Is ESG Reporting Mandatory in the UK? A Quick Guide for Businesses

In a word, yes!

But let’s dive deeper into Environmental, Social, and Governance (ESG) reporting and why it’s become a cornerstone of corporate responsibility across the UK. Here’s what businesses need to know:

Who Needs to Report?

Whether you need to report your ESG metrics depends on the size and type of your business.

• Companies meeting two of the following criteria must complete Streamlined Energy and Carbon Reporting (SECR):
  • Annual turnover of £36 million or more
  • A balance sheet total of £18 million or more
  • 250 or more employees

These companies must disclose Scope 1 (direct) and 2 (indirect) emissions.

• Listed companies with over 500 employees or an annual turnover of more than £500 million are required to report on a broader range of ESG metrics, including:
  • Environmental impact (including carbon emissions and climate-related risks)
  • Employee welfare and social matters
  • Respect for human rights
  • Anti-corruption and anti-bribery policies

What Do Climate Disclosures Involve?

Under mandatory reporting rules, companies must provide detailed climate-related disclosures, specifically addressing:

1. Risks and Opportunities: Companies must outline how climate change presents risks and opportunities for the business.
   
2. Governance: Businesses need to explain how climate-related risks are managed at the corporate level, including board oversight.
   
3. Targets and KPIs: Disclose the goals your company is working towards and the metrics used to measure progress.
   
4. Strategy: Describe how climate risks influence your overall business strategy.

These requirements align with global frameworks like the Task Force on Climate-Related Financial Disclosures (TCFD) to standardise climate reporting.

Industry-Specific Requirements

Some industries face additional ESG reporting requirements from governing bodies. For example:

• Public Sector Tenders: Companies bidding for government contracts may need to submit a Carbon Reduction Plan (CRP) to show their commitment to reducing emissions.

Why Complying Matters

Mandatory ESG reporting isn’t just about ticking boxes; it’s an important way to attract investors, improve your transparency and stay ahead of regulatory changes.

Axiom can help streamline the reporting process, taking the stress out of ESG reporting, making sure you’re compliant and ahead of incoming legislation.

About Axiom

AXIOM is a powerful cloud-based platform that helps your business monitor, analyse and improve sustainability performance. 

While collecting such detailed and specific data may seem overly complicated, specialist sustainable software like AXIOM exists to make steps towards logistic sustainability easier.

Using specialist technology, we equip businesses with a tool which enables them to track their environmental and social performance whilst also improving governance – identifying and mitigating risks associated with business operations and relationships.

Are you looking to transform your supply-chain sustainability? Let us help, don’t hesitate to get in touch with us here.

Book your free demo here.