UK government launches UK SRS, sustainability assurance and transition plans consultations

As summer comes to an end, so does the opportunity to feed into the Department for Business and Trade’s three long-awaited consultations on: 

1. exposure drafts of the UK Sustainability Reporting Standards (UK SRS);
2. developing an oversight regime for assurance of sustainability-related financial disclosures; and
3. mandating the development, disclosure and implementation of transition plans.

Respondents have until 17 September 2025 to submit their responses.

Together, these consultations mark an important milestone in the UK government’s plans to build a disclosure and assurance framework for sustainability-related financial reporting. The consultations also support the broader strategy of positioning the UK as a world leader in sustainable finance. Though it remains to be seen how the UK government will proceed after the consultations have concluded, their contents indicate the direction of travel and key areas of focus. 

UK SRS

The UK government has been a long-term supporter of the International Sustainability Standards Board (ISSB) (launched at COP26 in Glasgow) with the aim of setting a global baseline for sustainability reporting. These consultations were initially expected in Q1 2025 and are the final step before an endorsement decision. Despite the delay, it appears that the UK government is pressing ahead with bringing the IFRS S1 and S2 standards into domestic law. 

The exposure drafts for consultation on the UK SRS contain 6 proposed amendments to the IFRS S1 and S2 standards. Four of these have been taken from the Technical Advisory Committee recommendations published in December 2024. A further two have been proposed by the UK government. These changes include:

Amendment 1 – Transition-timing relief removed: The draft UK SRS S1 drops the ISSB option to publish sustainability disclosures later than the financial statements.

Amendment 2 – ‘Climate-first’ relief extended: The period during which firms may limit reporting to climate matters is doubled from one to two years, giving businesses extra time to build systems for other sustainability related reporting. The drafts do not propose extending the one-year scope 3 reporting relief. 

Amendment 3 - Flexibility on industry codes: Instead of mandating GICS codes for financed-emissions calculations, UK SRS S2 lets entities use any suitable classification already embedded in their reporting.

Amendment 4 – Effective-date clauses removed: Fixed start dates are deleted; the standards now use an “initial application” section, with actual commencement to be set later by legislation or FCA rules, though S1 and S2 must still be adopted together.

Amendment 5 – SASB references made optional: Mandatory language is softened from “shall” to “may,” so companies can decide whether SASB materials are relevant to them. 

Amendment 6 – Transition reliefs linked to mandatory adoption: All transition reliefs will run from the date UK law or regulation makes reporting mandatory, ensuring early voluntary reporters are not penalised.

The consultation is also seeking further views on topics that are not the subject of amendments, including on financed emissions reporting and carbon credit disclosures. It also seeks input on the sequencing of reporting, including the transitional reliefs, as well as potential benefits and costs of the UK SRS.

The consultation also requests responses on the merits of requiring large private companies to report against the UK SRS, building on the existing disclosure requirements on certain large private companies. It also recognises the difficulties around non-UK sustainability reporting requirements on UK companies, such as the EU’s Corporate Sustainability Reporting Directive (CSRD), and has requested input on this. 

Finally, the consultation seeks to consider whether protections similar to the existing ‘safe harbour’ in annual reports should be adopted for UK SRS reporting requirements. 

Sustainability assurance

The UK government is also consulting on developing an assurance oversight regime. This follows the publication of the FRC’s conclusions of its Assurance of Sustainability Reporting market study in February 2025. The purpose of this consultation is to progress the first phase of policy development regarding sustainability assurance, in response to the market study. 

The key focus of the consultation is on the creation of a voluntary registration regime for those offering assurance services for sustainability related financial disclosures. The specific proposals include the following:

• a new profession-agnostic category of ‘sustainability assurance provider’ that will need to meet relevant criteria to be set by ARGA;
• oversight of sustainability assurance providers by ARGA, who will be responsible for registering these providers, setting eligibility criteria for registration, monitoring their performance and taking enforcement action; and
• registration would mean recognition that providers are capable of high-quality assurance against UK SRS, TCFD, the European Sustainability Reporting Standards and any other domestic standards based on ISSB disclosures. 

The consultation also requests input on other matters, such as mandating assurance over future UK SRS disclosures and current issues with CSRD assurance requirements for UK companies. ARGA would also consult on the detailed elements of this regime, once established. 

Transition plan requirements

We have published a separate blog on the UK government’s consultation on mandating transition plans. This is available here.  

Next steps

The UK government has stated that it will take a phased approach to bringing forward this broader package of sustainability-related reporting updates:

• The first phase involves these consultations. 
• The following phases will involve further consultations, covering proposals on sustainability reporting, assurance and streamlining the UK’s current non-financial reporting framework under the Companies Act 2006, designed to update the structure of the Annual Report so that it can integrate sustainability related reporting requirements and remove redundant and duplicative developments.
• Finally, the UK government has said that, subject to future decisions, they aim to publish a roadmap of any future regulatory changes as part of the subsequent phases of consultation. 

Depending on the responses to the consultation, the UK government is expected to make a final endorsement decision in autumn 2025. The FCA has previously stated that it will consult on introducing the standards for listed companies after the UK government’s consultation has concluded, which was expected in Q3 2025 but may shift back further. 

Participating in the consultation 

Companies wishing to participate in the consultations should head to the relevant webpage for more information: 

1. UK SRS consultation, here,
2. sustainability assurance consultation, here, and
3. transition planning consultation, here.