On May 16, 2024, the UK Government published their final report outlining the implementation criteria and timeline on the Sustainability Disclosure Requirements (SDR) framework.
Let's talk how we can help your business.
Connect to a new world of efficiency by utilizing cleversoft’s business solutions.
On May 16, 2024, the UK Government published their final report outlining the implementation criteria and timeline on the Sustainability Disclosure Requirements (SDR) framework.
This final report is a significant milestone in the UK’s efforts to enhance sustainability standards in response to the IFRS Foundation’s International Sustainability Standards Board (ISSB) standards from July 2023. For more detailed insights, you can explore the official publication here: Sustainability Disclosure Requirements: Implementation Update 2024
The latest report covers four main topics:
- UK Sustainability Reporting Standards (UKSRS)
The UK Government plans to officially introduce the UKSRS in Q1 2025 and sets out an endorsement and implementation plan. The decision on whether these requirements will apply to UK listed companies only or will be imposed on non-listed companies, too, will follow in Q2 2025. All decisions will become effective from accounting periods beginning on or after January 1, 2026.
- Transition Plan Disclosures
Complementing the expansion of the UKSRS, the Transition Plan Taskforce (TPT) has been engaged in setting a transition policy to support companies in preparing their plans to achieve net zero as part of their annual reporting. At the same time, since various points are covered in all 3 frameworks – the IFRS S2, the ISSB Climate standard, and the TPT Disclosure Framework – the FCA will further discuss on its expectations for transition plans under the UK SRS with reference to the TPT Disclosure Framework. The disclosure of the transition plans for UK’s largest companies is another topic on the agenda for the UK Government’s future consultation.
- SDR and investment labels regime
The report highlights updated requirements and timeline for the SDR framework, initially published in November 2023. There is currently an open consultation on extending the SDR and labelling regime to portfolio managers based in the UK, which will close on June 14, 2024. Further information is available in our latest blog post.
- UK Green Taxonomy
The development of a UK Green Taxonomy remains a main focus for the Government, and open consultations are to continue throughout 2024. The initial phase of the new reporting framework will begin with a 2-year testing period during which disclosures will remain voluntary. A final decision on whether these reports will become mandatory afterwards is still to be confirmed by the Government.
Despite differences between the current versions of SDR and SFDR, the UK Government´s report reaffirms that both regimes remain aligned on their main objectives:
- Reduce the risk of greenwashing.
- Build the trust and confidence of customers on the market, while enhancing transparency, credibility and integrity of the markets.
- Support investors in making informed investment decisions, based on their true sustainability preferences.
cleversoft is closely monitoring the evolution of the new SDR framework in the UK as we develop our Standard SDR service in complement to our existing SFDR Service. For further information, please contact us via the contact form on our website. Our experts will be happy to answer your questions.