UK SRS "Comply or Explain" vs CSRD: A Dual-Reporting Map for Groups Caught Between Both

The short version

Two reporting regimes moved in September 2026. In the UK, the FCA confirmed a "comply or explain^[1]" approach for climate and sustainability disclosures under UK SRS, replacing the mandatory model that had been proposed. In the EU, the revised ESRS were published in the Official Journal on 24 September 2026, completing the Omnibus I simplification. If your group has UK-listed entities and EU subsidiaries, you now have two different legal models to map against each other.

Sources for the dates below are the Linklaters ESG newsletter of October 2026 unless stated otherwise.

UK: what is now settled

• Approach: comply or explain for climate and sustainability disclosures, rather than a mandatory climate reporting model.
• Climate reporting: effective 1 January 2027.
• Scope 3 reporting: effective 1 January 2028.
• Non-climate sustainability reporting: effective 1 January 2029.
• FCA Handbook Notice 144 (25 September 2026): simplifies product-level reporting. Retail products must address climate-related risks, but the opportunities element is removed. Institutional clients can receive Scope 1, 2 and 3 emissions data on demand, with flexibility on how it is communicated. Most changes apply from 25 September 2026, with institutional requirements from 30 June 2027.

UK: what is still open

The Department for Business launched its Modernising Corporate Reporting consultation on 7 September 2026. It proposes a principles-based framework, with five broad baseline reporting areas replacing detailed non-financial topics. Climate disclosures are retained pending a separate review, and incorporating UK SRS into the Companies Act is under consideration. The consultation closes on 30 November 2026, with an outcome expected in May 2027.

EU: the comparison point

• Scope: mandatory CSRD reporting applies only above 1,000 employees and EUR 450 million net turnover.
• Standards: the revised ESRS apply to financial years beginning on or after 1 January 2027. FY2026 reporters may choose the existing ESRS, the existing ESRS with reliefs, or the revised ESRS.
• Value chain cap: limits Scope 3 data requests to suppliers with up to 1,000 employees, and a new voluntary standard exists for companies outside CSRD scope.

Side-by-side

Question	UK SRS	CSRD / revised ESRS
Legal model	Comply or explain	Mandatory for in-scope companies
First climate reporting	1 Jan 2027	FY2027 (FY2026 optional early adoption)
Scope 3	1 Jan 2028	Part of ESRS E1, subject to materiality and value chain cap
Non-climate topics	1 Jan 2029	Subject to double materiality
Open policy questions	DBT consultation closes 30 Nov 2026	Digital taxonomy and datapoint work ongoing

Practical approach for dual reporters

1. Start from the broadest dataset. Build one climate dataset (Scope 1, 2, 3, targets, transition plan) that can feed both regimes, then add EU-specific topics through your double materiality assessment.
2. Keep the audiences separate. Comply-or-explain gives UK entities room to explain gaps; CSRD does not. Do not let the UK flexibility lower the quality of the EU-facing data.
3. Track the consultation. If the DBT proposals move non-climate reporting to a principles-based model, your 2029 UK workload could look very different.
4. Check entity scope separately. UK parent status and EU subsidiary thresholds are tested independently; do not assume one answers the other.

Bottom line

UK reporting got more flexible; EU reporting got narrower but remains mandatory for those in scope. Groups should plan one data foundation and two disclosure layers, and revisit after the DBT outcome in May 2027.

Sources: Linklaters, ESG newsletter October 2026.