Norway’s sovereign wealth fund has called on the UK’s financial regulator to be more demanding in some aspects of the new sustainability reporting rules for listed companies it is currently putting in place.
In its response to the Financial Conduct Authority’s (FCA) January 2026 consultation on aligning listed issuers’ sustainability disclosures with international standards, Norges Bank Investment Management (NBIM) said it strongly supported the proposal to replace the existing TCFD-aligned listing rules with requirements referencing the UK Sustainability Reporting Standards (UK SRS).
But it added: “However, we have concerns about certain aspects of the proposals that risk undermining the completeness, comparability and decision-usefulness of the information that global investors need.”
In the letter, published today, Carine Smith Ihenacho, NBIM’s chief governance and compliance officer, and Elisa Cencig, the organisation’s head of policy engagement, said that reporting Scope 3 emissions should become mandatory for UK-listed companies after the transition period.
The FCA has said it is not proposing to require mandatory reporting of Scope 3 emissions data, which it proposes can continue to be reported on a ‘comply or explain’ basis.
But NBIM, which runs the NOK21.3trn (€1.9trn) Government Pension Fund Global (GPFG) – about 5% of which is invested in the UK – said Scope 3 could represent 40% or more of total emissions and was “material for assessing transition risk”.
“An indefinite ‘comply or explain’ risks widespread non-reporting,” Smith Ihenacho and Cencig argued in their letter.
“We recommend mandatory Scope 3 reporting for periods beginning on or after 1 January 2028, or at a minimum, a clear sunset date for transition to mandatory disclosure,” they said.
Allowing for longer transition reliefs for Scope 3 reporting rather than an indefinite ‘comply or explain’ approach also tallied with the decision in other jurisdictions, “including some where climate-related reporting has been voluntary so far and/or less mature than in the UK”, they reasoned.
The NBIM pair also told the FCA that UK SRS S1 – the new rules setting out general content requirements for sustainability-related disclosures where, unlike for climate, there is no specific standard – should have a clear mandatory reporting timeline.
According to the FCA’s draft, the UK watchdog is proposing that this non-climate reporting can be on a comply or explain basis, because, it says, wider sustainability reporting “will be new to many of these listed companies and may present challenges”.
NBIM said, however, that non-climate sustainability information was equally capable of being financially material, that a two-year transition relief was already built in, and that voluntary disclosure rates among UK-listed companies were already significant.
“An open-ended ‘comply or explain’ regime provides insufficient certainty for preparers or investors,” Smith Ihenacho and Cencig said.
NBIM also objected to the FCA’s proposed exemption for secondary-listed issuers and depositary receipt issuers, saying this risked reducing disclosure relative to current TCFD rules.
“Secondary-listed companies should not face weaker requirements than today,” it noted.
