In its first 150 years, our country built its economy, wealth, and quality of life on the backs of its abundant natural resources—furs, timber, fish, minerals, and of course oil and gas.

Canada’s traditional energy sector today contributes a relatively minor portion of our GDP—about 7.3 percent, according to Natural Resources Canada. But it plays an outsized role in our financial system, representing 27 percent of our equity markets. All of our major institutions, including the Big Five banks, have significant equity holdings and/or debt positions in the nation’s larger oil and gas companies.

Pension funds are in a similar boat. The major funds including the Ontario Teachers Pension Plan and the Canada Pension Plan Investment Board — which has close to $300 billion worth of assets under management — hold extensive fossil-energy positions.

This is perfectly understandable; with a few corrections here and there, the traditional energy sector has delivered solid blue-chip returns to shareholders for decades.

But those days are waning. The global energy economy is presently heaving under our feet, opening up our banks and the economy at large to unprecedented uncertainty.

Specifically, new and emerging global, federal, and provincial climate policies are gradually correcting the costs of fossil-fuel production to more accurately reflect the societal impacts of those products. Once policy catches up to the science showing that two thirds of all fossil reserves cannot safely be extracted, valuations may be headed for a tectonic adjustment.

“Climate change is no longer an abstract and existential threat; it is casting a long shadow across the global economy.”

Meanwhile, larger market forces, such as decreasing renewable energy technology costs, innovations in energy storage and efficiency, and mobility are relentlessly chipping away on the demand side. Climate policy will impact the sector’s growth and eventually, as the world beyond the United States ratchets up the ambition of the Paris Agreement, the risk of stranded assets will grow acute.

All of these factors are ripening the risk for Canada’s financial institutions. How much risk are we talking about, exactly? Unfortunately, we don’t know.

For the most part, the Big Five aren’t telling us. Canadian banks and pension funds like to talk up their green credentials and their commitment to environmental, social and governance investing criteria, but when it comes to opening the carbon kimono and disclosing climate risk, they are among the most opaque in the world.

A recent assessment by BankTrack, an international NGO based in the Netherlands, gave three of the Big Five banks a grade of D-minus for climate-related stranded asset risk. The remaining two scored an F. Meanwhile, Canada’s pension funds scored poorly on the most recent Asset Owners Disclosure Project rankings.

Climate change is no longer an abstract and existential threat; it is casting a long shadow across the global economy. The just-released World Economic Forum’s 2017 Global Risk Report cites climate as a leading risk to the global economy, noting its very high impact and probability. To mitigate this risk, investors need consistent, comparable, reliable, clear, and efficient data on carbon exposure.

Fortunately, the global financial community has now drafted a road map to guide us to a world of greater transparency.

In late December, as the financial world focused on a looming Trump presidency and little else, the Task Force on Climate-Related Financial Disclosures published its recommendations for voluntary climate-related financial disclosures. The idea is that such disclosures will head off the possibility of severe financial shocks and abrupt losses in asset values.

Except for a column in this newspaper which dismissed the endeavour as a make-work project for consulting firms, the recommendations received little attention in Canada. Only the Canada Pension Plan Investment Board and Blackrock participated from Canada.

Let’s be clear: Canada has done a good job of funding innovations to deliver clean energy and efficiency. It’s done so by leveraging the willingness of Canadians to leave the relative safety of corporate employment to start new companies to scale up solutions for everything from oil and gas methane emissions to light rail trains and resource recovery.

More than 55,000 Canadians are currently working on these solutions at roughly 800 innovative firms, approximately two-thirds of which could be viewed as “climate-tech.” Such companies focus on alternative forms of energy for electricity, heating, and transportation; energy efficiency; the development of high-performance materials as enablers of low-carbon solutions; and the conversion of carbon into value-added products. It’s one of Canada’s best-kept secrets — their CEOs are building projects that are technically risk-neutral, and that can reduce climate-related financial risk for investors and lenders.

These companies could well form the future backbone of Canada’s upcoming clean-growth century. But if we are to meaningfully participate — if we are to grow a lower-carbon economy based on scaling up intellectual property, instead of extracting raw resources — we first need robust disclosure and transparency of the risks inherent in our current model.

The race is on to establish leadership on sustainable finance. In London, Paris, Shanghai, and Hong Kong, the responsibility for environment sustainability and governance (ESG) disclosure and new policy development is no longer limited to a group of isolated experts in pension funds, banks, and private equity groups. It’s a front-and-centre conversation.

To be sure, Canada’s finance sector is in a tricky spot. As lead economies intensify policy action on climate, our banks and pension funds hold the purse strings on the fourth most greenhouse-gas intensive economy in the world. (Only Indonesia, Russia, and China are more exposed.) Instead of proactively addressing the risks that global climate action presents to some of the banks’ bigger customers, and what those risks means for the health of our markets and the country’s overall economic stability, CEOs appear to be opting for a wait and see approach.

Like a lost motorist, there’s no shame in asking others for help. This is a chance to build together. If we wanted to, we could have the world’s largest sustainable-infrastructure financial market. We already have three of the world’s four largest infrastructure investors in Canada.

In the words of one central banker, Canada’s major financial institutions need to start “getting comfortable with feeling uncomfortable.” We need to stop hoping this problem will go away. The health of both our financial system and climate depend on it.