ESG Quick Guide: UK Sustainability Reporting Standards (UK SRS)

At present, the UK has two main sets of rules for the disclosure of climate change issues by companies:

• the rules under the Companies Act 2006 ("CA 2006") (known as the CFD regime); and
• the rules under the UK Listing Rules (“UKLR”) (known as the CRFD regime).

The CFD regime/CA 2006 are administered by central government and the Financial Reporting Council ("FRC"). 

The CRFD regime/UKLR are administered by the Financial Conduct Authority ("FCA"). 

In February 2026, the UK government formally endorsed the global sustainability disclosure standards developed by the ISSB (IFRS S1 and S2) for voluntary use in the UK, with some minor amendments. This was done via the UK Sustainability Reporting Standards ("UK SRS"). 

UK SRS S1 sets out the general requirements for sustainability-related disclosures. UK SRS S2 sets out requirements for climate-related disclosures. The UK SRS therefore cover all aspects of sustainability – not just climate change. 

The UK SRS will require changes to be made to the existing climate disclosure rules under the CA 2006 and UKLR (discussed below).

The FCA announced in September 2026 that it will replace the existing CRFD regime under the UKLR with new “comply or explain” rules relating to the UK SRS starting in January 2027. For more information, see our blog post and ESG Quick Guide: UK climate disclosure rules under Listing Rules. 

The UK government said, in its Modernising Corporate Reporting consultation in September 2026, that it is reviewing what changes would need to be made to the CFD regime in the CA 2006 to reflect the UK SRS. That review is expected to conclude by spring 2027 and feedback from that review, and from the Modernising Corporate Reporting consultation, will inform future statutory changes. For more information, see our blog post and ESG Quick Guide: UK climate disclosure rules under Companies Act 2006.  

The government has indicated that companies reporting voluntarily in accordance with the UK SRS S2 - and UK listed companies reporting under the revised UKLR - will meet their climate disclosure requirements under the CA 2006 (see para 158 in the government's Modernising Corporate Reporting consultation document and para 1.91 in the government's Response to its Consultation on the UK SRS).

The UK SRS apply on a voluntary basis initially.

However, under the FCA's revised UKLR, the UK SRS will apply to listed companies on a “comply or explain” basis from January 2027. 

It is not yet clear whether reporting in line with the UK SRS will become mandatory under the CA 2006 in due course - this is subject to an ongoing review (see above).   

The government published the final versions of the UK SRS on 25 February 2026 (see our blog post). The UK SRS are currently available for voluntary use in the UK. 

However (as explained above):

• The FCA has announced that it will replace the existing TCFD-aligned climate disclosure rules under the UKLR with new “comply or explain” rules relating to the UK SRS. These will apply to accounting periods starting on: 
  • 1 January 2027 for climate reporting (under UK SRS S2);
  • 1 January 2028 for Scope 3 reporting; and 
  • 1 January 2029 for other sustainability (non-climate) reporting (under UK SRS S1). 
• The UK government said in its Modernising Corporate Reporting consultation that it is reviewing what changes would need to be made to the climate disclosure rules in the CA 2006 to reflect the UK SRS. That review is expected to conclude by spring 2027 and feedback from that review, and from the Modernising Corporate Reporting consultation, will inform future statutory changes. 

The differences between the IFRS / ISSB standards and the UK SRS are set out in Annex A to the government response document. 

The main differences are as follows: 

• A reporting entity “may” (rather than “shall”) consider the SASB standards when reporting under the UK SRS.
• The removal of timings including for temporary reliefs, although these may be re-introduced when mandatory reporting requirements are introduced.
• The inclusion of provisions either limiting the ability to make compliance statements or requiring that additional information is included in compliance statements when an entity is relying on reliefs.
• Removing the ability for an entity to report sustainability disclosures after it has published its financial statements.
• Allowing financial institutions to report financed emissions from a different reporting period provided that additional disclosures are made.    

For a detailed analysis of the differences between the draft UK SRD and the final UK SRS, see our blog post.

The government consulted on climate transition plans in June 2025 (see our blog post), alongside its consultation on the draft UK SRS. 

However, the government has not yet published its response to that consultation so it remains unclear at this stage if transition plans will become mandatory in the UK, and (if so) for which entities and when. We are waiting for the government to announce its next steps on this. 

UK SRS S2 requires disclosure of any climate-related transition plan that an entity has, including key assumptions used to develop such a plan and dependencies on which the plan relies. 

In its consultation on transition plans, the government included questions on whether UK SRS S2 provides sufficient information on transition plans and, if not, it asked what further information respondents would like to see.  

The FCA has indicated in the revised UKLR (which will start applying from January 2027) that listed companies will not be required to produce transition plans but they will be required to disclose whether and where they have published a transition plan (if they have one) or state why they have not published one. 

For more information on transition plans requirements under various disclosure regimes, see our Quick Guide on this. 

In its consultation on the draft UK SRS in June 2025 (see our blog post), the government raised the issue of forward-looking information. 

Reporting on climate and sustainability-related matters will include forward-looking information, including information on the future prospects of the reporting entity, how its strategy will develop over time, and its climate and environmental targets. 

Stakeholders have raised the prospect of legal implications if it later emerges that this information is inaccurate. There could also be implications from any reliance on third-party data, including for example data used to estimate GHG emissions across the value chain.

In section 463 of the CA 2006, there are protective provisions for forward looking information in strategic reports and directors’ reports included in company annual reports. Directors are liable to the company (but not investors) for any loss suffered as a result of any untrue or misleading statement in a report, or any omission, where the director either “knew the statement to be untrue or misleading or was reckless” or knew that the omission was a “dishonest concealment of a material fact”. These provisions should allow for reporting to be made with the best available information and in good faith. 

The UK government said in the consultation on the draft UK SRS that it is considering whether similar provisions should apply to reporting requirements under the UK SRS. 

The government confirmed in its Modernising Corporate Reportjng consultation in September 2026 (see our blog post) that: 

• existing protections for careful directors who did not know that a statement was untrue or misleading should apply to UK SRS disclosures; 
• it may be necessary to extend the safe harbour in section 463 if sustainability disclosures are located outside the strategic report in the future (as the protection is currently limited to the strategic report); and
• legal protection for forward-looking and estimated information in transition plans is also being considered as part of the response to the government’s separate consultation on transition plans. 

The government has also said it will also consider whether to update current climate disclosure rules for pension schemes, in light of the UK SRS. 

The Department for Work and Pensions will review the existing regulations, building on evidence provided by The Pensions Regulator. 

• UK SRS S1 and UK SRS S2 - final versions
• Government response to the consultation on the draft UK SRS
• UK SRS webpage
• FCA: Policy Statement PS26/19: Aligning listed issuers' sustainability disclosures with international standards - explains the changes to the UKLR to reflect the UK SRS
• FCA: Draft Technical Note TN/803.1: UK SRS sustainability disclosures for listed companies - contains guidance on the “comply or explain” requirements in the revised UKLR - the consultation on the draft closes on 28 October 2026 

• UK: Government publishes final versions of UK SRS
• UK SRS: FCA confirms comply or explain approach for listed company climate disclosures
• UK: Government consults on modernising corporate reporting: sustainability takeaways
• Quick Guide on UK regime under Listing Rules 
• Quick Guide on UK regime under Companies Act 2006
• Quick Guide on ISSB standards
• Other ESG Quick Guides