On 30 January 2026, the UK’s Financial Conduct Authority (FCA) launched a consultation paper (CP26/5) proposing significant changes to the sustainability disclosure requirements for listed companies to better align them with emerging international reporting standards. The consultation reflects the transition away from the Task Force on Climate-related Financial Disclosures (TCFD) toward the International Sustainability Standards Board (ISSB) framework, and supports the UK Government’s development of UK Sustainability Reporting Standards (UK SRS) based on ISSB’s standards.
Under the proposals, in scope listed issuers would be required to report sustainability information against UK SRS S2 (climate-related disclosures) on a mandatory basis, while Scope 3 emissions disclosures would remain on a “comply or explain” basis due to measurement challenges. Non-climate sustainability disclosures under UK SRS S1 would also be on a comply or explain basis to recognise that broader sustainability reporting is new for many companies.
The FCA is also proposing increased transparency on transition plans, though mandating such plans is primarily a matter for government policy, and on whether issuers have obtained third-party assurance over their sustainability disclosures. A more flexible approach is proposed for international issuers with primary listings outside the UK, to avoid duplication with their home jurisdiction requirements.
Feedback on CP26/5 is invited until 20 March 2026, with the FCA aiming to publish a Policy Statement in autumn 2026 and implement the new requirements from 1 January 2027. The reforms are designed to provide investors with clearer, more consistent and internationally comparable sustainability-related information, enhancing market integrity and supporting the UK’s position as a global financial centre.
Please refer to the following announcement from FCA: