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UK ESG reporting requirements: a guide to mandatory and voluntary disclosures

Written by Yi Zheng and Charlotte Hampton

5 October 2026

As the global focus on sustainability intensifies, businesses are recognising the importance of incorporating environmental, social, and governance (ESG) considerations into their business strategy and operations.

However, the constant development in ESG regulation and awareness has led to a rapidly changing landscape of disclosures, which can be difficult to navigate, especially considering the overlap between some standards. Incorporating sustainability disclosures within financial accounts not only meets mandatory reporting requirements, but also aligns with growing stakeholder expectations for increased transparency and more responsible business practices.

We explore the various disclosure requirements which could be mandatory for your business, as well as how you can get ahead of the curve of ESG reporting by implementing voluntary disclosures.

Which ESG reporting framework is right for your business?

There is no single ESG reporting framework that applies to every business. The most appropriate framework will depend on your organisation’s size, sector, listing status, stakeholder expectations and geographic footprint. The sections below outline the mandatory requirements and voluntary frameworks that UK businesses may need to consider.

Which mandatory UK ESG reporting requirements apply to your business?

Companies Act 2006: ESG, climate and stakeholder reporting obligations

The Companies Act 2006 is applicable to all UK companies, regardless of size, although specific reporting requirements vary. While this may not be the first piece of legislation that springs to mind regarding sustainability and ESG, all medium and large companies are required to provide a description of the principal risks and uncertainties facing the company within the directors’ report.

This may include environmental and social factors if they’re considered material to the business and will be particularly applicable for organisations operating in carbon-intensive industries, or those that are more impacted by the physical and transition risks associated with climate change.

Section 172 of the Companies Act requires large companies to prepare a section 172 statement; this focuses on stakeholder engagement and ensuring stakeholders are considered within relevant decision-making. A section 172 statement should consider the impact of the business on the surrounding environment as well as considering relationships with suppliers and the impact of a company’s supply chain, making it additionally relevant.

Streamlined Energy & Carbon Reporting (SECR) requirements

This is required for quoted companies, large* unquoted companies and large limited liability partnerships (LLPs). Under the SECR requirements, unquoted companies and LLPs must report their UK energy use (if over 40 MWh) and the associated greenhouse gas emissions, and at least one relevant intensity ratio.

Comparative figures are also required to be disclosed. In addition, in scope entities must disclose information about energy efficiency action taken in the organisation’s financial year and the methodologies used to calculate the amounts disclosed. The requirements for quoted companies differ to those for unquoted companies and LLPs.

The SECR disclosures must be presented within the directors’ report.

*Satisfies for two consecutive years at least two of the following net thresholds: Turnover £36 million+, Balance sheet total assets £18 million+, or Employees 250+

Task Force on Climate-related Financial Disclosures (TCFD)

The Task Force on Climate-related Financial Disclosures (TCFD) recommend that companies should make disclosures across four key areas, covering governance, strategy, risk management, and metric and targets in relation to managing climate-related risks and opportunities.

The FCA Listing Rule require premium listed and standard listed companies to make disclosures under the TCFD framework on a comply or explain basis.

Climate-related Financial Disclosure Regulations 2022

For accounting periods commencing on or after 6 April 2022, the Climate-related Financial Disclosure (CRFD) Regulations came into effect for certain companies. These regulations are based on the recommendations issued by the TCFD, however there are some differences between the two sets of requirements.

The most significant difference is the omission of the disclosure of greenhouse gas emissions from the CRFD regulations due to the overlap of this information with the UK legislation for SECR.

The CRFD requirements are mandatory for:

Public interest entities,
UK registered AIM listed companies with more than 500 employees,
UK registered companies with more than 500 employees and turnover exceeding £500 million, and
Traded or banking LLPs with more than 500 employees or LLPs with more than 500 employees and turnover exceeding £500 million.

Entities in scope are required to include climate-related information across four key areas: governance, strategy, risk management and metrics and targets. The reporting aims to encourage more detailed analysis of the climate-related risks and opportunities faced by entities to help support investment decisions as we transition to a lower carbon economy.

Companies must include the climate-related financial disclosures in the non-financial and sustainability information (NFSI) statement within their strategic report. For LLPs not required to prepare a strategic report, the disclosures should be included in the Energy and Carbon Report instead.

The Corporate Sustainability Reporting Directive (CSRD)

The CSRD is the EU’s flagship sustainability directive, requiring in-scope companies to disclose information on sustainability-related impacts, risks and opportunities using the European Sustainability Reporting Standards (ESRS). Following the EU Omnibus reforms, the scope and implementation timeline of CSRD have been revised, with reporting now focused on larger organisations and certain reporting deadlines postponed.

The CSRD will require various sustainability-related information and reporting will be largely data focused. CSRD reporting goes beyond just climate reporting, and it will require a double materiality approach, with value chain consideration also being a crucial part of the directive.

Non-EU entities with significant EU activity may also be affected. Under the revised framework, non-EU groups with substantial EU turnover and a significant EU subsidiary or branch are expected to fall within scope from 2029, reporting on FY2028 data, with further details continuing to develop.

Additionally, limited assurance of ESG reporting is mandatory under CSRD requirements from the first year of application, so this will also need to be considered. Awareness of future reporting requirements in advance of it becoming mandated is important here as these may involve the collection of new types of ESG information to enable a business to adhere to this legislation.

International Sustainability Standards Board (ISSB) Disclosures: IFRS S1 and IFRS S2

The ISSB issued their first two sustainability standards, IFRS S1 and IFRS S2 in June 2023, largely based on recommendations from the Task Force on Climate-Related Disclosures (TCFD). These two standards have been endorsed in the UK, creating the first UK Sustainability Reporting Standards (SRS).

From accounting periods beginning on or after 1 January 2027, the FCA requires certain listed issuers to report against UK SRS on a comply-or-explain basis, although transitional reliefs are available for some disclosures, including Scope 3 emissions reporting. Companies must also disclose whether sustainability information has been externally assured and the scope of any assurance obtained.

The requirements apply to companies with shares listed in the FCA’s commercial companies category, transition category, non-equity shares or non-voting equity shares category, and to issuers with a secondary listing or depositary receipts in the UK. The rules replace the FCA’s previous TCFD-aligned disclosure requirements and are intended to improve the consistency, comparability and decision-usefulness of sustainability information provided to investors.

Although UK SRS is not yet mandatory for most private companies, they may still be affected through value chain reporting requirements. Businesses may increasingly receive requests from customers, investors and lenders for sustainability-related information, including emissions, climate risks and governance data. Early preparation can help organisations respond efficiently to these requests and meet evolving stakeholder expectations.

Other mandatory ESG disclosures: modern slavery and gender pay gap reporting

Focusing more on the ‘Social’ aspect of ESG-related disclosures, modern slavery statements and gender pay gap reports are also required by many companies. While these don’t need to be included within the financial statements of a business, they still form an important aspect of ESG-related reporting.

The Modern Slavery Act 2015 requires businesses supplying goods or services with a turnover of £36 million or more to provide a modern slavery statement. This should focus on steps to deal with the risks of modern slavery both in the business and in the supply chain.

The Equality Act 2010 ((Specific Duties and Public Authorities) Regulations 2017) requires employers with over 250 employees in a year to calculate and publish average gender pay gap results annually.

Voluntary ESG reporting frameworks and sustainability disclosures

While additional disclosures may not be mandatory, they allow a business to continue to build trust and transparency with stakeholders as well as demonstrating an increased commitment to sustainability and responsible business practices. With recent research showing a positive market response to increased ESG-based disclosures, there is more reason than ever to consider voluntary ESG reporting.

Unlike mandatory disclosure, voluntary disclosures can take several different forms. While they can be included in accounts, provided they are consistent with the financial information, there are also alternative options to present this information, such as in a separately published sustainability or impact report, or on a website. For each of these options a business can further enhance credibility by obtaining third party assurance.

Global Reporting Initiative (GRI) disclosures

The GRI standards create a framework all businesses can use to identify and assess their impact, as well as to determine the material topics most relevant to the company. Once these have been determined, the standards specify information that should be collected and reported for these material issues, as well as providing a structure to go on and report this information.

Utilising the GRI disclosures benefits your business through allowing an understanding of material ESG impacts. Reports using the GRI disclosures can be published as a standalone report or within an annual report.

Taskforce on Nature-related Financial Disclosures (TNFD): nature-related risk and biodiversity reporting

The TNFD is a science-based global initiative, providing a framework to identify, assess, and disclose material nature-related dependencies, impacts, risks and opportunities. Its four disclosure pillars align with the TCFD structure, enabling companies to focus on the nature-related issues most relevant to their business. The framework also supports the use of metrics and targets to manage and monitor performance. While TNFD remains a voluntary framework, it’s becoming an important reference point for investors, regulators and standard-setters, and is expected to inform the ISSB’s future work on biodiversity and nature-related disclosures.

How should you prepare for ESG reporting, and what happens if you don’t comply?

Businesses should identify which requirements apply, assess gaps in existing ESG data and controls, and establish clear governance responsibilities. Early preparation can help address data gaps, improve reporting processes and reduce the risk of non-compliance.

Failure to comply with mandatory ESG reporting requirements may result in regulatory action, financial penalties and reputational damage. The specific consequences will depend on the legislation, making it important to understand which requirements apply to your business.

How Saffery can help with ESG reporting and sustainability compliance

At Saffery, we recognise that the sustainability reporting landscape is a complex and continually evolving area, featuring much overlap. Although some ESG frameworks and regulations are highly aligned, reporting to one set of standards may not necessarily meet all requirements by another. Given this, we recommend seeking professional advice before making public disclosures.

For further assistance on ESG reporting requirements in the UK or compliance and disclosure matters, please get in touch.