Is SECR Mandatory? — SECR Legal Requirements and Enforcement
SECR is a legal requirement for qualifying UK companies. Understand your obligations, enforcement mechanisms, and the consequences of non-compliance.
Primary Legislation
SECR is mandatory under the Companies Act 2006, specifically through amendments made by The Companies (Strategic Report) Regulations 2018 (SI 2018/1155).
Key Legal Provisions
- Section 414CB: Strategic report requirements for large companies
- Section 463: Criminal liability for non-compliance
- SI 2018/1155: Detailed SECR reporting requirements
Who Must Comply
SECR compliance is mandatory for all UK-incorporated companies that qualify as "large companies" under the Companies Act 2006.
Must Comply
- • UK-incorporated companies
- • Meeting 2+ large company thresholds
- • Listed companies (regardless of size)
- • Subsidiary companies in qualifying groups
Exempt
- • Small and medium companies
- • Dormant companies
- • Charities (with some exceptions)
- • Companies in their first year
"Comply or Explain" vs Mandatory
Unlike some governance codes that operate on a "comply or explain" basis, SECR is an absolute legal requirement. There is no option to explain why you haven't complied instead of complying.
Limited Exemptions Only
The only way to avoid SECR is to fall below the large company thresholds or qualify for one of the narrow statutory exemptions (e.g., dormant companies). You cannot simply choose not to comply.
Companies House Enforcement
Companies House is responsible for enforcing SECR compliance. They have several enforcement mechanisms available, from administrative penalties to criminal prosecution.
Late Filing Penalties
Additional Consequences
- • Notice to remedy default
- • Disqualification proceedings against directors
- • Strike-off from Companies Register
- • Prosecution under section 463
Criminal Liability
Under section 463 of the Companies Act 2006, failure to comply with SECR requirements constitutes a criminal offence.
Potential Penalties
- • Unlimited fine on indictment
- • Fine and/or imprisonment up to 6 months on summary conviction
- • Personal liability cannot be excluded by insurance
- • Criminal record for officers found guilty
Enforcement in Practice
While criminal prosecutions are rare, Companies House actively monitors compliance and routinely issues penalties for late or missing filings.
Risk Factors
- • High-profile companies face greater scrutiny
- • Repeat offenders more likely to face prosecution
- • Public interest cases prioritised for enforcement
- • Stakeholder complaints trigger investigations
Mandatory Reporting Elements
To comply with SECR, your strategic report must include all required elements. Partial compliance is still non-compliance.
Quality Assurance
While external verification is not legally required for SECR, companies should implement robust internal controls to ensure data accuracy and completeness.
Recommended Controls
- • Board-level oversight of SECR reporting
- • Document data sources and calculation methodologies
- • Internal review by senior management
- • Retain supporting documentation for audit purposes
With the introduction of UK SRS in 2026, it's important to understand that SECR and UK SRS have different legal bases and compliance requirements.
SECR (Since 2019)
- • Mandatory under Companies Act 2006
- • Criminal penalties for non-compliance
- • Filed with Companies House
- • Applies to all large UK companies
UK SRS (From 2026)
- • Mandatory under different legislation
- • Higher thresholds than SECR
- • More detailed requirements
- • Separate filing and enforcement