FCA Climate Reporting Update 2026-27

Introduction

In September 2026, the FCA confirmed a set of updates to its rules on climate disclosure for UK investment firms. This followed a consultation centring around a general goal of simplifying the rules and ultimately making the reports more useful to investors and other stakeholders.

Speculation in the press suggested this could be the end for the FCA’s climate reporting regime, though this is not the case. To clear up any confusion, we’ve summarised the main changes and set out what firms still need to do to stay compliant with the updated climate rules.

What’s changed and what stays the same?

Entity-level reporting – remains unchanged

Entity-level TCFD reporting remains firmly in place, and in scope organisations will still need to report annually (by 30th June) following the same TCFD-based disclosure rules and publishing their annual emissions data.

Institutional investors – product reporting to “on demand” 

The main change for institutional investors is that the requirement to publish a product-specific report is being replaced by a revised "on-demand" regime.

• Scope. The scope of products remains the same and every product that was covered by the public or on-demand TCFD product reporting rules is still covered. Some respondents in the consultation asked for exemptions for ready-made portfolios, default arrangements and investment pathways but the FCA did not grant them.

• Data requirements. If a client asks for Scope 1, 2 and 3 greenhouse gas emissions data to meet its own climate reporting obligations, firms must provide it at a minimum. The FCA's view is that clients can work out most other metrics from this data. The updated guidance says that, where reasonably practicable and allowed under their contracts, firms should also provide:

  • other climate or carbon-related data the client reasonably needs for its climate reporting; and

  • an explanation of how much of the data is verified, reported, estimated or unavailable. This was put back in after feedback from asset owners.

• Data request timings. The rule requires a response to one request per product per calendar year but clients can still ask for more.

• Format and presentation. Emphasising the need for information to be clear, fair and not misleading, the FCA says that any information should be provided within a reasonable period and in a format the firm considers appropriate. Firms should also include context on how to read data and reports, and explain the methodology and any limitations e.g. proportion of data reported, verified, estimated or unavailable. As before, where data quality issues are so significant that information could be misleading, firms should not provide it without appropriate qualification.

• Key dates. A new transitional provision sets 30th June 2027 as the start date for the institutional rules, aligning with existing climate and TCFD timings.

Retail investors – simplified rules

Following reports that retail investors were struggling to meet the regulation’s more technical requirements, the FCA has made some small-ish changes to the guidance for this group.

Under the new rules the core requirements remain the same and firms must still assess material climate-related risks. However, they will no longer need to disclose climate-related opportunities.

The FCA has also narrowed when retail climate disclosures are required. This means firms won't need to create separate climate disclosures for retail investors. Instead, if a product is exposed to a climate-related risk that could have a meaningful impact on performance, that information should simply be included in the product's existing risk and return communications, including product summaries under the Consumer Composite Investments (CCI) regime where appropriate.

The aim is to make climate disclosures more relevant and easier for retail investors to understand, while reducing the amount of standalone reporting firms need to produce.

Our view

Overall we believe these changes are sensible and won’t actually have a significant impact for most of our clients. The main benefit comes from not having to produce and publish product reports. Everything else will broadly remain the same.

The FCA has somewhat vaguely said it will “continue to consider” making changes to requirements for the entity-level report but without setting out any kind of timeline or details. It seems for now at least, their focus is more likely to be on UK SRS, SDR and ISSB so watch this space and we’ll report back when there’s more information on these.

If you would like to discuss how these changes might affect your firm, please get in touch.