Transition Plans Under UK SRS

What UK SRS S2 Requires

Under the current FCA proposals, companies are not required to produce a climate transition plan. However, they are required to disclose whether they have published one, where it can be found, its key elements, and progress made against it. If a company has not published a transition plan, it must explain why. This is a disclose-or-explain approach to transition plans, rather than a mandate to produce one.

Where a transition plan exists, the disclosure must cover the company's emissions reduction targets (including whether they are absolute or intensity-based), the actions being taken to achieve those targets, the capital allocation committed to transition activities, and progress made against previous disclosures. The plan must be consistent with the company's overall strategy and risk management disclosures under UK SRS S2.

The TPT Framework

The UK Transition Plan Taskforce (TPT) published its framework in October 2023, setting out a gold standard for what a credible transition plan should contain. While the TPT Framework is not legally mandated under UK SRS, it is the most widely referenced guidance in the UK market and is expected to inform both corporate practice and regulatory expectations. The framework covers five elements: foundations (company-wide ambition and governance), implementation strategy (actions and policies), engagement strategy (value chain and industry collaboration), metrics and targets, and governance.

The Separate Government Consultation

The UK Government is separately consulting on potential mandatory transition plan requirements that would go beyond the current UK SRS S2 disclose-or-explain approach. This consultation is expected to consider whether certain large companies should be required to produce and publish a transition plan, the minimum content requirements, and the relationship with UK SRS disclosures. The timeline for this consultation has not been confirmed, but it is expected during 2026.

Assurance Considerations

Transition plan disclosures made within the Strategic Report under UK SRS S2 will be subject to the same assurance framework as other UK SRS disclosures. The FRC is establishing an interim register of sustainability assurance practitioners by mid-2026, and ISSA (UK) 5000 provides the assurance standard. While assurance of transition plan disclosures is not yet mandated, audit committees should consider whether voluntary assurance would strengthen the credibility of their transition plan disclosure.