Modernising Corporate Reporting: what the consultation means for sustainability reporting, and where the FCA’s new rules fit
Written by: Cameron Wilson, Solutions Manager – Reporting | Last updated: 29.09.2026
For listed companies, the future of UK sustainability reporting is close to being settled. The FCA is expected to publish its final rules this autumn, moving listed companies from TCFD onto reporting based on the UK Sustainability Reporting Standards (UK SRS). The bigger open question now sits with everyone else.
On 7 September 2026 the Government published Modernising Corporate Reporting, a consultation on simplifying the entire corporate reporting framework for UK companies. Sustainability is one part of one chapter. But for private companies in particular, it carries the strongest signals yet about where sustainability reporting is heading.
This insight answers four questions. What is the consultation? What does it change for climate and sustainability reporting? How is UK SRS developing for listed and for private companies? And what should reporting teams do now?
What is the consultation?
The Government’s stated aim is bold: to make the UK’s corporate reporting framework “the most proportionate and effective in the world”. The ministerial foreword promises “a simpler, modern corporate reporting framework that is fit for the future and fit for all”.
The consultation reaches well beyond sustainability. It covers company size thresholds and exemptions, financial and strategic reporting, governance and remuneration disclosures, digital reporting and the structure of the annual report itself. The diagnosis is that requirements have accumulated across company law, accounting standards and regulatory rules, creating duplication, complexity and cost without a clear sense of who the annual report is actually for.
Five principles guide the proposals: clarity of purpose, flexibility and trust, simplicity and coherence, proportionality, and being fit for the future. The first matters most here. The Government proposes that the purpose of the annual report and accounts should be to provide financially material, decision-useful information to investors and creditors.
The consultation closes on 30 November 2026, with an outcome expected within six months. Everything in it is a proposal, not a final requirement.
What does it change for climate and sustainability reporting?
Nothing yet, for those reporting today. Many large UK businesses currently report climate information under the Companies (Strategic Report) (Climate-related Financial Disclosure) Regulations 2022, with equivalent requirements for LLPs. The consultation does not amend or remove these requirements. The Government is running a separate post-implementation review of both sets of regulations, due to conclude by spring 2027, and any changes that follow would be subject to further consultation. If you are in scope today, continue to report against the CFD disclosures.
What the consultation does propose is a simpler home for this information, in two ways.
First, no double reporting. The climate disclosures required of the largest companies sit in section 414CB of the Companies Act 2006, inserted by the 2022 regulations. They require a description, in the strategic report, of climate governance, how climate risks are identified and managed, the principal risks and opportunities, scenario analysis where relevant, and related targets and KPIs. UK SRS S2 covers the same ground in greater depth. The Government therefore indicates that a company reporting under UK SRS S2 should not have to repeat itself under section 414CB: one set of disclosures would satisfy both.
Second, an end to prescriptive topic lists. Today the Companies Act tells certain companies which topics their strategic report must cover, including environmental matters, employees, and social and community issues, whether or not those topics matter to the business. The consultation proposes replacing these lists with a single principle: report what is financially material to your business. That is the same lens UK SRS S1 applies to sustainability information.
Taken together, the proposals bring sustainability reporting into the centre of corporate reporting rather than leaving it at the edge. It becomes part of the same system that produces the accounts, on the same timetable, judged by the same test of financial materiality.
I welcome the Modernising Corporate Reporting consultation. It is broader than sustainability reporting, but it offers companies a range of potential streamlining benefits and provides a soft endorsement of UK SRS, particularly S1. I believe this is proposing the direction of travel for private companies and I would encourage organisations to review their readiness now, so that they are better prepared for the future of corporate reporting.”Cameron WilsonSolutions Manager – Reporting
How is UK SRS developing for listed and for private companies?
Route one: listed companies, through the FCA. If you are not listed, this route does not reach you: AIM is an exchange-regulated market rather than the Official List, so the listing rules do not apply there, and private companies are untouched by this route. The FCA has consulted on replacing its TCFD-aligned listing rules with requirements based on UK SRS S1 and S2, applying to companies in its commercial companies listing categories, with the final list of categories settled in the policy statement. The timetable is final rules in autumn 2026, applying for accounting periods beginning on or after 1 January 2027, with reliefs phasing the requirements in over the first years. Until the policy statement is published, these remain proposals.
Route two runs through company law, and this is where the consultation matters most. The Government will consider how UK SRS should be reflected in the Companies Act 2006, informed by the responses to the Modernising Corporate Reporting consultation and by the climate disclosure review. Scope, thresholds, timing and the treatment of economically significant private companies are all still to be decided, with the key decisions expected in 2027. UK SRS is therefore not mandatory for large private companies, and nothing published so far makes it so. But the question is now live. Organisations that have treated UK SRS as a listed-company issue should treat it as a question of when and how it becomes relevant to them, not whether
Dates to watch:
Autumn 2026 for listed companies: the FCA publishes its final sustainability reporting rules.
30 November 2026 for all companies: the Modernising Corporate Reporting consultation closes. This is the window to give your view.
Spring 2027 for large companies and LLPs reporting under the CFD rules: the climate disclosure review concludes, and the Modernising Corporate Reporting outcome is expected.
2027 for large private companies: Government decisions on how UK SRS could enter company law, and for whom.
What should reporting teams do now?
Understand what applies to you today. Establish whether you are in scope of the Companies Act climate regulations, the FCA’s proposed rules, or neither. Not every UK SRS development applies to every company.
Understand your gaps against UK SRS. A structured readiness check shows how far your existing reporting already takes you, whether that is TCFD and CFD work, GRI or CSRD reporting, or a materiality assessment, and where the gaps sit across governance, strategy, risk management and metrics.
Engage your finance team. If UK SRS reaches you, through the FCA or through company law, the disclosures will be finance-grade: quantified financial effects, consistent with the accounts, on the accounts timetable. Early finance involvement is what makes that possible.
The bottom line
Prepare for the direction, not just the next deadline.
Corporate reporting is being simplified around financially material information, and sustainability reporting is being built into that core. The foundations pay off under any outcome.
Simply Sustainable is helping organisations work out which requirements apply to them, assess their readiness for UK SRS and turn the gaps into a practical roadmap. If you would like to understand where you stand, we would be glad to help.
It gives you a clear, high-level view of your organisation’s disclosure readiness and management maturity for UK SRS S1 and S2. No costs, no obligations.
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