Executive Summary
UK sustainability reporting is moving rapidly toward more standardised, investor grade disclosure. The UK Sustainability Reporting Standards (UK SRS) are the UK endorsed versions of the International Sustainability Standards Board (ISSB) global baseline standards: IFRS S1 and IFRS S2.
Following the Government’s consultation, the final UK SRS S1 and UK SRS S2 were published on 25 February 2026 and are available for voluntary use by UK organisations, in whole or in part. This guide explains what UK SRS is, what the consultation confirmed, how it relates to existing frameworks such as SECR and TCFD‑aligned reporting, and what large organisations should do now to prepare.
UK Sustainability Reporting Standard: What UK SRS is
UK Sustainability Reporting Standards (UK SRS) are the UK endorsed versions of the ISSB’s IFRS S1 (General Requirements for Disclosure of Sustainability – related Financial Information) and IFRS S2 (Climate‑related Disclosures). The standards have been published by the UK Government and are available for voluntary use.
UK SRS is designed to align sustainability reporting more closely with financial reporting, using consistent concepts, definitions and structured disclosures so investors and other stakeholders can compare information between organisations.
UK SRS S1 vs S2
- UK SRS S1 (general): governance, strategy, risk management and metrics across material sustainability risks and opportunities.
- UK SRS S2 (Climate): Climate‑specific disclosures including governance, strategy, scenario analysis, transition planning and greenhouse gas emissions (Scopes 1, 2 and 3).
Where UK SRS Comes From
The UK Government consulted on exposure drafts of UK SRS between 25 June 2025 and 17 September 2025. Following assessment by the Sustainability Disclosure Technical Advisory Committee (TAC) and the Policy and Implementation Committee (PIC), the Government decided to endorse IFRS S1 and S2 and issue UK SRS S1 and UK SRS S2 for voluntary use.
Why UK SRS Matters: drivers, timeline, and scope
Why this Matters Now
UK sustainability disclosure is shifting from narrative ESG reporting toward decision‑useful, comparable and finance‑grade disclosure. UK SRS strengthens the link between sustainability risks, strategy and financial performance, supporting investor decision‑making and regulatory consistency.
UK SRS Timeline: What Has Been Confirmed
• Consultation on exposure drafts closed: 17 September 2025
• Final UK SRS S1 and UK SRS S2 published: 25 February 2026 (voluntary use available immediately)
• Mandatory use: To be set through FCA rulemaking for listed companies and future Government consultation under the Modernising Corporate Reporting programme for other entities.
Who is Likely to be Affected First
While the Government has not yet legislated mandatory adoption for all entities, regulatory direction indicates:
- Listed companies: The FCA is consulting on replacing TCFD‑aligned rules with UK SRS‑aligned disclosures, with proposed rules coming into force from accounting periods beginning on or after 1 January 2027.
- Other large UK entities: Any mandatory requirements will be considered through future Government consultation under the Modernising Corporate Reporting programme.
SECR UK SRS: What Changes as Reporting Evolves
SECR (today): what it focuses on
SECR integrates energy and carbon disclosure into annual reporting for in scope entities and has been in place since 2019. The government’s environmental reporting guidelines describe the SECR requirements, and the types of entities affected. It focuses primarily on energy use and Scope 1 and 2 emissions.
UK SRS (emerging): how it expands beyond SECR
UK SRS expands sustainability reporting beyond energy and carbon metrics to include governance, strategy, risk management and forward‑looking climate disclosures. While UK SRS is expected to form the backbone of the UK’s future sustainability disclosure framework, the Government has not yet confirmed how or when it will formally replace SECR for all entities.
Many organisations currently producing SECR reporting will find UK SRS introduces broader disclosures and stronger links to governance and strategy.
What “Good” Looks Like: a finance‑grade reporting framework
A useful way to think about UK SRS readiness is to separate reporting output from the controls that make reporting defensible.
Core building blocks (what must be consistently defined)
- Boundary and scope
Define organisational boundaries and which activities/entities you include (group structure, subsidiaries, operational control considerations). - Governance and oversight
Who owns sustainability reporting? What is reviewed at board/committee level? How are sign‑offs recorded? - Materiality process
A documented approach to deciding what sustainability risks/opportunities are material enough to disclose. - Metrics, methods, and evidence
Standardised calculation methods, documented assumptions, retained evidence, and change logs.
These “good practice” components align with the kind of structured reporting model described in UK SRS materials (governance, strategy, risk management, metrics).
Scope 3 readiness (often the hardest shift)
Scope 3 is often the largest portion of an organisation’s footprint.
What “good” looks like for Scope 3:
- A defined Scope 3 inventory (categories used, why included/excluded)
- A supplier engagement plan (data request and cadence)
- A hierarchy of data quality (primary supplier data where feasible; robust secondary methods otherwise)
- A clear audit trail for calculations and updates.
Step‑by‑step: how large businesses can prepare
This is the practical UK Sustainability Reporting Standards (UK SRS) “action framework”:
Step 1 Build a UK SRS readiness map
Create a one-page summary:
- Current disclosures (SECR / TCFD‑aligned / sustainability reports)
- Owner(s) and sign‑off route
- Data sources and systems
- Known gaps (Scope 3, scenario analysis, governance narrative).
Step 2 Define governance and internal controls
Governance and strategy disclosures; start now by agreeing:
- Board/committee oversight
- Internal review cycles (finance and sustainability)
- Evidence retention and version control.
Step 3 – Prioritise Scope 3 categories by materiality
Do not try to perfect all categories immediately.
- Identify the categories most likely to be material (spend, relevance, risk)
- Define what “good enough” evidence looks like for year 1 vs year 2
- Plan how you will improve data quality over time.
Step 4 Pilot a “dry run” disclosure (voluntary)
The UK Government indicates UK SRS will be available for voluntary use (early 2026) before any broader future mandatory rollout decisions.
A dry run helps you:
- Stress test data collection
- Identify narrative gaps
- Pressure‑test internal sign‑off and evidence packs.
Step 5 Track regulatory updates and listing rule changes
Use this official reference: UK Sustainability Reporting Standards guidance and monitor FCA developments if you are listed or within scope of listing rule changes.
Templates and checklists
UK SRS readiness checklist
- Named reporting owner and finance counterpart
- Defined reporting boundary and consolidation approach
- Documented materiality process
- Scope 1 – 2 data sources validated and repeatable
- Scope 3 categories prioritised and method defined
- Evidence pack approach (files, versioning, approvals)
- Draft governance narrative (roles, oversight, escalation)
- Dry run disclosure tested against UK SRS concepts.
SECR UK SRS Gap Scan
| Area | SECR today | UK SRS direction of travel |
| Governance narrative | limited | Expanded governance plus oversight expectations. |
| Climate disclosures | variable | UK SRS S2 climate focused, replacing TCFD in listing context. |
| Scope 3 | optional | Phased/expanded expectations; harder data collection. |
| Assurance | not universal | Increasing attention; FCA consult signals disclosure of assurance status. |
What is the UK Sustainability Reporting Standard?
UK SRS refers to the UK‑endorsed Sustainability Reporting Standards, based on the ISSB’s IFRS S1 and IFRS S2. UK SRS S1 and UK SRS S2 are designed to create consistent, decision‑useful sustainability disclosures aligned to international standards within a UK regulatory context
What did the UK SRS consultation cover?
The government consultation sought views on exposure drafts of UK SRS S1 and UK SRS S2, including proposed UK‑specific amendments, and gathered evidence on the costs, benefits and practical implications of using UK SRS ahead of potential future mandatory adoption.
When will UK SRS become mandatory?
The UK Government has published the final UK SRS for voluntary use and has not yet set mandatory adoption dates in law.
For listed companies, the FCA is consulting on replacing TCFD‑aligned rules with UK SRS‑aligned disclosures, with proposed application for accounting periods beginning on or after 1 January 2027. Any wider mandatory requirements for other UK entities will be considered through future government consultation under the Modernising Corporate Reporting programme.
How does “SECR UK SRS” affect existing reporting teams?
UK SRS builds on existing climate and energy reporting but extends disclosure expectations to include governance, strategy, risk management and forward‑looking climate related information. Reporting teams should expect greater emphasis on financial materiality, internal controls and audit ready evidence, beyond the current focus of SECR.
Will Scope 3 be required?
UK SRS S2 includes Scope 3 greenhouse gas emissions as part of climate‑related disclosures. For listed companies, the FCA is consulting on a phased “comply or explain” approach to Scope 3 reporting, recognising data availability challenges. The availability and timing of Scope 3 requirements will ultimately be set through regulation where UK SRS becomes mandatory.
Where can I read the official UK SRS material?
Start with UK SRS exposure drafts consultation (GOV.UK) and UK Sustainability Reporting Standards guidance.
Updated February 2026: This guidance reflects the UK Government’s publication of the final UK Sustainability Reporting Standards (UK SRS) and the latest FCA consultation on future mandatory adoption.
Written by: Tim Holman – Head of Consultancy, MSc, MEng, CEng, MEI
Tim directs TEAM’s consultancy practice, applying 25+ years in strategy, audits, metering, and compliance to deliver robust, audit‑ready results for customers.