Government endorses ISSB sustainability reporting standards to create UK SRS

What you need to know

• The UK Government has published the UK Sustainability Reporting Standards (UK SRS) and a response to its June 2025 consultation on the exposure drafts of the UK SRS.
• The UK SRS are the UK endorsed versions of the International Sustainability Standards Board (ISSB) sustainability reporting standards. Minimal amendments have been made to S1 and S2 to make them relevant in a UK context.
• A key change is removal of the specific time references in the UK SRS so that they do not specify how long the reliefs for non-climate reporting and Scope 3 emissions reporting may be applied. This means voluntary users of the UK SRS can use these reliefs indefinitely.
• The standards are available immediately for voluntary use and the next step is for the Financial Conduct Authority (FCA) and the Government to mandate their use by listed companies and private companies (respectively).

On 25 February 2026, the Secretary of State for Business and Trade published the UK Sustainability Reporting Standards (UK SRS) and the Government's response to its June 2025 consultation on the exposure drafts of the UK SRS. 

The UK SRS are the UK endorsed versions of the ISSB sustainability reporting standards: IFRS S1 (general sustainability disclosures) and S2 (climate-related disclosures), which created a single global baseline for sustainability disclosures upon which jurisdiction-specific requirements can be built. (For background on the Government's consultation on the exposure drafts, see UK Government consults on adopting ISSB sustainability reporting standards and mandating Transition Plans to develop a sustainability reporting framework).

Minimal amendments have been made to S1 and S2 to make them relevant in a UK context. The key changes include:

• Removal of the specific time references within UK SRS S1 and UK SRS S2 so that they do not specify how long the reliefs for non-climate reporting and Scope 3 emissions reporting may be applied. This means voluntary users of the UK SRS can use these reliefs indefinitely. Changes have also been made to clarify that the length of the reliefs will be specified in the Companies Act 2006, the UK Listing Rules (UKLR), and by any regulatory authority that has the ability to mandate the use of the UK SRS.
• A new paragraph B59A has been added in UK SRS S2 requiring financial institutions that have determined they cannot reliably estimate their financed emissions for the same reporting period as the related financial statements to explain why they have not been able to comply with the financed emissions disclosure requirements in paragraph B59.
• References to the Sustainability Accounting Standards Board (SASB) materials have been amended so that entities can choose, rather than being obliged, to refer to them. 

The UK SRS also reflect the ISSB's recent changes to S2 concerning:

• Use of Global Industry Classification Standard (GICS);
• Scope 3 emissions associated with derivatives, facilitated emissions, and insurance-associated emissions;
• Jurisdiction reliefs for the use of certain Global Warming Potential (GWP) values; and
• Jurisdictional relief regarding the required use of a methodology other than the GHG Protocol.

For more information on the ISSB's changes to S2 see Ashurst Governance & Compliance Update – Issue 77.

The publication of the UK SRS is the culmination of a process to adopt the ISSB standards that was announced shortly after they were published in June 2023. The standards are now available immediately for voluntary use and the next step is for the FCA and the Government to mandate their use by listed companies and companies not subject to the UKLR (respectively). The dates for when any mandatory requirements would apply will be set out in the regulations or legislation (as relevant).

The FCA is currently consulting on amendments to the UKLR to require disclosures by listed companies under UK SRS S1 and S2 (for further information see FCA consults on aligning listed issuers sustainability disclosures with UK SRS). 

For private companies, the Consultation Response states that the Government will consult later in 2026 on whether to require them to report information in accordance with UK SRS as part of its Modernising Corporate Reporting (MCR) programme to streamline corporate reporting requirements.

Impact of UK SRS on the existing CFD requirements

Ahead of the MCR consultation on modernising and consolidating corporate reporting, the Consultation Response also provides some clarifications of the impact of the UK SRS on existing reporting requirements:

• As UK SRS S2 is a national reporting framework for the purposes of section 414CB(6) of the Companies Act 2006 (which specifies the contents of non-financial and sustainability information statements), companies reporting on either a mandatory or voluntary basis in accordance with UK SRS S2 do not need to duplicate their disclosures in order to meet their climate-related financial disclosure (CFD) obligations under section 414CB(2A). However, they should ensure that the relevant requirements under section 414CB (1) to (5) are met and the use of UK SRS S2 is clearly referenced in the relevant statement. The guidance on climate-related financial disclosures for companies and LLPs will be updated to reflect this. The Government will consider the future of the section 414CB(2A) obligations when the merits of reporting using the UK SRS are considered.
• The Department for Energy Security and Net Zero will consider how energy and emissions data reported by an entity using UK SRS interacts with the Streamlined Energy and Carbon Reporting (SECR) requirements with the aim of reducing duplication.
• If entities include UK SRS disclosures within their Strategic Report, this will ensure that the safe harbour provisions in section 463 of the Companies Act automatically apply.

Those in-scope of the existing TCFD-aligned CFD regime in the UKLR and also the CFD regime under the Companies Act 2006 should:

• Conduct a gap analysis between their existing sustainability reporting obligations and the UK SRS to understand the uplift in reporting that will be needed.
• Follow the FCA and Government consultation processes to understand how their climate disclosures will change, when those changes will apply and the availability of any transitional reliefs.
• Consider if UK SRS should be adopted on a voluntary basis ahead of any mandatory requirements. This may be particularly relevant for entities with reporting obligations in other jurisdictions that have also endorsed the ISSB standards.
• Plan for data collection or work that may be needed to be able to make the additional disclosures required under the UK SRS.

Want to know more? 

• FCA consults on aligning listed issuers sustainability disclosures with UK SRS
• UK Government consults on adopting ISSB sustainability reporting standards and mandating Transition Plans to develop a sustainability reporting framework
• Disclosures required under the IFRS's Sustainability Disclosure Standards (ISSB S1 and S2)
• ISSB publishes first standards on sustainability and climate disclosures