UK SRS: No major evolutions to reporting, based on latest from FCA

According to the latest announcement from the Financial Conduct Authority (FCA) on the incoming UK Sustainability Reporting Standards (UK SRS), not a whole lot is going to change in terms of requirements for UK-listed companies. In practice, UK SRS will (in its current form) not require companies to do much more than they had already been doing for their TCFD reporting – at least for the next three or so years.

After a long waiting period, therefore, SRS’ arrival comes as a bit of an anticlimax. As is the case with regulatory rollbacks in the EU, the burden now shifts on to companies to maintain progress on sustainability despite facing a regulatory framework which has reduced in ambition.

Ideally, fewer reporting requirements will free up teams up to work on operational advancements. But a weaker SRS will mean less rigor to the financial aspects of these disclosures – at least in the medium-term – which changes the equation for how companies should communicate on their most significant impacts.

What’s the news?

The FCA, which oversees the Listing Rule governing listed companies, has released a paper and consultation on how it plans to implement UK SRS. This acts as our first fully official view into the scope and extent of what the standards will enforce.

To recap, UK SRS is the UK’s implementation of the IFRS Sustainability Standards, and comprises S1 – wider sustainability topics – and S2 – specifically climate-related disclosures. S2 is very close to TCFD, with more in-depth demands on financial quantification.

The key points from the FCA’s paper are:

1. The scope of the FCA’s proposals aligns with existing TCFD-based rules – this means that if you are in scope of TCFD, you will be in scope of UK SRS. This was expected, but it’s good to have clear confirmation that, for now, the scope will not be expanding or narrowing.
2. S2 (Climate) will apply from FY27 reporting (i.e. reporting released in 2028), with companies to report TCFD up until this point.
3. S1 will not apply until FY29 reporting (i.e. reporting released in 2030), and will apply on a ‘comply or explain’ basis.
4. Foundational parts of S1 – to do with e.g. ‘conceptual foundations’ – will be required even as part of S2 reporting, but these don’t represent a large burden.
5. The scope 3 emissions reporting aspect of S2 will apply from FY28 reporting (i.e. reporting released in 2029) on a ‘comply or explain’ basis.
6. Transition plans won’t be required as part of UK SRS – but the FCA notes that the government’s consultation on mandatory transition plans (which is likely to only affect FTSE 100 companies and large financial institutions, either way) is still ongoing.
7. Assurance on disclosed sustainability information won’t be mandatory, but companies will need to say whether they obtained assurance or not. Again, the FCA’s paper defers to the government’s ongoing consultation on this.

So, to summarise: With no mandatory transition plans, comply-or-explain scope 3, a far-off S1, and S2’s similarities to TCFD, UK SRS can’t be said to represent a particularly large burden for companies.

By the 2027 reporting cycle, companies will need to take their existing TCFD work and upgrade it to meet S2, which will primarily involve greater detail on certain line-items, and further work on financial quantification. They will also need to report the foundational parts of S1.

They will not have to do a transition plan. But they will likely have to show some form of scope 3 reporting, as it will be difficult for most companies to use ‘comply or explain’ to avoid scope 3 entirely – although we note that many large listed companies already report scope 3 and have targets.

Importantly, companies will not have to worry about S1 until around 2029, which is quite far in the future. As S1 was going to be the part of SRS which created the most additional work, it could be said that in pushing S1 back, SRS has lost some of its teeth.

What’s next?

The FCA’s consultation closes on the 20^th March. They aim to publish a follow-up Policy Statement in Autumn 2026, which will come into force from 1^st January 2027 (implementing the timelines described above). We still expect to see final UK SRS documents from the government in February 2026 – although the FCA’s paper implies that these will not change from what we have already seen.

What are my next steps?

Given that UK SRS is primarily financially-minded, the delay with which S1 is being introduced means that companies will for now continue to communicate on sustainability without an additional financial lens being applied.

This is not necessarily better or worse – but it does mean companies won’t, in most cases, have developed clear and comparable financial figures to point towards when discussing their most significant non-climate impacts. Thinking about how to communicate and report credibly on the significance, opportunities, and actions being taken around these topics therefore remains just as, or even more important, than ever – with those communicating on sustainability having to continue to determine approaches which are the best for their sector and context.

In terms of immediate next steps for companies, however, we would recommend assessing how your current TCFD reporting aligns with S2’s requirements.

If you’d like a call with the Emperor sustainability team to give a run-through of how we think you align with SRS as it stands, and where there are gaps to think about, please be in touch and we’d be happy to set up a discussion.