UK Sustainability Reporting Standards (SRS): 2026 Guide
Standards S1 & S2 Published — Voluntary Today, Mandatory Reporting Proposed From 2027
📅 Key Date: UK SRS S1 and S2 were issued by the Secretary of State for Business and Trade on 25 February 2026, for voluntary use
Mandatory reporting is proposed, not yet finalised: the FCA's CP26/5 consultation proposes accounting periods beginning on or after 1 January 2027 for certain listed companies, with a policy statement expected in autumn 2026 (no date confirmed)
What Are UK Sustainability Reporting Standards?
UK Sustainability Reporting Standards (UK SRS) are UK-specific standards based on the International Sustainability Standards Board (ISSB)'s IFRS S1 and S2, issued by the Secretary of State for Business and Trade rather than endorsed by the ISSB, and carrying UK-specific differences set out in Annex A of the government's response.
UK SRS is available for voluntary use by any entity today; the government and the FCA are separately considering whether to introduce mandatory reporting requirements. The dedicated reference site for UK sustainability reporting standards tracks the standards and the process in detail.
UK SRS S1: General Requirements
Foundation standard setting out general requirements for sustainability-related financial disclosures
- Governance structures and oversight
- Strategy for managing sustainability risks
- Risk identification and management
- Metrics, targets and performance
UK SRS S2: Climate Disclosures
Specific requirements for climate-related disclosures aligned with TCFD
- Physical and transition climate risks
- Climate scenario analysis
- Scope 1, 2 and 3 GHG emissions
- Climate transition planning
Who Would Be In Scope, If UK SRS Reporting Is Mandated?
UK SRS reporting is voluntary for every entity today — nobody is currently required to report against it. The FCA has proposed, but not yet finalised, mandatory reporting for certain listed companies; a policy statement is expected in autumn 2026, with no date confirmed.
Full UK SRS Route (Proposed)
Proposed from 2027 — not yet in force
- • Commercial companies (UKLR 6)
- • Non-equity & non-voting shares (UKLR 16)
- • Transition category (UKLR 22)
Lighter-Touch Route (Proposed)
Proposed from 2027 — not yet in force
- • Secondary listing category (UKLR 14)
- • Depositary receipts category (UKLR 15)
- • A statement of overseas or voluntary standards followed — not UK SRS reporting
Everyone Else
Voluntary today
- • UK SRS is available for voluntary use by any entity
- • No FCA policy statement has been published
- • No effective date is set in the Standards themselves
Scale, if the FCA's proposals proceed: around 600 listed companies would be affected, of which 515 (commercial companies, non-equity/non-voting shares and transition categories) would be required to comply, and 89 (secondary listing and depositary receipts) would instead make a statement of the overseas or voluntary standards they follow.
UK SRS S1: General Requirements in Detail
Governance
- •Board oversight of sustainability risks and opportunities
- •Management's role in assessing and managing sustainability
- •Skills and competencies of governance bodies
- •How sustainability is integrated into decision-making
- •Frequency of board sustainability discussions
Strategy
- •Sustainability risks and opportunities identified
- •Impact on business model and value chain
- •Effects on strategy and resource allocation
- •Resilience of strategy to sustainability risks
- •Trade-offs considered in strategic decisions
Risk Management
- •Processes for identifying sustainability risks
- •Assessment and prioritisation methodologies
- •Monitoring of sustainability risks
- •Integration with overall risk management
- •Use of scenario analysis and stress testing
Metrics & Targets
- •Cross-industry metrics required for all
- •Industry-specific metrics where relevant
- •Targets set and progress against them
- •Methodologies and assumptions disclosed
- •Performance against targets with explanations
UK SRS S2: Climate Disclosure Requirements
Physical Climate Risks
- Acute risks (floods, wildfires, storms)
- Chronic risks (sea level rise, temperature changes)
- Location-specific risk assessments
- Supply chain vulnerability analysis
Transition Climate Risks
- Policy and regulatory changes
- Technology shifts and obsolescence
- Market changes and demand shifts
- Reputational considerations
GHG Emissions Reporting Requirements
Scope 1
Direct emissions from owned/controlled sources
Proposed as mandatory, not yet in force
Scope 2
Indirect emissions from purchased energy
Proposed as mandatory, not yet in force
Scope 3
All other indirect emissions in value chain
Proposed on a comply-or-explain basis, never straight-mandatory
If UK SRS S2 reporting is mandated, financial institutions would need to disclose financed emissions (Category 15 of Scope 3) where material
Emissions are calculated using the annual DESNZ GHG conversion factors.
Climate Scenario Analysis
UK SRS S2 requires companies that report under it to conduct climate scenario analysis using at least:
1.5°C Scenario
Aligned with Paris Agreement goals
3°C+ Scenario
Business-as-usual pathway
UK SRS Timeline
Only the first step below has happened. Everything after it is proposed and not yet finalised.
25 February 2026 - Standards Published
The Secretary of State for Business and Trade issues the finalised UK SRS S1 and S2 for voluntary use
Autumn 2026 (Expected, Unconfirmed) - FCA Policy Statement
The FCA aims to finalise its rules responding to CP26/5; no date has been confirmed
Proposed From 1 January 2027 - Mandatory Start
If finalised, the first reporting period would begin for in-scope listed companies (UKLR 6, 16, 22)
If Mandated - First Reports Due
First UK SRS reports for the first in-scope accounting period
Beyond The Initial Proposals
No further phase - covering large private companies, AIM-listed entities or others - has been proposed by government or the FCA as at August 2026
How to Prepare for UK SRS
Assess Current State
- • Gap analysis against S1 and S2
- • Review existing TCFD/SECR reporting
- • Identify data gaps
- • Assess governance maturity
Build Capabilities
- • Establish sustainability governance
- • Implement data systems
- • Train teams on requirements
- • Engage stakeholders
Implement & Report
- • Conduct scenario analysis
- • Develop transition plan
- • Prepare first report
- • Obtain assurance
Recommended Preparation Actions
Immediate Actions (Now)
- Form sustainability committee at board level
- Appoint Chief Sustainability Officer or equivalent
- Conduct materiality assessment
- Begin Scope 3 emissions baseline
Before January 2027 (If Reporting Is Mandated)
- Complete climate scenario analysis
- Develop transition plan to net zero
- Implement reporting software
- Dry run UK SRS report preparation
Common UK SRS Implementation Challenges
Challenge
Scope 3 Data Collection
Gathering emissions data from suppliers and customers
Scenario Analysis Expertise
Limited internal capability for climate modelling
Cross-functional Coordination
Aligning finance, sustainability, and operations teams
Technology Infrastructure
Lack of integrated sustainability data systems
Solution
Supplier Engagement Programs
Phased approach using estimates then actual data
External Expert Support
Partner with climate consultants for first analysis
Project Management Office
Dedicated PMO for UK SRS implementation
Phased Technology Rollout
Start with carbon accounting, expand gradually
Want to Talk It Through?
SRS Report is an independent reference site, not a consultancy — but if it would help to talk through where UK SRS applies to you, we offer a free, no-obligation call.