UK SRS S2 · the greenhouse gas paragraphs
Carbon accounting UK SRS:
disclosures
UK SRS S2 asks for Scope 1, 2 and 3 in one paragraph — ¶29(a) — and then qualifies almost every part of it in the application guidance and the transition appendix.
Under the FCA’s final rules, listed companies in UKLR 6, 14, 15, 16 and 22 report against it on a comply-or-explain basis for accounting periods beginning on or after 1 January 2027, with first reports in 2028.
This page goes through the paragraphs a carbon inventory has to answer, and the four places the usual summaries get them wrong.
Paragraph 29(a)
Six requirements, one paragraph
| Paragraph | What it asks | Where it is qualified |
|---|---|---|
| ¶29(a)(i) | Absolute gross Scope 1, Scope 2 and Scope 3, in metric tonnes of CO2e | ¶C4 lets Scope 3 be omitted; gross means before any offsets |
| ¶29(a)(ii) | Measured under the GHG Protocol Corporate Standard (2004) | Unless a jurisdictional authority or exchange requires another method; ¶C3 first-year relief |
| ¶29(a)(iii) | The measurement approach, inputs and assumptions; why; and any changes, with reasons | ¶¶B38–B57 for Scope 3 |
| ¶29(a)(iv) | Scope 1 and 2 split between the consolidated accounting group and other investees | Associates, joint ventures and unconsolidated subsidiaries |
| ¶29(a)(v) | Location-based Scope 2, and information about contractual instruments where necessary | ¶¶B30–B31: market-based permitted, not required |
| ¶29(a)(vi) | The Scope 3 categories included; financed emissions for asset managers, banks and insurers | ¶B32: consider all fifteen; ¶¶29A–29C: financed emissions |
UK SRS S2 was published by the Department for Business and Trade on 25 February 2026, based on IFRS S2.
Its body paragraphs follow IFRS S2’s numbering, so ¶29(a) is the same paragraph in both; the transition appendix was renumbered, which is where the trouble starts (see the reliefs below).
For the wider standard, the UK SRS S2 reference covers governance, strategy, risk management, scenario analysis and targets; this page stays with the inventory.
S2 emissions duties
Published text
S2 emissions duties
Paragraph numbers
S2 emissions duties
Wider standard
Your inventory against ¶29(a)
Tick what you produce; what is left is the work
Most companies coming to UK SRS S2 already produce Scope 1 and location-based Scope 2 for SECR.
The checklist on this panel lists each ¶29(a) disclosure with its paragraph, and changes when you say you are a financial institution, a listed company, or using the Scope 3 relief.
The gaps it usually shows are three: the explanation of approach, inputs and assumptions; the split between the consolidated group and other investees; and, once Scope 3 is in, the ¶B56 statement of how much of it rests on specific and on verified inputs.
The carbon accounting reference covers building the inventory itself, from boundary to base year.
UK SRS S2 ¶29(a) · what is left to build
- Absolute gross Scope 1, Scope 2 and Scope 3 emissions in metric tonnes of CO2e, with no offsets deducted (¶29(a)(i))
- Measured under the GHG Protocol Corporate Standard (2004), or the required method named (¶29(a)(ii))
- The measurement approach, inputs and assumptions, why they were chosen, and any change with its reason (¶29(a)(iii))
- Scope 1 and 2 split between the consolidated accounting group and other investees (¶29(a)(iv))
- Location-based Scope 2 (¶29(a)(v), ¶B30)
- Information on contractual instruments (REGOs, PPAs, tariffs) where they exist and inform the figure (¶29(a)(v), ¶B30)
- Which Scope 3 categories are included, whatever the method (¶29(a)(vi)(1), ¶¶B32–B33)
- The extent to which Scope 3 is measured with inputs from specific value-chain activities, and with verified inputs (¶B56)
UK SRS S2 ¶¶29(a), 29A–29C, B30, B32–B33, B56, C4–C5; FCA PS26/19 and UKLR TP 16.4R.
A checklist of the paragraphs, not an assurance opinion.
Nothing you tick is stored or sent.
Method
The 2004 Corporate Standard — and two ways out of it
Paragraph 29(a)(ii) requires measurement “in accordance with the Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (2004)” — a named edition of the Corporate Standard, not whatever the GHG Protocol publishes next.
Read the provisions and qualifications
The same sentence carries a carve-out that summaries usually drop: the requirement applies unless the entity is required, in whole or in part, by a jurisdictional authority or an exchange on which it is listed to use a different method.
The second way out is ¶C3, which permits another method “in the first annual reporting period” in which the entity applies the Standard.
¶C3 is the one UK transition relief that kept its time limit, and the FCA’s rules expressly preserve it: UKLR TP 16.4R(3) says nothing in the Scope 3 relief affects it (PS26/19, Appendix 1).
The Corporate Standard offers three consolidation approaches — equity share, financial control and operational control — and UK SRS S2 does not choose between them.
What it adds is ¶29(a)(iv): Scope 1 and 2 split between the consolidated accounting group and other investees, which is simplest when the inventory boundary follows the accounts.
The GHG Protocol page covers the standards and the revision now under way; under ¶29(a)(ii) a revised edition does not apply until the Standard is amended to name it.
Measurement method
Frozen edition
Measurement method
Jurisdiction carve-out
Measurement method
First-year method relief
Measurement method
FCA preservation
Tables and tools
¶29(a)(ii) names the 2004 Corporate Standard.
Whether that picks up the 2013 nitrogen trifluoride amendment and the 2015 Scope 2 Guidance is not settled in the text.
State the base edition and the amendments you apply, rather than a single gas count.
Scope 2
Location-based is required; market-based is a choice
This is the point most often misstated, including on the page this one replaces.
Read the provisions and qualifications
¶29(a)(v) asks for location-based Scope 2 “and … information about any contractual instruments that is necessary to inform users’ understanding”.
¶B30 puts it beyond doubt: “For the avoidance of doubt, an entity is required to disclose its Scope 2 greenhouse gas emissions using a location-based approach and is required to provide information about contractual instruments only if such instruments exist and information about them informs users’ understanding.”
¶B31 then says the entity “might” disclose market-based Scope 2.
The GHG Protocol’s Scope 2 Guidance is stricter: where a company operates in markets with contractual instruments, it reports both figures, and the UK is such a market.
So a company can comply with UK SRS S2 with one location-based figure and a note on its REGOs or power purchase agreements, while the GHG Protocol would also expect the market-based total.
Many will publish both anyway: the SECR guidelines recommend that a market-based figure reflecting renewable contracts be presented alongside the location-based one (Environmental Reporting Guidelines).
The Scope 2 revision under consultation would change the market-based method, not UK SRS S2’s requirement.
The Scope 2 emissions page has the calculator, the UK instruments and the residual mix.
Scope 2 disclosure
Common error
Scope 2 disclosure
Location-based duty
Scope 2 disclosure
Paragraph B30
Scope 2 disclosure
Optional market-based
Scope 3
Consider fifteen, disclose which are in
¶B32 asks the entity to “consider its entire value chain” and to “consider all 15 categories” of the Scope 3 Standard, then requires it only to disclose which categories are included.
Consider is not report: a company that screens all fifteen and measures four discloses four and says so.
¶29(a)(vi)(1) pins the categories to the 2011 edition of the Scope 3 Standard, now hosted on the GHG Protocol’s standards page.
How Scope 3 is measured is governed by ¶¶B38 to B57, which IFRS S2 calls the measurement framework and which UK SRS S2 kept unchanged.
| Paragraph | What it says |
|---|---|
| ¶B38 | Use an approach, inputs and assumptions that give a faithful representation — “likely to include the use of estimation” |
| ¶B39 | All reasonable and supportable information available without undue cost or effort |
| ¶B40 | Prioritise inputs by four characteristics, in no particular order: direct measurement; specific value-chain activities; timely data true to the jurisdiction and technology; verified data |
| ¶B42 | Trade-offs between those characteristics require management judgement |
| ¶B47 | Prioritise — “with all else being equal” — primary data |
| ¶B48 | Primary data includes supplier-specific emission factors for purchased goods or services |
| ¶B49 | Secondary data includes industry averages from published databases, government statistics, literature and industry associations |
| ¶B51 | Prioritise emission factors for the jurisdiction where the entity operates or the activity took place |
| ¶B53 | Prioritise verified Scope 3 data |
| ¶B56 | Disclose the extent to which Scope 3 uses inputs from specific activities, and inputs that are verified |
| ¶B57 | A presumption that Scope 3 can be estimated reliably using secondary data and industry averages; if impracticable, disclose how Scope 3 is managed |
Two consequences follow.
Spend-based estimates are acceptable as a starting point — ¶B57 presumes secondary data works — but the ¶B56 disclosure shows readers how much of the figure rests on them.
And “impracticable” is meant to be rare: the fallback in ¶B57 is a disclosure about management, not a blank.
For asset managers, commercial banks and insurers, ¶¶29A to 29C govern financed emissions in category 15, including when the category may be limited to financed emissions.
UK SRS Scope 3 reporting takes the categories one by one, and Scope 3 emissions covers the measurement methods for every UK regime.
Value-chain disclosure
Fifteen categories
Value-chain disclosure
Consider versus report
Value-chain disclosure
2011 taxonomy
Value-chain disclosure
Measurement framework
Reliefs
¶C4, the FCA’s one year, and a cross-reference that points nowhere
| Relief | What it does | How long |
|---|---|---|
| UK SRS S2 ¶C3 | Another measurement method instead of the GHG Protocol | First annual reporting period only |
| UK SRS S2 ¶C4 | Scope 3 need not be disclosed | No time limit in the Standard |
| IFRS S2 ¶C4 | Both of the above, in one paragraph | First annual reporting period only |
| UKLR TP 16.4R(2)(a) | A UKLR 6 company may use UK SRS S2 ¶C4, stating that it relies on TP 16.4R(2) and ¶C4 | Accounting periods beginning on or after 1 January 2027 and before 1 January 2028 |
| UKLR TP 16.6G(2) | No comparatives for the first period of disclosures | The first period |
The renumbering is the trap: Annex A of the government’s response maps IFRS S2 C4(a) to UK SRS S2 ¶C3 and C4(b) to ¶C4.
A sentence such as “the C4 relief expires after one year” is true of IFRS S2 and false of UK SRS S2, so always name the standard with the paragraph.
The UK text carries a slip of its own: ¶B41 still refers to “the transition relief described in paragraph C4(a)”, which does not exist in UK SRS S2; the relief meant is ¶C3.
¶C5 asks an entity using a relief to say so, and ¶C6 subordinates every relief to the Companies Act, the FCA and other UK regulators.
That is how the FCA turns an untimed relief into a one-year one for listed companies.
For a UKLR 6 company, UKLR TP 16.4R(2)(a) allows the ¶C4 relief for accounting periods beginning in 2027 only, provided the annual financial report states that it relies on that provision and on ¶C4; no further explanation is needed during the relief period.
From periods beginning in 2028, Scope 3 is disclosed or its absence explained under UKLR 6.6.6R(7A): a summary of the unmet requirements, the reasons, and the steps planned.
The FCA’s rules apply comply or explain to the whole of UK SRS, so Scope 3 is not a mandatory core with an exception; it is on the same footing as every other disclosure.
Early adopters keep the reliefs too, which reverses what the consultation, CP26/5, had proposed.
Separate reliefs
Renumbering
Separate reliefs
IFRS versus UK
Separate reliefs
Text cross-reference
Separate reliefs
Other rules
Changes and reassessment
What the Standard asks when things change
¶29(a)(iii)(3) asks for “any changes the entity made to the measurement approach, inputs and assumptions during the reporting period and the reasons for those changes”.
Read the provisions and qualifications
It sets no percentage threshold and does not itself require prior-year figures to be restated; a restatement policy comes from the GHG Protocol, which leaves the significance threshold to the company.
¶B34 is a different trigger: on a significant event or significant change in circumstances — a change of supplier, a merger or acquisition, new emissions regulation — the entity reassesses which Scope 3 categories and value-chain entities to include.
That is a reassessment of scope, not a base-year recalculation, and ¶B35 permits it more often.
Factor changes are a practical case: the UK electricity factor in the 2026 government set fell 26%, partly through a change of method, and a company that chooses to restate earlier years explains the change under ¶29(a)(iii)(3).
The GHG conversion factors page has the figures and the activity-year rule.
Method and scope changes
Method changes
Method and scope changes
No percentage trigger
Method and scope changes
Significant events
Method and scope changes
Scope reassessment
Alongside SECR
SECR and UK SRS S2, from one inventory
| SECR | UK SRS S2 (FCA rules) | |
|---|---|---|
| Legal basis | Companies Act regulations, SI 2018/1155 | A voluntary standard, applied by UKLR 6.6.6R(7A) and equivalents |
| Who | Quoted companies; large unquoted companies and LLPs | Listed companies in UKLR 6, 14, 15, 16 and 22 |
| Basis | Mandatory content | Comply or explain |
| Where | Directors’ report (LLPs: energy and carbon report) | Annual financial report, with cross-reference where S1 permits |
| Scope 1 | Required (quoted: global) | Required, gross, split by group and investees |
| Scope 2 | Location-based grid factors encouraged; a market-based figure presented alongside, if used | Location-based required; market-based permitted |
| Scope 3 | None for quoted companies; transport fuel for which the company is responsible for large unquoted companies and LLPs | All fifteen considered; included categories disclosed; relief for periods beginning in 2027 |
| Energy | kWh required | Not a ¶29(a) disclosure |
| Intensity ratio | At least one | Not required by ¶29(a) |
| Assurance | No statutory requirement | A statement of whether assurance was obtained |
Neither regime replaces the other: a listed company subject to SECR keeps filing its energy and carbon disclosures in the directors’ report and makes its UK SRS S2 disclosures in the annual financial report.
The two should reconcile, which in practice means one inventory with one boundary, and a clear note where SECR’s narrower Scope 3 limb differs from what S2 includes.
The SECR hub and the SECR reporting guide cover the directors’ report side.
Evidence
The evidence file an assurer would ask for
The FCA chose not to require assurance; CP26/5 said it was not proposing mandatory requirements “at this time”, and the final rule asks only for a statement.
Read the provisions and qualifications
UKLR 6.6.6R(8)(d) requires a listed company to say whether it obtained third-party assurance over its disclosures and, if so, the provider, which disclosures were assured and to what level, the assurance standards used, and where any published report can be found.
The FRC’s ISSA (UK) 5000 was issued on 12 November 2025 for voluntary use, effective for periods beginning on or after 15 December 2026, and the IAASB has approved withdrawing ISAE 3410 from ISSA 5000’s effective date.
Whether or not assurance is bought, the inventory behind ¶29(a) should hold up to one.
That means source records for every activity figure, named factors with their year, a written boundary and approach that answers ¶29(a)(iii), the Scope 3 screen of all fifteen categories with reasons for each exclusion, the ¶B56 split of specific and verified inputs, and a log of changes with reasons.
The sustainability assurance reference covers the standards and the oversight regime.
Software helps with the trail: carbon accounting software sets out what the measurement layer must do, carbon reporting software compares platforms, and ESG data management covers the controls around the data.
Evidence and assurance
FCA decision
Evidence and assurance
Assurance statement
Evidence and assurance
ISSA UK 5000
Evidence and assurance
Inventory evidence
Test the reading
Seven statements about UK SRS S2
Each statement on this panel circulates in summaries of UK SRS S2, and most are false.
They are false in the same way: an IFRS S2 rule, a GHG Protocol rule or a consultation proposal carried across as if it were UK SRS S2 or the FCA’s final rule.
Each answer names the paragraph to check.
For both standards together, UK SRS S1 and S2 sets out how the climate standard leans on S1’s general requirements.
UK SRS S2 greenhouse gas rules: true or false?
UK SRS S2 requires both location-based and market-based Scope 2.
UK SRS S2’s ¶C4 Scope 3 relief lasts one year.
A company that uses a non-GHG-Protocol method can keep doing so under ¶C3 indefinitely.
UK SRS S2 requires all fifteen Scope 3 categories to be reported.
Spend-based estimates are not acceptable under UK SRS S2.
A significant acquisition requires the base year to be recalculated under ¶B34.
Under the FCA’s rules a listed company must obtain assurance over its emissions.
0 of 7 answered.
Nothing you choose is stored or sent.
A reading and preparation sequence
carbon accounting UK SRS: from the question to the evidence
- Step 0101
S2 emissions duties
UK SRS S2 was published by the Department for Business and Tradeon 25 February 2026, based on IFRS S2.Read the detail. - Step 0202
Measurement method
Paragraph 29(a)(ii) requires measurement “in accordance with the Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (2004)” — a named edition of the Corporate Standard, not whatever the GHG Protocol publishes next.Read the detail. - Step 0303
Scope 2 disclosure
This is the point most often misstated, including on the page this one replaces.Read the detail. - Step 0404
Value-chain disclosure
¶B32 asks the entity to “consider its entire value chain” and to “consider all 15 categories” of the Scope 3 Standard, then requires it only to disclose which categories are included.Read the detail. - Step 0505
Separate reliefs
The renumbering is the trap: Annex Aof the government’s response maps IFRS S2 C4(a) to UK SRS S2 ¶C3 and C4(b) to ¶C4.Read the detail. - Step 0606
Method and scope changes
¶29(a)(iii)(3) asks for “any changes the entity made to the measurement approach, inputs and assumptions during the reporting period and the reasons for those changes”.Read the detail. - Step 0707
Evidence and assurance
The FCA chose not to require assurance; CP26/5said it was not proposing mandatory requirements “at this time”, and the final rule asks only for a statement.Read the detail.
Dates, with their status
The relevant dates, drawn in order
- 25 February 202601
UK SRS published
S1 and S2 are published for voluntary use. The standards themselves do not decide which companies must report. - 30 September 202602
FCA final rules
PS26/19 sets a comply-or-explain reporting obligation for the five in-scope listing categories. It replaces the consultation proposals. - 28 October 202603
Draft guidance comments close
Technical Note 803.1 is proposed guidance on the explanations and compliance statements. Keep its draft status clear. - Periods from 1 January 202704
New listed-company regime
The first eligible accounting periods begin. Optional reliefs cover Scope 3 for one year and wider S1 sustainability information for two years. - 2028 reporting season05
First annual reports
The FCA identifies 2028 as the first reporting year. An issuer’s actual publication deadline follows its annual financial report rules and year end. - Periods from 1 January 202906
Transitional reliefs end
The Scope 3 and climate-first transitional reliefs have expired. The comply-or-explain reporting obligation continues.
Continue your research
Related reporting guides, one question at a time
Frequently asked
UK SRS S2 carbon accounting, answered
What does UK SRS S2 require for greenhouse gas emissions?
Paragraph 29(a): absolute gross Scope 1, Scope 2 and Scope 3 emissions in metric tonnes of CO2e; measurement under the GHG Protocol Corporate Standard (2004) unless a jurisdictional authority or exchange requires another method; the measurement approach, inputs and assumptions and any changes; Scope 1 and 2 split between the consolidated group and other investees; location-based Scope 2 with contractual-instrument information where relevant; and the Scope 3 categories included, with financed emissions for asset managers, banks and insurers.
Does UK SRS S2 require market-based Scope 2?
No. Paragraph B30 says the entity is required to disclose Scope 2 using a location-based approach, and to provide information about contractual instruments only if they exist and that information informs users’ understanding.
Paragraph B31 says the entity might disclose market-based Scope 2.
The GHG Protocol’s dual-reporting rule is the GHG Protocol’s, not UK SRS S2’s.
Is Scope 3 mandatory under UK SRS?
Nothing in UK SRS is mandatory by itself; the standards are voluntary and the FCA applies them to listed companies on a comply-or-explain basis.
Within UK SRS S2, paragraph C4 lets an entity omit Scope 3 with no time limit.
Under the FCA’s rules, a commercial company in UKLR 6 can rely on that relief only for accounting periods beginning in 2027, stating that it relies on UKLR TP 16.4R(2) and UK SRS S2 ¶C4; from 2028 Scope 3 is disclosed or explained.
Which emission factors does UK SRS S2 require?
None in particular.
Paragraph B29 says the Standard does not specify emission factors and asks for those that best represent the activity.
For Scope 3, ¶B51 prioritises factors that relate to the jurisdiction in which the entity operates or the activity took place.
For UK activity the DESNZ conversion factors are the natural source.
Which edition of the GHG Protocol does UK SRS S2 require?
Paragraph 29(a)(ii) names “A Corporate Accounting and Reporting Standard (2004)”.
Whether that frozen reference picks up the 2013 amendment adding nitrogen trifluoride and the 2015 Scope 2 Guidance is not settled in the Standard’s text, so name the base edition and the amendments you apply.
What is the difference between UK SRS S2 ¶C3 and ¶C4?
¶C3 allows a method other than the GHG Protocol in the first annual reporting period only. ¶C4 allows Scope 3 to be omitted, with no time limit.
In IFRS S2 both reliefs sit in one paragraph, also numbered C4, and both last one year — so a bare “C4” is ambiguous.
Does UK SRS S2 require restatement of prior-year emissions?
It asks for any changes the entity made to the measurement approach, inputs and assumptions during the period, and the reasons (¶29(a)(iii)(3)). It sets no restatement threshold.
Base-year recalculation policy comes from the GHG Protocol, which leaves the significance threshold to the company.
How does UK SRS S2 sit alongside SECR?
Separately.
SECR is a Companies Act duty in the directors’ report for quoted companies and large unquoted companies and LLPs, with its own content; UK SRS S2 is a standard the FCA applies to listed companies in the annual financial report.
A listed company does both, from the same inventory, and the government has decided to keep SECR.
Do UK SRS S2 emissions need to be assured?
No. The FCA chose not to require assurance; UKLR 6.6.6R(8)(d) asks a listed company to state whether it obtained third-party assurance and, if it did, the provider, the scope and level, the standards used and where the report is.
ISSA (UK) 5000 is available for voluntary use.
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.
- Department for Business and TradeUK SRS S2 Climate-related Disclosures (25 February 2026)
¶¶29(a), 29A–29C, B29–B35, B38–B57, C3–C6.
- Department for Business and Trade (GOV.UK)UK Sustainability Reporting Standards: UK SRS S1 and UK SRS S2
Publication page for both standards.
- Department for Business and TradeConsultation response on the exposure drafts, Annex A
The renumbered transition appendices: IFRS S2 C4(a) → UK SRS S2 C3, C4(b) → C4.
- Financial Conduct AuthorityPS26/19: Aligning listed issuers’ sustainability disclosures with international standards
Comply or explain from periods beginning on or after 1 January 2027.
- Financial Conduct AuthorityPS26/19 (PDF), Appendix 1 — UKLR 6.6.6R and UKLR TP 16
TP 16.4R(2)(a) Scope 3 relief; TP 16.4R(3) preserves ¶C3; TP 16.6G(2) comparatives.
- Financial Conduct AuthorityCP26/5 — the consultation the rules finalise
Consultation landing page.
- Financial Conduct AuthorityCP26/5 (PDF)
¶¶7.5–7.6 on assurance.
- GHG ProtocolCorporate Accounting and Reporting Standard (2004)
The edition ¶29(a)(ii) names.
- GHG ProtocolCorporate Value Chain (Scope 3) Standard (2011)
The fifteen categories ¶29(a)(vi)(1) is pinned to.
- GHG ProtocolScope 3 Standard — standards page
Current location of the standard.
- GHG ProtocolScope 2 Guidance (2015)
Dual reporting where contractual instruments exist — a GHG Protocol rule, not a UK SRS one.
- GHG ProtocolScope 2 Standard — standards page
Where the guidance and its revision now sit.
- DESNZ (GOV.UK)Government conversion factors for company reporting
One set per activity year; UK SRS S2 prescribes none (¶B29).
- legislation.gov.ukThe Companies (Directors’ Report) and LLP (Energy and Carbon Report) Regulations 2018
SECR, alongside UK SRS for listed companies.
- HM GovernmentEnvironmental Reporting Guidelines (March 2019)
SECR guidance; no statutory audit requirement.
- Financial Reporting CouncilAssurance standards
ISSA (UK) 5000, issued 12 November 2025 for voluntary use.
- IAASBWithdrawal of ISAE 3410
Approved March 2025, effective from ISSA 5000’s effective date.
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