Environmental

Climate report

Climate change presents both risks and opportunities for professional services firms, with potential implications for strategy, operations, and long-term resilience. As a member firm of the BDO professional services global network, BDO Canada has committed to aligning its sustainability reporting with TCFD’s recommendations.

Building on the phased integration of TCFD elements initiated in prior years, 2025 marked a period of progress in embedding climate-related considerations into governance, strategy, and enterprise risk management processes.

We outline our progress across the four TCFD pillars below:

Governance

Oversight of climate-related matters is embedded within BDO’s existing governance framework. The Board and our Executive Leadership Team (ELT) receive regular updates on environmental, social, and governance (ESG) matters, including climate-related developments, as part of their broader oversight of enterprise risks and strategic priorities.

In 2025, we placed continued emphasis on strengthening leadership awareness and understanding of climate-related risks and opportunities. Climate considerations are being increasingly incorporated into governance discussions alongside other regulatory, operational, and strategic risks, supporting informed oversight and decision-making.

Strategy

BDO Canada’s climate strategy is informed by our commitment to reduce near-term greenhouse gas emissions by 50% by 2030 and achieve net-zero emissions by 2050. Our ongoing work to understand and address climate-related impacts across firm operations helps inform the identification of risks and opportunities that may influence our long-term strategy.

In 2025, we continued advancing our assessment of climate-related risks and opportunities, including both physical risks associated with the impacts of climate change and transition risks arising from evolving regulation, market expectations, and the transition to a low-carbon economy. This work enhances our understanding of how climate considerations may affect our business over the short, medium, and long term and supports future TCFD-aligned disclosures.

Risk management

Our approach to governance is supported by enterprise risk management processes that help identify, assess, and manage emerging risks to the firm. In 2025, we further integrated climate-change related considerations into our existing enterprise risk management framework to support a more structured approach to risk identification and oversight.

This work is built on our previous consideration of physical risks, including the potential effects of weather and climate-related events on operations, assets, business continuity, insurance costs, and our people. This year, we also expanded our risk assessment to include transition risks associated with the shift to a lower-carbon economy. These may include changes in regulatory requirements, operating and compliance costs, stakeholder expectations, and market dynamics. Our analysis considered the potential business impacts of both physical and transition-related risks over a one-year time horizon. Both physical and transition risks are evaluated, considering likelihood and impact, as a basis for determining how they should be managed.

Assessment elements considered

• Likelihood — The possibility that a climate-related event will occur in locations where BDO operates.
• Impact — The extent to which a climate-related event might affect BDO.
• Inherent risk — The risk that an adverse event could occur and negatively affect the achievement of BDO’s objectives, assuming no controls are in place.
• Control effectiveness — The extent to which controls and mitigation strategies reduce the likelihood and impact of a risk.

Net risk results

One-year time horizon

• Physical risk — Modest
• Transition risk — Low

Risks are rated on a five-level scale from severe to low. Physical climate risk is assessed as modest, while transition risk is assessed as low. The scale includes severe, high, moderate, modest, and low risk levels.

We continue to integrate climate change-related risks alongside other enterprise risk considerations. This allows us to have a more holistic and structured view of potential impacts on the firm. We will also further consider qualitative scenario analysis in our enterprise risk management processes. This work will help us assess how physical and transition risks could affect the firm under a range of plausible future conditions and support our alignment with TCFD recommendations and evolving Canadian regulatory expectations.

Metrics and targets

We measure and monitor our greenhouse gas emissions in accordance with the World Economic Forum (WEF): Measuring Stakeholder Capitalism Towards Common Metrics and Consistent Reporting of Sustainable Value Creation (Planet pillar):

• GHG Protocol - A Corporate Accounting and Reporting Standard (2015 revised edition)
• GHG Protocol: Scope 2 Guidance (Amendment to GHG Protocol) (2015)
• GHG Protocol Corporate Value Chain (Scope 3) Accounting (2011)
• GHG Protocol Technical Guidance for Calculating Scope 3 Emissions (Version 1.0)

Science Based Targets initiative

In 2024, BDO formally registered a commitment to submit emissions reduction targets to the SBTi. In 2025, we advanced this commitment by establishing and submitting near-term and net-zero emissions reduction targets. SBTi subsequently assessed the targets against the SBTi Net-Zero Standard criteria and guidance, and approved and validated them in May 2025. The validated targets are aligned with a 1.5°C pathway and provide a framework to support BDO’s emissions reduction efforts.

1. Eligibility Verification
2. Technical Screening
3. Target Evaluation
4. Official Target
5. Target Publication

Our carbon footprint

BDO is committed to measuring, managing, and reducing its greenhouse gas (GHG) emissions as a core component of its climate strategy, in alignment with the GHG Protocol. Our GHG inventory provides the foundation for tracking progress against our science-based targets and informs actions to reduce emissions across our operations and value chain.

Our reporting period aligns with our financial year and covers Jan. 1 to Dec. 31, 2025. BDO applies the operational control approach, under which we account for GHG emissions from operations over which we have control. Operational control refers to operations where BDO has the authority to introduce and implement operating policies at the worksite. This approach is consistent with the accounting and reporting practices widely used by organizations disclosing emissions from their facilities. Under this boundary, BDO operationally controls 83 locations across Canada, including four of our downstream leased assets.

In 2025, we continued to enhance data quality through retrospective internal reviews and ongoing refinements to data collection processes, while continuing to use estimates and extrapolation where direct data was unavailable.

Units are in metric tonnes of carbon dioxide equivalent (MtCO₂e)

• Scope 1 emissions — are direct emissions from sources we control such as natural gas.
• Scope 2 emissions — are indirect emissions from the energy we purchase such as electricity and steam.
• Scope 3 emissions — are all other indirect emissions that occur in our value chain, such as purchased goods and services, capital goods, fuel and energy-related activities, and waste generated in operations.

Waste diversion initiatives

Waste diversion pilot: Turning corporate waste into community value

In 2025, BDO launched its first waste diversion pilot in partnership with Green Standards, a Toronto-based organization that supports office decommissioning through donation, resale, recycling, and impact reporting. The initiative was developed to address the growing environmental impacts associated with office relocations and renovations, where furniture, fixtures, and equipment too often end up in landfills. Instead of discarding these assets, Green Standards employs charitable donations, resale, and recycling to extend their lifespan while generating measurable social and environmental benefits.

Through this collaboration, BDO arranged materials from the piloted sites to be managed through documented donation and recycling pathways. The results demonstrate the value of this partnership and will inform BDO’s assessment of whether and how to expand the program to other Canadian offices as future decommissioning opportunities arise.

Environmental benefit

The pilot achieved 100% landfill diversion, redirecting 24.87 tons of materials and avoiding 20.89 tonnes of CO₂e emissions through responsible donation and recycling.

In practical terms, this impact is comparable to cutting approximately 2,355 gallons of gasoline use, or nurturing 348 tree seedlings over ten years, or powering three homes for an entire year.

Note: These estimates were calculated using the U.S. Environmental Protection Agency’s Waste Reduction Model.

Community impact

In addition to the environmental benefits, the pilot redirected value back into communities across Alberta and Ontario. In total, the program generated $24,777 worth of in-kind charitable donations, supporting six community organizations working in areas such as transitional housing programs, food security, education, and newcomer support. These organizations received essential furnishings to help strengthen their programs, operations, and service delivery, demonstrating how workplace transitions can create meaningful opportunities for community impact.

Metrics and targets

We measure and monitor our greenhouse gas emissions in accordance with the World Economic Forum (WEF): Measuring Stakeholder Capitalism Towards Common Metrics and Consistent Reporting of Sustainable Value Creation (Planet pillar):

• GHG Protocol - A Corporate Accounting and Reporting Standard (2015 revised edition)
• GHG Protocol: Scope 2 Guidance (Amendment to GHG Protocol) (2015)
• GHG Protocol Corporate Value Chain (Scope 3) Accounting (2011)
• GHG Protocol Technical Guidance for Calculating Scope 3 Emissions (Version 1.0)

Science Based Targets initiative

In 2024, BDO formally registered a commitment to submit emissions reduction targets to the SBTi. In 2025, we advanced this commitment by establishing and submitting near-term and net-zero emissions reduction targets. SBTi subsequently assessed the targets against the SBTi Net-Zero Standard criteria and guidance, and approved and validated them in May 2025. The validated targets are aligned with a 1.5°C pathway and provide a framework to support BDO’s emissions reduction efforts.

1. Eligibility Verification
2. Technical Screening
3. Target Evaluation
4. Official Target
5. Target Publication

Our carbon footprint

BDO is committed to measuring, managing, and reducing its greenhouse gas (GHG) emissions as a core component of its climate strategy, in alignment with the GHG Protocol. Our GHG inventory provides the foundation for tracking progress against our science-based targets and informs actions to reduce emissions across our operations and value chain.

Our reporting period aligns with our financial year and covers Jan. 1 to Dec. 31, 2025. BDO applies the operational control approach, under which we account for GHG emissions from operations over which we have control. Operational control refers to operations where BDO has the authority to introduce and implement operating policies at the worksite. This approach is consistent with the accounting and reporting practices widely used by organizations disclosing emissions from their facilities. Under this boundary, BDO operationally controls 83 locations across Canada, including four of our downstream leased assets.

In 2025, we continued to enhance data quality through retrospective internal reviews and ongoing refinements to data collection processes, while continuing to use estimates and extrapolation where direct data was unavailable.

Units are in metric tonnes of carbon dioxide equivalent (MtCO₂e).

• Scope 1 emissions — are direct emissions from sources we control such as natural gas.
• Scope 2 emissions — are indirect emissions from the energy we purchase such as electricity and steam.
• Scope 3 emissions — are all other indirect emissions that occur in our value chain, such as purchased goods and services, capital goods, fuel and energy-related activities, and waste generated in operations.