UK SRS for banks: where the disclosure burden really sits

Scope

Are banks in scope?

Banks are caught earlier and more clearly than most sectors, because the existing climate-disclosure law names them.

Section 414CB of the Companies Act 2006 explicitly applies to banking companies, and any large bank with more than 500 employees and turnover above £500 million or a balance sheet above £500 million already makes climate-related financial disclosures today Companies Act 2006 s.414CB.

On top of that, listed banks fall within the FCA's proposed UK SRS S2 regime.

CP26/5 would require UK SRS S2 for listed companies in UK Listing Rules categories 6, 14, 15, 16 and 22 for financial years beginning on or after 1 January 2027FCA CP26/5.

A listed banking group is therefore likely to move from s.414CB reporting onto the fuller UK SRS S2 standard.

UK SRS S1 and S2 themselves were published by the Department for Business and Trade on 25 February 2026, so the standards a bank must apply already exist in final formDBT.

The core obligation

Financed emissions across the lending and investment book

IFRS S2 requires Scope 1, 2 and 3 emissions on the GHG Protocol Corporate StandardGHG Protocol, and for a bank the entire weight of that sits in Scope 3 Category 15 — financed emissions.

The IFRS S2 industry-based guidance for commercial banking asks specifically for these portfolio figuresIFRS S2 industry-based guidance.

The accepted way to calculate them is the PCAF Standard, whose financed-emissions methodology covers seven asset classes — listed equity and corporate bonds, business loans and unlisted equity, project finance, commercial real estate, mortgages, motor-vehicle loans and sovereign debt PCAF Standard, Part A.

A bank must map its balance sheet onto those classes and attribute a share of each borrower's emissions to its own lending.

That attribution is the hard engineering problem: it depends on counterparty emissions data of variable quality, and PCAF's data-quality score system exists precisely because so much of it must be estimated PCAF Standard.

This is why the methodology, not the disclosure template, is where banks spend their effort.

The capital-markets question

Facilitated emissions and arranged finance

Lending is only half of a universal bank's footprint.

When a bank arranges a bond or equity issue rather than holding the exposure, the emissions are facilitatedrather than financed, and they sit outside the core financed-emissions numberPCAF Standard, Part B.

PCAF addresses these separately through its facilitated-emissions methodology, which attributes a portion of capital-markets transactions to the arranging bankPCAF Standard, Part B.

How prominently a bank discloses facilitated emissions is a judgement call under the IFRS S2 materiality lens, but for investment-banking-heavy groups it is increasingly hard to argue immaterialIFRS S2.

Timing

The timeline and what to build now

The proposed first UK SRS S2 reporting year for listed banks is the financial year beginning 1 January 2027, with first reports published in 2028FCA CP26/5.

Financed emissions, as Scope 3, benefit from one year of transitional relief and become comply-or-explain a year laterFCA CP26/5.

That deferral is not a reason to wait.

Building counterparty-data pipelines and PCAF attribution takes longer than a single reporting cycle, and assurance — though not yet mandatory — is coming: a bank that assures must disclose the provider, level and standard, which in the UK is ISSA (UK) 5000 FRC, ISSA (UK) 5000.

The standards underneath all of this are explained on the IFRS S1/S2 hub, and the full schedule on the finance timeline page.