In short: Climate-related disclosures explain how climate change affects your business (outside-in) and, through emissions, how your business affects the climate (inside-out). UK listed companies have reported against the TCFD recommendations since 2021 and move to UK SRS S2 for periods from 1 January 2027, when they must also say whether they have published a climate transition plan. Large UK companies also have Companies Act climate-related financial disclosure duties. TaxDigit's sustainability team identifies physical and transition risks, runs scenario analysis, quantifies the financial effect and drafts the disclosures and transition plan.
Physical risk, transition risk and what they cost
Physical risks come from climate change itself: acute events such as floods, storms and wildfires, and chronic shifts such as changing rainfall, rising temperatures and sea levels. They damage assets, interrupt supply chains, raise insurance costs and reduce output. Transition risks come from the move to a low-carbon economy: carbon prices and new regulation, technology that makes existing assets obsolete, shifts in customer demand and reputational damage. A faster transition means more transition risk and less physical risk.
Scenario analysis tests how your business performs if those risks crystallise under different warming paths, typically including a 1.5°C or below 2°C scenario. It is not a forecast. It shows where your operations, supply chain, demand and asset values are exposed, and which responses would make the strategy resilient. That analysis then feeds the climate resilience disclosure required by UK SRS S2 and IFRS S2.
- Listed companiesMoving TCFD reporting onto UK SRS S2 and the transition plan statement.
- Large private companies and LLPsMeeting Companies Act climate-related financial disclosure duties.
- Asset-heavy businessesProperty, manufacturing, energy, transport and agriculture with material physical or transition exposure.
- Borrowers and investeesAnswering lender and investor climate questionnaires.
Led by Dr Attieh Moezoddin, Head of Sustainability & ESG Advisory (PhD, Built Environment)Reviewed by Amir Rafiei, ACCA Certificate in Sustainability for FinanceLast reviewed
What we do
Board oversight and management roles
We document how the board and its committees oversee climate risks and opportunities and how management assesses and manages them.
Physical and transition risk register
We build a climate risk register covering acute and chronic physical risks and policy, legal, technology, market and reputational transition risks, mapped into your existing ERM framework.
Qualitative to quantitative
From narrative scenarios for first-time reporters to quantitative models using public climate data, we test resilience under orderly, disorderly and high-warming paths.
Revenue, costs, assets and capital
We translate each material risk into its effect on revenue, operating costs, capital expenditure, asset values and cost of capital.
Credible, costed, governed
We help you set targets, actions, dependencies and governance in a transition plan that can be disclosed, and draft the comply or explain statement for the FCA rules.
Where climate creates value
Resource efficiency, energy sources, low-emission products, new markets and resilience, quantified alongside the risks.
Climate disclosure duties in the UK
| Regime | Who | What and when |
|---|---|---|
| FCA Listing Rules (PS26/19) | UK listed companies | UK SRS S1 and S2 on a comply or explain basis for periods from 1 January 2027; transition plan disclose or explain |
| FCA Listing Rules (TCFD-based) | UK listed companies | TCFD-aligned climate disclosures for periods before 1 January 2027, or early UK SRS |
| Companies Act climate-related financial disclosures | Large UK companies and LLPs (employee and turnover tests apply) | Climate governance, risks, scenario analysis and targets in the strategic report; UK SRS S2 reporting can meet the duty |
| FCA ESG Sourcebook | UK asset managers and FCA-regulated asset owners above thresholds | Entity and product climate reports |
| Transition plans | Government consulted in 2025 on whether to mandate them | No mandatory duty to produce a plan yet; listed companies must disclose whether they have one |
How we approach climate disclosure
How climate differs as a risk: long horizons, uncertainty, non-linear tipping points and complex links.
Map climate risks to your existing risk categories and assess likelihood and impact.
Scenario analysis proportionate to your exposure and experience.
Board-approved disclosures and, where wanted, a transition plan.
A dedicated sustainability and ESG team
TaxDigit has a dedicated sustainability and ESG team, led by Dr Attieh Moezoddin, Head of Sustainability & ESG Advisory. Attieh holds a PhD in the Built Environment from the University of Salford and is a sustainable development researcher whose doctoral work built a framework for sustainable urban development using expert panels and multi-criteria analysis (fuzzy Delphi, fuzzy AHP and fuzzy TOPSIS) across social, environmental, economic and cultural pillars.
Finance, reporting and tax quality is reviewed by Amir Rafiei, Senior Manager for Global Tax Strategy, Transfer Pricing and Sustainability, who holds the 
ACCA Certificate in Sustainability for Finance. The team works side by side with our accounts, tax, payroll and international specialists, so your sustainability disclosures, financial statements and tax returns rest on one set of facts. Statutory audit is carried out separately by our alliance firm Jelveh Audit & Assurance.
- PhD, Built Environment
- Sustainable development research
- Materiality and expert panels
- SDGs and impact
- Climate risk and reporting
- ESG metrics and analytics
- IFRS S1, S2 and UK SRS
- CSRD and ESRS
- CBAM and green taxes
All sustainability and ESG services
See the full overview on our sustainability and ESG services page, or go straight to a related service. Large groups may also need our large and multinational group tax support.
Official sources
Rules, thresholds and dates on this page were checked against these sources on 14 November 2026. We re-check them whenever they change.
Frequently asked questions
What are the four pillars of climate disclosure?
Governance, strategy, risk management, and metrics and targets. They come from the TCFD recommendations and are carried into IFRS S2 and UK SRS S2.
What is the difference between physical and transition risk?
Physical risk arises from climate change itself, such as floods, heatwaves or changing rainfall. Transition risk arises from moving to a low-carbon economy, such as carbon pricing, new regulation, technology change and changing demand.
Is scenario analysis a forecast?
No. It tests how the business performs under different plausible futures when climate risks crystallise. It is not a prediction of values.
Do we have to publish a climate transition plan?
Not yet in the UK. Listed companies must state whether they have published one and where, or explain why not, for periods from 1 January 2027. The government has consulted on wider requirements.
Which scenarios should we use?
Usually at least one 1.5°C or well-below 2°C scenario and one higher-warming scenario, drawn from public sources such as the IPCC, the IEA or the NGFS, chosen to match your exposure.
What does outside-in and inside-out mean?
Outside-in is the effect of climate on the organisation. Inside-out is the organisation's effect on the climate, mainly through emissions, which can become financial through transition risk.
We are a private company. Does any of this apply to us?
Large private companies and LLPs have Companies Act climate-related financial disclosure duties if they pass the size tests, and lenders and customers increasingly ask for the same information.
Can you connect scenario analysis to our impairment testing?
Yes. We align the assumptions in your climate disclosures with impairment, useful lives and provisions in the financial statements. See climate risk in financial statements.