UK Sustainability Reporting Standards Consultation – Help Shape the Future of Sustainability Reporting

The government has commenced a consultation process around the proposed adoption of a UK Sustainability Reporting Regulation (UK SRS), seeking the views of stakeholders on three consultation areas, intending to help develop a reporting framework for sustainability information.

In this article, we will look at the objective and potential impact of the proposed standards, as well as highlighting the importance of engagement with this process from as wide a range of companies and assurance practitioners as possible. This will ensure the regulations produced are fit for purpose.

Consultation request

The consultation is seeking feedback in three separate areas connected to the development UK Sustainability Reporting Standards.

1. The views of stakeholders on the exposure drafts of UK Sustainability Reporting Standards (UK SRS). The standards, UK SRS S1 and UK SRS S2, largely follow IFRS S1 and IFRS S2 published by the ISSB, with some amendments to reflect the reporting requirements already required by the Companies Act 2006 and related legislation. Given the existing sustainability reporting requirement, to aid the adoption of the new standard, those reporting requirements will be brought into the new standard.
   
   The changes needed to IFRS S1 and S2 to facilitate this are primarily either in the form of adjusting the wording within IFRS S1 and S2 to align the wording with existing requirements on UK companies or to add a new reporting requirement into the proposed standard.
   
   
2. The views of stakeholders on a proposal to introduce a registration regime operated by the Audit, Reporting and Governance Authority (ARGA). The intention of the regime is to recognise assurance providers as being capable of assuring information disclosed against UK SRS standards, as well as those required by other jurisdictions.
   
   The introduction of such a regime would aid the ability of those not currently providing assurance work on sustainability information, as well as those already operating in this market, to understand the requirements of the proposed standard and assist companies to aid their understanding of what is expected to be disclosed to ensure compliance with the standard.
   
   
3. The views of stakeholders on the government’s manifesto commitment on the theme of transition planning. Whilst this question may seem less significant than the other consultation questions, transition planning plays a vital role in ensuring the changes proposed by the new standard are implemented in a timely and efficient way.
   
   We have already seen delays in the implementation of the EU sustainability reporting standards, namely the Corporate Sustainability Reporting Directive (CSRD), with the reporting requirements set out by the directive being delayed for two years for certain companies. This delay created confusion and inefficiency for both companies and practitioners, and therefore, the avoidance of these delays is an important consideration.

A brave new world

So far in the UK, sustainability reporting has primarily been focused on large companies, and as a result, understandably, the current UK sustainability requirements are very much tailored towards large companies.

This is fine for large companies, which have the resources to collate such information. However, as the importance of sustainability reporting continues to grow and the reporting requirements trickle down to SMEs, just bolting on the requirements for large companies to SMEs can generate a significant administrative burden on those companies.

This is why engagement with the consultation process is vital to ensure the regulations, as well as the timeframe for the introduction and the criteria for any registration regime, do not only reflect the opinions of large companies. Large firms that already have experience with sustainability reporting may not appreciate the challenges for SMEs and smaller firms.

Consultation period

The consultation period runs for 12 weeks from 25 June 2025 to 17 September 2025, so there is still plenty of time to collate a response the consultations to make sure your opinions are considered.

Commitment to sustainability

Over the last few years, we have already begun to see the importance of sustainability reporting and its impact on helping stakeholders make informed, responsible decisions. This importance is likely to increase as we move towards the Net Zero target.

This provides an opportunity for companies to showcase their commitment to sustainability practices. This potentially opens additional funding avenues as investors begin placing greater value to a company’s sustainability performance as opposed to simply its financial performance.

It also creates a new market for audit and assurance firms to invest in and help shape. As such, engagement at this stage in the consultation is vital to ensure the framework developed is relevant to business needs, not just now, but in the future.