Sustainability reporting standards

Sustainability reporting standards are published rulebooks that set out what an organisation discloses about sustainability matters, and how, so that one company's figures can be compared with another's. The set a UK organisation can be asked to use is small: the GRI Standards, the SASB Standards, the ISSB's IFRS S1 and S2, the EU's ESRS, the TCFD recommendations (a framework, now disbanded), and the UK's own UK SRS S1 and S2, which the Department for Business and Trade published on 25 February 2026.

They differ mainly in who they are written for — investors, or a wider set of stakeholders.

No. UK SRS S1 and S2 are voluntary standards for any UK entity.

Under the FCA's final rules (PS26/19, 30 September 2026), listed companies in UKLR 6, 14, 15, 16 and 22 must report against them on a comply-or-explain basis for accounting periods beginning on or after 1 January 2027, with first reporting in 2028.

That is comply or explain across both standards: the consultation, CP26/5, had proposed making UK SRS S2 mandatory, and the final rules do not.

Parts of it are, under regulations rather than standards.

Quoted companies, and large unquoted companies and LLPs above the SECR thresholds, report energy use and emissions under SI 2008/410 Schedule 7, in force since 1 April 2019.

Organisations with at least 250 employees, or turnover above £44 million and a balance sheet above £38 million, must comply with ESOS, with Phase 4 qualification judged on 31 December 2026.

Companies with more than 500 employees that are traded, banking, insurance or AIM companies, or have turnover above £500 million, make the eight climate-related financial disclosures in Companies Act 2006 section 414CB.

None of the six sustainability reporting standards is mandatory for a UK company; listed companies in scope report against UK SRS on a comply-or-explain basis from 2027.

There is no single UK ESG reporting law.

The requirements are the sum of several regimes: energy use and emissions under SECR, climate risk and governance in the strategic report under Companies Act 2006 section 414CB, four-yearly energy assessments under ESOS, and — on the social and governance side — gender pay gap reporting, modern slavery statements and the section 172 statement.

For listed companies in UKLR 6, 14, 15, 16 and 22, the FCA's final rules add comply-or-explain reporting against UK SRS from accounting periods beginning on or after 1 January 2027.

It depends on who is asking.

Investors and lenders asking about financial exposure point to the ISSB standards, and in the UK to UK SRS S1 and S2.

Customers, employees and NGOs asking about impact point to GRI.

An EU parent or an EU-listed customer points to the ESRS.

No company has to choose only one: GRI and the IFRS Foundation have said their disclosures are complementary, and many large UK reports draw on both.

For accounting periods beginning on or after 1 January 2027, with first reporting in 2028.

The FCA's instrument was made on 24 September 2026 and comes into force on 1 January 2027.

Two reliefs apply: one year's non-disclosure of Scope 3 emissions under UK SRS S2, and two years' non-disclosure of UK SRS S1 non-climate matters.

A company using a relief states that it is doing so and need give no further explanation during the relief period.

The Policy Statement gives no total count.

It names the categories: UKLR 6 (commercial companies), 14 (international commercial companies secondary listing), 15 (depositary receipts), 16 (non-equity and non-voting equity shares) and 22 (transition).

CP26/5, the consultation, estimated that around 600 listed companies would be affected — the consultation's estimate, not a figure in the final rules.

UK SRS S2 is IFRS S2 as amended by the ISSB in December 2025, endorsed and adapted for the UK rather than adopted.

Annex A of the government's response lists every difference: references to the industry-based guidance at paragraphs 12, 23 and 32 changed from 'shall' to 'may'; the Scope 3 relief in Appendix C lost its one-period time limit; and paragraph B59A was added, requiring an entity to explain why it could not disclose financed emissions for the same period — the one place UK SRS is stricter than IFRS.

Compliance with UK SRS is not automatically compliance with the ISSB standards.

UK SRS and SECR impose no general legal duty to obtain sustainability assurance.

SECR's guidance says there is no statutory requirement, section 414CB imposes disclosure duties only, and the FCA's final rules keep assurance as a disclosure: where a listed company obtains it, it names the provider, the disclosures assured and the assurance standards used.

The FRC issued ISSA (UK) 5000 on 12 November 2025, effective for periods beginning on or after 15 December 2026.

In practice many large companies obtain it anyway: 83% of FTSE 350 assurance engagements in 2023 were limited assurance, according to the FRC's market study.

No UK instrument requires the GRI Standards.

They are voluntary worldwide and ask an organisation to report its most significant impacts on the economy, environment and people.

A company reports to GRI because its stakeholders or a parent ask it to, not because UK law does.

The IFRS Foundation is the not-for-profit body; the ISSB is the board it set up, formed on 3 November 2021, that writes IFRS S1 and S2.

The Foundation describes the ISSB as operating alongside, but independently from, the IASB, which writes the accounting standards.

UK SRS S1 and S2 are the UK's endorsed and adapted versions, not the ISSB's own text.

No UK instrument requires the ISSB's standards as such.

The UK route runs through UK SRS, which the Department for Business and Trade published on 25 February 2026 and which is voluntary for any entity.

New or amended ISSB standards would not automatically apply in the UK, according to the FRC, and compliance with UK SRS is not automatically compliance with IFRS.

No UK instrument cited on this page fixes a list of seven principles; the phrase comes from guides, and lists differ.

What the standards do fix are tests: UK SRS S1 paragraph 18 sets the financial materiality test, and paragraph B19 sets no quantitative threshold.

Our page on the seven principles sets out the common list and says where it comes from.

No. The FCA's SDR and investment labels rules, made in Policy Statement PS23/16, apply to investment products and the firms that sell them.

They are separate from the company reporting rules on this page, and the government's implementation update treats them as a separate strand.

Nothing yet.

The consultation of 7 September 2026, which closes on 30 November 2026, proposes to abolish the directors' report, and says SECR disclosures would move because of it, with companies free to place them in the first half of the annual report.

That would change the address of the disclosure, not the duty: scope, thresholds and content are not part of the proposal.

DESNZ separately says it intends to consult on SECR and ESOS later in 2026.

Yes, from 1 January 2027.

The UK carbon border adjustment mechanism is legislated in Finance Act 2026 Part 5 and starts on the same day as the FCA's rules, but it is a tax on imports, not a reporting standard, and it is separate from the EU's mechanism.

Sustainability reporting is an organisation measuring and publishing its environmental, social and governance performance in a form others can check.

In the UK it runs from compulsory energy and emissions statements under SECR to voluntary reports against GRI or UK SRS.

The chain is the same each time: meter readings, conversion factors, an emissions inventory, a statement in the report and, if the company chooses, assurance.

UK SRS S1 and S2, published by the Department for Business and Trade on 25 February 2026, are the new UK standards, and they are voluntary for any entity.

For listed companies in UKLR 6, 14, 15, 16 and 22 the FCA's final rules (PS26/19, 30 September 2026) add comply-or-explain reporting against them for accounting periods beginning on or after 1 January 2027.

The EU's revised ESRS apply from financial years beginning on or after 1 January 2027.

CP26/5 proposed mandatory UK SRS S2 excluding Scope 3 and only a signposting statement for UKLR 14 and 15.

The final rules in PS26/19 put all of UK SRS on comply or explain, bring UKLR 14 and 15 into reporting, and give one year's non-disclosure of Scope 3 and two years' non-disclosure of S1 non-climate matters.

Early adopters keep those reliefs (paragraph 3.19), and the new rules replace the TCFD-aligned disclosures (paragraph 1.10).

No. UK SRS is available for voluntary use by any entity, and no government document cited on this page proposes a threshold or date for private companies.

A private company can still be inside SECR, ESOS or the Companies Act climate disclosures when it meets their size tests, and a lender or customer can ask for UK SRS-style disclosures as a commercial matter.

The modernising corporate reporting consultation closes on 30 November 2026, and everything in it is a proposal.

The 2026 set gives 0.14396 kgCO2e per kWh for electricity consumed, against 0.19553 in the 2025 set.

DESNZ says most of the decrease is grid decarbonisation, with changes in the grid mix from 2023 to 2024 worth 16 percentage points and 2024 to 2025 worth 3.

The remaining 6 to 7 percentage points come from methodological changes, and the 2024 data year is skipped, so a year-on-year Scope 2 comparison across 2025 and 2026 should say so.

GRI asks an organisation to report its most significant impacts on the economy, environment and people, for everyone affected.

The ISSB standards, IFRS S1 and S2, ask for the sustainability matters that affect an entity's financial prospects, for investors and lenders.

GRI and the IFRS Foundation describe their disclosures as complementary, and no UK instrument names GRI.

Confirm its listing category, because UKLR 6, 14, 15, 16 and 22 are in scope and UKLR 11, 12, 13, 17, 18 and 19 are not.

Then identify when its first accounting period starting on or after 1 January 2027 begins, decide whether to use the Scope 3 or S1 relief and say so in the annual report, and draft the transition plan, assurance and explanation statements the rules ask for.

The checklist on this page sets the steps out against the paragraphs.

No. Environmental reporting in the UK is the sum of SECR for energy and emissions, ESOS for energy audits, the DESNZ conversion factors that turn energy into emissions, and the voluntary GHG Protocol, which requires a minimum of Scope 1 and Scope 2 reporting.

UK SRS S2 is the climate standard that sits above them for companies that choose it, or that the FCA's rules reach.