Companies in Scope
Am I in scope of UK SRS?
A practical decision tree walking through the rules in CP26/5, the Companies Act, and the proposed mandatory framework. UK SRS itself is available for voluntary adoption by any UK entity — the question of mandatory application is jurisdiction-specific.
Last verified 12 May 2026 · Subject to FCA Policy Statement on CP26/5
Outcome categories
UK SRS S1 applies to the same population as S2 — approximately 500 primary-listed companies under FCA regulation.
This includes commercial companies (UKLR6), non-equity shares and non-voting equity shares (UKLR16), and transition category issuers (UKLR22).
The scope may be extended to private companies through future Companies Act amendments, but this is not yet confirmed. See regulatory updates for the latest.
The Two-Year Transitional Relief
Under FCA CP26/5, UK SRS S1 applies on a comply-or-explain basis from financial years beginning on or after 1 January 2029 — two years after UK SRS S2 is proposed to become mandatory. This two-year gap is deliberate. It recognises that while most listed companies have some experience with climate disclosure through TCFD, fewer have mature reporting programmes for broader sustainability topics such as biodiversity, water, workforce, and supply chain. See the full UK SRS mandatory timeline for all key dates.
During the transitional period (2027–2028), companies are required to comply with UK SRS S2 (climate disclosures) but are not required to comply with or explain their position on S1. From 1 January 2029, companies must either comply with S1 or provide specific explanations for each area of non-compliance.
What Comply-or-Explain Means in Practice
Comply-or-explain is not optional reporting. It requires companies to either meet every applicable disclosure requirement in S1 or provide specific, requirement-by-requirement explanations for areas of non-compliance. A general statement that the company has decided not to apply S1 is insufficient. As KPMG's analysis of FCA CP26/5 explains, the comply-or-explain standard under UK SRS is significantly more demanding than under the former TCFD regime.
In practice, this means companies choosing the explain path will still need to understand S1 in detail. They will need to assess each requirement, determine whether compliance is feasible, and — where it is not — articulate why. The materiality framework under S1 will determine which sustainability topics require disclosure.
What Companies Should Do Now
The 2029 deadline may appear distant, but the data collection and governance structures required for S1 compliance take time to build. Companies in scope should begin identifying the sustainability topics likely to be material to their business (using the S1 materiality definition), assessing the availability and quality of data for each topic, establishing governance structures for broader sustainability oversight (see UK SRS for boards), and evaluating whether their current reporting systems can accommodate non-climate sustainability disclosures. A gap analysis is the recommended starting point. For the relationship between UK SRS and the global ISSB baseline, see UK SRS vs IFRS S1 and S2. Companies already reporting under SECR will have some existing data infrastructure to build upon. For professional guidance, see BDO's overview of UK sustainability reporting requirements.