The UK government has taken a significant step toward mandatory corporate sustainability reporting with the release of exposure drafts for the UK Sustainability Reporting Standards (UK SRS). Developed in alignment with the International Sustainability Standards Board (ISSB)’s global framework, the draft standards aim to provide investors and stakeholders with consistent, transparent, and decision-useful sustainability-related financial information.
Aligning UK sustainability reporting standards with global frameworks
The draft UK Sustainability Reporting Standards (SRS), comprising S1 and S2, correspond directly to the ISSB’s IFRS S1 (general sustainability-related disclosures) and S2 (climate-related disclosures). This alignment ensures compatibility with international expectations while allowing for jurisdictional refinements. The UK government, through its Sustainability Disclosure Technical Advisory Committee (TAC), has proposed several amendments that reflect feedback from the UK market and aim to smooth the path for adoption.
A climate-first focus with more time to adapt
One of the most notable changes is the extension of the “climate-first” reporting relief. While the ISSB allows companies one year to focus on climate-related disclosures before expanding to broader sustainability topics, the UK draft proposes a two-year period.
This phased approach recognises that many businesses, especially SMEs and mid-sized firms, may need additional time to build reporting capabilities across environmental, social, and governance (ESG) dimensions.
The UK Sustainability Reporting Standards (SRS) also tighten expectations around connectivity. The draft removes the ISSB’s relief that would have allowed sustainability disclosures to be published after financial statements in the first reporting year, emphasising the importance of integrated, timely reporting.
Learn how to report on sustainability while avoiding common disclosure pitfalls
A broader sustainability disclosure package
The release of the UK SRS is part of a wider set of sustainability-related consultations launched by the UK government. These include:
- A consultation on climate transition plan requirements for large companies and financial institutions, with a stated commitment to mandating credible 1.5°C-aligned strategies.
- A proposal for a voluntary registration regime for assurance providers of sustainability reporting, aimed at improving quality and trust in ESG data.
- An open call for evidence on the costs and benefits of the UK Sustainability Reporting Standards (SRS), which will help determine whether sustainability reporting becomes mandatory for certain UK companies.
Each consultation is open for public feedback until 17 September 2025.
Conclusion – What this means for UK businesses
With the release of the UK Sustainability Reporting Standard (SRS) drafts, the UK is charting a clear course toward consistent, high-quality sustainability disclosure, anchored in global best practice but tailored to national priorities. For UK businesses, this is a signal to start aligning internal systems, governance structures, and reporting practices with emerging expectations.
Organisations already reporting under frameworks like the Taskforce on Climate-related Financial Disclosures (TCFD) or the Greenhouse Gas Protocol (GHG Protocol) will find familiar ground in the UK SRS. However, for many, the standards represent a step-change in how sustainability performance is measured, reported, and scrutinised.
Early alignment offers a strategic advantage: reducing compliance risk, strengthening stakeholder trust, and supporting access to capital in a market increasingly driven by ESG criteria. Now is the time for UK companies to treat ESG data with the same rigour as financial data, embedding it across teams, systems, and strategies to meet regulatory demands, but also broader societal and market expectations.
