UK sets course for global alignment in sustainability reporting with SRS S1 and S2
Sustainability reporting in the UK is becoming more structured and demanding. Businesses are under growing pressure to share clear information about how they manage ESG risks and opportunities. Investors, regulators and other stakeholders want more than general statements – they expect solid data and insights showing how companies respond to climate change and other sustainability issues.
New standards on the horizon: SRS S1 and S2
One of the most significant developments for UK businesses is the arrival of the UK Sustainability Reporting Standards (SRS) S1 and S2. These drafts mark a significant step towards aligning UK sustainability reporting with international standards. Based on the work of the International Sustainability Standards Board, the SRS aim to bring consistency and comparability to how companies disclose sustainability information.
SRS S1 focuses on general sustainability-related financial disclosures. It sets out what businesses should report about ESG matters that could influence their financial position or performance. SRS S2 is more specific and deals with climate-related disclosures, asking companies to explain how climate risks and opportunities affect their strategy and business plans. Importantly, the UK Government has proposed a two-year climate-first relief period, though this approach is still under consultation and not yet final. If adopted, it would allow businesses to focus on climate disclosures before reporting on a broader range of sustainability topics under SRS S1.
What SRS S1 and S2 mean for businesses
These draft standards are not simply another reporting exercise. They will affect how sustainability is integrated into business planning, risk management and financial reporting. For CSOs, the SRS create new expectations about the quality and detail of ESG information that goes into public reports. Data collection, internal controls and assurance processes may all need to improve to meet the demands of the new standards.
One challenge for businesses is the potential overlap with existing requirements. Many UK companies are already reporting under frameworks such as TCFD, SECR or the Modern Slavery Act. Bringing new standards into the mix means companies must work out how to avoid duplication and ensure consistency across multiple reports.
Another challenge is the pace of change. While the climate-first relief period offers breathing space, many companies will still feel pressed to build systems quickly enough to comply when the broader standards come into force.
Why SRS S1 and S2 matter for UK businesses
Despite the challenges, aligning with global standards offers real advantages. Businesses that report clearly and consistently are better placed to earn trust from investors, lenders and partners who increasingly factor ESG performance into decisions. Transparent reporting can also help avoid difficult questions from regulators or stakeholders later.
For CSOs, the SRS make it easier to show how sustainability work ties directly to financial results and business resilience. This can strengthen the case for resources and support from senior leadership. Companies that start preparing early could also save time and effort later by avoiding last-minute reporting gaps or rushed data gathering.
Conclusion
The drafts of the UK Sustainability Reporting Standards S1 and S2 show that sustainability reporting is moving into a new phase in the UK. CSOs must ensure their teams and systems are ready for more detailed disclosures, particularly on climate risks. While there’s time to prepare, starting early will help businesses turn regulatory compliance into an opportunity to strengthen their sustainability strategy.
If you’d like to learn more about how Speeki supports UK businesses with ESG management and reporting, please visit this page.
