The FCA has now set out its roadmap for transitioning from TCFD to ISSB-based UK Sustainability Reporting Standards (SRS).  The consultation is open, but the direction of travel is clear.  For UK companies, this is no longer a question of if sustainability disclosures become more structured and rigorous. It is a question of when and how prepared you will be when they do.

The timeline is phased — but tight

The proposed implementation timeline is designed to provide stability:

• 2027 – Mandatory climate-related disclosures begin
• 2028 – Scope 3 emissions reporting introduced on a “comply-or-explain” basis
• 2029 – Broader non-climate sustainability disclosures added on a “comply-or-explain” basis

On paper, that may look comfortably distant. In practice, 2027 is less than two reporting cycles away. And the systems, controls and governance required to produce disclosures of sufficient quality do not appear overnight. Nor are they cost-neutral. Building audit-ready data environments, upgrading internal controls and integrating sustainability into financial reporting processes requires both budget and specialist capacity, resources that are already constrained in many organisations.

The shift that really matters - investor-grade information

The FCA’s approach centres on single materiality — information that investors need to assess enterprise value. This contrasts with the EU’s CSRD framework, which applies a double materiality lens — requiring companies to report not only on financial risk, but also on their impacts on society and the environment. For UK-headquartered groups with EU operations, the interaction between these frameworks will require careful coordination to avoid duplication, inconsistency or reporting fatigue.

Whatever your view on that framing, it sends a clear signal: sustainability reporting is being treated as financially decision-useful information, not corporate communications.

That has three implications for UK companies:

1. Greater scrutiny of assumptions and estimates
2. Higher expectations of data quality and internal controls
3. More alignment between sustainability reporting and financial reporting processes

This is where assurance becomes critical.

Enter ISSA 5000: raising the assurance bar

Alongside the reporting shift, assurance standards are also evolving.

ISSA 5000 has been developed specifically for sustainability information, rather than adapting a general assurance framework. Compared to ISAE 3000, it introduces:

• Explicit focus on environmental, social and governance risks
• Greater emphasis on value chain and third-party data
• Stronger assessment of greenwashing and bias risk
• Higher expectations for the sufficiency and appropriateness of evidence
• Clearer reporting on scope, criteria and assurance levels

In short, assurance providers will be required to dig deeper — particularly where data maturity is uneven or forward-looking statements are involved. That depth carries implications for audit fees, internal preparation time and the availability of suitably qualified assurance teams.

These developments sit alongside revisions to the GHG Protocol, which are tightening organisational boundaries and Scope 2 accounting — reinforcing the broader move toward audit-ready comparability. Across both reporting and emissions standards, flexibility is gradually giving way to consistency.

What does this mean in practice?

For UK companies preparing for 2027 and beyond, several practical consequences follow.

1. Your reporting team cannot operate in isolation

Finance, sustainability, risk and internal audit functions will need tighter integration. ISSB-aligned reporting will increasingly resemble financial reporting in discipline and documentation.

2. Scope 3 will not wait until 2028

Although formally introduced on a comply-or-explain basis in 2028, building credible Scope 3 inventories, particularly across complex supply chains, takes time. Early data mapping and supplier engagement will reduce future friction. For many companies, this will mean investing in new data platforms, contractual revisions with suppliers and additional verification procedures — well before formal assurance becomes mandatory.

3. Governance will be tested

Boards and audit committees will need to demonstrate oversight of climate-related risks and disclosures. That includes understanding key judgements, data gaps and scenario assumptions.

4. Assurance conversations will change

Under ISSA 5000, companies can expect more structured scoping discussions, earlier focus on data readiness and clearer articulation of gaps.

The strategic question

The FCA is not (yet) mandating detailed transition plans. But companies will be expected to explain where they stand.

Companies can either treat 2027 as a reporting obligation to be met at the last responsible moment, or as an opportunity to strengthen governance, improve data resilience and demonstrate credibility ahead of regulatory compulsion.

The consultation period offers time, but not complacency.

For many UK companies, the real work is not understanding the draft standards. It is assessing whether current data, governance and assurance arrangements could withstand investor-grade scrutiny under the new regime. The shift from TCFD to UK SRS is more than a reporting update.
It is a test of whether sustainability information is ready to sit alongside financial information, on equal footing.