12 Items for Noting

26 February 2026 Agenda Paper 12: Appendix A OFFICIAL - PUBLIC

Executive Summary

This paper provides a summary of the agenda and decisions from the 19 January 2026 meeting of the UK Sustainability Disclosure Technical Advisory Committee (TAC) as relevant to the UKEB remit.

The UKEB is represented on the TAC by a Board Member, who is appointed as a full Committee member to reflect the need to maintain connectivity between UK-adopted international accounting standards and UK Sustainability Reporting Standards (UK SRS).

TAC meeting January 2026

A1.The members considered (a) the final draft response to the Greenhouse Gas Protocol (GHGP) regarding its proposed revisions to its Scope 2 guidance (b) related recommendations to the ISSB and (c) supplementary technical analysis of IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information (IFRS S1) and IFRS S2 Climate-related Disclosures (IFRS S2).

Greenhouse Gas Protocol (GHGP) Scope 2: Final draft consultation response1

A2.The TAC discussed the final draft response to GHGP and approved both the cover letter to the GHG Protocol and corresponding survey response. The response noted possible financial accounting impacts of the proposed GHGP Scope 2 revisions, including on IFRS 9 Financial Instruments own-use eligibility, hedge accounting and IAS 37 Provisions, Contingent Liabilities, and Contingent Assets onerous contracts in its response.

A3.The TAC recommended that to avoid any potential overlaps or unintended consequences, the GHGP technical team engage as a priority with both the International Sustainability Standards Board (ISSB) and IASB technical staff and discuss the recent IASB amendments Contracts Referencing Nature-dependent Electricity.

GHG Protocol consultation: TAC's letter to the ISSB2

A4.The TAC discussed and approved its letter on the GHG Protocol consultation to the ISSB. The content of the letter was in the context of findings from UK stakeholder engagement conducted by the TAC Secretariat and discussions with the UKEB Secretariat in relation to potential impacts on accounting for nature-dependent electricity contracts.

A5.The members agreed to provide further detail in the letter regarding the potential impacts and potential unintended consequences relating to the accounting for contracts referencing nature-dependent electricity.

Supplementary technical analysis of IFRS S1 and IFRS S23

A6.The TAC considered the supplementary advice that will be submitted to the Secretary of State for DBT in relation to the endorsement of IFRS S1 and IFRS S2. The discussion and decisions focused on three topics, including the additional assessment of the requirements relating to revising comparatives and financed emissions, and a technical assessment of the IFRS S2 amendments issued by the ISSB in December 2025.

A7.The TAC made the following recommendations and decisions:

1. That UK Government adopt the ISSB's amendments to IFRS S2 into UK SRS, except for those relating to ‘Effective date' and ‘Transition' (adjusting comparatives).
2. The TAC will add supplementary analysis relating to revising comparatives, noting that entities are required to apply materiality when considering revising comparatives.
3. The TAC will modify its initial recommendations regarding financed emissions and recommend an amendment to UK SRS 2. This amendment will require that when an entity determines it is impracticable to reliably estimate its financed emissions for the same reporting period as the related financial statements, the entity shall disclose:
   1. why it cannot reliably estimate its financed emissions for the same reporting period as the related financial statements;
   2. the measurement approach, inputs and assumptions used to estimate any financed emissions information reported; and
   3. its plan, including the timeline, to be able to report its financed emissions for the same reporting period as the related financial statements.

General reporting update

A8.The TAC noted a summary of local and international sustainability news and jurisdictional developments. The TAC observer from the Department of Business and Trade (DBT) confirmed that the final UK Sustainability Reporting Standards (UK SRS) are expected to be published in February 2026.

Annex A: UK Sustainability Disclosure TAC Background

A1.The TAC was initially tasked by the DBT⁴ to assess the IFRS Sustainability Disclosure Standards, from a technical perspective, and provide advice⁵ to the Secretary of State for DBT on whether their endorsement would be conducive to the long-term public good in the UK.

A2.On 18 December 2024, the TAC concluded⁶ that the endorsement of both IFRS S1 and IFRS S2, was likely to be conducive to the long-term public good in the UK.

A3.The TAC was also requested by the DBT⁷ to understand the ISSB's enhancements to the SASB Standards and the implications of this for UK Sustainability Reporting Standards (UK SRS).

A4.In addition to the TAC there is also a separate Committee, the Policy Implementation Committee (PIC)⁸ is responsible for ensuring that any endorsed standards are implemented in a way that aligns with the mandates of UK government departments and regulator representatives.

Annex B: UK Sustainability Disclosure TAC 2026 Meeting Schedule

B1.The public meeting agenda, technical papers and summary minutes from the TAC meetings can be found on the UK Sustainability Disclosure Technical Advisory Committee website⁹.

B2.TAC meetings, scheduled for 2026, are listed below for information.

1. Monday 19 January: meeting summary.
2. Tuesday 17 February: This will be a private meeting where the TAC will hold confidential informational sessions on upcoming workstreams and to discuss related administrative matters.
3. Tuesday 24 March
4. Tuesday 21 April
5. Tuesday 19 May
6. Tuesday 16 June
7. Tuesday 14 July
8. Tuesday 15 September
9. Tuesday 13 October
10. Tuesday 17 November
11. Tuesday 15 December

Appendix B: Sustainability Update

IFRS Foundation updates

International Sustainability Standards Board (ISSB)

B1.The ISSB met on ISSB met on 28 January 2026 to discuss the objective and scope of its Biodiversity, Ecosystems and Ecosystem Services (BEES) standard-setting project¹⁰ regarding nature-related risks and opportunities. The ISSB decided to proceed with standard-setting on the basis that it would:

1. cover material information on all nature-related risks and opportunities that could reasonably be expected to affect an entity's prospects instead of limiting the scope; and
2. assume that entities are applying IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information (IFRS S1) and IFRS S2 Climate-related Disclosures (IFRS S2) so that the disclosure requirements or guidance on nature-related risks and opportunities will supplement those requirements.

B2.The next phase of the project will be to develop defined terms for the disclosure requirements.

B3.At the same meeting the ISSB received an update from the November 2025 meeting of the Transition Implementation Group¹¹ (TIG) on IFRS S1 and IFRS S2.

UK update

B4.The FRC published updated guidance¹² on the Strategic Report which considers developments in sustainability reporting standards, including the IFRS Sustainability Disclosure Standards issued by the International Sustainability Standards Board (ISSB).

B5.The Department for Business and Trade¹³ (DBT) issued a letter to the Financial Conduct Authority (FCA) providing an update on the UK government process to finalise UK Sustainability Reporting Standards (UK SRS). DBT advised the FCA, that most of the respondents to their consultation agreed with the content of the draft UK SRS. Some stakeholders strongly advocated (a) giving entities sufficient time to align with the most challenging parts of the Standards and (b) requested clarity regarding how reliefs in the UK SRS would interact with FCA rules.

B6.DBT advised that to provide the market with clarity, they will remove specific time-references about when the reliefs would apply in the standards. Instead, these references will be set out in government regulations (Companies Act) or FCA rules (where relevant) or by any other relevant authority.

B7.The FCA published a consultation¹⁴ on proposed updates to UK Listing Rules (UKLR). The consultation proposes replacing the current TCFD-aligned rules with UK SRS. This would align the UKLR with international sustainability standards. UK-listed companies would be expected to report climate-related information under UK SRS S2 Climate-related Disclosures from January 2027, with an additional year of relief before reporting Scope 3 information.

B8.Reporting on sustainability information beyond climate would begin from January 2029. Reporting Scope 3 climate information and non-climate-related information is proposed on a comply-or-explain basis. The consultation closes on 20 March 2026.

European update

B9.EFRAG published a summary report¹⁵ from its conference on the draft simplified European Sustainability Reporting Standards (ESRSs). The conference focused on EFRAG's technical advice submitted to the European Commission in December 2025 and the launch of the ESRS Knowledge Hub.