Comparison · UK and EU regimes
UK SRS vs CSRD: two regimes, compared as law
UK SRS vs CSRD is usually framed as a contest of standards, and the bigger difference is legal force: UK SRS S1 and S2 are voluntary standards, and the CSRD is an EU directive that binds.
Since 30 September 2026 the FCA’s final rules put UK-listed companies on comply or explain against UK SRS, while the CSRD applies to large EU companies whatever they explain.
This page compares who each regime binds, from when, on what test, with what assurance, and what a UK group with EU operations owes under both.
Two kinds of instrument
A standard with a comply-or-explain rule, and a directive with a standard
The UK standards were published by the Department for Business and Trade on 25 February 2026, and the government’s guidance says they are available for voluntary use by any entity.
They carry no effective date of their own: timing was left to regulation or the FCA.
The FCA supplied it in PS26/19: listed companies in UKLR 6, 14, 15, 16 and 22 report against UK SRS or explain, for accounting periods beginning on or after 1 January 2027.
The EU runs the other way round: the Accounting Directive, as amended by the CSRD, is the duty, and the ESRS are the content it points to.
The Commission’s CSRD page sets out the regime; the UK standards are covered in depth on the sister reference uksrs.org.uk.
| UK | EU | |
|---|---|---|
| The standards | UK SRS S1 and S2 (DBT) | Twelve ESRS (Commission) |
| What makes anyone use them | FCA Listing Rules, for five listing categories | Accounting Directive Art 19a and 29a |
| Basis | Comply or explain | Must report |
| Who writes the rule | FCA for listed companies; government for anything wider | EU legislature; member states transpose |
The divide
The materiality divide, at the provision
UK SRS S1 asks one question: could this information influence the decisions of investors, lenders and other creditors?
Paragraph 3 ties it to effects on the entity’s cash flows, its access to finance or its cost of capital.
The CSRD asks two: what the company does to people and the environment, and what sustainability matters do to the company.
A matter material on either limb is reported under ESRS.
The practical effect: a company’s effect on a local watercourse can be reportable under ESRS and not under UK SRS, if it creates no reasonably foreseeable financial effect on the company.
The concept is set out on double materiality, and the UK judgement on UK SRS S1 materiality.
Two tests, quoted
Material if omitting it “could reasonably be expected to influence decisions that primary users of general purpose financial reports make”.
Information needed to understand “the undertaking’s impacts on sustainability matters”, and “how sustainability matters affect” it.
Topics
Two standards against twelve, and what that means
UK SRS S1 is not a climate-only standard: its ¶3 reaches all sustainability-related risks and opportunities that could reasonably be expected to affect the entity’s cash flows, access to finance or cost of capital.
What it lacks is topical detail; ESRS gives each topic its own standard with named disclosures.
Under the FCA’s rules a listed company may take two years’ relief from UK SRS S1’s non-climate matters, reporting climate first.
ESRS has no climate-first relief of that kind; it handles the first years through its own phase-in provisions, which a company discloses under ESRS 2 BP-2.
A standard-by-standard reading of ESRS is on ESRS explained.
| Topic | UK SRS | ESRS |
|---|---|---|
| Climate | S2, required content | E1, if material |
| Other sustainability risks and opportunities | S1, where financially material | Across E2–E5, S1–S4, G1, if material |
| Pollution, water, biodiversity, circularity | Only if financially material, under S1 | E2, E3, E4, E5 |
| Workforce and value-chain workers | Only if financially material, under S1 | S1, S2 |
| Communities and consumers | Only if financially material, under S1 | S3, S4 |
| Business conduct | Only if financially material, under S1 | G1 |
Scope
Who each regime reaches: listing against size
The UK test is a listing, not a size: a small listed company is in and a very large private one is out.
The FCA’s final rules give no total company count; its consultation estimated that around 600 listed companies would be affected, and that remains the consultation’s estimate.
The EU test is size alone, set by Directive (EU) 2026/470: more than 1,000 employees and more than €450 million net turnover, from financial years beginning on or after 1 January 2027.
The Commission’s staff working document estimates that leaves about 6,753 companies in the EU.
UK private companies are not proposed for UK SRS: the government’s modernising corporate reporting consultation says only that it “will consider” how UK SRS should be reflected in the Companies Act 2006.
The Article 40a test for UK groups is worked through on CSRD for UK companies, and the UK energy regime that does bind large private companies on SECR thresholds.
| UK SRS (FCA rules) | CSRD | |
|---|---|---|
| Test | Listing category: UKLR 6, 14, 15, 16 or 22 | More than 1,000 employees and more than €450m net turnover, both |
| Excluded | Funds, shells, debt, securitised derivatives, miscellaneous securities (¶3.7) | Everyone below either limb from FY 2027 |
| Numbers | No count in the final rules; CP26/5 estimated around 600 affected | About 6,753, on the Commission’s estimate |
| Non-domestic groups | Secondary listings and depositary receipts included | Article 40a: >€450m EU turnover for two years and a >€200m EU entity |
| Private companies | No threshold proposed anywhere | In, if above the size test |
Dates
The timelines, side by side
The two regimes start on the same date for different reasons.
The FCA rules apply to accounting periods beginning on or after 1 January 2027, with a one-year Scope 3 relief and a two-year relief for UK SRS S1’s non-climate matters; a company using one says so and gives no further explanation during the relief (¶3.14, ¶3.20).
When a relief expires, the topic becomes comply or explain, not mandatory.
The revised ESRS, Delegated Regulation (EU) 2026/1563, apply to financial years beginning on or after 1 January 2027, the same year the new CSRD scope takes effect.
EU companies that reported in the first wave under the 2023 standards and fall below the new thresholds stop from financial year 2027.
Anyone who prepared for the broader pre-2026 CSRD scope should test again before building further; the UK path is set out on UK SRS compliance.
- 25 Feb 2026UK SRS S1 and S2 published
Voluntary.
- 18 Mar 2026Omnibus I in force
EU scope cut.
- 30 Sep 2026FCA PS26/19 published
Comply or explain for listed companies.
- 1 Jan 2027Both start
UK: accounting periods; EU: financial years, under the revised ESRS.
- 2028First reports under both
UK Scope 3 relief gone for periods from 1 Jan 2028.
- 1 Jan 2028Article 40a financial years begin
Non-EU groups reported on through an EU entity.
- 1 Jan 2029UK S1 climate-first relief gone
For periods beginning on or after.
Groups that face both
Four group shapes, four answers
| Group | UK SRS | CSRD |
|---|---|---|
| UK-listed (UKLR 6), with an EU subsidiary above €450m and 1,000 staff | Comply or explain in the UK annual report | The EU subsidiary reports under ESRS from FY 2027 |
| UK-listed, EU sales above €450m for two years and a €200m EU branch | Comply or explain | The EU branch publishes a group-level impacts report from FY 2028 (Article 40a) |
| Large UK private company, no EU entities | Not in scope; UK SRS voluntary | Not in scope; may receive supplier requests |
| EU-headquartered group with a UK secondary listing (UKLR 14) | Comply or explain; home reporting may broadly comply | The EU parent reports under ESRS if above the thresholds |
A company that owes both can build one data platform, but not one assessment: the double materiality assessment is a different exercise from the financial materiality judgement in UK SRS S1.
For an international company with a UK secondary listing, the FCA says home-jurisdiction reporting aligned with UK SRS outcomes may already broadly comply, with an explanation for anything not met.
Where the two overlap most is climate, and even there UK SRS S2 requires location-based Scope 2 while ESRS E1 wants both methods.
The UK’s older climate duty, section 414CB of the Companies Act, sits alongside both for large UK companies and is a separate regime again.
Side by side
UK SRS and CSRD on ten points
| Point | UK SRS | CSRD / ESRS |
|---|---|---|
| Legal force | Voluntary standards; comply or explain via FCA Listing Rules | EU directive; standards in a delegated regulation |
| Published | UK SRS S1 and S2: 25 February 2026 | CSRD December 2022; ESRS July 2023; revised ESRS 21 September 2026 |
| Scope | Five UK listing categories | More than 1,000 employees and €450m turnover; Article 40a for non-EU groups |
| Materiality | Single, financial | Double, impact and financial |
| Standards | Two | Twelve |
| Where it sits | Annual report; cross-reference permitted | Management report |
| First year | Accounting periods from 1 January 2027 | Financial years from 1 January 2027 on the new scope |
| Reliefs | Scope 3: one year; S1 non-climate: two years | FY2026 version choice; phase-ins within ESRS |
| Assurance | Not required; a statement of whether obtained | Limited assurance required |
| Enforcement | FCA, through the Listing Rules | National law in each member state |
The FCA’s rules replace its earlier TCFD-aligned disclosures, so a UK-listed company’s climate reporting moves to UK SRS whether or not it has any EU exposure.
The CP26/5 consultation that preceded them had proposed mandatory UK SRS S2; the final rules are comply or explain across both standards.
For the EU side in full, read the EU CSRD.
Frequently asked
Questions people ask
Is UK SRS the same as CSRD?
No. UK SRS is a pair of standards, UK SRS S1 and S2, published by the Department for Business and Trade on 25 February 2026 for voluntary use and based on the ISSB’s IFRS S1 and S2.
The CSRD is an EU directive that makes companies above size thresholds report against a different set of twelve standards, the ESRS, on double materiality.
One is a UK standard; the other is EU law.
Is UK SRS mandatory?
No. UK SRS S1 and S2 are voluntary for any UK entity.
Under the FCA’s final rules (PS26/19, 30 September 2026), listed companies in UKLR 6, 14, 15, 16 and 22 must report against them on a comply-or-explain basis for accounting periods beginning on or after 1 January 2027, with first reporting in 2028.
The consultation had proposed making UK SRS S2 mandatory; the final rules do not.
If a company complies with CSRD, does it also need UK SRS?
Only if it is also listed in the UK in one of the five UKLR categories the FCA’s rules cover.
A group with a UK listing and an EU subsidiary above the CSRD thresholds can owe both: comply-or-explain reporting against UK SRS in its UK annual report, and an ESRS statement from the EU subsidiary.
Can a CSRD report satisfy the UK rules?
Not automatically.
The FCA’s explain limb for UK SRS S2 asks for a summary of the UK SRS S2 requirements not met, the reasons and the steps planned, so a company would have to map its ESRS disclosures to UK SRS and explain the gaps.
Climate is where most information carries across, but the materiality basis, the location of disclosures and some metrics differ.
Why does UK SRS not use double materiality?
UK SRS S1 is based on IFRS S1, which is written for primary users of general purpose financial reports — investors, lenders and other creditors — and asks what sustainability matters could do to the entity’s cash flows, access to finance or cost of capital.
The EU chose double materiality in the CSRD, adding the company’s impacts on people and the environment.
Will UK SRS apply to large private companies?
No threshold for private companies has been proposed anywhere.
The government’s modernising corporate reporting consultation, open until 30 November 2026, says only that it will consider how UK SRS should be reflected in the Companies Act 2006.
Does either regime require assurance?
The CSRD does: the sustainability statement needs a limited assurance opinion.
UK SRS does not: the FCA’s rules ask a listed company to state whether it obtained assurance and, if so, the provider, what was assured and the standards used.
Sources
Primary sources
Every figure, date and status on this page traces to the instrument’s owner.
Secondary commentary is never the source for a number.
- Financial Conduct AuthorityPS26/19 — Aligning listed issuers’ sustainability disclosures with international standards
Published 30 September 2026: comply or explain against UK SRS for UKLR 6, 14, 15, 16 and 22 (¶3.6), accounting periods from 1 January 2027 (¶3.12).
- Financial Conduct AuthorityPS26/19 (PDF) — ¶1.2, ¶1.7, ¶1.10, ¶3.14, ¶3.20, ¶3.23–3.24 and Appendix 1
Reliefs; replaces the TCFD-aligned rules; the Listing Rules instrument made 24 September 2026, in force 1 January 2027.
- Financial Conduct AuthorityCP26/5 — the consultation PS26/19 finalises
Had proposed mandatory UK SRS S2; the final rules did not adopt it.
- Department for Business and TradeUK SRS S1 and UK SRS S2, 25 February 2026
- Department for Business and TradeUK Sustainability Reporting Standards — guidance
“Available for voluntary use, by any entity that chooses to do so.”
- Department for Business and TradeUK SRS S1 — ¶3, ¶18
Single, financial materiality; primary users of general purpose financial reports.
- Department for Business and TradeUK SRS S2 — ¶29(a)(v), ¶B32, ¶B59A
- Department for Business and TradeExposure drafts of UK SRS: government response, Annex A
Every UK difference from IFRS S1 and S2.
- Department for Business and TradeModernising corporate reporting, consultation, 7 September 2026 (¶¶154–155)
The government “will consider” how UK SRS is reflected in the Companies Act 2006; no proposal.
- legislation.gov.ukCompanies Act 2006, section 414CB
The UK’s climate-related financial disclosure duty, a separate regime.
- EUR-LexDirective 2013/34/EU, consolidated 18 March 2026 — Arts 19a, 29a, 34, 40a
- EUR-LexDirective (EU) 2026/470 (Omnibus I), Official Journal
In force 18 March 2026.
- EUR-LexCommission Delegated Regulation (EU) 2023/2772 — ESRS Set 1
- EUR-LexCommission Delegated Regulation (EU) 2026/1563 — the revised ESRS
Applies to financial years from 1 January 2027.
- European CommissionCorporate sustainability reporting
- European CommissionSWD(2026) 500 final
About 6,753 companies in CSRD scope.
- EFRAG and IFRS FoundationESRS–ISSB Standards Interoperability Guidance, 2 May 2024
Financial-materiality definition aligned; not a statement of equivalence.
- IFRS FoundationIFRS Sustainability Disclosure Standards