The City watchdog, the Financial Conduct Authority (FCA) , should ensure that UK companies are ready to meet the growing sustainability reporting challenges.

Responding to the consultation Aligning listed issuers’ sustainability disclosures with international standards,  ACCA says the FCA needs to strike the right balance between providing investors with decision-useful information whilst also recognising market maturity.

Aligning FCA requirements with the recently introduced UK Sustainability Reporting Standard (SRS) 1 and SRS 2 is a sensible step. However these standards represent an expansion in scope and specificity compared with the requirements of the disbanded Task Force on Climate-related Financial Disclosures (TCFD).

Glenn Collin, Head of Technical and Strategic Engagement, ACC UK, said: ‘It is therefore important that the FCA continues to consider market readiness, both in terms of capabilities and data availability, particularly for smaller or less mature preparers within the in-scope population.’

ACCA is calling on the FCA to adopt a pragmatic and proportionate approach which will be critical to ensure successful implementation and high quality reporting. ACCA also supports the use of transitional arrangements. However, ACCA believes that the ultimate ambition should be full and mandatory adoption of sustainability disclosure requirements.

Joe Fitzsimons, Regional Lead Policy and Insights – EEMA & UK, ACCA, said: ‘Regular assessments support in scope listed companies with operational planning, system readiness and capacity building while also giving investors greater certainty about when they can expect comprehensive disclosures to become available.’

Read the ACCA submission here.
Read the FCA consultation here.

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