The Government has launched a consultation on sweeping changes to the UK’s corporate reporting system.
Explaining the motivation behind the proposals, the Secretary of State for Business, Innovation, Science and Trade said that the existing system is “long overdue for reform”, having developed in “a messy and piecemeal way, resulting in a complex series of regulations, many of which distract businesses from the main job of creating employment and generating wealth”.
Described as a “once in a generation review”, the consultation is unsurprisingly a lengthy and dense document, containing numerous proposed changes which affect companies of all sizes. Among the most significant proposals are:
- Simplifying which companies are required to report different types of information by “taking a fresh look at the Companies Act 2006 to rationalise the scopes, thresholds and exemptions which determine what disclosures a company must make”;
- Creating a reporting framework for SMEs which would allow certain medium-sized companies to claim a wider package of exemptions;
- Creating a new ‘very large’ threshold that could be applied to non-financial reporting requirements;
- Streamlining the existing legal framework and moving detailed requirements “out of the law and into relevant standards”;
- Removing prescriptive obligations relating to strategic reports so as to enable companies to “explain performance, strategy and governance in a way that reflects the size and nature of their business”;
- Simplifying remuneration and corporate governance reporting; and
- Bringing more of the existing system into the modern world, including exploring which disclosures can be made digitally.
The consultation closes on 30 November 2026 and can be read in full here.