a huge consultation. I think there was 179 comment letters. Wow. And I read every single one. It was great. We went through each of the processes. We went through the consultation papers to really make sure like, are we making the right decisions for Canada? We came up with our own criteria for modification framework to really say, when should we diverge from the ISSB? Ultimately, where we landed, when balancing all of the different views and our regulators' views, we did say, look, we need more transitional relief.

39:54And we also always have the opportunity to do a post-implementation review if we want to go back and modify any of those standards. So I think where we felt at the time was there was a lot of pressure to put out a Canadian equivalent of ISSB to align. And that's why we said, okay, let's give everyone some more time to align with those standards. And I think they're a great set of standards if you're looking at doing voluntary reporting in Canada, anywhere, because really it just streamlined our report. Yes, very interesting. So if I take a step back from all of this then, what advice would you give if you're talking to other people in your position who are taking over sustainability reporting?

40:33So coming from financial reporting background, but bringing sustainability reporting in, do you have two or three top recommendations? Okay. I'm trying to report. But you could do just one if you'd like. I think the biggest thing, and we talk to a lot, we have a lot of key people that we talk to. It's a small community. And my biggest thing is, why are you reporting what you're reporting? It's a great question. And so who are you reporting to? And one of my good friends actually said, and it inspired me, It was like, we used to look at our sustainability report and report to the people we wanted to read.

41:07Yes, that's a great comment. But not necessarily those people who are actually reading it. And so when you change your mindset into who are actually reading the report and who do you want to read the report, ours was investors. And so for us, it was clearly an investor-based report. And that's what made us brave. We're not speaking to our governments. we're not speaking to our employees we're not speaking to our communities now interestingly enough we replaced our report and we did the refresh and then we met with everyone and said okay how are you using it so our government relations team is actually like we use it all the time interesting oh i didn't oh well i'm glad you like it they're like it's so readable because it was just at that investor financial materiality lens and so i take those two learnings to go really think about why you're reporting what you're reporting.

42:00And if anything, cut it down, make it readable. If you should be able to read your sustainability report in less than an hour. That's a great benchmark, I think, for companies to think about. Yeah. When you see these, and I know some of the ones, and they're more in Europe, where you have broader standards, but I think there are some large companies out there with over 400 pages of a sustainability report. And then you're obscuring that information. So not only do I say, look at who you're reporting to and then think about why you're reporting and really say, what is material information? Like I think about Sue Lloyd in the back of my head going like, what is the material information about this?

42:40Yes. And only disclose that. And then it's the other part that I'd say to my sustainability reporting professionals is think about the internal control process. but even from the reporting standpoint, and maybe what we didn't touch upon is everyone, we had about 50 reporting reviewers of our report. And everyone had different ideas about what to say, how to say it. And it just became a beast of a process. And so what we did was we also were brave to say like, you're allowed to look and give us critical feedback and comments. Fatal flaws. Fatal flaws. It's for people who are allowed to touch this report in terms of that.

43:16And that also allowed us to save timelines. And because it was like, we are the true report writers. We're the ones with the skill set and expertise. We will take your opinion. But I think using kind of all of those tools in place, that's what really kind of changed the game to make our report readable, fun to read, more usable. And that's the advice I would give to other professionals in our view. All right. Well, Janice, it's such a pleasure to talk to you and hear all of your experience. Thank you so much for joining me today. It was a pleasure. Thank you so much, Heather. Thank you. And then for our viewers and listeners, thank you for joining us as well.

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