UK Climate-Related Financial Disclosure (CfD) Regulations aim to increase transparency and accountability of companies in their management of climate- related risks.

CFD Standards and Compliance Timeline

Part of the UK's efforts to make climate-related financial disclosure mandatory across the economy by 2025.

The regulations apply in England, Wales and Scotland. They will also apply by agreement in Northern Ireland.

Affected by these regulations are:

  • All UK companies that are currently required to produce a non-financial information statement, being UK companies that have more than 500 employees
  • UK regulated market, banking companies or insurance companies (Relevant Public Interest Entities)
  • UK registered companies with securities admitted to The Alternative Investment Market (AIM) with more than 500 employees
  • UK registered companies not included in the categories above, which have more than 500 employees and a turnover of more than £500m
  • Large LLPs, which are not traded or banking LLPs, and have more than 500 employees and a turnover of more than £500m and
  • Traded or banking LLPs which have more than 500 employees

UK Climate-Related Financial Disclosure (CfD) Regulations came into force on April 6, 2022.

Reporting Requirements

  • Scopes 1-3 GHG emissions
  • Climate-related risks and opportunities
  • Governance structures and strategy to manage climate impacts
  • Metrics and targets
  • Climate scenario analysis

To whom and how to report:

A relevant company should disclose its climate-related financial disclosures within the section of the Non-Financial and Sustainability Information Statement. The regulations have introduced this change of name.

Companies may also consider the FRC's Guidance on the Strategic Report, which encourages companies to consider the importance of linking disclosures with other information disclosed in an Annual Report. Linkages help readers to understand climate disclosures in a broader context.

LLPs should include their disclosures in the Energy and Carbon Report or, if a Strategic Report is prepared, within that report.