ESG reporting · the process
How is ESG reporting done?
A UK company finds the duties its figures trigger, fixes the reporting boundary, collects energy, emissions and people data, drafts each disclosure where its law puts it, and has the board approve and a director sign before it is published.
It is seven steps, and the first decides how much of the rest there is.
Seven steps
What are the steps in ESG reporting?
Duties, boundary, materiality, data, drafting, approval, publication.
| Step | What happens | Where the rule is |
|---|---|---|
| 1. Find the duties | Run each regime’s own test on the year’s figures | Which companies need ESG reporting |
| 2. Fix entity, period and boundary | Same entity and period as the accounts; operational or financial control | GHG Protocol |
| 3. Decide what is material | Financial materiality (UK SRS) or impact materiality (GRI) | UK SRS S1 |
| 4. Collect and calculate | kWh, emissions with the year’s conversion factors, an intensity ratio | Environmental Reporting Guidelines |
| 5. Draft where the law says | Directors’ report, strategic report, website, government service | Sch 7 |
| 6. Approve and sign | Board approval; a director signs | s.414D |
| 7. Publish, file, assure if chosen | Companies House, website, the GPG service; assurance optional | ISSA 5000 |
One year
What does one company’s reporting year look like?
A private distributor with 480 staff runs the seven steps between January and its filing deadline.
It is an illustration, not a real organisation, with a December year end.
It owes four duties and writes four different documents, none of them called an ESG report.
If it later chooses to publish a standalone ESG report for customers, it reuses the same figures, so the two never disagree.
Which documents a company of each size writes is on the ESG reporting template.
- 1
- 2
February: the boundary
It reports on the same group and period as its accounts, and records which sites and vehicles are in.
- 3
March: the data
Meter readings, fuel cards and invoices give kWh; the 2026 factors give tonnes CO2e.
- 4
April: the drafts
SECR into the directors’ report, the s.172(1) statement into the strategic report, the slavery statement for the website.
- 5
- 6
Then: publication
The accounts go to Companies House; gender pay gap figures to the government service within 12 months of 5 April (SI 2017/172).
The data
How is the carbon data calculated?
Activity data in kWh or litres, multiplied by the year’s government conversion factor, under the GHG Protocol’s scopes.
SECR asks for UK energy use and the emissions from it, an intensity ratio, the prior year, the methodology and the efficiency measures taken (SI 2008/410 Sch 7).
The government’s Environmental Reporting Guidelines explain the method, and its conversion factors turn kWh and litres into tonnes.
A company that used 40,000 kWh or less need not give the figures, but must say so.
The method in detail is on carbon accounting and GHG conversion factors.
A company with several duties often runs this step, and the evidence trail, in ESG reporting software; what to test before buying is in that guide.
Emissions data
Scope 2
Emissions data
Scope 3
Materiality
How does a company decide what to report?
Statutory disclosures are fixed by law; for everything else, materiality decides.
SECR and the climate disclosures list what must be said, so there is little to decide.
Under UK SRS S1, information is material if it could reasonably be expected to influence investors’ decisions, judged by its effect on cash flows, access to finance or cost of capital.
Under GRI, the test is the company’s impact on the economy, environment and people.
The EU’s ESRS ask both questions together, which is double materiality.
Your duty
How is each ESG report prepared?
Choose the requirement and see its steps, from scope to sign-off.
The reporting output
Annual financial report: UK SRS disclosures, explanations and applicable FCA statements.
- Step 101
Scope and period
Confirm the listing category, reporting entity, period and any transitional reliefs. - Step 202
Governance
Describe oversight, responsibilities, skills and management’s role. - Step 303
Strategy
Connect risks and opportunities to the business model, plans and financial effects. - Step 404
Risk management
Explain identification, assessment, prioritisation, monitoring and integration. - Step 505
Metrics and targets
Build the required metrics, target information and calculation evidence. - Step 606
Gaps and statements
Record required explanations, relief reliance, locations, transition-plan and assurance statements as applicable.
The reporting output
Directors’ report or LLP energy and carbon report, under the applicable instrument.
- Step 101
Scope and boundary
Apply the quoted, unquoted or LLP rules and any relevant group provisions. - Step 202
Energy records
Collect the consumption evidence for the applicable reporting boundary. - Step 303
- Step 404
Intensity ratio
Use a suitable ratio and retain the denominator and calculation. - Step 505
Efficiency actions
Describe the required energy-efficiency measures taken during the year. - Step 606
Disclosures and review
Check required comparisons, methodology and any conditional omission before publication.
The reporting output
The non-financial and sustainability information statement, subject to the applicable scope and reliefs.
- Step 101
Governance
Describe arrangements for climate-related risk and opportunity oversight. - Step 202
Identification and management
Explain the processes used to identify, assess and manage risks and opportunities. - Step 303
Integration
Show how climate processes connect to overall risk management. - Step 404
Risks and time horizons
Describe principal risks and opportunities and their assessment periods. - Step 505
Business impacts
Explain actual and potential effects on the business model and strategy. - Step 606
Resilience
Analyse resilience using different climate-related scenarios. - Step 707
Targets and performance
Describe the targets and performance against them. - Step 808
Indicators and calculations
Explain progress indicators and the calculations on which they are based.
The reporting output
Applicable assessment records and scheme notification, followed by action-plan and progress-update obligations.
- Step 101
Qualification
Assess the undertaking and UK group against the ESOS qualification test. - Step 202
Energy boundary
Identify total and significant energy consumption using the guidance. - Step 303
Assessment route
Complete the audit or applicable ISO 50001 route and relevant assessor requirements. - Step 404
Savings achieved
Record required implemented-measure savings and their categories. - Step 505
Action-plan review
Explain proposed measures that were not implemented. - Step 606
Notification and follow-through
Complete the notification and plan subsequent action-plan and progress-update work.
Preparation order is suggested.
The legal requirement is in the cited instrument; scope and any exceptions need separate assessment.
For the FCA statements, read PS26/19 Appendix 1.
Sign-off
Who approves and publishes ESG reporting?
The board approves, a director signs, and each disclosure goes to its own place.
ESG reporting is done duty by duty, and the scope test at the start decides how much work follows.
- Step 1
The scope test decides which documents exist at all
Each regime has its own test. - 0.14396 kgCO2e/kWh
The 2026 factor turns consumed electricity into emissions
Use the factor set for the activity year. - Sections 414D and 419
The board approves and a director signs
Knowingly approving a non-compliant report is an offence. - No statute
Assurance over ESG figures is optional in the UK
Listed companies say whether they obtained it.
Frequently asked
How ESG reporting is done, answered
How is ESG reporting done?
In seven steps: find which duties apply on the year’s figures; fix the reporting entity, period and boundary; decide what is material; collect the data (energy in kWh, emissions using the GHG Protocol and the government’s conversion factors, workforce and governance facts); draft each disclosure where its law puts it; have the board approve and a director sign; then publish or file it, with assurance if the company chooses to obtain it.
How do you prepare an ESG report?
Start from the duties rather than the document.
A UK company rarely writes one “ESG report”: it writes SECR into the directors’ report, climate disclosures and the section 172(1) statement into the strategic report, a modern slavery statement for the website and gender pay gap figures for the government service.
A standalone report, if the company wants one, is assembled from those same figures.
How long does ESG reporting take?
No instrument sets a preparation period.
The deadlines that matter are the filing deadline for the annual report, the 5 April snapshot and 12-month window for gender pay gap reporting, and for ESOS Phase 4 the 5 December 2027 compliance date.
Most companies start data collection at the year end, so the emissions are ready for the draft annual report.
Who signs off ESG reporting?
The board.
The strategic report must be approved by the board and signed by a director or the secretary (Companies Act section 414D), and the directors’ report likewise (section 419).
The modern slavery statement must be approved by the board and signed by a director.
Does ESG reporting have to be assured?
No UK statute requires assurance over ESG figures.
Listed companies reporting under the FCA’s UK SRS rules state whether they obtained assurance and, if they did, its scope, level and standard.
Where assurance is obtained, ISSA 5000 is the international standard for it.
What data do you need for ESG reporting?
For SECR: UK energy use in kWh from gas, electricity and transport fuel, the emissions calculated from it, an intensity ratio, prior-year figures and the efficiency measures taken.
For climate disclosure: governance, risks and opportunities, scenario analysis, targets and KPIs.
For the social duties: turnover and supply-chain steps (modern slavery) and hourly pay and bonus data (gender pay gap).
What conversion factors are used for UK carbon reporting?
The UK government publishes greenhouse gas conversion factors each year for company reporting.
The 2026 factor for consumed UK electricity is 0.14396 kgCO2e per kWh.
Companies apply the factor set for the year of the activity and state the methodology.
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.
- legislation.gov.ukSI 2008/410, Schedule 7 (SECR)
What the directors’ report must contain on energy and carbon.
- legislation.gov.ukSI 2008/410, Schedule 7 paragraph 20B
The scope test.
- GOV.UKEnvironmental Reporting Guidelines
The government’s guidance on SECR methodology.
- GOV.UKGreenhouse gas reporting: conversion factors 2026
The factors that turn activity data into emissions.
- GHG ProtocolCorporate Accounting and Reporting Standard
Scopes 1, 2 and 3 and organisational boundaries.
- Department for Business and TradeUK Sustainability Reporting Standards
S1 and S2.
- Department for Business and TradeUK SRS S1 (PDF)
Financial materiality: what could affect cash flows, finance or cost of capital.
- GRIGRI 1: Foundation 2021
Impact materiality and the reporting principles.
- legislation.gov.ukCompanies Act 2006, section 414CA
Who makes climate disclosures.
- legislation.gov.ukCompanies Act 2006, section 414CB
The eight climate disclosures.
- legislation.gov.ukCompanies Act 2006, section 414CZA
The section 172(1) statement.
- legislation.gov.ukCompanies Act 2006, section 414D
Board approval and signature of the strategic report.
- legislation.gov.ukCompanies Act 2006, section 419
Board approval and signature of the directors’ report.
- IAASBISSA 5000
The international standard for sustainability assurance.
- Financial Conduct AuthorityPS26/19
Listed companies state whether they obtained assurance.
- legislation.gov.ukModern Slavery Act 2015, section 54
Approval and signature of the statement.
- legislation.gov.ukSI 2017/172
Gender pay gap figures and where they go.
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