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ESG criteria (environmental, social, and governance) have become a standard in evaluating companies. In Canada, they now influence not only an organization’s image and reputation but also its access to funding—particularly when it comes to innovation.
In 2025, integrating ESG into your projects is no longer optional: it is a strategic lever. Governments, investors, and financial institutions prioritize projects that demonstrate a real commitment to sustainability, especially in strategic sectors such as energy, clean technologies, mobility, and the circular economy.
Public and private funders now require guarantees of a project’s sustainable contribution. For a company, failing to integrate ESG into funding applications risks having the file considered incomplete or lower priority.
Including ESG in a funding application:
Canada is known for its tax incentives, particularly the SR&ED (Scientific Research and Experimental Development) program. This tax credit remains a cornerstone of innovation funding. However, evaluators increasingly highlight the ESG relevance of projects—even when it is not yet an official criterion.
Several institutions have also deployed specific mechanisms:
All of these converge toward the same logic: supporting innovative projects that directly contribute to the country’s sustainable transition.
The Canadian sustainable investment taxonomy, currently being deployed, sets out scientific and uniform criteria to identify “green” and “transition” projects.
For example, an innovative project in carbon capture, clean hydrogen, or bio-based materials will more easily demonstrate its ESG relevance by referring to this taxonomy.
Each company must determine which ESG criteria are most relevant for its sector: GHG emissions, material circularity, workplace diversity, ethical governance, etc.
Before submitting an application, an ESG audit or internal review helps assess strengths and weaknesses and build a credible action plan.
Drawing on international standards (ISSB, TCFD, GRI) strengthens the robustness of the file. These frameworks help quantify impacts and present comparable data.
ESG commitments must be concrete: reduction of X% in emissions within three years, use of Y% recycled materials, creation of Z inclusive jobs.
Funders want to know how a project will have lasting impact. Demonstrating the durability and structural contribution of innovation to the sustainable transition is a major asset.
A project that integrates ESG inspires confidence and reduces perceived risk for investors and public bodies.
Many programs reserve specific envelopes for projects that meet strict ESG criteria.
A company that demonstrates its ability to combine innovation and sustainability improves its image and stands out from competitors—both in Canada and internationally.
The future of innovation funding in Canada depends on integrating ESG criteria. By combining technological creativity with a commitment to sustainability, companies not only maximize their chances of securing funding but also position themselves as leaders in the economy of tomorrow.
The message is clear: to innovate, it is no longer enough to develop new technology. You must demonstrate that it contributes to a more sustainable, inclusive, and responsible future.
To support companies in this process, ABGI Canada offers a dedicated service for integrating ESG criteria into your innovation projects. Our experts can guide you in showcasing your sustainable initiatives and maximizing your chances of accessing appropriate funding. Contact us!
