The Standards, designed to build upon the existing and widely adopted International Sustainability Standards Board (ISSB) framework, are part of a noticeable trend to increase the level of sustainability-related reporting, with the ultimate aim of it gaining parity with companies’ reporting of their financial risks and opportunities.
Alongside the UK SRS Exposure Draft, two separate consultations were launched this week. One concerning climate-related transition plan requirements, and the other seeking to strengthen the robustness around sustainability-related assurance across the UK.
Taken together, these consultations are evidence of the UK’s stated ambition to be a global leader in sustainable finance and to, more broadly, support the transition to a net zero economy.
Here’s what this means for UK-listed companies, and some actions that can be undertaken to put you in good stead for the Standards eventual implementation.
The government’s consultation, published on 25 June 2025, proposes new reporting standards based on the ISSB’s IFRS S1 and S2. These Standards will require companies to create clearer, more consistent, and comparable information about their sustainability-related risks and opportunities.
The UK SRS will closely follow the global ISSB Standards, with only minor amendments to suit the UK context. The Exposure Draft lists six key amendments that will have various levels of importance for listed companies:
Removal of the transition relief that allows for delayed reporting in Year One – instead the UK government believes UK-listed companies are well placed to report sustainability-related information at the same time as their financial information;
Extension of the transition relief that permits a ‘climate-first’ approach – the UK SRS proposes that companies would not have to report on sustainability-related risks and opportunities in Year Two as per ISSB, but instead would have until Year Three;
Removal of the requirement to use the Global Industry Classification Standard (GICS) – with the UK government stating that reporters should be able to use any appropriate classification standard;
Removal of the ‘effective date’ clauses in IFRS S1 and IFRS S2 – the UK government has yet to set an implementation date;
References to the SASB materials – the UK SRS weakens the need to align with SASB materials from ‘shall refer to’ to ‘may refer to’;
Treatment of transition reliefs – the UK SRS is proposing that any reliefs that are available take effect from the date in which reporting becomes mandatory, not voluntary.
The UK’s creation of an ambitious set of Sustainability Reporting Standards is a significant step towards bringing sustainability reporting in line with financial reporting.
While the transition will undoubtedly require investment and adaptation, there are also significant opportunities for companies who are bold and seize this moment to show their continued commitment to sustainability reporting.
At Black Sun Global we have worked with multiple listed companies from across the FTSE on their preparedness for ISSB. Whether it is creating robust transition plans, viable sustainability strategies that account for your sustainability-related IROs, or carrying out a gap analysis on your existing reporting so you can be tactical in how you move forward, we are here to support you as you engage with the UK SRS.
Black Sun Global is a stakeholder advisory and engagement agency that's been driving transformation and positive change for ambitious brands for more than 20 years. With deep expertise in disclosure and reporting, ESG, sustainability, and digital engagement, we reshape how organisations connect with customers, investors, employees, and the wider world.
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