Named kind
Traded, banking, authorised insurance, insurance market or AIM company at any time in the year.
s.414CA(1)(a)–(e)Companies Act · Climate-related financial disclosures
CFD reporting requirements UK: who reports, what and when
The CFD reporting requirements UK companies face are set by section 414CB of the Companies Act 2006, inserted by SI 2022/31, with a parallel instrument for LLPs.
A company is in scope only if it has more than 500 employees and is traded, a bank, an insurer, on AIM, or has turnover of more than £500 million.
It must then make eight disclosures in its strategic report, of which four may be omitted with a reasoned explanation.
In brief
CFD reporting requirements, in four lines
The CFD reporting requirements are a Companies Act duty, not a listing rule and not a voluntary framework.
Section 414CB(A1) imposes the duty: the non-financial and sustainability information statement “must contain the climate-related financial disclosures of the company”.
Section 414CA decides which companies must include that statement, and section 414CB(2A) defines the eight disclosures.
Both apply to any financial year commencing on or after 6 April 2022, under regulation 1(2) of SI 2022/31.
The deeper reference, with a scope checker and a disclosure checklist, is the climate-related financial disclosures guide; every UK regime side by side is on the sustainability reporting requirements hub.
In one table
The CFD requirements, one line each
Each line names the provision it rests on.
Read the scope test first: nothing else applies unless it is met.
| Requirement | Who | Where or when | Provision |
|---|---|---|---|
| Include a non-financial and sustainability information statement | In-scope companies | In the strategic report | s.414CA(A1) |
| Put the climate-related financial disclosures in it | In-scope companies | Same statement | s.414CB(A1) |
| Make the eight disclosures (a) to (h) | In-scope companies | Same statement | s.414CB(2A) |
| Explain any omission of (e) to (h) | Directors, where they rely on the gate | Same statement | s.414CB(4A)–(4B) |
| Specify the framework used, if relying on one such as UK SRS S2 | Companies using the route | Same statement | s.414CB(6) |
| Approve and sign the strategic report | The board | Before filing | s.414D(1) |
| Make the disclosures in the strategic report | Traded or banking LLPs over 500 employees | Strategic report | SI 2022/46 reg 2 |
| Set out the disclosures in the energy and carbon report | Large LLPs | Energy and carbon report | SI 2022/46 reg 4 (s.416A) |
| First applies | Companies and LLPs | Financial years commencing on or after 6 April 2022 | SI 2022/31 reg 1(2); SI 2022/46 reg 1(2) |
| Publish the first review report | Secretary of State | Before 6 April 2027 | SI 2022/31 reg 5(2) |
Who is in scope
The scope test: 500 employees on every route
Section 414CA(1) names five kinds of company: traded, banking, authorised insurance, insurance market and AIM.
Subsection (1A) adds the high turnover company, defined in (2A) as one with turnover of more than £500 million or, for a parent, a group with aggregate turnover of more than £500 million net.
Subsection (1B) makes both limbs subject to subsections (3) to (7), and that is where the employee floor sits.
Under (4) the duty does not apply to a company with no more than 500 employees, or to a parent whose group has no more than 500.
So the test is conjunctive on every route: more than 500 employees and one of the named kinds or high turnover.
Under (3) a company subject to the small companies regime, or qualifying as medium-sized, is excluded whatever else is true.
Under (7) a subsidiary is excluded if it is included in its parent’s group strategic report with a group statement covering it.
A “traded company” under section 474(1) is one with any transferable securities on a UK regulated market, so listed debt alone can bring a company in.
For a financial year that is not in fact a year, the turnover figures are proportionately adjusted under (2B), while the employee floor stays at more than 500.
The size thresholds behind “small” and “medium-sized” are compared with the other statutory tests on the UK SRS thresholds page.
More than 500 employees (group, if a parent), and not small or medium-sized
High turnover company
Turnover of more than £500 million, or a group aggregate of more than £500 million net.
s.414CA(1A), (2A)LLP
Traded or banking LLP; or a large LLP with more than 500 employees and turnover over £500 million.
SI 2022/46 regs 2, 4LLPs
The LLP routes, and a different home
SI 2022/46 applies the same eight disclosures to limited liability partnerships through the LLP accounts regulations.
A traded or banking LLP with more than 500 employees, or heading a group with more than 500, makes them in its strategic report.
Any other LLP is a “large LLP” under the new section 416A only if it has more than 500 employees and an annual turnover of more than £500 million, both together.
A large LLP sets out the disclosures in its energy and carbon report, beside its SECR figures, rather than in a strategic report.
There is no AIM route for LLPs.
How the energy and carbon report itself works is on the SECR reporting requirements page.
What must be reported
The eight disclosures in section 414CB(2A)
The statute’s own words, shortened only where marked, with the omission gate beside each.
Item (a) is the governance limb; the eight are a definition, and (A1) is the duty that requires them.
| Item | What the statute requires | May be omitted with an explanation? |
|---|---|---|
| (a) | A description of the company’s governance arrangements in relation to assessing and managing climate-related risks and opportunities | No |
| (b) | A description of how the company identifies, assesses, and manages climate-related risks and opportunities | No |
| (c) | A description of how processes for identifying, assessing, and managing climate-related risks are integrated into the company’s overall risk management process | No |
| (d) | A description of the principal climate-related risks and opportunities arising in connection with the company’s operations, and the time periods by reference to which they are assessed | No |
| (e) | A description of the actual and potential impacts of the principal climate-related risks and opportunities on the company’s business model and strategy | Yes, under (4A)–(4B) |
| (f) | An analysis of the resilience of the company’s business model and strategy, taking into consideration different climate-related scenarios | Yes, under (4A)–(4B) |
| (g) | A description of the targets used to manage climate-related risks and realise climate-related opportunities, and of performance against those targets | Yes, under (4A)–(4B) |
| (h) | A description of the key performance indicators used to assess progress against those targets, and of the calculations on which they are based | Yes, under (4A)–(4B) |
The statute names no particular metric: item (h) asks for the indicators the company uses and how they are calculated, not for a prescribed list.
Each item is worked through with drafting prompts on the CFD reference page, and the scope 1, 2 and 3 rules that sit in other regimes are on the GHG reporting requirements page.
Omissions and frameworks
The reasoned explanation, and the framework route
Under section 414CB(4A), directors may omit the whole or part of items (e), (f), (g) or (h) if they reasonably believe, having regard to the nature of the business and how it is carried on, that it is not necessary for an understanding of the business.
Subsection (4B) then requires “a clear and reasoned explanation of the directors’ reasonable belief” in the statement itself.
The gate does not reach items (a) to (d): governance, risk processes, their integration and the principal risks must always be described.
Subsection (6) lets a company that publishes the required information through a national, EU-based or international reporting framework specify the framework instead of repeating the information.
The government’s UK SRS consultation response confirmed that UK SRS S2 is a national reporting framework for that purpose, so a company reporting under UK SRS S2 “do[es] not need to duplicate” its disclosures.
That confirmation names UK SRS S2, not UK SRS S1, and it does not make UK SRS compulsory for anyone.
The standard itself is explained on the UK SRS S2 page, and what it asks of listed companies on the UK SRS S2 reporting requirements page.
Where and by whom
From evidence to the filed strategic report
A company’s disclosures go in the non-financial and sustainability information statement, which is part of the strategic report.
Where the strategic report is a group report, section 414CA(2) requires the statement to be consolidated for the undertakings in the consolidation.
The statement must, where appropriate, refer to and explain amounts in the annual accounts, under section 414CB(5).
The strategic report must be approved by the board and signed on its behalf by a director or the secretary, under section 414D(1).
The disclosures are therefore published and filed on the same timetable as the annual report and accounts, not on a separate deadline.
The government’s guidance encourages linking climate disclosures with other information in the annual report, and points to the FRC’s guidance on the strategic report.
- 1
Management
Identifies the principal climate risks and opportunities, time periods, scenarios, targets and indicators.
- 2
Directors
Decide any omission of items (e) to (h) and the reasoned explanation for it.
- 3
Statement
The non-financial and sustainability information statement carries the eight items, or names the framework used.
- 4
Board approval
The strategic report is approved by the board and signed under s.414D(1).
- 5
Annual report
Published and filed with the accounts as part of the annual report.
When
The CFD reporting requirements in dates
The regulations were made on 17 January 2022 and apply to financial years starting on or after 6 April 2022, as the government’s guidance page records.
A company with a 31 March year end therefore first reported for the year beginning 1 April 2023, because its year beginning 1 April 2022 started before the commencement date.
There is no separate filing date for the disclosures: they travel with the strategic report.
The next statutory date is the review: regulation 5(2) says the first report “must be published before 6th April 2027”, and later reports at intervals of not more than five years.
Dates across every UK regime sit together on the UK sustainability regulation timeline.
- 17 Jan 2022
Regulations made
SI 2022/31 and SI 2022/46. - 6 Apr 2022
Duty applies
Financial years commencing on or after this date. - 21 Jan 2025
FRC thematic review
AIM and large private companies. - 25 Feb 2026
UK SRS S2 a s.414CB(6) framework
Confirmed in the consultation response. - 30 Nov 2026
Consultation closes
Modernising corporate reporting; no CFD proposals. - Before 6 Apr 2027
First review report
SI 2022/31 reg 5(2).
Guidance
The BEIS guidance, and what it is not
Section 414CB(10) gives the Secretary of State a power to issue guidance on the climate-related financial disclosures; it is not a power to change them.
The guidance issued under it in February 2022, Mandatory climate-related financial disclosures by publicly quoted companies, large private companies and LLPs, sets out the outcomes the government hoped each disclosure would achieve.
It describes itself as a factual explanation that is not exhaustive, and says companies and LLPs “should not rely on it for legal guidance”.
The department that issued it, BEIS, no longer exists; the current consultation on company reporting was issued by the Department for Business, Innovation, Science and Trade.
The FRC’s sustainability reporting FAQ is the regulator’s current overview of how UK SRS relates to existing reporting.
Enforcement
Who enforces CFD, and how
There is no penalty written for the CFD disclosures themselves; enforcement runs through the general law on the strategic report.
Under section 414D(2), every director who knew a strategic report did not comply, or was reckless as to whether it complied, and failed to take reasonable steps to secure compliance or prevent approval, commits an offence.
Under section 414D(3) the offence carries a fine on conviction on indictment, or a fine not exceeding the statutory maximum on summary conviction.
Section 456 allows a court to order the revision of a defective strategic report.
Section 463 limits a director’s liability for untrue or misleading statements in the report to the company, and only where the director knew or was reckless, or knew an omission to be dishonest concealment.
The Financial Reporting Council reviews corporate reports, and its thematic review of 21 January 2025 found “inconsistent quality among the companies selected”.
A thematic review is a finding, not a sanction, and the FRC’s other climate reviews are listed in its thematic review index.
What is not required
Common myths about CFD
The test is not “more than 500 employees or £500 million turnover”: the employee floor applies to every route, including banks and insurers.
CFD does not require the five non-financial matters of section 414CB(1), such as employees and human rights, from AIM or high turnover companies; those reach only traded, banking and insurance companies.
CFD does not require a statement of consistency with the TCFD recommendations; that was the FCA’s listing rule, now replaced by UK SRS from 2027.
CFD contains no assurance requirement and no prescribed metric list.
CFD does not require a transition plan; the requirements around plans are on the transition plan reporting requirements page.
The government’s announcement of 29 October 2021 estimated that “over 1,300 of the largest UK-registered companies and financial institutions” would have to disclose, as the BEIS and HM Treasury news story put it; it is an estimate from that date, not a count of reporters.
Wordings still in circulation that are wrong
“Banks and insurers are in scope regardless of size” — the 500-employee floor applies to them.
“More than 500 employees or £500m turnover” — both conditions are needed on the turnover route.
“UK SRS is now required by the Companies Act” — it is voluntary; CFD may be met through UK SRS S2.
“Large LLPs report in the strategic report” — they use the energy and carbon report.
How it fits
CFD beside SECR, TCFD and the FCA’s UK SRS rules
| Regime | Source | Who | Relationship to CFD |
|---|---|---|---|
| SECR requirements | SI 2008/410 Sch 7 Part 7A | Quoted companies and large unquoted companies and LLPs | Energy and carbon figures in the directors’ report; a separate duty |
| UK SRS for listed companies | FCA PS26/19, UKLR 6.6.6R(7A) and equivalents | UKLR 6, 14, 15, 16 and 22 | Comply or explain from periods beginning 1 January 2027; separate from CFD |
| TCFD listing rule | UKLR 6.6.6R(8) before PS26/19 | Listed companies | Replaced by UK SRS for periods from 1 January 2027 |
| UK SRS S2 | DBT, 25 February 2026 | Voluntary for any entity | May discharge CFD under s.414CB(6) |
| Non-financial matters | CA 2006 s.414CB(1)–(2) | Traded, banking and insurance companies | Same statement, narrower population |
A listed company over the CFD thresholds answers to both rulebooks: the Companies Act for CFD and the FCA’s PS26/19 for UK SRS on a comply-or-explain basis from accounting periods beginning on or after 1 January 2027.
The FCA writes listing rules and cannot amend the Companies Act, so PS26/19 changed nothing in sections 414CA and 414CB.
The earlier listing-rule regime was reviewed by the FCA in its July 2022 multi-firm review; the replacement is set out on the UK SRS and the FCA page.
What is changing
The review and the consultation, labelled as proposals
Nothing in force today changes the CFD reporting requirements; two processes may.
The first is the statutory review under regulation 5, whose first report is due before 6 April 2027.
The second is Modernising corporate reporting, published on 7 September 2026 and open until 30 November 2026.
At ¶147 of the consultation document the government says it “does not include proposals regarding the future of the CFD requirements” and will use the post-implementation review, which ¶148 says is due by spring 2027.
At ¶¶154–155 it says the government “will consider how UK SRS should be reflected in the Companies Act 2006”, with no mechanism and no date.
The same document proposes, as a proposal only, removing the directors’ report, which would move SECR’s location but not CFD’s, since CFD already sits in the strategic report.
At ¶¶160–161 it notes that the section 463 safe harbour covers UK SRS disclosures only where they sit in the strategic report.
The proposals and how to respond are on the Modernising corporate reporting page.
Status on 11 October 2026
In force: CA 2006 ss.414CA and 414CB, and SI 2022/46 for LLPs.
Proposed: nothing on CFD; the consultation defers to the review.
Due: the first review report, before 6 April 2027.
Check yourself
Six statements about the CFD rules
Each answer names the provision it turns on.
The statute is short enough to read whole: section 414CA for scope and section 414CB for content.
The listed-company side is on the TCFD listing rule page, and the wider ESG duties on the ESG reporting requirements page.
CFD reporting requirements: true or false?
A bank with 400 employees must make climate-related financial disclosures.
A private company with 600 employees and £520 million turnover is in scope.
The governance disclosure in item (a) can be omitted with a reasoned explanation.
A large LLP that is not traded puts its disclosures in the strategic report.
A company reporting under UK SRS S2 can rely on it for its CFD duty.
The Modernising corporate reporting consultation proposes to abolish CFD.
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Frequently asked
CFD reporting requirements, answered
What are the CFD reporting requirements in the UK?
They are the Companies Act duty for in-scope companies to put climate-related financial disclosures in the non-financial and sustainability information statement of the strategic report.
The duty is section 414CB(A1) of the Companies Act 2006, the content is the eight items in section 414CB(2A), and the scope is section 414CA.
LLPs have a parallel instrument, SI 2022/46.
Both apply to financial years beginning on or after 6 April 2022.
Who must make climate-related financial disclosures under the Companies Act?
A company with more than 500 employees (counted for the group if it is a parent) that is a traded company, a banking company, an authorised insurance company, a company carrying on insurance market activity, an AIM company, or a high turnover company with turnover of more than £500 million.
Companies in the small companies regime or qualifying as medium-sized are excluded, and so is a subsidiary covered by its parent’s group statement.
Is the CFD test 500 employees or £500 million turnover?
Neither on its own.
The 500-employee floor applies to every route, so a company needs more than 500 employees and must also fall into one of the named kinds or have turnover of more than £500 million.
A bank or insurer with 500 employees or fewer is not in scope.
Are AIM companies in scope of CFD?
Yes, if they have more than 500 employees.
Section 414CA(1)(e) names a company any of whose securities are admitted to trading on AIM.
AIM companies make the climate disclosures only; the wider non-financial matters in section 414CB(1) reach traded, banking and insurance companies, not AIM or high turnover companies.
What are the eight CFD disclosures?
Section 414CB(2A): (a) governance arrangements for climate-related risks and opportunities; (b) how the company identifies, assesses and manages them; (c) how that is integrated into overall risk management; (d) the principal climate-related risks and opportunities and the time periods used; (e) their actual and potential impacts on the business model and strategy; (f) an analysis of resilience under different climate-related scenarios; (g) the targets used and performance against them; (h) the key performance indicators and the calculations behind them.
Can a company leave out any of the CFD disclosures?
Only items (e) to (h), and only where the directors reasonably believe that the whole or part of a disclosure is not necessary for an understanding of the company’s business.
The statement must then give a clear and reasoned explanation of that belief.
Items (a) to (d) cannot be omitted under that gate.
Where do CFD disclosures go?
For a company, in the non-financial and sustainability information statement, which is part of the strategic report.
For a traded or banking LLP, in the strategic report.
For a large LLP that is neither traded nor banking, in the energy and carbon report.
Do LLPs have CFD reporting requirements?
Yes, under SI 2022/46.
A traded or banking LLP with more than 500 employees reports in its strategic report.
Any other LLP reports in its energy and carbon report if it has more than 500 employees and turnover of more than £500 million, both conditions together.
Is CFD the same as TCFD?
No. CFD is UK company law; the TCFD was a market-led taskforce whose recommendations the eight disclosures were modelled on.
The statute does not require a statement of consistency with the TCFD, and it uses its own words rather than the TCFD’s eleven recommended disclosures.
Does CFD require scenario analysis?
Item (f) requires an analysis of the resilience of the business model and strategy taking into consideration different climate-related scenarios. It may be omitted only under the reasoned-explanation gate.
The statute does not prescribe a method or a particular scenario.
Do CFD disclosures need to be assured?
Sections 414CA and 414CB contain no assurance requirement, and the government’s Modernising corporate reporting consultation says it has no plans at this stage to require assurance over future UK SRS reporting or other strategic reporting topics.
Who enforces the CFD rules?
There is no CFD-specific penalty.
Directors approve the strategic report under section 414D, and a director who knowingly or recklessly approves a non-compliant report commits an offence.
The Financial Reporting Council reviews corporate reports, and section 456 lets a court order a defective strategic report to be revised.
Can UK SRS S2 be used to meet the CFD requirements?
Yes.
The government confirmed in its UK SRS consultation response that UK SRS S2 is a national reporting framework for the purposes of section 414CB(6), so a company reporting under UK SRS S2 need not duplicate its disclosures, provided the statement specifies the framework used.
How does CFD relate to the FCA’s UK SRS listing rules?
They are separate duties.
The FCA’s PS26/19 puts listed companies in UKLR 6, 14, 15, 16 and 22 on a comply-or-explain basis against UK SRS for accounting periods beginning on or after 1 January 2027.
A listed company over the CFD thresholds still has the Companies Act duty as well, though it may meet it through UK SRS S2.
Are the CFD requirements changing?
Not yet.
SI 2022/31 requires the first review report before 6 April 2027.
The Modernising corporate reporting consultation, open until 30 November 2026, says it does not include proposals on the future of the CFD requirements and that the post-implementation review is due to be completed by spring 2027.
How many companies are in scope of CFD?
No official count of reporters has been published.
When the rules were announced on 29 October 2021, the government said that over 1,300 of the largest UK-registered companies and financial institutions would have to disclose; that is an announcement estimate, not a count.
When did the CFD reporting requirements start?
SI 2022/31 came into force on 6 April 2022 and applies to any financial year commencing on or after that date.
The first reports therefore covered financial years beginning from 6 April 2022.
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.
Checked against 22 sources fromlegislation.gov.ukGOV.UK (BEIS)GOV.UK (BEIS and HM Treasury)Financial Reporting CouncilDepartment for Business and TradeDepartment for Business, Innovation, Science and Trade
- legislation.gov.ukCompanies Act 2006, section 414CB — contents of the non-financial and sustainability information statement
The duty at (A1), the eight disclosures at (2A), the omission gate at (4A)–(4B), the framework route at (6) and the guidance power at (10). Up to date to 11 October 2026.
- legislation.gov.ukCompanies Act 2006, section 414CA — which companies must include the statement
The five named kinds, the high turnover company, the small and medium-sized exclusion and the 500-employee floor.
- legislation.gov.ukSI 2022/31 — the Companies (Strategic Report) (Climate-related Financial Disclosure) Regulations 2022
The amending instrument: commencement for financial years from 6 April 2022.
- legislation.gov.ukSI 2022/31, regulation 5 — review
The first review report must be published before 6 April 2027.
- legislation.gov.ukSI 2022/46 — the Limited Liability Partnerships (Climate-related Financial Disclosure) Regulations 2022
The traded and banking LLP route and the large LLP route.
- legislation.gov.ukSI 2022/46, regulation 4 — the new section 416A for large LLPs
More than 500 employees and turnover of more than £500 million, in the energy and carbon report.
- legislation.gov.ukCompanies Act 2006, section 414D — approval and signing of the strategic report
The offence for a director who knowingly or recklessly approves a non-compliant report.
- legislation.gov.ukCompanies Act 2006, section 456 — revision of defective reports
Court-ordered revision, which reaches a strategic report.
- legislation.gov.ukCompanies Act 2006, section 463 — liability for false or misleading statements
Liability to the company only, for knowing or reckless statements.
- legislation.gov.ukCompanies Act 2006, section 474 — definitions, including “traded company”
Any transferable securities on a UK regulated market, bonds included.
- GOV.UK (BEIS)Climate-related financial disclosures for companies and LLPs
The guidance page: regulations made 17 January 2022, applying to financial years starting on or after 6 April 2022.
- GOV.UK (BEIS)Mandatory climate-related financial disclosures by publicly quoted companies, large private companies and LLPs (PDF)
Non-binding guidance issued under the power now at s.414CB(10).
- GOV.UK (BEIS and HM Treasury)UK to enshrine mandatory climate disclosures for largest companies in law, 29 October 2021
The government’s own scale estimate at announcement.
- Financial Reporting CouncilFRC reviews CFD by AIM and large private companies, 21 January 2025
The first thematic review of the regime.
- Financial Reporting CouncilCorporate reporting thematic reviews
The index of the FRC’s climate and other thematic reviews.
- Financial Reporting CouncilSustainability Reporting Developments: Frequently Asked Questions
UK SRS is voluntary; last updated 26 February 2026.
- Department for Business and TradeUK SRS consultation response (PDF), Chapter 3
Confirms UK SRS S2 as a national reporting framework for s.414CB(6).
- Department for Business and TradeUK Sustainability Reporting Standards S1 and S2
Published 25 February 2026 for voluntary use.
- Department for Business, Innovation, Science and TradeModernising corporate reporting — consultation
Published 7 September 2026; closes 30 November 2026.
- Department for Business, Innovation, Science and TradeModernising corporate reporting — consultation document (PDF), ¶¶147–158
No proposals on CFD; the post-implementation review; UK SRS and the Companies Act.
- Financial Conduct AuthorityPS26/19: aligning listed issuers’ sustainability disclosures with international standards
The listing-rule duty that sits beside CFD from 1 January 2027.
- Financial Conduct AuthorityReview of TCFD-aligned disclosures by premium listed commercial companies, July 2022
The FCA’s review of the listing-rule regime that runs alongside CFD.