What the UK Sustainability Reporting Standards (UK SRS) mean for your business
- 6 days ago
- 11 min read
When I first started to work in sustainability, the ESG ‘alphabet soup’ of disclosures was a constant headache but sustainability reporting is now moving from a fragmented set of requirements towards a single, global baseline. This is all galvanising around the international IFRS Standards, the UK interpretation of which is the UK Sustainability Reporting Standards (UK SRS).
The IFRS Sustainability Disclosures
The IFRS Sustainability Disclosures were developed specifically to bring together and harmonise ESG reporting across the globe. They aim to define reporting for any sustainability issue that could reasonably affect a company’s financial prospects, from climate change and biodiversity to human rights and data privacy.
Establishing international standards to replace the plethora of existing standards has not been simple and it is still a journey. So far the ISSB has only published two standards, known as IFRS S1 (General Requirements) and IFRS S2 (Climate-related Disclosures), but more are in development:
Biodiversity, ecosystems, and ecosystem services (BEES) is expected to be drafted by the end of 2026 and will build on the requirements of the Taskforce on Nature-related Financial Disclosures (TNFD).
Human capital is being scoped, including metrics but with no draft publication date yet.
Human rights has been deferred for now but is on the ‘reserve list’ for future consideration.
The UK Sustainability Reporting Standards (UK SRS)
The UK version of the IFRS Standards is the UK Sustainability Reporting Standards (UK SRS). The first two of which were finalised and published on 25 February 2026.
The two standards, known as UK SRS S1 (General Requirements for Disclosure of Sustainability-related Financial Information) and UK SRS S2 (Climate-related Disclosures) directly translate to the IFRS S1 (General Requirements) and IFRS S2 (Climate-related Disclosures), respectively.
What are the requirements of the UK Sustainability Reporting Standards?
The aim of the UK SRS is to provide primary users of financial reports (e.g. shareholders) with information about, “sustainability-related risks and opportunities that could reasonably be expected to affect the entity’s cash flows, its access to finance or cost of capital over the short, medium or long term” (UK SRS S1, p3).
In practice, think of it as this: if information about a sustainability issue could affect an investor’s decision to invest in your company, then you need to publicly report that information.
The type of information that needs to be reported falls into four categories (which those familiar with the Task Force on Climate-related Financial Disclosures will recognise) – governance; strategy; risk management; and metrics and targets. Whilst UK SRS S1 asks for the broad, company-wide approach to these, the topic-specific standards (of which so far only SRS S2 has been published) provide additional granular detail on the information required. Both build upon and add to existing UK reporting requirements for companies rather than reinventing the wheel.
UK SRS S1 (general sustainability) is an evolution and expansion of the non-financial and sustainability information statement (previously known as the ‘non-financial information statement’). This statement was introduced by the Companies, Partnerships and Groups (Accounts and Non-Financial Reporting) Regulations 2016, which is the UK version of an EU Directive. Under this legislation companies in scope have to report on their policies, risks and key performance indicators relating to environment, employees, social, human rights and anti-corruption/bribery. Under UK SRS general disclosures are both honed – they only need to cover sustainability topics where the non or mis-disclosure could impact an investor’s decision about the company - and deepened - covering in far more detail how issues are identified and mitigated.
Feature | Non-financial and sustainability information statement | UK SRS S1 |
UK SRS S1 | ||
Relevant ESG issues | Five defined topics: environment; employees; social; human rights; and anti-corruption/bribery. | Requires companies to identify and disclose sustainability issues that could reasonably affect a financial decision about their company (e.g. a hypothetical investors’ decisions to invest in your company) because of their impact on the entity’s business model and/or value chain.
Topics are non-exhaustive and may consider SASB (Sustainability Accounting Standards Board) Standards, CDSB biodiversity and CDSB water guidance, other best practice and known industry/geographic issues. |
Level of detail | Light touch, covering: policies; policy outcomes; risk; risk management; and key performance indicators. | Disclosures are deepened into a single, coherent structure, requiring companies to explain:
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Financial link | n/a | Extensive. Companies should disclose quantitative and qualitative information about how sustainability risks/opportunities are anticipated to impact the company’s financial position (e.g. investment and disposal plans; funding), financial performance and future cash flows. |
Temporal horizon | Current – The legislation focusses on what is currently in place at the company and what risks are there now. | Current and forward-looking. Forward-looking disclosures include:
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UK SRS S2 (Climate-related Disclosures) builds upon two disclosure requirements:
Streamlined Energy and Carbon Reporting (SECR), which requires in scope companies to measure and report scope 1 & 2-related energy use, GHG emissions and energy reduction measures.
Task Force on Climate-related Financial Disclosures (TCFD), which started as a global best practice standard and in the UK became a mandatory requirement for certain companies under FCA listing requirements and/or legislation (the Climate-related Financial Disclosure (CFD) Regulations 2022). Note the precise details of the CFD requirements do vary slightly from the listing requirements but the overall approach for both is very closely aligned to TCFD reporting.
Feature | SECR | TCFD (FCA listing requirement/CFD) | UK SRS |
UK SRS S2 | |||
Relevant ESG issues | Scope 1 & 2 energy use & greenhouse gas (GHG) emissions | Climate-related risks and opportunities that could have a material financial impact on the organization. | Climate-related risks and opportunities that could reasonably be expected to affect the entity’s prospects (e.g. an investors’ decisions to invest in your company). This is worded slightly differently to TCFD but is likely to result in the same risks being identified. |
Metrics required | Scope 1 & 2 energy use & greenhouse gas (GHG) emissions. | Scope 1 & 2 GHG emissions and optional (if appropriate) scope 3 GHG.
| Scope 1, 2 and 3 GHG emissions, with a 1-year transition relief for scope 3 on a ‘comply or explain’ basis. Primary data for material scope 3 categories is encouraged (i.e. moving beyond spend-based methodology). |
Level of detail | Light. Disclosures on data methodology and energy saving reduction measures are non-prescriptive. | Moderate. 11 general disclosures covering governance; strategy; risk management; and metrics and targets. | High. As per TCFD but with additional specific details needed, for example the planned use of carbon credits; details of risks and risk concentrations in the value chain. |
Financial link | n/a | Moderate. Impacts on financial performance and financial position should be discussed. Some quantification is usual but it’s not explicitly required. | Extensive. Companies should disclose quantitative and qualitative information about how climate risks/opportunities are anticipated to impact the company’s financial position (e.g. investment and disposal plans; funding), financial performance and future cash flows. |
Temporal horizon | Current/past – information relating to the reporting year and previous year. | Current and forward-looking. Forward-looking disclosures include:
| Current and forward-looking as per TCFD, with additional disclosures relating to the company’s climate-related transition plan (whether one is in place, and if so assumptions and dependencies). |
Transition Plan Taskforce (TPT) and the UK SRS
Whilst the UK SRS/IFRS disclosures focus on ‘what’ a company will do about climate change, a transition plan is the detail behind this – the ‘how’. The best practice standard for transition plan disclosures is the Transition Plan Taskforce (TPT) Disclosure Framework.
Developed by the UK, the TPT was adopted by the IFRS but has not been included in IFRS S2 (Climate-related Disclosures), beyond a light-touch requirement for companies that have a transition plan, to state that they do so, along with the plan assumptions and dependencies. Although not included in the main IFRS Standards, TPT requirements have been absorbed into the non-mandatory supplementary guidance to the Standards, the IFRS Educational Material and the two standards have been specifically designed with interoperability in mind.
In the UK, a transition plan (TPT-aligned or otherwise) is currently not a legal or listing requirement. It is also not mandatory under UK SRS, which takes exactly the same disclosure approach as IFRS (i.e. if you have a public plan you need to state so, and if not, why not).
However, compliance requirements in this space may change going forward. The UK government conducted a consultation on climate-related transition plans in 2025, the outcome from which is yet to be published. While this is pending the FCA has proposed introducing a requirement for listed companies to state if they have a public transition plan (and if so, where it is), and if not, why not. This doesn’t need to be a TPT-aligned plan, although the FCA intends to reference the IFRS Educational Material in their guidance as something companies ‘may wish to use’. The outcome from the FCA proposal is expected in the autumn.
EU Corporate Sustainability Reporting Directive (CSRD) and UK SRS
The European CSRD regulations are similar to UK SRS in that they are sustainability reporting standards for companies, however their approach is quite different, and a company compliant with CSRD will not automatically be compliant with UK SRS.
One important point of differentiation is around the assessment of which ESG risks/opportunities require disclosures. For CSRD this is based on a ‘double materiality assessment’ which considers ESG issues based on both their impact materiality (inside-out) and their financial materiality (outside-in). The UK SRS, in contrast, only considers the latter but does so in a much more granular fashion, considering financial impact in terms of financial position, financial performance and future cash flows. For this reason, a company which has conducted a double materiality assessment will likely need to complete additional quantitative financial analysis in order to comply with UK SRS. Further, the ESG topics requiring disclosure for CSRD will likely differ from those required for UK SRS.
In terms of the disclosure requirements for identified sustainability issues, these are largely the same as both CSRD and UK SRS are based on IFRS Standards. However, CSRD has some additional requirements (e.g. mandatory transition plan details).
Who will UK SRS apply to? The UK SRS consultation
For now UK SRS are best practice voluntary standards, but that will likely very soon change as the FCA intends to make these mandatory requirements for some companies.
In January 2026 the Financial Conduct Authority (FCA) issued a consultation on the UK SRS, and this closed in March. Although the FCA’s response is not expected until autumn, the consultation gives us an indication on who the UK SRS could mandatorily apply to and the timeframes for this.
In the consultation the proposal is to replace their existing TCFD listing requirements with the new UK SRS requirements. This means that UK SRS would apply to the following FCA listing categories:
Equity shares (commercial companies) - UKLR 6.
Equity shares (international commercial companies secondary listing) - UKLR 14.
Certificates representing certain securities (depository receipts) - UKLR 15.
Non-equity shares and non-voting equity shares - UKLR 16.
Equity shares (transition) - UKLR 22.
This scope is narrower than companies that currently have general and/or carbon disclosure requirements – i.e. just because a company is making some sustainability disclosures now does not mean that UK SRS applies.
Sustainability reporting requirements for limited companies, excluding banking and insurance:
General: | Climate: |
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Non-financial & sustainability statement | UK SRS S1 | SECR | TCFD (CFD reg) | TCFD (FCA listing) | UK SRS S2 | |
Companies trading on UK regulated markets: - Equity shares, commercial companies (UKLR 6); - Equity share, secondary listing (UKLR 14); - Depository receipts (UKLR 15); - Non-equity shares and non-voting equity shares (UKLR 16); - Equity shares, transition (UKLR 22). | ✓ if large (i.e. two of: £54m+ turnover; £27m+ balance sheet; 250+ employees) AND 500+ employees | ✓ | ✓ | ✓ if large (i.e. two of: £54m+ turnover; £27m+ balance sheet; 250+ employees) AND 500+ employees | ✓ | ✓ |
Companies trading on EU, New York Stock Exchange or NASDAQ regulated markets | ✓ if large (i.e. two of: £54m+ turnover; £27m+ balance sheet; 250+ employees) AND 500+ employees |
| ✓ | ✓ if large (i.e. two of: £54m+ turnover; £27m+ balance sheet; 250+ employees) AND 500+ employees |
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Companies trading on other regulated markets | ✓ if large (i.e. two of: £54m+ turnover; £27m+ balance sheet; 250+ employees) AND 500+ employees |
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| ✓ if large (i.e. two of: £54m+ turnover; £27m+ balance sheet; 250+ employees) AND 500+ employees |
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AIM listed UK registered companies |
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| ✓ if two of: £36m+ turnover; £18m+ balance sheet; 250+ employees) | ✓ if 500+ employees |
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Other UK registered companies |
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| ✓ if two of: £36m+ turnover; £18m+ balance sheet; 250+ employees) | ✓ if 500+ employees AND £500m+ turnover |
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In terms of general disclosures, current disclosures in the form of a non-financial and sustainability information statement are defined by the Companies, Partnerships and Groups (Accounts and Non-Financial Reporting) Regulations 2016. This legislation applies to traded[1], banking and insurance companies that are large and also have 500+ employees. If you’re already reporting a non-financial and sustainability information statement and are trading on regulated markets outside of the UK, or are a banking and insurance company that doesn’t fall into the five FCA listing categories (UKLR 6, 14, 15, 16 and 22), you will not need to conduct any additional reporting under UK SRS.
In terms of carbon disclosures, current disclosure requirements stem from:
Streamlined Energy and Carbon Reporting (SECR) which applies to UK quoted[2] companies; large unquoted companies and large LLPs.
FCA listing requirements on TCFD reporting. Originally these were mandatory for premium listed companies in the UK for financial years beginning on or after 1st January 2021 and for standard listed companies from 1st January 2022. In 2024 the UK Listing Rules framework (UKLR) was updated, replacing the terms ‘premium’ and ‘standard’ with 11 new listing categories. Thereafter the companies required to report changed, to those listed in five FCA listing categories (UKLR 6, 14, 15, 16 and 22).
Climate-related Financial Disclosure (CFD) Regulations 2022 (TCFD-style reporting) applies to companies:
Required to produce non-financial information statements (see above).
UK registered AIM listed companies with 500+ employees.
Other UK registered companies with 500 employees and turnover of £500m+.
Banking or traded LLPs with 500+ employees.
Other large LLPs with 500 employees and turnover of £500m+.
Only companies currently completing TCFD reporting because of an FCA listing requirement will need to change their reporting to align with UK SRS. Other companies, such as those trading on regulated markets outside of the UK, AIM listed companies and large non-listed companies, will for now, need to just continue with their existing SECR/CFD disclosure requirements.
Going forward the scope of application of UK SRS may increase to private entities. This is something the UK Government has committed to reviewing as part of the Modernising Corporate Reporting (MCR), a consultation on which is due later this year.
When will UK SRS be implemented?
The proposed timelines for mandatory UK SRS reporting are detailed in the FCA consultation earlier this year. Under this proposal companies would need to report on UK SRS S1 and UK SRS 2 for financial years starting on or after 1st January 2027.
However, there is also a ‘transitional relief’ phase, which allows delayed reporting for some elements of UK SRS on a ‘comply or explain’ basis. Applying the transitional reliefs leaves mandatory reporting as follows:
What does this mean for companies?
The outcome from the FCA proposals on UK SRS will only be released in autumn 2026 and compliance will potentially commence from reporting periods starting only a few months later, thus understanding if you are likely to be in scope is a priority. If you are to be in scope, conducting a gap analysis against your existing reporting is a priority. If you’re not likely to be in scope remember that you may be part of the value chain of other companies that are in scope. As such you may be asked to complete more complex ESG questionnaires or provide sustainability data, e.g. carbon emissions.
How we can help
The transition to UK SRS is a strategic shift which companies will need to respond to.
The Rawstone team consists of former in-house experts who understand the real-world pressure of these disclosures. We specialise in:
Materiality assessments to identify what matters to your business, needed for SRS S1.
GHG emissions calculations (scopes 1, 2, and 3), needed for SRS S2.
Board & investor alignment to ensure your data tells a pragmatic, professional story.
EcoVadis submissions that demonstrate your sustainability credentials to your business customers.
Contact us to find out more.
[1] Traded company means a company whose transferable securities are admitted to trading on a regulated market. This does not include AIM listed companies.
[2] Quoted company is slightly different to traded company in that equity share capital must be officially listed on the main market of London, Europe, New York Stock Exchange or on the NASDAQ.
