Government consultation · not law
Modernising Corporate Reporting: the consultation, read at source
The government’s Modernising Corporate Reporting consultation was published on 7 September 2026 and closes on 30 November 2026.
It proposes to remove the directors’ report, replace most strategic report requirements with a baseline set, and asks whether to create a “very large” company category.
Nothing in it applies to anyone yet, and every reporting duty described elsewhere on this site is unchanged.
Read this first
A consultation, not a change in law
The consultation is a 70-page document with four annexes, published by the Department for Business, Innovation, Science and Trade.
The department took that name in July 2026; its organisation page and the former Department for Business and Trade page are both live.
It builds on the government’s written statement of 21 October 2025, which set out the programme and said a broad consultation would follow in 2026.
That statement calls the programme “Modernisation of Corporate Reporting”; the government’s UK SRS documents call it “Modernising Corporate Reporting (MCR)”, and both are government usage.
¶7 says the measures already announced would save business an estimated £230 million a year, and that statutory instruments “will be laid before Parliament in due course”.
Reports elsewhere that the UK is scrapping sustainability reporting do not match the document.
The government “is proposing to remove or retain the below requirements from the directors’ report, subject to the legislative process”, and “these intended amendments are still in an early stage of drafting”.
Source: Annex A
What it proposes
The proposals, paragraph by paragraph
| Subject | What the consultation says | Where |
|---|---|---|
| Directors’ report | Remove the requirement to produce one; some provisions removed, others relocated in the annual report | ¶7; Annex A |
| Strategic report | “Remove most existing strategic reporting requirements and replace them with a core set of baseline narrative disclosures”: business model, performance, resources and relationships, strategy, principal risk exposures | ¶128 |
| A “very large” company category | A question whether to create one for certain non-financial reporting; no figures; “the government has an open mind” | ¶¶57–58 |
| SECR | Its location moves with the directors’ report; no new location prescribed | ¶149 |
| SECR and ESOS reform | A separate DESNZ consultation promised “later in 2026” | ¶150 |
| Climate-related financial disclosures (s.414CB) | Out of scope; a post-implementation review is due by spring 2027 | ¶¶147–148 |
| UK SRS | The government “will consider” how it should be reflected in the Companies Act 2006 | ¶¶154–155 |
| Directors’ liability (s.463) | Only UK SRS disclosures in the strategic report are covered unless s.463 is expanded | ¶¶160–161 |
| Assurance | No plans at this stage for new assurance requirements | ¶178 |
The directors’ report
Proposed for removal, with parts relocated
¶7 lists, among measures already announced, a plan to “remove the requirement to produce a directors’ report, with some provisions to be removed entirely, and others relocated elsewhere in the annual report”.
Annex A sets out which requirements would go and which would move, and says energy reporting and supplier payments would be relocated “for the time being”.
No statutory instrument had been laid when the consultation was published.
The exemption frameworks that decide which companies prepare which reports are summarised in Annex B.
SECR
An address, not a duty
For unquoted companies and LLPs, the energy and carbon report sits inside the directors’ report, so removing the report moves it.
Companies would be free to place it anywhere in the first half of the annual report.
Who must report, and what they report, is untouched; SECR requirements sets out the duty as it stands, and SECR legislation the instruments behind it.
The consultation’s own heading for SECR reads “Streamlined energy and climate disclosures”; the regime is Streamlined Energy and Carbon Reporting, explained on SECR.
¶150 promises a separate DESNZ consultation on SECR and ESOS later in 2026, building on an evaluation of SECR published on 29 January 2026 and an ESOS evaluation under way.
That promise has no date or document; until it lands, ESOS and SECR apply as they do today, and the ESOS timetable is on the ESOS Phase 4 compliance guide.
¶149, verbatim
“The location of SECR disclosures will be moved because of the removal of the directors’ report from the annual report.
We do not intend to prescribe a specific reporting location for SECR reporting in the annual report.”
Source: consultation document ¶149
UK SRS
“Will consider”, and that is all
¶¶154–155 record that the government published UK SRS in February 2026 and that it “will consider how UK SRS should be reflected in the Companies Act 2006”.
There is no proposal, no mechanism and no date, and the UK SRS legislation page sets out what law does exist.
¶156 said the FCA’s final listing rules were expected in autumn 2026; they arrived on 30 September 2026 as PS26/19, on a comply-or-explain basis rather than the mandatory UK SRS S2 the paragraph described.
¶158 says the government will make clear that UK SRS is a national reporting framework for section 414CB(6), subject to the FCA’s outcome; the government’s UK SRS response had already confirmed that for UK SRS S2 in February 2026.
¶¶160–161 note that the directors’ liability safe harbour in section 463 covers only UK SRS disclosures in the strategic report, unless the section is expanded.
What this means for companies weighing UK SRS is the subject of UK SRS and the MCR consultation, and the standards themselves are on UK SRS S1 and S2.
What it leaves alone
Four things the consultation does not do
Climate-related financial disclosures
¶147: the consultation “does not include proposals regarding the future of the CFD requirements” in section 414CB.
The review of SI 2022/31 is due by spring 2027.
A UK SRS duty
¶155 considers, and proposes nothing.
The only UK SRS obligation made is the FCA’s for listed companies.
A “very large” threshold figure
¶¶57–58 ask the question and give no numbers; any figure reported for it is not in this document.
Mandatory assurance
¶178: no plans “at this stage”. That is a present-tense position, not a permanent one.
Which companies the section 414CB duty reaches is set by section 414CA, and all the UK carbon duties side by side are on carbon reporting requirements in the UK.
Responding
How to respond, and where to start
Responses close at 11:59pm on 30 November 2026 through the consultation page on GOV.UK.
Annex D lists every question by chapter; if SECR is your concern, start with the strategic report chapter and the questions on where sustainability and climate information should sit.
¶150 also invites views on what DESNZ should prioritise in any future reform of energy and carbon reporting.
Listed companies have a separate, settled timetable under the FCA’s rules, set out on FCA sustainability disclosure requirements, and every date is on the dated register of UK SRS events.
We will read the government response when it is published; until then, no statement of current law on this site changes on the strength of a proposal.
Frequently asked
The consultation, answered
What is the Modernising Corporate Reporting consultation?
A consultation published by the Department for Business, Innovation, Science and Trade on 7 September 2026 on how UK companies report: the directors’ report, the strategic report, a possible “very large” company category, the location of sustainability information and digital reporting. It closes at 11:59pm on 30 November 2026. It is a consultation and changes no law.
Has the directors’ report been abolished?
No. The consultation records the government’s intention, announced in October 2025, to remove it, and says statutory instruments “will be laid before Parliament in due course”.
Annex A says the amendments are “still in an early stage of drafting”.
None had been laid when the consultation was published.
Does the consultation remove SECR?
No. ¶149 says the location of SECR disclosures will move because the directors’ report is to be removed, and that the government does not intend to prescribe a new location.
Who must report and what they report are not changed.
A separate DESNZ consultation on SECR and ESOS is promised for later in 2026.
Does it change the climate-related financial disclosure duty in section 414CB?
No. ¶147 says the consultation does not include proposals on the future of those requirements.
A post-implementation review of the 2022 regulations is under way and due to be completed by spring 2027.
Does it make UK SRS mandatory for private companies?
No. ¶155 says only that the government will consider how UK SRS should be reflected in the Companies Act 2006, taking account of this consultation, the review of the climate disclosure regulations and related processes.
There is no proposal, no mechanism and no date.
What is the “very large” company threshold?
A question, not a figure. ¶¶57–58 ask whether to create a “very large” category for certain non-financial reporting obligations, say the government has an open mind, and give no numbers.
The government has no plans to apply such a threshold to requirements on the financial statements.
Does the consultation require assurance of sustainability reporting?
No. ¶178 says the government has no plans at this stage to introduce new requirements for companies to obtain assurance over future UK SRS reporting or other strategic reporting topics, calling that disproportionate given the costs and the nascency of the market.
How do I respond?
Through the consultation page on GOV.UK before 11:59pm on 30 November 2026.
Annex D lists every question by chapter.
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, Innovation, Science and TradeModernising corporate reporting — consultation page
Published 7 September 2026; closes 11:59pm on 30 November 2026.
- Department for Business, Innovation, Science and TradeModernising corporate reporting — consultation document (PDF), ¶¶7, 57–58, 128, 147–161, 178
Every quotation on this page.
- Department for Business, Innovation, Science and TradeAnnex A: October 2025 legislative changes (PDF)
The directors’ report provisions proposed for removal or relocation, “still in an early stage of drafting”.
- Department for Business, Innovation, Science and TradeAnnex B: the exemption frameworks (PDF)
The size-based exemptions the consultation discusses.
- Department for Business, Innovation, Science and TradeAnnex D: list of consultation questions by chapter (PDF)
The quickest way to the questions that affect you.
- UK ParliamentWritten statement HCWS973, 21 October 2025
The policy statement announcing the Modernisation of Corporate Reporting programme and the directors’ report changes.
- GOV.UKDepartment for Business, Innovation, Science and Trade — organisation page
The department’s current name, used since 20 July 2026.
- legislation.gov.ukCompanies Act 2006, section 414CB
The climate-related financial disclosure duty the consultation expressly leaves alone (¶147), and the s.414CB(6) national-framework route.
- legislation.gov.ukCompanies Act 2006, section 414CA
Which companies the climate-related financial disclosure duty reaches.
- legislation.gov.ukThe Companies (Strategic Report) (Climate-related Financial Disclosure) Regulations 2022, SI 2022/31
The regulations whose post-implementation review is due by spring 2027.
- Financial Conduct AuthorityPS26/19: Aligning listed issuers' sustainability disclosures with international standards
The FCA’s final listing rules, which ¶156 anticipated.
- Department for Business and TradeGovernment response to the UK SRS consultation (web version), Chapter 3
UK SRS S2 as a s.414CB(6) national reporting framework, and s.463 for disclosures in the strategic report.
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