ESG Global Vision

Social policy

In force

All companies.

The Equality Act 2010 (the Act) prohibits discrimination, victimisation and harassment on the grounds of nine protected characteristics (age, disability, gender reassignment, marital or civil partnership status, pregnancy or maternity, race, religion or belief, sexual orientation and sex) and applies both in the context of employment but also in the provision of goods and services to a consumer (save in respect of age and marital or civil partnership status). 

The Act also contains enhanced protections for disabled persons including a prohibition against discrimination arising from a disability and a duty to make reasonable adjustments to alleviate situations where disabled persons are or would be placed at a disadvantage by a provision, criterion or practice. In addition, the Act enshrines the principle of equal pay for equal work between men and women and permits positive action in specific circumstances related to protected characteristics (as opposed to positive discrimination).

Non-financial disclosures

In force

Commercial organisations with an annual turnover of £36 million or more.

The Modern Slavery Act 2015 includes an obligation on large commercial organisations to issue a public statement describing the steps they have taken during the financial year to deal with modern slavery risks in their supply chains and business.

Non-financial reporting

In force

Large employers (with at least 250 employees on 5 April of each year).

Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 (SI 2017/172) (the Regulations) require employers who employ 250 or more employees on 5 April of each year to publish an annual report on their gender pay gaps.  Reporting must include the disclosure of: mean and median gender pay gap; mean and median bonus pay gap; the proportion of male and female employees that receive bonus pay; and the proportion of male and female employees by quartile pay bands.  These metrics must be analysed on 5 April each year, and the gender pay gap report published within 12 months. The report must be published on the employer’s website and be accessible to employees and to the public for three years from publication.

Companies not subject to the mandatory reporting requirements may wish to voluntarily disclose gender pay gap information in its CR report or its strategic report. 

In response to a 2018 consultation on mandatory ethnicity pay gap reporting the government recently confirmed it will not be legislating to make ethnicity pay gap reporting mandatory “at this stage”. 

Social policy

In force from October 2024

All companies.

The Worker Protection (Amendment of Equality Act 2010) Act 2023 (the "2023 Act") will come into force in October 2024.

The 2023 Act introduces a new s. 40A of the Equality Act 2010 (the "EqA 2010"), to require all employers to take "reasonable steps" to prevent the sexual harassment of their employees in the course of their employment.

There are two main things to note about the new mandatory duty:

1. The Equality and Human Rights Commission (the "EHRC") will be able to take direct enforcement action against employers who breach the mandatory duty; and
2. The Employment Tribunal may apply a compensation uplift of up to 25% for breach of the mandatory duty, in successful sexual harassment claims (compensation uplift).

The EHRC recently published updated technical guidance on the duty to prevent sexual harassment, to outline how employers can fulfil their duty. The updated guidance, published by the EHRC on 9 July (the "Draft Guidance") makes clear that a positive duty to prevent sexual harassment covers sexual harassment by third parties, which would include clients, customers, contractors etc. Therefore, employers will likely need to take third party harassment into account when taking "reasonable steps" to prevent sexual harassment.  Consultation on the Draft Guidance has now closed.  The Draft Guidance can be found here:

Sexual harassment and harassment at work: technical guidance | EHRC (equalityhumanrights.com).

For more information, please see this podcast: Employment Bite: The Duty to prevent sexual harassment in the workplace.

Social policy

In force

All companies

The Employment Relations (Flexible Working) Act 2023 (the "Act") came into force on 6 April 2024.

The Act made amendments to s. 80F and s. 80G of the Employment Rights Act 1996 ("ERA 1996"). This resulted in a number of key changes to how flexible work requests are dealt with:

• When making a flexible work request, the employee no longer has to explain what effect they think their requested change will have on the employer, and how this should be dealt with.
• Employees are entitled to two, rather than just one, request in a 12-month period. Note that it will not be possible for an employee to make a further application while another application to the same employer is already proceeding.
• An employer is not permitted to refuse a request unless the employee has been consulted.
• The time for an employer to make a decision has been reduced from three to two months. However, it is possible for the parties to agree a longer period.

Social policy

In force

All companies

The Flexible Working (Amendment) Regulations 2023 (SI 2023/1328) (the "Regulations") came into force on 6 April 2024. The Regulations mean that the right to request flexible working will be a "day one" right for employees, by removing the need for the employee to have been continuously employed for a period of at least 26 weeks.

For more information please see this podcast: Employment Bite: Flexible Working

Social policy

Not yet in force

All companies

The King announced the Labour Government’s legislative programme for the new Parliamentary session at the State Opening of Parliament, including a draft bill to:

1. Enshrine in law the full right to equal pay for ethnic minorities and disabled people; and
2. Introduce mandatory ethnicity and disability pay gap reporting for employers with at least 250 employees.

When the Employment Rights Bill was published on 10 October 2024, the Governed also published a Next Steps to make Work Pay (“Next Steps”) document, which provides commentary on the Bill together with details of future reforms. In this document, the Government confirmed its intention to begin consulting on this legislation in due course.

According to the Next Steps document, in addition to the two proposals above, measures may include ensuring that outsourcing of services can no longer be used by employers to avoid paying equal pay; and, implementing a regulatory and enforcement unit for equal pay with involvement from trade unions. 

A draft Bill is to be published during this parliamentary session for pre-legislative scrutiny. Further consultation will also take place prior to the making of secondary legislation implementing these reforms.

Social policy

The Bill was introduced to Parliament on 10 October 2024. The Bill will now make its way through Parliament. Its second reading will take place on 21 October 2024 and, given the strength of political will, we anticipate that it will move promptly to Committee, with the potential for Commons stages to be completed by Christmas, or early January 2025, before it moves to the House of Lords.

There will also be further consultations on the detail of how many of the new rights will operate in practice during 2025, and the government has confirmed that the majority of the changes will not be in force before 2026.

All companies.

The proposed measures of the Bill include:

• giving pregnant employees, and those on or who have recently returned to work from maternity leave more protection against dismissal, by making it unlawful to dismiss them other than in specific circumstances;
• making flexible working the default, so employers will have to agree to flexible working requests unless they can show that their refusal is reasonable;
• requiring large employers with 250 or more employees to have action plans to address their gender pay gaps and to support employees during the menopause;
• day one rights to paternity and unpaid parental leave; and
• strengthening protection against sexual harassment by requiring employers to take “all” reasonable steps to prevent such harassment, prohibiting third party harassment and extending whistleblowing protection to cover disclosures about sexual harassment.

 For more information, see this article.

Environmental policy

In force

UK government

The Act enshrines a legal duty for the UK government to ensure that the UK reaches net zero emissions by 2050.  It created the Climate Change Committee (“CCC”), an independent body that advises the government on its climate change mitigation and adaptation strategy.

The government is required to set legally binding “carbon budgets’ on a five yearly basis, for which it takes advice from the CCC.  On the CCC’s advice, these budgets are then enacted by Parliament.  Since the passing of the Act, six budgets have been set (the final is provisional) requiring percentage reductions in emissions (versus 1990 levels):

• 2008-2012: 3,018 MTCO2e (26% reduction)
• 2013-2017: 2,782 MTCO2e (32% reduction)
• 2018-2022: 2,544 MTCO2e (38% reduction)
• 2023-2027: 1,950 MTCO2e (52% reduction)
• 2028-2032: 1,725 MTCO2e (58% reduction)
• 2033-2037: 965 MTCO2e (77% reduction)
• 2037-2042: 535 MTCO2e (87% reduction) (provisional)

The UK over-achieved its emissions reductions targets over the years of the first three budgets. 

However, most of these reductions have come from the energy supply sector (in particular the phase out of coal, the transition to less emissive electricity generation from gas, and the increase in the proportion of renewables in the energy mix. Further reductions are expected to be incrementally more difficult, and need to come from other sectors, in particular transport, industry, and heating. 

The current government has published the 2025 ‘Carbon budget and growth delivery plan’, which sets out how the government aims to meet the reductions under the budgets.  This includes plans to (amongst other things):

• decrease the costs of renewable electricity to encourage individuals and businesses to use electricity rather than fossil fuels (a useful example being a steelmakers choosing to use an electric arc furnace rather than a traditional blast furnace);
• encourage and subsidise people to de-carbonise their homes and to lower their energy bills through measures including insulation, heat pumps, and rooftop solar panels;
• increase the proportion of electric vehicles on the road by making it more convenient and cheaper to operate and own an electric vehicle.

Related legislation

The Climate Change Act creates direct legal obligations only for the UK government and its agencies, imposing no obligations on businesses or individuals.  The goals under the Act are intended to be effected and met through related legislation and initiatives, including:

• The UK Environment Act
• The UK Emissions Trading Scheme
• The Carbon Offsetting and Reduction Scheme for International Aviation
• Reform of the Energy Performance Certificates Regime

Criticism

The CCC has received criticism from a number of environmental advocates for its ‘target culture’, which they criticise as prioritising a relatively arbitrary reduction in net emissions.  Criticism is focused on the methods of net reduction, including attempted reforestation, which has been attacked for: (i) taking too long to achieve any meaningful difference to the climate emergency; (ii) not being an efficient or sensitive use of the land; and (iii) having an overstated impact on carbon sequestration.

The CCC has also been attacked from the right of politics, and by industry groups, who claim that the targets and methods of achieving these targets will stifle UK growth and hurt UK consumers, all for a relatively negligible change to global emissions.

Environment, corporate governance

Varies between participating states 

CORSIA applies to airline operators who fulfil the following criteria:

• their annual CO2 emissions from international flights using aeroplanes with a take-off mass greater than 5,700kg exceed 10,000 tonnes (all major carriers meet this relatively low threshold);
• they are responsible for international flights (flights by state aircraft and humanitarian, medical, and firefighting flights, as well as flights before or after such flights which are carried out by the same aeroplane and are needed for these activities, are not included); and
• they are registered in one of the participating states (see the list as of 1 January 2026 here; notable omissions include India and China).

In 2010, the International Civil Aviation Organisation (ICAO), a United Nations Agency that sets global standards and regulations for international civil aviation, adopted a sectoral aspirational goal for carbon neutral growth from 2020 onwards. Whilst operational and technological improvements are seen as a key part of achieving this goal, the ICAO took the view that a market based scheme was required to fill the remaining emissions gap and to achieve carbon neutral growth. Accordingly, the International Standards and Recommended Practices for the implementation of CORSIA were adopted as an Annex to the Chicago Convention in 2016, to apply to all of ICAO’s 193 member states from 1 January 2019.

CORSIA is being implemented in three phases:

• The Pilot Phase (2021-2023) and the First Phase (2024-2026). During these phases participation by ICAO member states was voluntary. 126 member states participated, with flights between participating states subject to reporting and offsetting requirements.
• The Second Phase (2027-2035). During this phase, with some exemptions, such as for Least Developed Countries and Small Island Developing States, participation will become mandatory for all ICAO member states and all international flights will be subject to offsetting requirements. The Second Phase will be split into three-year compliance periods.

In scope airline operators are under the following obligations:

• To monitor and report emissions from international flights on an annual basis.
  • At the beginning of each 3-year compliance period, an operator is required to submit an Emissions Monitoring Plan to its administering state which, once approved, the operator will use for the entire compliance period.
  • Under the plan, the operator is required to monitor and record its fuel use for international flights over the course of each calendar year. The operator must then estimate their annual CO2 emissions and report them to the national authority of their administering state by 30 April the following year. To guarantee the accuracy of the data reported, operators will need their annual emissions report to be verified by an impartial third-party verification body prior to submission.
  • Aggregated emissions are required to be reported by each administering state to ICAO, which will publish the total emissions from individual operators.
• To offset their emissions.
  • Under the scheme, the administering state calculates the annual offsetting requirements for each operator by multiplying the operator’s CO2 emissions by a ‘Growth Factor’, which is calculated by the ICAO and represents the percentage growth of the aviation sector’s international CO2 emissions covered by CORSIA’s offsetting requirements in a given year compared to the sector’s baseline emissions (being 85% of 2019 emissions levels).
  • Upon completion of each 3-year compliance period, the operator will have to show they have met their offsetting requirements by purchasing and cancelling the appropriate number of certified CORSIA Eligible Emissions Units (“CEEUs”) (each representing a tonne of CO2). The price of these units varies considerably depending on the type of project ($0.50 to $45/tCO2e during 2020-2021 with a weighted average of $3.08/tCO2eq in 2021).
  • Operators can also reduce their offsetting requirements by using CORSIA Eligible Fuels (“CEFs”) that meet the CORSIA sustainability criteria, which includes fuels with at least 10% lower CO2e emissions on a life-cycle basis compared to a reference fossil fuel value of 89.1 gCO2e/MJ. It is worth noting that as the baseline for calculating emissions reduction targets is 85% of 2019 emissions levels, offsetting requirements will only cover the growth in emissions since 2019 and therefore it is anticipated that the percentage of their total emissions that operators will have to offset will remain modest for the first few years of implementation of the scheme.

For more information, please follow the link here.

Penalties and enforcement:

National aviation authorities of participating states determine the sanctions for non-compliance, so these vary between countries. In the UK, for example, typical civil penalties can include a £20,000 penalty with a further daily penalty of £500 for failing to: (i) apply or revise an emissions monitoring plan; (ii) monitor emissions properly; or (iii) submit emissions reports. In recent consultations, the UK government has indicated that the penalties for failing to cancel CEEUs on time in line with an airline’s offsetting requirements would be £100 for each uncancelled unit.

Environment, corporate governance

The UK ETS was established through The Greenhouse Gas Emissions Trading Scheme Order 2020 (the “Order”). The UK ETS began operating on 1 January 2021.

Companies emitting the following greenhouse gases (“GHGs”) through the activities described below:

• carbon dioxide from:
  • electricity and heat generation with a total rate thermal input exceeding 20MW (although please note that power generators in Northern Ireland still fall under the European Union Emissions Trading System);
  • capture of GHGs and geological storage of GHGs;
  • energy-intensive industry sectors, including oil refineries, steel works, and the production of iron, aluminium, metals, cement, lime, glass, ceramics, pulp, paper, cardboard, acids and bulk organic chemicals; and
  • UK domestic flights, flights between the UK and Gibraltar, and flights departing the UK to EEA states. The UK is also considering how the UK ETS should interact with Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) scheme, which covers aviation emissions at a global scale (for more details, see here);
• nitrous oxide (N₂O) from the production of nitric, adipic and glyoxylic acids and glyoxal; and
• perfluorocarbons (PFCs) from the production of aluminium.

The UK ETS will be expanded to cover the maritime sector from July 2026 and to cover energy from waste and waste incineration from 2028, preceded by a 2-year monitoring and reporting period.

The UK ETS was implemented after the UK left the EU ETS on 1 January 2021. The UK Government, Scottish Government, Welsh Government and the Northern Ireland Department of Agriculture, Environment and Rural Affairs (collectively making up the UK ETS Authority (the “Authority”)) established the UK ETS in an effort to help the UK to decarbonise and to meet its climate targets, whist simultaneously aiming to protect the competitiveness of UK businesses. As with the EU ETS, the UK ETS is based on a ‘cap and trade’ model through which an overall cap on total emissions is set for all industries and sectors in scope of the UK ETS. The cap for 2025 was 86.7 MtCO2e (roughly 20% of UK CO2e emissions), a significant decrease from 156 MtCO2e in 2021, and is set to reduce further to 50 MtCO2e by 2030.

Each year, in-scope companies are required to monitor and report their emissions for the preceding year by 31 March in accordance with Commission Implementing Regulation (EU) 2018/2066 (the ‘Monitoring and Reporting Regulation’), as amended by the Order. By 30 April, companies must surrender a number of UK ETS Allowances (“UKAs”) (a single allowance being equivalent to 1 tonne of CO2 equivalent GHG) to cover their emissions for the preceding year. UKAs can be acquired through: (i) auctions run by the Authority; (ii) free allocation if eligible; or (iii) trading on secondary markets. Revenues from UK ETS auctions accrue to the general budget. Free allowances are intended to mitigate the risk of companies moving production and its associated emissions to another country where there is no carbon price. A list of each in-scope company’s free allocation for the 2021 to 2026 period can be found here.

Companies that provide services to hospitals or meet the criteria to be classed as a small emitter (emissions lower than 25,000t CO2e per annum from an installation with a rated thermal capacity below 35 MW) can qualify for Hospital and Small Emitter (HSE) status, meaning they do not need to surrender allowances to cover their emissions and are not entitled to receive any free allocation. Instead, they are set annual emissions targets for each scheme year. If HSEs exceed their targets in a given year, they are required to pay the applicable UK ETS carbon price for each tonne of CO2 emitted over their target.

To ensure the effective functioning of the scheme the UK ETS has two market stability mechanisms:

1. The Auction Reserve Price (“ARP”): the ARP is effectively a minimum price for UKAs, set at £28 for 2026 and increasing each year with inflation.
2. The Cost Containment Mechanism (“CCM”): this mechanism is triggered if the average price on the secondary future markets is more than an amount equal to three times the average price in the preceding two-year period for six consecutive months. It enables the Authority to authorise a number of interventions, including increasing the number of UKAs to be auctioned.

The UK government is in conversations to link the UK ETS with other emissions trading schemes. Notably, in May 2025, the UK government and the EU agreed to work together to link their respective ETS. The May 2025 Summit Common Understanding sets out the parameters for a potential linking agreement and a timetable is currently being agreed for linking negotiations.

Read here about the extension of the UK ETS beyond 2030.

Penalties and enforcement:

If an in-scope company fails to surrender sufficient allowances to cover their emissions in a given year, they will be liable to a penalty of £100 per tCO2e (adjusted for inflation) for which the company has not surrendered allowances and must also surrender the amount of allowances in respect of those excess emissions.

The UK ETS also has penalties for failures to obtain or comply with GHG emission permits and for the incorrect reporting of emissions.

Financial reporting

Phases 1 and 2 have been implemented. Phase 3 of TCFD is set to be implemented by 2026.

UK registered companies, financial advisers and institutions, insurers, pension schemes and other types of organisations.

The TCFD was created by the G20 in the aftermath of the 2015 Paris Agreement, aiming to “improve and increase reporting of climate-related financial information”.

In 2017, the TCFD released climate-related financial disclosure recommendations designed to help companies provide better information to support market transparency and more informed capital allocation. These recommendations are split up into four ‘pillars’ (governance, strategy, risk management, and metrics and targets), and eleven recommended disclosures. 

The UK has incorporated these recommendations into its regulatory landscape through changes to the Financial Conduct Authority (“FCA”) Listing Rules, for major listed companies, through the Prudential Regulation Authority’s Supervisory Statement for banks, insurers, building societies, credit unions, and major investment firms, as well as through changes to the Companies Act for smaller listed companies and large privately owned businesses.

These changes have been, or will be, implemented in three phases: 

• Phase 1: This was implemented for the fiscal year 2023-2024 and covers:
  
  • the general principles of the TCFD, including scoping;
  • disclosure of general governance principles in relation to climate risks and opportunities, including the board’s oversight of the same, and senior management’s role in assessing these risks and opportunities; 
  • the disclosure of Scope 1, Scope 2, and if appropriate, Scope 3 greenhouse gas emissions; and
  • the TCFD compliance statement requirements.
• Phase 2 was implemented for the 2024-2025 fiscal year, and covers:
  
  • disclosure of further metrics and targets; and
  • description of risk management processes (how the organisation plans to assess and manage relevant climate related risks and opportunities).
• Phase 3 is due to be implemented for the 2025-2026 financial year, and will cover:
  
  • the strategy recommendation requirement, i.e. disclosing climate risks, impacts, and opportunities; and
  • disclosure of the organisation’s plans and strategy to address the risks and opportunities that the organisation has identified over the short, medium, and long terms. 

Whilst the TCFD recommendations were designed as voluntary global standards, they are increasingly being made mandatory through national level legislation and regulation. In scope entities are required to comply with the requirements described above, or explain why they have not been able to do so (the comply or explain principle). 

It is also increasingly thought of as best practice for out of scope entities to attempt to comply with the recommendations.

There is extensive guidance on the UK government website, which links to other useful resources here. 

See this article for further detail.

Environmental policy

In force

All individuals, entities, and government agencies operating or located in the United Kingdom.

The UKEA is intended to fill the gap created in UK environmental legislation after the UK’s exit from the EU.  The key stated aims of the UKEA are to: (i) provide a legal framework for environmental guidance in the UK; and (ii) introduce measures for the improvement of the environment.  

It is a landmark piece of legislation that encompasses almost all aspects of UK environmental policy, including but not limited to: (i) air and water quality; (ii) biodiversity; (iii) waste reduction; and (iv) the restoration of the natural environment.

The UKEA requires the UK government to set long term binding targets for the environmental metrics referred to above.  Currently (set under the 2022-24 Conservative government), these are to:

• halt the decline in species populations by 2030, and then increase populations by at least 10% to exceed current levels;
• restore precious water bodies to their natural state by cracking down on harmful pollution from sewers and abandoned mines and improving water usage in households;
• increase tree and woodland cover to 16.5% of total land area in England by 2050;
• halve waste sent to residual treatment by 2042 (on a per capita basis);
• reduce PM2.5 emissions and exposure; and
• restore 70% of designated features in Marine Protected Areas to a favourable condition by 2042, with the rest in a recovering condition.

A new watchdog, the Office for Environmental Protection, was established under the UKEA, and is empowered to investigate complaints and take action if in scope entities, individuals, or public authorities are in breach of the UKEA. 

Recent developments

The UKEA acts as a framework for further legislation and is constantly evolving to meet changing government priorities and respond to threats to the UK and world environment.

For example, the UK government recently announced plans to introduce new anti-deforestation measures under the UKEA, which are aimed at making sure that products sold in the UK do not contribute to deforestation outside of its borders (studies estimate that 99.7% of all deforestation caused by UK consumption takes place outside of the UK).  UK consumption is thought to lead to yearly deforestation of c. 29,000 hectares globally, and a resulting 9.4 million tons of related carbon emissions. 

Related legislation/requirements

The UKEA, alongside creating its own requirements and obligations also modifies existing legislation to achieve its aims.

A key example of this is the ‘Biodiversity Net Gain in the UK requirement’, which the UKEA amends the Town and Country Planning Act to include.  In brief, this is a requirement for land and building developers to increase the biodiversity of a site or land being built upon/developed by at least 10% (see here for more details).

Penalties and enforcement

Penalties and enforcement vary due to the wide-ranging nature of the legislation, but include: (i) civil prosecutions; (ii) uncapped fines (fines having previously been limited before the introduction of the UKEA); and (iii) criminal prosecutions.  Penalties can be particularly severe in cases of pollution and contamination.  In England, penalties are administered by the Environment Agency.

Criticism

The Act has received heavy criticism from both sceptics of further environmental legislation, and from conservation and environmental protection advocates who have attacked the Act on the grounds that it doesn’t go far enough, with much criticism focused on the absence of any short-term binding targets. 

In particular, NGOs and environmental campaigners have criticised the legislation for its particulate matter provisions, alleging that the 2040 target for reducing fine particulate matter emissions is too lenient on polluters, and that 2030 would be both achievable, and allow the UK to meet WHO targets for air quality. 

A further criticism is the UKEA’s provisions relating to deforestation, which deal almost exclusively with domestic tree felling, eliding the fact that over 90% of the timber and timber related products consumed in the UK are imported, only requiring that timber felled abroad is felled ‘legally’.  Whether felling is legal or not varies from jurisdiction to jurisdiction, with some nations having essentially no restrictions on deforestation, or requirements wholly out of step with the need to reduce deforestation at a national and global level.

Environmental policy

The EPC regime is in force but subject to reform pending the outcome of a government consultation. 

Developers and investors in commercial and domestic properties across England and Wales.

From 4 December 2024 to 26 February 2025, the Ministry of Housing, Communities, and Local Government, as well as the Department for Energy Security and Net Zero ran a consultation seeking input from relevant stakeholders on the reform of the Energy Performance of Buildings (“EPB”) framework in England and Wales. The EPB framework was established under the Energy Performance of Buildings (England and Wales) Regulations 2012. It is one of the key legislative tools promoting carbon reduction in building stock and promoting energy efficiency improvements in commercial and domestic properties across England and Wales. The proposed reforms would impact energy performance certificates (“EPCs”), display energy certificates and air conditioning inspection reports.

Reform to EPCs is significant, as they form the basis for energy efficiency targets, regulatory requirements for minimum energy efficiency standards (“MEES”), and funding criteria.

The proposals include: 

1. Multiple metrics for evaluation – at present, whilst EPCs display various metrics detailing environmental performance, there is a “headline” metric, the Energy Efficiency Rating for domestic property and Environmental Impact Rating for commercial property, expressed in the familiar A – G scale. The Government has acknowledged that these headline metrics are flawed (as they can be significantly influenced by factors outside the building owner’s control). Under the proposals, multiple metrics would be used to provide a wider range of better quality performance data to ultimately give a better representation of a building’s energy performance, covering thermal performance, energy efficiency, heating source, smart readiness, carbon emissions and overall energy consumption. 
      
   These changes are anticipated to be introduced in the second half of 2026. At present, there is no suggestion that changes to EPC metrics would invalidate existing EPCs which could continue to be used to demonstrate compliance with regulatory requirements. 
     
   The Government has also left the door open for additional updates in the future, including metrics to show a building’s resilience to climate change impacts, occupant health and wellbeing, biodiversity, and water efficiency. 

2. Reducing the EPC validity period -  the proposals indicate that the current EPC validity period could be reduced by as much as eight years. The report states that the Government preference is that all existing EPCs would remain valid until their natural expiration, and any reduced validity period would only apply to new EPCs. 
3. Requiring a valid EPC throughout a tenancy – the Government has recognised that because EPCs only need to be produced in limited circumstances there are often instances of EPCs not needing to be renewed when they expire (and which brings properties outside the scope of the MEES regime, for example). To address this, a new EPC would need to be commissioned for a let property when the existing EPC expires (which would mean more properties are subject to MEES). 
4. Listed buildings – the Government appears to acknowledge that the current regulation is confusing. Under the changes, all heritage buildings would be required to have an EPC. This would bring listed buildings within the scope of MEES (although exemptions may be available). 

Enforcement and penalties

At the moment compliance is not particularly efficiently enforced. The reforms may include possible changes to the relevant enforcement agency’s access to data, and increased penalties (which have remained stagnant since their introduction in 2007). 

The level of penalty charge(s) for breaching the EPC regime varies according to the type of property, but for a commercial property the penalty is calculated by a formula linked to the property’s rateable value, collared at £500 and capped at £5000. There is potential for these figures to be increased to £1,000 and £10,000 under the proposed changes.

Alongside penalties and enforcement, there are obvious reputational risks for companies and developers found to have been non-compliant with the regime. 

Future

The Government is expected to release its response to the consultation in mid-2025. For more information see our article: The EPC reformation in England and Wales – changes on the horizon

Non-financial reporting 

In force

All publicly listed UK companies, and unlisted companies, Limited Liability Partnerships (“LLPs”), and groups that exceed at least two of the following three thresholds over the final year:

• £36m annual turnover
• £18m net balance sheet
• 250 employees

Entities are exempt from the reporting requirements if they can show that their annual energy use is below 40 MWh.

The SECR is intended to increase awareness of energy use, greenhouse gas emissions, and costs within large organisations, and to ensure that reporting obligations are proportionate and align with other the requirements of other reporting regulations. The Government intends that the SECR will give investors and other stakeholders greater transparency on entities’ emissions and incentivise energy efficiency within the private sector.

The SECR replaces the new defunct the Mandatory Greenhouse Gas Reporting scheme. 

Reporting requirements for companies caught by the SECR differ for listed and unlisted companies:

• Listed companies must report:
  
  • Global Scope 1 and 2 emissions (Scope 3 is voluntary but recommended). 
  • Emissions intensity ratios (i.e. greenhouse gas emissions per product sold (or another applicable metric)). This is designed to allow comparisons between companies of different sizes.
  • Underlying global energy use over the reporting year.
  • Underlying energy use and greenhouse gas emissions for the previous reporting year.
  • Energy efficiency measures and steps taken by the company over the financial year.
  • The methodology used to prepare the report. 
• Unlisted companies and LLPs must report:
  
  • UK energy use and greenhouse gas emissions.
  • The previous year’s UK energy use and greenhouse gas emissions
  • At least one emissions intensity ratio
  • Energy efficiency measures and steps taken by the company over the financial year
  • The methodology used to prepare the report.

The SECR contains a ‘comply or explain clause’, which is common across similar regulations. This allows entities to not provide information where it is not feasible/proportionate to collect it, if they are able to provide sufficient explanation of the difficulties in doing so.  

The government has published detailed guidance on compliance.

Financial reporting

Phases 1 and 2 have been implemented. Phase 3 of TCFD is set to be implemented by 2026.

UK registered companies, financial advisers and institutions, insurers, pension schemes and other types of organisations.

The TCFD was created by the G20 in the aftermath of the 2015 Paris Agreement, aiming to “improve and increase reporting of climate-related financial information”.

In 2017, the TCFD released climate-related financial disclosure recommendations designed to help companies provide better information to support market transparency and more informed capital allocation. These recommendations are split up into four ‘pillars’ (governance, strategy, risk management, and metrics and targets), and eleven recommended disclosures. 

The UK has incorporated these recommendations into its regulatory landscape through changes to the Financial Conduct Authority (“FCA”) Listing Rules, for major listed companies, through the Prudential Regulation Authority’s Supervisory Statement for banks, insurers, building societies, credit unions, and major investment firms, as well as through changes to the Companies Act for smaller listed companies and large privately owned businesses.

These changes have been, or will be, implemented in three phases: 

• Phase 1: This was implemented for the fiscal year 2023-2024 and covers:
  
  • the general principles of the TCFD, including scoping;
  • disclosure of general governance principles in relation to climate risks and opportunities, including the board’s oversight of the same, and senior management’s role in assessing these risks and opportunities; 
  • the disclosure of Scope 1, Scope 2, and if appropriate, Scope 3 greenhouse gas emissions; and
  • the TCFD compliance statement requirements.
• Phase 2 was implemented for the 2024-2025 fiscal year, and covers:
  
  • disclosure of further metrics and targets; and
  • description of risk management processes (how the organisation plans to assess and manage relevant climate related risks and opportunities).
• Phase 3 is due to be implemented for the 2025-2026 financial year, and will cover:
  
  • the strategy recommendation requirement, i.e. disclosing climate risks, impacts, and opportunities; and
  • disclosure of the organisation’s plans and strategy to address the risks and opportunities that the organisation has identified over the short, medium, and long terms. 

Whilst the TCFD recommendations were designed as voluntary global standards, they are increasingly being made mandatory through national level legislation and regulation. In scope entities are required to comply with the requirements described above, or explain why they have not been able to do so (the comply or explain principle). 

It is also increasingly thought of as best practice for out of scope entities to attempt to comply with the recommendations.

There is extensive guidance on the UK government website, which links to other useful resources here. 

See this article for further detail.

Corporate governance policy and non-financial disclosures

In force

All companies subject to the Companies Act 2006.

Under section 172 of the CA 2006, directors are under a duty to only act in a way that they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members.

In fulfilling that duty they must have regard to the non-exhaustive list of factors including the impact on stakeholder groups (e.g. employees, suppliers, customers and others) and the likely consequences and impact of their decisions (including, for example, the long-term impacts on the community and the environment).

For financial years beginning on or after 1 January 2019, large companies are required to include a separate section 172(1) statement in their strategic report describing how the directors have had regard to the matters set out in section 172(1)(a) to (f) of the CA 2006.

Non-financial disclosures

In force

Companies (other than those subject to the small companies regime).

Under section 414A of the CA 2006, the directors of a company must prepare a strategic report for each financial year of the company.

The contents of the strategic report must cover the factors listed in 414C. This includes information about the impact of the company's business on the environment, the company’s employees, and social, community and human rights issues, and information about any policies of the company in relation to those matters and the effectiveness of those policies.

Corporate governance policy, financial reporting

In force since 2017, implemented into Member States’ national laws between 2019 and 2020.  On-shored into UK law before the UK’s exit from the European Union via the European Union (Withdrawal) Act 2018.  

Companies which have their registered office in a Member State (or the UK) and whose shares are admitted to trading on a regulated market situated or operating within a Member State (or the UK).

It is worth noting that there a number of exemptions available for non EU/UK issuers, in circumstances where a company’s compliance with SRD II may come into conflict with other third party transaction related legislation/regulation.

SRD II, which was passed by the European Parliament in 2017, amended the original Shareholders Rights Directive (“SRD I”), which had been in force since 2007.  The original legislation was passed in an attempt to promote “…the exercise of shareholder rights at general meetings of companies with registered offices in the European Union and the shares of which are admitted to training on a regulated market in the EU”.  

The key stated purpose of SRD II is to facilitate, require, and encourage: (i) shareholder engagement; (ii) transparency in relation to shareholder holdings, directors remuneration, and related party transactions; and (iii) ensure that board-level remuneration is sufficiently aligned with company performance and share price. 

The substantive changes brought in by SRD II are to Article 3 of SRD I, requiring Member States to implement secondary legislation providing for enhanced rights and obligations for in scope companies and shareholders in the form of:

• identification (at the request of the relevant entity) of shareholders holding more than 0.5% of the registered share capital of the relevant entity by intermediaries, and that intermediaries communicate the information requested “without delay”. individual Member States have the right to lower this threshold, and the majority of Member States have no threshold (in particular Germany, France, Spain, and the UK);
• disclosure of directors’ remuneration;
• disclosure of related party transactions (the definition of a “related party” is derived from the Internation Financial Reporting Standards (IAS 24));
• further obligations for intermediaries (similar/identical to those imposed on in scope entities), including requirements to:
  • transmit information without delay between companies and shareholders;
  • facilitate the exercise of shareholder rights; and
  • publicly disclose any charges for providing these services.
• facilitation of the exercise of shareholder rights; and
• transparency of institutional investors, asset managers, and proxy advisors.

The EU passed a further Implementing Regulation (EU 2018/1212) on 4 September 2018 (in force from 3 September 2020), the provisions of which set out minimum requirements and formats for information passing between issuers and shareholders.  This was passed in an attempt to standardise these requirements between Member States, and to ensure that stakeholders faced equivalent requirements across Member States, and were not unfairly prejudiced by differing disclosure and administration requirements depending on the location of their registered office(s) within the EU. 

The detail of the implementation of this directive by each Member State is outside the scope of this note, but it is worth noting that the national level legislation is largely consistent across the EU.

Enforcement and penalties

Penalties for non compliance with SRD II vary jurisdiction by jurisdiction. The Directive only states that penalties should be “sufficiently dissuasive and proportionate”.  Penalties are generally financial, e.g. the Italian implementing legislation allows for fines of up to EUR 150,000 for the most serious breaches. 

Environmental policy

In force on 1 October 2021

Authorised master trusts and occupational pension schemes with at least £5bn of assets. From 1 October 2022 the requirements will extend to occupational schemes with at least £1bn of assets.

Regulations under the Pension Schemes Act 2021, applicable to authorised master trusts and very large occupational pension schemes, impose additional governance requirements in relation to the assessment and management of risks and opportunities arising from climate change. Pension schemes within scope will also have to report in line with the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.

Corporate Governance policy

In force

Applies to all companies with a premium listing on a “comply or explain” basis.

The UK Corporate Governance Code issued by the Financial Reporting Council consists of principles of good governance in the areas of leadership, division of responsibilities, composition, succession and evaluation, audit, risk and internal control and remuneration, to ensure that a company operates effectively, complies with legal requirements and reports reliably. 

The UK Corporate Governance Code applies to all companies with a premium listing, whether incorporated in the UK or elsewhere. The UK Corporate Governance Code is a "comply or explain" code.

Non-financial reporting

In force

Listed companies with listed equity shares (or certificates representing equity shares) admitted to a premium or standard listing.

The Listing Rules require in-scope listed companies to include the following information in their annual reports:

• A ‘comply or explain’ statement on whether they have achieved the following targets for women and ethnic minority representation on their board: (1) at least 40% of the individuals on the board are women; (2) at least one senior board member (chair, CEO, CFO or senior independent director) is a woman; and (3) at least one board member is from a non-white minority ethnic background.
• Numerical data (in a standardised format) on the ethnic background and gender identity or sex of their board and executive management team (i.e. the executive committee or the most senior executive or managerial body below the board including the company secretary).

Non-financial reporting

In force

Listed companies with transferable securities admitted to trading on a regulated market.

The Disclosure Guidance and Transparency Rules require in-scope listed companies to produce a corporate governance statement which includes the following information:

• A description of the company’s diversity policy applied to its administrative, management and supervisory bodies and the remuneration, audit and nomination committees of those bodies with regard to aspects such as age, gender, ethnicity, sexual orientation, disability or educational, professional and socio-economic backgrounds.
• A description of the objectives of the abovementioned diversity policy, how it has been implemented and the results in the reporting period.
• If the company does not have a diversity policy, an explanation of why that is the case.

Governance and anti-bribery

In force

All business operating or registered in the UK and their service providers (referred to as “associated persons”)

The Bribery Act makes it an “offence for a UK national or person located in the UK to pay or receive a bribe, either directly or indirectly”.

The Act creates five key bribery offences, alongside introducing strict liability for organisations whose associated persons commit bribery offence(s) without the organisation’s knowledge, unless the organisation has implemented sufficient measures to prevent the offence(s):

1. Active bribery (offering or giving a bribe) (section 1);
2. Passive bribery (accepting or requesting a bribe) (section 2);
3. Bribery of a foreign official (section 3);
4. Consent or connivance of a company officer in bribery by a company (section 4); and
5. Failure by a company to prevent bribery by an associated person or persons.

The first four offences were largely already contained in various statutes and regulations.  The fifth offence (the “failure to prevent” offence), represented a significant shift in the requirements on companies and organisations to address the actions of their associates, a term loosely defined under the provisions of the Act.  The definition of “associated persons” can extend to persons as diverse as employees, contractors, agents, subsidiaries, and many others. 

Should a company fail to prevent bribery by an associated person, the Act imposes strict liability on the company in question, unless the company can show that it had adequate procedures in place to stop bribery by its associated persons.  The UK government has published guidance on the implementation of these procedures here. This is an area of law that continues to develop as it is addressed further by the courts, and has served as the basis for the Economic Crime and Corporate Transparency Act 2023, which includes similar “failure to prevent” offences (please see our detailed article on this here).

Penalties and enforcement

Enforcement of the Bribery Act is administer by the Serious Fraud Office (SFO). Penalties include unlimited fines and disqualification from bidding for public contracts for organisations found to have committed one of the offences under the Act, and disqualifications from acting as a director and/or prison sentences of up to ten years for individuals found guilty of breaching the terms of the Act. 

For more detail as to how to proof your business against the Bribery Act and other anti-corruption legislation, please see this page.

Non-financial disclosure 

The requirements set out in the framework are intended to come into force on or after 1 January 2025 and for reporting to begin in 2026.

All listed companies and financial services firms. 

The TPT was created in March 2022 in the wake of the COP26 climate conference, with a mission statement of producing a ‘gold standard Disclosure Framework for transition plans”. 

“Transition planning”, is the process by which polluting entities plan to make the methods of production/provision of their goods/services less greenhouse gas intensive, or net zero.

The Framework was published in October 2023, and is designed to compel companies to create realistic and actionable transition plans and to require them to disclose them to their investors and other stakeholders.  The framework outlines four main areas: (i) governance, (ii) strategy, risk management, (iii) metrics, and (iv) targets, providing a structured approach for companies to disclose their plans.

The framework is currently voluntary, however, the FCA and the UK government have signalled their intent to either introduce or consult on the introduction of the Framework as a mandatory disclosure requirement for listed companies and financial services firms. 

Financial disclosure

The government is currently aiming to make the investment standard available to firms in Q1 2025. 

All FCA authorised UK firms. 

The FCA’s SDR regime is a key part of the UK’s anti ‘greenwashing’ rules. It is intended to give investors greater clarity when making decisions about investments’ green credentials. 

The regime introduces four ‘investor labels’, which firms labelling investment products as ‘green’, ‘ESG focused’, ‘net zero’, ‘sustainable’, ‘low carbon’, or other similar terms will have to use. The labels proposed are:

1.)    Sustainability Impact
2.)    Sustainability Focus
3.)    Sustainability Improvers
4.)    Sustainability Mixed Goals 

The labels are based on sustainability reporting standards created by the International Sustainability Standards Board, and are therefore similar, if not identical, to standards in use across other jurisdictions.  The regime is opt in, however, there has been significant uptake of the similar regimes in other jurisdictions, and it is considered likely that it will be come industry standard and best practice to adopt these terms once they become available.  

For further detail, see the FCA’s consultation paper here. 

Batteries, Waste and Recycling, Extended Producer Responsibility, Circular Economy, Environmental Protection

In force.

The Waste Batteries and Accumulators Regulations 2009 (“UK Waste Batteries Regulations”) were introduced in the UK to implement certain requirements of the EU Batteries Directive 2006/66/EC into local law. For further details about the requirements related to the placing of batteries on the market, please see UK Batteries Regulations.

Post-Brexit, the UK Waste Batteries Regulations remain in effect in the UK as retained legislation, though with certain amendments to ensure continued legal operability. In particular, the applicable provisions differ between Great Britain (England, Wales and Scotland) and Northern Ireland, given that Northern Ireland remains subject to the EU batteries regime under the Northern Ireland Protocol and Windsor Framework. For further details about the EU batteries regime, please see here.

The UK Waste Batteries Regulations apply to producers, importers, and distributors involved in the handling of waste batteries in Great Britain. The obligations vary depending on the type of battery: portable, industrial, and automotive, and the economic operator’s role in the supply or waste chain.

The UK Waste Batteries Regulations establish a statutory framework for the separate collection, treatment, and environmentally sound disposal and recycling of waste batteries.

Specific requirements differ depending on the battery type, but key requirements include:

• Compliance Schemes: in scope economic operators placing over 1 tonne of batteries on the market annually must join a Battery Compliance Scheme (“BCS”) and contribute to financing the net costs of collecting, treating, and recycling waste batteries.
• Take-back schemes: in scope economic operators must offer free of charge take-back of waste batteries from end-users and ensure that batteries collected are handled appropriately, including by way of transfers to approved battery treatment facilities (“ABTF”) or approved exporters for recycling and recovery (as applicable).
• Reporting obligations: all producers must maintain records of the quantities and chemistry of batteries placed on the market and collected for treatment, and must be registered with the relevant authority. Compliance Scheme administrators are also required to report on member activities and ensure proper waste treatment and public awareness.

In November 2023, the Department for Business and Trade (DBT) published the UK battery strategy, outlining the government's aim to achieve a globally competitive battery supply chain by 2030 to support economic growth and the net zero transition. As a result, legislation to reform the UK batteries regime may be introduced in the near future.

Enforcement and penalties:

The Office for Product Safety and Standards (the “OPSS”) is responsible for enforcing the UK Waste Batteries Regulations in relation to the compliance of producers of automotive and industrial batteries and take back scheme for distributors and retailers. Other aspects of the regulations are enforced by the Environment Agency and its equivalents in Wales, Scotland and Northern Ireland.

Authorities have the power to conduct inspections, enter premises, examine records, take samples, and serve enforcement notices for suspected non-compliance. Offences under the UK Waste Batteries Regulations can include, for example, failure to register as a producer or join or comply with the obligations of a BCS, as well as breaching record-keeping and reporting duties. Penalties include unlimited fines and company officers may also be held personally liable if offences are committed with their consent or due to their neglect.

Find out more here

Batteries, Product Standards, Waste and Recycling, Circular Economy, Environmental Protection

In force.

The Batteries and Accumulators (Placing on the Market) Regulations 2008 (the “UK Batteries Regulations”) were introduced in the UK to implement certain requirements of the EU Batteries Directive 2006/66/EC into local law. While the UK Batteries Regulation implemented requirements related to the placing of batteries on the market, requirements related to waste batteries are addressed by the UK Waste Batteries Regulations, please see UK Waste Batteries.

Post-Brexit, the UK Batteries Regulations remain in effect in the UK as retained legislation, though with certain amendments to ensure continued legal operability. In particular, the applicable provisions differ between Great Britain (England, Wales and Scotland) and Northern Ireland, given that Northern Ireland remains subject to the EU batteries regime under the Northern Ireland Protocol and Windsor Framework. For further details about the EU batteries regime, please see here.

The UK Batteries Regulations apply to all categories of batteries placed on the market in Great Britain, regardless of their shape, volume, weight, material composition or use. They also apply to all appliances into which a battery is or may be incorporated. Obligations fall on a broad range of economic actors involved in the batteries supply chain, including manufacturers, producers, importers, authorised representatives, and distributors. 

Key requirements under the UK Batteries Regulation include:

• Hazardous substance restrictions: batteries must not contain more than 0.0005% mercury by weight, or more than 0.002% cadmium by weight in portable batteries.
• Labelling obligations: batteries must display: (i) the crossed-out wheeled bin symbol, indicating that the battery should not be disposed of with unsorted waste; (ii) chemical symbols (Hg, Cd, Pb) if these substances are present above prescribed levels; as well as (iii) capacity labelling, to inform consumers about the battery’s performance and encourage better use and replacement practices. Labelling must be visible, legible, and indelible to ensure durability and user awareness.
• Making batteries readily removable: manufacturers must design battery-powered appliances so that batteries can be readily and safely removed by end-users or qualified professionals. This is aimed at supporting repair, reuse and appropriate end-of-life treatment.

In November 2023, the Department for Business and Trade (DBT) published the UK battery strategy, outlining the government's aim to achieve a globally competitive battery supply chain by 2030 to support economic growth and the net zero transition. As a result, legislation to reform the UK batteries regime may be introduced in the near future.

Enforcement and penalties:

Enforcement is carried out by the Office for Product Safety and Standards (the “OPSS”) which has wide-ranging investigatory powers, including the ability to inspect premises, require production of documents, obtain samples, and enter commercial premises (excluding private residences) to ensure compliance. Where breaches are identified, the OPSS may issue compliance notices requiring remedial action, or enforcement notices requiring the withdrawal, modification, or restriction of non-compliant products from the market.

Non-compliance with the requirements of the UK Batteries Regulation may lead to criminal prosecution. Penalties can include an unlimited fine. Where a company is responsible for an offence, its directors, managers, or officers may also be held personally liable if the offence was committed with their consent, connivance, or through their neglect.

Find out more here

Regulation of Chemicals, Product Labelling, Product Packaging

In force.

Post-Brexit, Regulation (EC) No 1272/2008 on the classification, labelling and packaging of substances and mixtures (“EU CLP Regulation”) was, on 1 January 2021, under the European Union (Withdrawal) Act 2018, assimilated into UK law and remains in effect in Great Britain (England, Scotland and Wales) known as the “UK CLP Regulation”. Northern Ireland continues to be subject to the EU CLP Regulation under the terms of the Northern Ireland Protocol and Windsor Framework.

The EU CLP Regulation adopts the United Nations' Globally Harmonised System on the classification and labelling of chemicals (“GHS”). Consequently, Great Britain also continues to adopt the GHS, but now does so independently of the EU.

Businesses placing certain hazardous chemicals on the market in Great Britain. This includes manufacturers, importers, formulators, distributors, and retailers, regardless of whether the in scope substance or mixture (which can include products) they are placing on the GB market is for industrial use (e.g. explosives) or consumer use (e.g. scented candles).

The UK CLP Regulation does not, however cover substances and mixtures in certain forms that, when in their finished states, are intended for end consumers (e.g. cosmetics or medicinal products).

Depending on a business’s role in the supply chain, they may be required under the UK CLP Regulation to:

• Classify: according to specified criteria, and identify the type and severity of any hazard posed by a substance or mixture.
• Notify: the UK CLP Regulation is closely linked to the UK REACH regime, and so where a new substance or mixture placed on the GB market has been classified as hazardous, or where it is registered under UK REACH and is placed on the GB market (to the extent the information has not already been provided through the UK REACH regime), a notification to the Health and Safety Executive (“HSE”) for inclusion in the GB CLP notification database must be made. For more information on the UK REACH regime, see here;
• Label: include specified information on the label of most substances and mixtures that are classified as hazardous.
• Package: hazardous substances or mixtures must be packaged in a safe way. For example:
  • the package design and construction must prevent contents from leaking;
  • the packaging materials used must not be easily damaged by the contents or liable to form hazardous compounds with the contents;
  • packaging and fastenings should be durable to withstand handling, and replaceable fastening devices should be able to be refastened repeatedly without the contents escaping; and
  • packaging of hazardous substances or mixtures supplied to the general public should not be designed in a way that is likely to attract the curiosity of children or be misleading to consumers.
• Record-keep: suppliers must collate, keep and in some instances provide applicable information relating to a substance’s or mixture’s hazardous properties.

Following Brexit, changes to the GHS framework are now reviewed and implemented independently by the UK government. This means suppliers trading on both UK and EU markets must monitor both systems as:

• updates from the EU (such as new hazard categories or pictogram revisions) do not automatically apply in Great Britain;
• companies importing chemicals into Great Britain must update labels to meet GB CLP requirements, even if the product was correctly labelled in the EU; and
• a substance classified under the EU CLP Regulation may need a different label under the UK CLP Regulation, requiring businesses to maintain separate versions for different jurisdictions.

Enforcement and penalties:

HSE is the relevant agency overseeing CLP functions for substances and mixtures placed on the Great Britain market. Failure to comply with the UK CLP Regulation may lead to penalties such as an unlimited fine and/or up to two years imprisonment.

Find out more here

Regulation of Chemicals, Protection of Human Health, Environmental Protection

In force.

Post-Brexit, Regulation (EC) No 1907/2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (“EU REACH”) was, on 1 January 2021, under the European Union (Withdrawal) Act 2018, assimilated into UK law and remains in effect in Great Britain (England, Scotland and Wales) known as "UK REACH". Enforcement of UK REACH is governed by the REACH Enforcement Regulations 2008 (S.I. No. 2852 of 2008). Northern Ireland continues to be subject to the EU REACH regime under the terms of the Northern Ireland Protocol and Windsor Framework.

While the key principles of EU REACH have (for now) been retained, changes (via statutory instruments) were made to ensure UK REACH is operable in a domestic context. It is important to note that UK REACH and EU REACH operate independently from each other and businesses looking to operate in both the UK and EU must ensure compliance with both regimes.

UK REACH regulates chemicals and heavy metals placed on the market in Great Britain. It applies (with limited specific exclusions) to the majority of chemical substances that are manufactured in or imported into Great Britain, whether in their standalone form, in mixtures (e.g. ink or paint), or in their form as an article (i.e. consumer products like electronics, clothing, furniture and cars).

This means UK REACH covers not only the chemical industry but all sectors manufacturing, importing, distributing, or using chemicals as raw materials or finished products, and applies regardless of company size.

The main aims of UK REACH include:

• providing a high level of protection to human health and the environment from the use of chemicals in Great Britain;
• making those who place and/or make available chemicals (whether in their raw form or as part of an ‘article’) on the Great Britain market responsible for understanding and managing the risks associated with their use; and
• promoting the use of alternative methods for the assessment of the hazardous properties of substances.

To achieve these aims, UK REACH mandates that companies involved in the manufacturing, importing, distribution, or use of chemical substances on the British market must (amongst other things and depending on their role in the supply chain):

• register substances that are manufactured in or imported into Great Britain in quantities at one tonne or above per annum with the relevant regulator’s UK REACH IT system. This means that substances in their standalone form, in mixtures, and (in some cases) in a finished product should be registered;
• conduct risk assessments and submit safety data to the responsible UK regulator, the Health and Safety Executive (“HSE”), which performs a similar function to the European Chemicals Agency (“ECHA”) under EU REACH;
• communicate information along the supply chain, including to downstream users, on how a substance can be used safely and which particular risk management measures should be employed; and
• ensure compliance with substance restrictions and authorisation requirements (with certain chemicals and substances being subject to use limitations / requiring authorisation before they can be placed or made available on the British market).

Whilst the EU and UK REACH regimes are currently similar in scope and application, it is likely that the UK’s current REACH system will be updated, which may cause the two regimes to diverge. This means:

• the UK’s list of restricted substances, although currently similar to those under EU REACH, may be changed, and updates published on the HSE’s website should be monitored;
• post Brexit, an economic operator’s status within the supply chain may change or have changed (e.g. downstream users under EU REACH may have become importers under UK REACH) and care must be exercised to ensure that substances placed on the British market are covered by a valid UK REACH registration;
• that UK REACH does not automatically grant access to EU REACH registration data, requiring companies to resubmit or acquire new data;
• that UK REACH maintains many EU REACH restrictions but independently evaluates new authorisations; and
• non UK manufacturers are required to designate an “Only Representative” to manage certain compliance tasks.

Enforcement and penalties

It is an offence for a person to fail to comply with, or cause another person to fail to comply with, their duties under UK REACH. Penalties can include an unlimited fine and/or up to two years imprisonment. Information on HSE’s successful prosecutions and notices are also made public.

Find out more here

Regulation of Chemicals, Protection of Human Health, Environmental Protection

In force.

Post-Brexit, Regulation (EU) 2019/1021 on persistent organic pollutants (“EU POPs Regulation”) was, on 1 January 2021, under the European Union (Withdrawal) Act 2018, assimilated into UK law and remains in effect as retained legislation in Great Britain (England, Scotland and Wales), known as the "UK POPs Regulation". Enforcement of the UK POPs Regulation is governed by The Persistent Organic Pollutants Regulations 2007 (SI 2007/3106). Northern Ireland continues to be subject to the EU POPs Regulation under the terms of the Northern Ireland Protocol and Windsor Framework.

Further, as the UK is a party to the Stockholm Convention on Persistent Organic Pollutants (the "Stockholm Convention"), which aims, at a global level, to protect human health and the environment from Persistent Organic Pollutants (“POPs”), it is required to keep its domestic regime up to date to reflect amendments to the Stockholm Convention. The Stockholm Convention is implemented in Great Britain by assimilated Regulation (EU) 2019/1021 (as amended).

The UK POPs Regulation applies to a variety of economic operators who handle POPs, including those involved with their manufacture, placing on the market, stockpiling, and waste management in Great Britain.

POPs are chemical substances that persist in the environment (i.e. do not readily breakdown so remain in the environment for long periods of time), bioaccumulate (i.e. build up in the tissue of humans and wildlife when transferred through air, water and the food chain), cause adverse effects or are toxic (i.e. are harmful to human health and/or the environment) and have the potential for long-range environmental transport (i.e. can be found far from where they were used or produced).

Examples of POPs include: (i) pesticides; (ii) industrial chemicals and perfluoroalkyl substances (“PFAS”), which are used in non-stick cookware and water-resistant materials; (iii) polychlorinated biphenyls (“PCBs”), which are found in electrical equipment and hydraulic systems); and (iv) unintentional by-products of combustion and some industrial and non-industrial processes (i.e. dioxins and furans).

The UK POPs Regulation therefore affects the majority of manufacturers, importers, and recyclers operating in Great Britain, and particularly those involved in the following sectors electronics, chemicals, agriculture, coatings, and flame retardants.

The UK POPs Regulation aims to prohibit (or at the least severely restrict) the manufacture, marketing, and use of POPs (whether on their own, in mixtures or articles (i.e. physical products)). It also contains provisions which aim to: 

• minimise the environmental release of POPs that are formed as industrial by-products;
• ensure that stockpiles of restricted POPs are safely managed, with reporting obligations being triggered when certain amounts of material containing POPs are stored; and
• ensure the environmentally sound disposal of waste consisting of or contaminated by POPs, which disposal generally requires such waste to be destroyed or irreversibly transformed.

Most recently, the UK Government has been vocal about its commitments to:

• seek to eliminate the use of polychlorinated biphenyls (“PCBs”) by 2025 in line with its commitments under the Stockholm Convention; and
• substantially increase the amount of POPs material being destroyed or irreversibly transformed by 2030, so there are negligible leaks to the environment.

It is important to remember that while the UK and EU regimes are currently aligned, following Brexit, the UK has the power to:

• go further than the requirements of the Stockholm Convention in achieving its aims, such as through more UK-focused stringent restrictions for a given POP, where there are good reasons and sufficient evidence to do so; and
• diverge from EU-level amendments to its POPs regime, which is likely in the event the UK considers an EU proposal to be unsuitable for the UK context.

Enforcement and penalties:

Pursuant to the Persistent Organic Pollutants Regulations 2007, responsibility for enforcing environmental chemicals legislation primarily rests with the following bodies, known as the Competent Authorities:

• in England: The Environment Agency (“EA”);
• in Scotland: The Scottish Environment Protection Agency (“SEPA”); and
• in Wales: Natural Resources Wales (“NRW”).

Where a Competent Authority considers a non-compliance with the requirements of the UK POPs Regulation amounts to an offence, penalties may include an unlimited fine and/or up to two years imprisonment.

Find out more here.

Product Design, Hazardous Substances, Protection of Human Health, Environmental Protection

In force.

The Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Regulations 2012 (SI 2012/3032) (as amended) (“RoHS Regulations”) were introduced in the UK to implement the EU RoHS Directive 2011/65/EU into national law.

Post Brexit, the RoHS Regulations remain in force in the UK as retained legislation, though with certain amendments to ensure continued legal operability. In particular, the applicable provisions differ between Great Britain (England, Wales and Scotland) and Northern Ireland, given that Northern Ireland remains subject to the EU RoHS regime under the Northern Ireland Protocol and Windsor Framework.

A range of economic operators (including manufacturers, authorised representatives, importers and distributors).

The electrical and electronic equipment (“EEE”) covered by the RoHS Regulations include large and small household appliances, IT and telecoms equipment, electrical and electronic tools, toys, leisure and sports equipment, and some types of medical devices. Such products must be designed for use with a voltage rating not exceeding 1,000V for AC and 1,500V for DC.

Certain categories of products are, however, specifically excluded from the RoHS Regulations such as equipment intended for military purposes or designed to be sent into space, large-scale fixed installations, and equipment designed solely for R&D purposes that are made available for business use.

The RoHS Regulations also set out specific exemptions where products are used in certain applications. These exemptions may be time-limited, and subject to the payment of fees for processing applications for grant, renewal or revocation.

The RoHS Regulations restrict the use of hazardous substances found in EEE with the underlying aim of protecting human health and the environment, including the environmentally sound recovery and disposal of waste generated by EEE.

The placement of EEE on the market is prohibited if it contains certain hazardous substances above specified concentration limits (unless an exemption applies). These substances and their maximum permitted concentrations include, for example:

• lead (0.1%);
• mercury (0.1%);
• cadmium (0.01%); and
• hexavalent chromium (0.1%).

EEE with substances that exceeds these limits are not permitted to be placed on the market.

Economic operators must also meet additional essential requirements, including conducting conformity assessment procedures, preparing technical documentation, ensuring proper labelling and marking, implementing compliance procedures for production conformity, maintaining records, and taking appropriate action in the event of non-conformity. They are also required to provide information and cooperate with the competent authorities as necessary.

Key developments include updates in 2023 related to restricted substances and exemptions. These changes introduced new restrictions on phthalates, revised exemptions for the use of mercury in lighting and medical devices, and revoked certain exemptions where safer alternatives are now available. Additionally, as of April 2023, fees apply to applications for the grant, renewal, or revocation of exemptions under the RoHS Regulations.

Enforcement and penalties:

The Office for Product Safety and Standards (“OPSS”) is the relevant market surveillance authority responsible for monitoring compliance with, and enforcement of, the RoHS Regulations. It can issue compliance, enforcement, and recall notices, and prosecute serious breaches.

Offences may result in unlimited fines, recall or withdrawal of EEE from the market, as well as criminal liability for obstructing enforcement or providing false information.

Find out more here.  

Ecodesign, Energy efficiency, Labelling

In force.

The  Ecodesign for Energy-Related Products Regulations 2010 (SI 2010/2617) (as amended) (“UK Ecodesign Regulations”) were introduced in the UK to implement the EU Ecodesign Directive 2009/125/EC (the “EU Ecodesign Directive”) into local law.

Post-Brexit, the UK Ecodesign Regulations remain in effect as retained legislation, though with certain amendments to ensure continued legal operability. In particular, the applicable provisions differ between Great Britain (England, Wales and Scotland) and Northern Ireland, given that Northern Ireland remains subject to the EU Ecodesign regime under the Northern Ireland Protocol and Windsor Framework.

In-scope products include domestic appliances (e.g. ovens, dishwashers, and vacuum cleaners), consumer products (e.g. smartphones and computers), industrial appliances (e.g. industrial fans and welding equipment), and different types of heating/cooling devices (e.g. air conditioners, space heaters, and water heaters). Such products may also be subject to the Energy Information Regulations 2011 (as amended).

Responsibility for compliance with the Regulations rests with the manufacturer, authorised representative, or importer that first places a regulated product on the GB market or puts it into service.

The UK Ecodesign Regulations aim to ensure that in-scope energy-related products are designed to be as energy efficient and environmentally friendly as possible throughout their lifecycle.

Economic operators must not place in-scope energy-related products on the GB market unless that product complies with the applicable ecodesign requirements, which are set out in various implementing measures.  

In-scope products must undergo a conformity assessment, bear the appropriate marking(s) (the UKCA and/or CE mark, as applicable) and be accompanied by a Declaration of Conformity to demonstrate their compliance with the UK Ecodesign Regulations.

The Declaration of Conformity must be supported by technical documentation which must be kept available for inspection for a period of at least ten years from the date the product was last manufactured and be made available to the relevant authority upon request within ten working days.

Importantly, the EU and UK regimes will soon diverge when it comes to ecodesign requirements. This is because the EU has brought into force the Ecodesign for Sustainable Products Regulation (“EU ESPR”), which after its transposition periods have passed, will go beyond the current EU Ecodesign Directive (on which the current UK ecodesign regime is based) by:

• Expanding its scope: Unlike the EU Ecodesign Directive, the EU ESPR applies to a wider range of consumer and industrial goods (including textiles, furniture and “other” electronics).
• Integrating the Energy Labelling Regulation: The ESPR complements existing regulations by integrating sustainability into product labelling, making it easier for consumers to make informed choices.
• Prioritising sustainability: The ESPR prioritises environmental sustainability, circularity, and transparency in the product design and production phases, as highlighted by the introduction of the Digital Product Passport which is designed to enhance traceability across a product’s entire lifecycle.

Now that the UK has left the EU, the UK is not bound by the EU ESPR and has not provided any indications that it will align its current ecodesign regime with its requirements.

Enforcement and penalties:

The Office for Product Safety and Standards ("OPSS") is the appointed market surveillance authority for the UK Ecodesign Regulations.  Non-compliance with the UK Ecodesign Regulations may lead to an unlimited fine. Other sanctions can include the issuing of compliance notices, variable monetary penalties, third party undertakings, enforcement undertakings, and stop notices.

Find out more here.

Waste Management, Extended Producer Responsibility, Circular Economy, Sustainable Products

In force.

The Waste Electrical and Electronic Equipment Regulations 2013 (as amended) (“WEEE Regulations”) were introduced in the UK to implement the EU WEEE Directive 2012/19/EU into local law.

Post Brexit, the WEEE Regulations remain in effect in the UK as retained legislation, though with certain amendments to ensure continued legal operability. In particular, the applicable provisions differ between Great Britain (England, Wales and Scotland) and Northern Ireland, given that Northern Ireland remains subject to the EU WEEE regime under the Northern Ireland Protocol and Windsor Framework.

The WEEE Regulations apply to all electrical and electronic equipment (“EEE”) placed on the market in Great Britan unless specifically exempted. The obligations extend to producers, importers, distributors (including retailers), Producer Compliance Schemes (“PCS”), and treatment facilities involved in the manufacture, sale, or disposal of EEE.

In scope EEE include 14 product types, covering a wide range of electrical and electronic goods used across domestic, commercial, and industrial settings. Certain categories of equipment are, however, specifically excluded from the WEEE Regulations such as military and national security equipment, equipment intended for space applications, large-scale industrial tools and fixed installations, most transport vehicles, certain medical devices, and R&D equipment supplied exclusively for business use.

The WEEE Regulations aim to prevent the creation of waste, enhance reuse and recycling, and improve the environmental performance of all actors in the EEE lifecycle.

Key requirements include:

• End-of-life management: in scope producers bear the financial duty of managing products at end-of-life, covering the costs of collecting, treating, recycling, and disposing of EEE once it becomes waste. Producers that place more than 5 tonnes of EEE on the market must join an approved PCS.
• Reporting requirements: in scope producers must report annually on the quantity and category of EEE placed on the market.
• Labelling requirements: in scope producers must mark all in-scope EEE with the crossed-out wheeled bin symbol and make information available on how new types of EEE can be reused and recycled in an environmentally sound manner at end of life.
• Take-back schemes: in scope retailers and distributors must offer free take-back services of WEEE (or joining a Distributor Take-Back Scheme (“DTS”) to do so on their behalf); displaying clear WEEE recycling information to customers and keeping records of take-back and disposal activities.

Recent amendments in 2025 include the ban on single use vapes in the UK; the introduction of a new category of regulated WEEE for vapes, e-cigarettes, and other nicotine delivery systems; and the modernisation of the EPR regime with the inclusion of obligations for online marketplaces (“OMPs”) and non-UK suppliers:

• Register and assume responsibility for overseas sellers: From 15 November 2025, OMPs must register with a PCS and take on producer responsibilities for EEE sold by non-UK sellers on their platforms.
• Report data and finance WEEE: Transitional data reporting applies in 2025 for OMPs, with full financial obligations for WEEE collection and recycling commencing in 2026. Planned reforms include kerbside WEEE collection and mandatory take-back during delivery of large appliances.

Enforcement and penalties:

The Office for Product Safety and Standards (“OPSS”) is responsible for enforcing the WEEE Regulations in relation to the compliance with EEE marking requirements and distributor obligations. Other aspects of the regulations, including compliance by producers, treatment facilities, and exporters, are enforced by the Environment Agency and its equivalents in Wales, Scotland and Northern Ireland.

Enforcement authorities have a wide range of powers to impose civil penalties, issue compliance notices, and pursue criminal prosecutions for serious breaches. Penalties can include unlimited fines, enforcement action, and criminal liability, depending on the nature and severity of the violation.

Find out more here.

Waste Prevention, Packaging Design, Circular Economy, Recycling

In force.

The Packaging (Essential Requirements) Regulations 2015 (as amended) (“UK Packaging Regulations”) were introduced in the UK to implement into local law the provisions of EU Directive 94/62/EC on packaging and packaging waste that relate to essential requirements for packaging.

Post Brexit, the UK Packaging Regulations remain in effect in the UK as retained legislation, though with certain amendments to ensure continued legal operability. In particular, the applicable provisions differ between Great Britain (England, Wales and Scotland) and Northern Ireland, given that Northern Ireland remains subject to the EU packaging regime under the Northern Ireland Protocol and Windsor Framework.

Any “responsible person” that places packaging on the market – this includes:

• any person that is responsible for packing and filling products into packaging;
• any person that affixes their name or trademark to the packed or filled packaging; and
• any importer.

All forms of packaging are covered by the UK Packaging Regulations, including primary (sales) packing, secondary (grouped) packaging, and tertiary (transport) packaging. This is regardless of the material used for the packaging (e.g., paper, plastic, glass, wood). Empty packaging (designed to be filled) and packaging components (to be integrated into packaging) are also covered.

The UK Packaging Regulations are designed to reduce the environmental impact of packaging at the source (i.e., before products reach consumers) by requiring sustainable design and limiting the use of hazardous materials.

Key requirements include:

• Minimisation: packaging must use the minimum volume and weight necessary to maintain the required level of safety, hygiene, and acceptability of the packed product and the consumer.
• Reusability and recoverability: packaging must be designed to be reusable or recoverable through material recycling, energy recovery, or organic/biodegradable recovery.
• Hazardous substances: packaging and its components must be designed in such a way that minimises the release of dangerous substances into the environment when incinerated or landfilled.
• Heavy metal restrictions: packaging must not (unless an exemption is available) contain more than 100 parts per million (ppm) of lead, cadmium, mercury, and hexavalent chromium in total.
• Technical documentation: businesses must hold appropriate evidence to demonstrate compliance with the essential requirements of the UK Packaging Regulations and be able to provide this on request to enforcement authorities.

Note that the UK packaging regime has been expanded through the adoption of the Producer Responsibility Obligations (Packaging and Packaging Waste) Regulations 2024, which introduces extended producer responsibility for packaging. For further information see here.

Enforcement and penalties:

Local Trading Standards authorities enforce the UK Packaging Regulations in England, Wales, and Scotland. The Department of Enterprise, Trade and Investment enforces the UK Packaging Regulations in in Northern Ireland.

Enforcement authorities are empowered to: (i) issue enforcement or compliance notices; (ii) order removal or withdrawal of non-compliant packaging from the market; and (iii) prosecute offences under criminal law.

Failure to comply with the requirements of the UK Packaging Regulations can result in criminal sanctions, including the potential for an unlimited fine.

Find out more here.

Waste Prevention, Recycling, Circular Economy

Largely in force.

The Producer Responsibility Obligations (Packaging and Packaging Waste) Regulations 2024 ("UK PPW Regulations") implement the Extended Producer Responsibility for packaging (“EPR”) regime in the UK.  

The UK PPW Regulations largely came into force on 1 January 2025, and will fully revoke the Producer Responsibility Obligations (Packaging Waste) Regulations 2007 (SI 2007/871) from 1 January 2026 (though some transitional provisions require continued record-keeping obligations).

Producers captured by the regime were required to register with the appropriate regulator (e.g., the Environmental Agency in England) by 1 April 2025. Reporting periods (i.e. when producers must collect packaging data) and deadlines for submitting data vary depending on the type of producer (“large” or “small”) and the year they are reporting on.

A range of producers which are established in the UK including: brand owners, packers or fillers, importers, distributors, online marketplace operators, service providers, and sellers.

The specific obligations that apply depend on whether the producer is a “small producer" or a "large producers".

An organisation is a “small” producer if either:

• its annual turnover is between £1 million and £2 million and it supplies or imports more than 25 tonnes of packaging in the UK; or
• its annual turnover is over £1 million and it supplies or imports between 25 and 50 tonnes of packaging in the UK.

An organisation is a “large producer” if:

• it has an annual turnover of more than £2 million; and
• it supplies more than 50 tonnes of packaging in the UK.

Packaging covered by the UK PPW Regulations is broadly defined: any material (for example, glass, plastic, steel, paper, or wood) that is used to cover, protect, deliver or present goods in the UK market. This includes primary (sales) packaging, secondary (grouped) packaging, and tertiary (transport) packaging. There are some exemptions.

The UK PPW Regulations shift the financial burden of managing packaging waste from the taxpayer and local authorities to various classes of obligated producers, and set out how those obligated producers must comply with the packaging waste regime and meet targets for recycling and recovery.

A “small producer” must register with the appropriate environment agency, and collect, retain and report on its packaging data annually. 

A “large producer” must meet more onerous requirements, including:

• meeting the same obligations as for a “small producer” (though with different deadlines and reporting periods, for example needing to collect, retain and report on its packaging data every six months);
• meeting recycling obligations for each of the categories of packaging it supplies;
• assessing the recyclability of the household packaging it supplies;
• paying a disposal fee for any householding packaging it supplies; and
• paying administration costs to the scheme administrator.

Producers under the UK PPW Regulation can meet their obligations by complying directly or by joining an approved compliance scheme (with the latter requiring provision of necessary information to the compliance scheme operator and payment of the appropriate membership fee).

Enforcement and penalties

The competent regulator varies per market: the Environment Agency in England; the Scottish Environment Protection Agency in Scotland; the Natural Resources Body in Wales; and the Department of Agriculture, Environment and Rural Affairs in Northern Ireland.

The competent regulator may issue a compliance notice to require compliance with the regime. Where enforcement action is necessary, civil sanctions may be imposed, such as enforcement undertakings and fines. Fines may range from a fixed penalty for minor offences, 5% of the producer's turnover for more significant offences (including variable monetary penalties), and unlimited fines where criminal sanctions apply.

Find out more here.

ESG policy

Voluntary standards

UK insurance and reinsurance firms and groups, banks, building societies, and PRA-designated investment firms.

Supervisory statements set flexible frameworks for firms, incorporating new and existing expectations. They do not set absolute requirements – these are contained in rules. However, from a practical perspective, a firm would need to be able to demonstrate an objectively justifiable reason for departing from the guidance in a supervisory statement.

The PRA sets out its expectations regarding how firms should:

• embed the consideration of the financial risks from climate change in their governance arrangements;
• incorporate the financial risks from climate change into existing financial risk management practice;
• use (long term) scenario analysis to inform strategy setting and risk assessment and identification; and
• develop an approach to disclosure on the financial risks from climate change.

The PRA expects firms to engage with (presumably meaning they should become interested and actively involved in) wider initiatives on climate-related financial disclosures and to take into account the benefits of disclosures that are comparable across firms.

ESG policy

Voluntary standards

Firms of which investment strategy or investment decision could have a material impact on a policyholder's investment returns and relates to a product where the primary purpose is to provide and investment return and the investment risk is borne by a policyholder who is a natural person or a relevant policyholder.

This contains guidance setting out the FCA's expectations on how certain FCA-regulated firms may take into account ESG financial considerations and other financial considerations and non-financial matters as part of its investment strategy and investment decision making to demonstrate compliance with Principles 2, 3, 6 or 8.

ESG policy

Voluntary standards

Operators of a personal pension scheme or stakeholder pension scheme.

This contains guidance setting out the FCA's expectations on how certain FCA-regulated firms may take into account ESG financial considerations and other financial considerations and non-financial matters as part of its investment strategy and investment decision making to demonstrate compliance with Principles 2, 3, 6 or 8.

ESG policy

Voluntary standards

Firms, funds.

The IA framework categorises, and provides standard definitions for, the different components of responsible investment. IA member firms are encouraged to adopt the framework to help bring clarity and consistency to investors on the approaches they take to responsible investment. IA members are asked to identify which funds should be classified as having responsible investment characteristics and this information feeds into IA reports.