UK SRS Glossary: Key Terms and Definitions
This glossary defines key terms related to UK Sustainability Reporting Standards (UK SRS), including technical terminology, regulatory bodies, and reporting requirements. Essential reference for understanding UK SRS S1 and S2 compliance.
Understanding these terms is essential for navigating UK SRS compliance requirements and sustainability reporting obligations.
Core Standards and Framework
UK SRS
The UK Sustainability Reporting Standards — the UK's domestically endorsed equivalents of the IFRS Sustainability Disclosure Standards, published by the Department for Business and Trade on 25 February 2026.
UK SRS closely follows IFRS S1 and IFRS S2, with a small number of UK-specific differences set out in Annex A of the government's response to its consultation, and is available for voluntary use by any entity today.
UK SRS S1
The first of the two UK Sustainability Reporting Standards, covering general requirements for sustainability-related financial disclosures.
S1 establishes the four-pillar framework (governance, strategy, risk management, metrics and targets) across all material sustainability topics including environmental, social, and governance factors.
UK SRS S2
The second UK Sustainability Reporting Standard, covering climate-related disclosures.
S2 requires disclosure of climate-related risks and opportunities, greenhouse gas emissions (Scope 1, 2, and 3), climate scenario analysis, and transition plans.
The FCA has proposed, in CP26/5, that UK SRS S2 apply on a mandatory basis to in-scope listed companies for accounting periods beginning on or after 1 January 2027; the Policy Statement confirming those rules has not yet been published.
Regulatory Bodies
FRC
Financial Reporting Council — the UK's independent regulator responsible for promoting high quality corporate governance and reporting.
The FRC did not publish UK SRS; that was the Department for Business and Trade.
The FRC hosts the secretariat for the Technical Advisory Committee in the UK endorsement process, issued the ISSA (UK) 5000 sustainability assurance standard on 12 November 2025, and has been tasked with establishing an interim register of sustainability assurance providers.
FCA
Financial Conduct Authority — the UK financial services regulator that has proposed, in CP26/5, to make UK SRS S2 climate reporting mandatory for certain listed companies through the UK Listing Rules, with UK SRS S1 non-climate and Scope 3 disclosures proposed on a comply-or-explain basis.
No Policy Statement responding to CP26/5 has yet been published, so nobody is required to report under UK SRS today; which entities would need to comply, and how the rules would be enforced, are proposals and not yet settled.
ISSB
International Sustainability Standards Board — the global standard-setter under the IFRS Foundation that developed IFRS S1 and S2, which form the basis for UK SRS.
The ISSB aims to develop a comprehensive global baseline for sustainability disclosures.
Climate and Environmental Terms
TCFD
Task Force on Climate-related Financial Disclosures — created by the Financial Stability Board in 2015 and the origin of the four-pillar structure (governance, strategy, risk management, metrics and targets).
The TCFD was disbanded in 2023 and monitoring of climate-related disclosure progress passed to the IFRS Foundation.
IFRS S2, and therefore UK SRS S2, fully incorporates the TCFD four-pillar architecture.
Scope 1 Emissions
Direct greenhouse gas emissions from sources owned or controlled by the company.
Examples include emissions from company vehicles, on-site energy generation, manufacturing processes, and fugitive emissions.
These are typically the easiest emissions to measure and control.
Scope 2 Emissions
Indirect greenhouse gas emissions from the generation of purchased electricity, steam, heating and cooling consumed by the company.
While not directly controlled by the company, these emissions result from the company's energy consumption decisions and can be influenced through renewable energy procurement.
Scope 3 Emissions
All other indirect greenhouse gas emissions that occur in the company's value chain.
This includes upstream emissions (supplier activities, business travel, employee commuting) and downstream emissions (product use, disposal, distribution).
Often the largest source of emissions but most challenging to measure.
There is no Scope 3 carve-out within the standard itself.
Under the FCA's CP26/5 proposals an in-scope listed company may elect a one-year transitional relief from disclosing Scope 3 for accounting periods beginning in 2027, stating in the annual financial report that the disclosures have not been made; from accounting periods beginning 1 January 2028 Scope 3 sits on a comply-or-explain basis, drafted without a sunset date.
Physical Risk
Climate-related risks resulting from physical effects of climate change, including acute risks (extreme weather events) and chronic risks (longer-term shifts in climate patterns).
UK SRS S2 requires assessment and disclosure of material physical risks.
Transition Risk
Climate-related risks arising from the transition to a lower-carbon economy, including policy and legal risks, technology risks, market risks, and reputation risks.
Companies must assess how the low-carbon transition could affect their business model and strategy.
Scenario Analysis
A process for exploring and assessing potential future outcomes by considering alternative possible scenarios, particularly climate-related scenarios.
UK SRS S2 requires companies to conduct and disclose climate scenario analysis, unlike the recommended approach under previous TCFD guidance.
Reporting Concepts
Materiality Assessment
The process of identifying and evaluating sustainability-related risks and opportunities that could reasonably influence investment or business decisions.
Under UK SRS, materiality focuses on financially material topics rather than broader stakeholder materiality concepts used in some other frameworks.
Sustainability Disclosure
Information about sustainability-related risks and opportunities that could affect an entity's cash flows, access to finance, or cost of capital over the short, medium, or long term.
UK SRS requires these disclosures to be integrated with financial reporting rather than published as standalone reports.
Double Materiality
A concept requiring companies to consider both how sustainability matters affect the company (financial materiality) and how the company affects the environment and society (impact materiality).
While prominent in EU frameworks, UK SRS focuses primarily on financial materiality.
ESG Reporting
Environmental, Social, and Governance reporting — the practice of measuring and disclosures a company's performance across these three key sustainability dimensions.
UK SRS provides a structured framework for ESG reporting focused on financially material information.
Using This Glossary
Each term includes clear definitions for direct citation and cross-referencing. When reading UK SRS guidance or regulatory documents, refer back to these definitions for clarity. For the most current definitions, always consult the DBT publications of UK SRS S1 and S2, FRC guidance, and FCA consultation and policy material.
This glossary is regularly updated to reflect the latest developments in UK SRS implementation and regulatory guidance.
For comprehensive implementation support, see our UK SRS compliance and UK SRS timeline.