CSRD for UK Companies
CSRD UK: What It Means for UK Businesses (2026)
CSRD is an EU directive and does not apply directly to UK-domiciled companies.
But UK subsidiaries of EU parents, UK companies with significant EU revenue and UK issuers on EU regulated markets are still pulled into scope.
Here is how the rules work after the Omnibus I simplification adopted in February 2026.
Does CSRD Apply in the UK?
1 The Corporate Sustainability Reporting Directive (CSRD) is an EU directive with no direct effect in the United Kingdom post-Brexit. A wholly UK-domiciled company with no EU subsidiaries, branches, listed securities or material EU turnover is not within CSRD scope.
UK-domiciled companies will instead be regulated by the developing UK sustainability reporting framework, with UK SRS S1 and UK SRS S2 expected to apply for accounting periods beginning on or after 1 January 2027, subject to UK legislation following the 2025 consultation.
That said, CSRD reaches further than the EU border. UK groups with EU operations, UK subsidiaries of EU parents and UK issuers on EU regulated markets are all potentially caught. The relevant rules sit in Directive 2022/2464 as amended by the Omnibus I package finalised in early 2026.
How UK Companies Get Caught by CSRD
2 CSRD (Directive 2022/2464) extends sustainability reporting obligations beyond EU-incorporated entities through three principal mechanisms. Omnibus I narrowed the population caught by each route but did not eliminate any of them.
A UK company should map each of the four scenarios below against its group structure. CSRD scoping is a group perimeter exercise rather than an entity-level test, and a small change to consolidation, listing or EU revenue can shift the conclusion.
1. UK Subsidiary of an EU Parent in CSRD Scope
A UK subsidiary consolidated into an EU parent group meeting the revised CSRD thresholds (1,000+ employees and €450m+ net turnover) is included in the parent's consolidated sustainability statement. Group-level reporting covers the UK entity even though no UK statute requires it.
2. UK Parent with Significant EU Activity (Article 40a)
A UK-headquartered group generating more than €450m of EU net turnover at group level, with either at least one large EU subsidiary or an EU branch generating more than €200m turnover, must file an EU-level sustainability report through its EU subsidiary or branch from FY 2028 (reporting in 2029).
3. UK Company with Securities on an EU Regulated Market
A UK issuer with securities admitted to trading on an EU regulated market (such as Euronext Paris, Amsterdam or Frankfurt) falls within scope as an EU-listed undertaking, regardless of where the company is incorporated, where it meets the revised size thresholds.
4. Value Chain Information Requests
UK suppliers and customers of in-scope EU groups will receive sustainability data requests. Omnibus I introduced a value chain cap limiting requests to non-CSRD entities to the data points covered by the Voluntary SME standard (VSME), but UK SME suppliers should still expect ESG data requests from EU counterparties.
Revised Non-EU Group Threshold
EU net turnover at group level required to trigger Article 40a non-EU CSRD reporting after Omnibus I, raised from €150m.
Plus an EU subsidiary that is a large undertaking, or an EU branch generating €50m of net turnover.
CSRD Timeline and Omnibus I Changes
3 The original CSRD timetable scoped in roughly 50,000 undertakings globally across four waves. Following sustained concerns from European business and member states, the European Commission proposed a simplification package on 26 February 2025.
The package was implemented in two stages. The Stop-the-Clock Directive (Directive 2025/794) was published in the Official Journal on 16 April 2025 and postponed Wave 2 and Wave 3 mandatory reporting by two years. The substantive "content" directive — Directive (EU) 2026/47 — was provisionally agreed on 9 December 2025, adopted by the European Parliament on 16 December 2025, formally adopted by the Council on 24 February 2026 and published in the Official Journal on 26 February 2026.
Member States must transpose the revised CSRD into national law by 19 March 2027, with mandatory reporting applying for financial years starting on or after 1 January 2027.
Revised reporting waves
Wave 1 — Large public-interest entities with 500+ employees already reporting for FY 2024. The 11 July 2025 quick-fix delegated act extended phase-in transition reliefs through FY 2026.
Wave 2 — Other large EU companies and groups meeting the revised 1,000 employee and €450m turnover thresholds. First report now for FY 2027, filed in 2028.
Wave 3 — Listed SMEs. Removed from mandatory scope under Omnibus I; will instead be encouraged to apply the Voluntary SME (VSME) standard.
Wave 4 — Non-EU parents (including UK-headquartered groups) meeting the revised Article 40a thresholds (€450m EU turnover and qualifying EU subsidiary or branch). First report for FY 2028, filed in 2029.
What CSRD Requires of UK Companies in Scope
4 UK companies caught by CSRD must report against the European Sustainability Reporting Standards (ESRS) developed by EFRAG and adopted by the European Commission as delegated acts. The simplified ESRS reduce mandatory data points from approximately 1,073 to around 320, with the delegated act expected by mid-2026.
Reporting is governed by double materiality. A topic is material if either (a) the company has actual or potential positive or negative impacts on people or the environment (impact materiality), or (b) the topic creates financial risks or opportunities for the company (financial materiality). This is broader than the single-materiality lens applied by UK SRS S1 and ISSB standards.
Environment (E1 to E5)
E1 Climate Change (mitigation, adaptation, energy and Scope 1 to 3 emissions), E2 Pollution, E3 Water and Marine Resources, E4 Biodiversity and Ecosystems, E5 Resource Use and Circular Economy. E1 is the most frequently material standard across sectors.
Social (S1 to S4)
S1 Own Workforce, S2 Workers in the Value Chain, S3 Affected Communities, S4 Consumers and End Users. Disclosures cover working conditions, equal treatment, human rights and health and safety across direct and value chain workforces.
Governance (G1)
G1 Business Conduct covers corporate culture, whistleblower protection, animal welfare where relevant, supplier relationships including payment practices, anti-corruption and anti-bribery, lobbying and political engagement.
ESRS 1 and ESRS 2 (cross-cutting)
ESRS 1 sets the General Requirements including the double materiality framework. ESRS 2 mandates General Disclosures covering governance, strategy, impact, risk and opportunity management. Both remain mandatory for all in-scope undertakings under the simplified standards.
Value chain, Scope 3 and assurance
ESRS E1 requires Scope 1, 2 and material Scope 3 emissions disclosure consistent with the GHG Protocol. Value chain coverage is required to the extent necessary for a fair understanding of material impacts, risks and opportunities, with information requests to non-CSRD suppliers capped at the VSME data set. See UK SRS Scope 3 reporting for how the upstream and downstream rules compare.
Assurance begins as limited assurance from the first reporting year and steps up to reasonable assurance once the European Commission adopts the relevant standard. Sustainability statements must be digitally tagged in XBRL using the ESRS taxonomy, and published as part of the management report. Climate transition plans remain a required disclosure, although Omnibus I removed the obligation to put the plan into effect.
CSRD vs UK SRS: How They Sit Together
5 The UK Government consulted on UK SRS S1 and S2 in 2025 and confirmed intent to adopt ISSB-aligned standards as the UK's primary sustainability disclosure framework. UK SRS is built on the same global sustainability standards baseline (ISSB) used by Japan, Australia, Singapore and Canada.
CSRD and UK SRS differ on three substantive points. First, materiality: CSRD applies double materiality, while UK SRS applies single (financial) materiality drawn from ISSB. Second, scope: CSRD covers environment, social and governance topics; UK SRS S1 and S2 cover general sustainability-related financial information and climate respectively, with social and governance treated through other UK channels. Third, standard-setter: ESRS is set by EFRAG and the European Commission, while UK SRS is endorsed by the UK Government through the FRC and DBT.
Practical Steps for UK Companies
UK companies facing potential CSRD scope should sequence their preparation alongside UK SRS readiness and existing ESG reporting obligations such as SECR and TCFD-aligned disclosure. The four steps below are the practical starting point.
1. Map Your Group Perimeter
Identify every EU subsidiary, EU branch and EU-listed entity. Assess whether any sits inside an EU consolidation that meets the 1,000 employee and €450m turnover thresholds, or whether the UK parent itself triggers Article 40a non-EU group reporting.
2. Run an Early Double Materiality Assessment
Even if final CSRD scope is uncertain, a double materiality assessment is required under both CSRD ESRS and the UK SRS framework. Completing it once, properly, supports both regimes and answers EU customer questionnaires.
3. Build Auditable Data Systems
Scope 1, 2 and material Scope 3 emissions, workforce metrics and value chain data must be evidenced to a level supporting limited (then reasonable) assurance. Establish controls, retention policies and tagging conventions now rather than reverse-engineering them at year-end.
4. Track UK SRS Implementation in Parallel
The UK Government consultation on UK SRS S1 and S2 closed in 2025. First mandatory UK reporting is expected from accounting periods beginning on or after 1 January 2027, subject to legislation. Aligning CSRD and UK SRS workstreams avoids duplicate data architecture.
Mandatory ESRS Data Points (Simplified)
Approximate number of mandatory data points under the simplified ESRS adopted alongside Omnibus I, down from 1,073 in the original 2023 ESRS delegated act.
The delegated act for the simplified standards is expected by mid-2026.
Does CSRD apply directly to UK companies?
No.
CSRD is an EU directive and does not have direct effect in the United Kingdom following Brexit.
A purely UK company with no EU subsidiaries, branches, listed securities or material EU turnover is not within CSRD scope.
UK-domiciled companies will instead be regulated by UK SRS once the Government legislates following its 2025 consultation.
Is my UK subsidiary of an EU parent caught by CSRD?
Yes, indirectly.
If the EU parent meets the revised Omnibus I thresholds (1,000+ employees and €450m+ net turnover when consolidated), the UK subsidiary is included in the parent's consolidated sustainability statement.
The UK entity itself does not file separately, but it must supply data, undergo data verification and contribute to the group double materiality assessment.
What are the CSRD reporting thresholds after Omnibus I?
EU companies and groups are in scope where they exceed both 1,000 employees and either €25m balance sheet total or €50m net turnover, with revised analysis post-Omnibus I focused on the 1,000 employee and €450m turnover combined threshold.
Non-EU parents need €450m of EU turnover plus an EU subsidiary that is a large undertaking or an EU branch generating €50m.
These thresholds replace the original limits and were finalised in Directive (EU) 2026/47.
When does CSRD reporting start for UK companies caught via EU groups?
Wave 1 companies (those already reporting in 2025 for FY 2024) continue under the existing framework with quick-fix transition relief through FY 2027.
Wave 2 companies, including most UK subsidiaries of large EU groups, now report for FY 2027 (filed in 2028) following the Stop-the-Clock Directive.
Non-EU groups (Wave 4, capturing UK-headquartered groups using Article 40a) report for FY 2028, filed in 2029.
How does CSRD interact with UK SRS for UK companies?
CSRD and UK SRS are separate regimes with overlapping disclosures.
UK SRS is based on ISSB S1 and S2 and focuses on sustainability-related financial risks and opportunities (single materiality).
CSRD applies the broader double materiality lens through ESRS.
A UK company caught by both will need data covering both perspectives, but a single set of controls and emissions inventory can usually serve both filings.
Do UK suppliers to EU companies need to comply with CSRD?
Not directly, but EU customers in scope will request sustainability data from UK suppliers as part of their value chain disclosures.
Omnibus I introduced a value chain information cap restricting these requests to the data points covered by the Voluntary SME (VSME) standard for non-CSRD entities.
UK SMEs should expect ESG questionnaires from EU buyers but are not required to produce a full ESRS-aligned report.
Related guides & references
CSRD vs UK SRS: Side-by-Side Analysis
Detailed comparison of scope, materiality, ESRS versus ISSB-aligned UK standards
UK SRS S1: General Sustainability Disclosures
The UK adoption of IFRS S1 covering general sustainability-related financial information
UK SRS S2: Climate-Related Disclosures
The UK adoption of IFRS S2 covering climate risks, opportunities and Scope 1 to 3 emissions
Double Materiality Explained
Impact materiality and financial materiality under CSRD ESRS for UK companies in scope
UK SRS Implementation Timeline
When UK SRS becomes mandatory and how it sequences with CSRD waves