Posted 2nd November 2026

The sustainability conversation has changed considerably in recent years. For businesses, the challenge now isn't simply knowing that sustainability matters. It's understanding what matters most, demonstrating progress, and making sure sustainability is part of how the business actually operates.

Sustainability has become a much bigger part of the business conversation.

A few years ago, discussions often centred around commitments, targets and ambitions. Businesses were setting net zero goals, publishing sustainability statements and thinking about how they could demonstrate their environmental credentials.

Now, the conversation is becoming much more practical.

1. What are we actually measuring?

2. Can we back up what we're saying?

3. Which sustainability issues genuinely matter to our business?

4. And, perhaps most importantly, are we using the information we collect to make better decisions?

These questions are becoming increasingly relevant as sustainability reporting continues to evolve.

On 30 September, the Financial Conduct Authority confirmed new rules requiring in-scope listed companies to report against the UK's Sustainability Reporting Standards (UK SRS) on a "comply or explain" basis. The new rules apply to accounting periods beginning on or after 1 January 2027, with the first reporting expected in 2028.

That might sound like a conversation primarily for listed companies and finance teams.

But there is a wider lesson here for businesses of all sizes.

Sustainability is moving from something businesses talk about to something they increasingly need to understand.

Sustainability isn't just about reporting

It's easy to see sustainability reporting as another compliance exercise.

Another set of numbers to collect. Another document to produce. Another deadline to meet.

But there is an opportunity to look at it differently.

Good sustainability data can tell a business a great deal about how it operates.

• Where are we using the most energy?

• Where are we creating waste?

• How dependent are we on particular suppliers?

• Where might climate-related risks affect our operations?

• What are our customers increasingly asking for?

• Where could we become more efficient?

These aren't just sustainability questions. They're business questions.

The FCA itself has highlighted the value of reliable, comparable sustainability information in helping businesses and investors understand risks and opportunities and make better decisions.

And that is where the conversation becomes much more interesting.

Rather than seeing sustainability reporting as something the business has to do, what if we used it as a way of understanding the business better?

The rules are changing. Your reasons shouldn't.

The regulatory landscape around sustainability is evolving quickly.

The FCA's new approach is intended to align listed-company reporting with the UK SRS, which are based on the international ISSB standards. The "comply or explain" approach gives companies some flexibility, while still creating a common framework for sustainability and climate-related information.

There are also transitional arrangements, including relief around Scope 3 emissions and wider sustainability disclosures. For businesses affected by the changes, understanding the detail will obviously be important.

There is a bigger question worth asking.

What do we want sustainability to achieve for the business?

If the only objective is to produce a compliant report, there is a risk that sustainability becomes a box-ticking exercise. If the objective is to build a more resilient, efficient and future-ready business, the information becomes much more useful.

• That might mean identifying where energy costs could be reduced.

• It might mean understanding supply chain vulnerabilities.

• It might mean rethinking the materials being used or the way products are designed.

• It might mean investing in technology that reduces waste.

Or it could simply mean having a much clearer understanding of the environmental impact of everyday decisions. The report is the output. The thinking behind it is where the value lies.

Don't wait until you're required to measure

One of the biggest challenges for businesses is data. You can't manage what you don't understand, and sustainability is no different. Yet many businesses still don't have a clear picture of their environmental impact.

• They might know how much they spend on energy, but not necessarily how that translates into emissions.

• They might know how much waste they produce, but not where the biggest opportunities to reduce it are.

• They might have information from individual suppliers, but no consistent way of bringing it together.

This is why getting the basics right is more important than trying to measure everything at once.

Start with the questions that are most relevant to your business.

1. What has the biggest environmental impact?

2. What has the biggest financial impact?

3. Where is there the greatest risk?

4. And where could a relatively small change make a meaningful difference?

You don't need perfect data on day one. But you do need to start building a picture.

Sustainability can make commercial sense

There is sometimes an assumption that sustainability and commercial success sit on opposite sides of the table. But they have to. In many cases, becoming more sustainable can also make good business sense.

• Reducing energy use can reduce costs.

• Reducing waste can improve efficiency.

• Using resources more carefully can make a business less exposed to price increases or supply shortages.

• Understanding climate risks can help businesses prepare for disruption.

• And responding to changing customer expectations can open up new markets and opportunities.

There is also a resilience argument.

The businesses that understand their dependencies and vulnerabilities are likely to be better placed to respond when circumstances change. That doesn't mean every sustainability investment will have an immediate financial return. Some changes will require upfront investment. Others will take time to deliver results. But sustainability shouldn't automatically be viewed as a cost sitting outside the core business. Increasingly, it is part of thinking about how the business will operate in five, ten or twenty years' time.

Be careful of the sustainability claims

As sustainability becomes more important, so does credibility. Customers, investors and other stakeholders are becoming more interested in the evidence behind sustainability claims. Regulators are also placing greater emphasis on the quality and reliability of information.

The FCA has specifically highlighted the importance of trustworthy sustainability information and measures designed to prevent firms gaining an unfair advantage through unsubstantiated sustainability claims. For businesses, this is a useful reminder.

It is better to be honest about where you are than to make ambitious claims you can't substantiate.

You don't need to have solved every sustainability challenge. In fact, there can be real value in being open about the areas where you're still working things out.

• "We're measuring this for the first time."

• "We've identified this as an area we need to improve."

• "We've reduced this by X%."

• "We haven't reached our target yet, and this is what we're doing next."

That feels much more meaningful than vague statements about being committed to a greener future.

What should businesses do now?

For businesses wondering where to start, keep it relatively simple.

• Understand your biggest impacts.

  Don't try to measure everything immediately. Identify the areas that are most significant for your business and start there.

• Get your data in order.

  Good decisions depend on good information. Look at what you're already collecting and identify where the gaps are.

• Connect sustainability to business objectives.

  If sustainability sits separately from financial planning, operations and strategy, it is much harder for it to influence decisions.

• Set realistic goals.

  Ambition is important, but targets need to be meaningful and measurable. Make sure you know how you'll track progress.

• Be honest about where you are.

  Progress doesn't have to be perfect to be worthwhile. Credible information is much more valuable than impressive-sounding claims.

• Think beyond compliance.

  Even if a particular requirement doesn't apply to your business, the underlying questions may still be useful.

• What could climate change mean for your business?

• Where could resource efficiency improve your bottom line?

• What are your customers going to expect in the future?

• What would make your business more resilient?

These are questions worth asking regardless of whether a regulator is asking you to.

Sustainability is becoming part of good business

The sustainability landscape is likely to continue changing. Reporting requirements will evolve. Expectations will shift. New technologies will create opportunities, while climate-related risks will become increasingly relevant to business planning.

It can be tempting to respond to each change as it happens. A new regulation comes in, so we react. A customer asks for new information, so we collect it. A new sustainability trend emerges, so we look at whether we should follow it.

But there is another approach.

Build sustainability into the way the business thinks and makes decisions, so that individual changes in regulation or expectations become easier to respond to. That's where the real opportunity lies.

The businesses that take sustainability seriously aren't necessarily the ones with the longest sustainability reports or the biggest list of commitments.

They are the ones that understand their impact, use the information available to them and are prepared to make changes where those changes genuinely matter.

The rules may continue to change.

But the underlying principle doesn't need to.

Understand where you are. Be honest about where you need to improve. And use that information to build a better, more resilient business for the future.