Review findings - 2025
In August 2025 the FCA published their findings from a review of how their client reporting rules for asset managers, life insurers and FCA-regulated penison providers were working. Also, they have set out their plans to streamline and enhance their sustainability reporting framework.
The FCA's sustainability reporting requirements webpage has been updated to clarify how firms in scope of both the FCA's Task Force on Climate-related Financial Disclosures (TCFD) rules and Sustainability Disclosure Requirements (SDR) can report efficiently under both regimes.
Policy Statement - 2021
In December 2021 the FCA published PS21/24 Enhancing climate-related disclosures by asset managers, life insurers and FCA-regulated pension providers.
The FCA are introducing a new Environmental, Social and Governance (ESG) sourcebook. This contains rules and guidance for asset managers and certain FCA-regulated asset owners to make mandatory disclosures consistent with the TCFD’s recommendations on an annual basis at:
- Entity level – an entity-level TCFD report, published in a prominent place on the main website of the firm’s business, setting out how they take climate-related risks and opportunities into account in managing or administering investments on behalf of clients and consumers.
- Product or portfolio level – a baseline set of consistent, comparable disclosures in respect of their products and portfolios, including a core set of metrics. These must be made public in in a prominent place on the main website of the firm’s business and included or cross-referenced in an appropriate client communication, or made upon request to certain eligible institutional clients.
The rules aim to increase transparency on how firms are managing climate-related risks and opportunities and enable clients and consumers to make considered choices, while also remaining proportionate. This should, in turn, help to enhance competition in the interests of consumers, protect consumers from unsuitable products, and drive investment towards greener projects and activities.
The FCA is applying a phased approach for the implementation of the new rules:
- Phase 1 – the proposed rules will start to apply from 1 January 2022 to asset managers with assets under management (AUM) of more than £50 billion (enhanced scope SMCR firms) and to asset owners with £25 billion or more in AUM or administration relating to in-scope business. These firms will be required to publish the first set of disclosures by 30 June 2023.
- Phase 2 – Remaining asset managers and asset owners will need to comply from 1 January 2023 with the first disclosures being due by 30 June 2024.
The Policy Statements refers to the Climate Financial Risk Forum (CFRF) which is a financial services industry forum established jointly by the FCA and the Prudential Regulation Authority (PRA). CFRF Working Groups produce guidance, best practice, case studies and tools to help financial services firms identify, assess and respond to climate-related risks and opportunities.
Consultation - 2021
In the summer of 2021, the FCA published a consultation (CP21/17 Enhancing climate-related disclosures by asset managers, life insurers, and FCA-regulated pension providers). AREF held a webinar to gauge members views on the consultation in September 2021. After which, AREF sent the FCA this response. A main part of this related to the TCFD metrics and ensuring they are appropriate for real estate assets. We would like to thank CBRE who have assisted AREF and IPF in drawing up a paper on recommended metrics for real estate assets which can be found as an Annex to AREF’s response. The FCA have introduced guidance to clarify that a firm may disclose ‘other’ metrics that it considers an investor may find useful. They have stated that firms may wish to refer to sector‑specific guidance or best practice to determine which other metrics to disclose. They have given an example of Global Real Estate Sustainability Benchmark metrics and the Carbon Risk Real Estate Monitor tool for real estate investment activity.
There is ongoing engagement between AREF and the FCA on climate-related and sustainability disclosures. This is being led by AREF's ESG Disclosures Working Group and overseen by AREF’s Public Policy Committee and ESG & Impact Investing Committee. If you wish to be involved in AREF’s engagement with the FCA, please advise Jacqui Bungay, Head of Policy ([email protected]).
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