Which of the 15 GHG Protocol categories must be included?

All 15 categories must be assessed for materiality. You must disclose those that are material based on size, influence, risk, stakeholder interest, and outsourcing criteria. UK SRS S2 requires identifying which specific categories are included in your disclosure.

What data quality hierarchy does UK SRS S2 require?

UK SRS S2 requires prioritising inputs by data quality: measurement over estimation, primary over secondary data, representativeness, timeliness, and verification status. You must disclose your measurement approach, inputs, assumptions, extent of activity-specific data, and verification extent.

Is PCAF mandatory for Category 15 financed emissions?

PCAF is commonly used but not mandated by UK SRS. Financial institutions must report financed emissions using methodologies that meet UK SRS requirements, with PCAF being the established framework most use for consistency.

What conversion factors should I use?

Use DESNZ UK Government GHG Conversion Factors for Company Reporting for UK-specific emissions factors, supplemented by international databases and supplier-specific data where available.

Is Scope 3 assurance mandatory?

No. Assurance is not mandatory under the FCA proposal. Companies must state whether they obtained voluntary third-party assurance. The FRC will establish an interim assurance register by mid-2026 using ISSA (UK) 5000 standard.

How long does Scope 3 implementation typically take?

Implementation typically takes 12-18 months from materiality assessment to first reporting. The timeline is driven by supplier engagement for data collection, which cannot be compressed significantly.

UK SRS Scope 3 Reporting: The Practitioner's Guide

How to build a UK SRS S2 Scope 3 inventory — the 15 GHG Protocol categories, the data-quality hierarchy S2 requires, financed emissions (Cat 15), and assurance readiness.

Quick Answer: What does UK SRS require for Scope 3?

UK SRS S2 requires absolute gross GHG emissions across Scope 1, 2, and 3 in tCO₂e, with Scope 3 disclosed by significant categories across the 15 GHG Protocol categories where material. You must prioritise inputs by data quality and disclose your measurement approach, assumptions, and verification extent.

Last updated: 21 May 2026

The 15 Categories

UK SRS S2 requires Scope 3 emissions across all 15 GHG Protocol categories where material. Each must be assessed and documented, with material categories disclosed by upstream/downstream classification.

Upstream Categories (1-8)

Category 1: Purchased Goods & Services

Upstream emissions from all purchased products and services. Typically material for most companies.

Category 2: Capital Goods

Emissions from manufactured capital equipment, facilities, and infrastructure.

Category 3: Fuel & Energy Activities

Upstream emissions from fuel production and transmission & distribution losses.

Category 4: Upstream Transportation

Transportation and distribution of purchased goods in vehicles not owned by reporting company.

Category 5: Waste in Operations

Disposal and treatment of waste generated in operations.

Category 6: Business Travel

Employee transport for business-related activities in vehicles not owned by reporting company.

Category 7: Employee Commuting

Employee transport between their homes and worksites.

Category 8: Upstream Leased Assets

Emissions from leased assets not included in Scope 1 and 2.

Downstream Categories (9-15)

Category 9: Downstream Transportation

Transportation and distribution of sold products in vehicles not owned by reporting company.

Category 10: Processing of Sold Products

Processing of intermediate products by third parties subsequent to sale.

Category 11: Use of Sold Products

Emissions from use of goods and services by end users. Often material for manufacturers.

Category 12: End-of-Life Treatment

Disposal and treatment of products at end of life.

Category 13: Downstream Leased Assets

Emissions from assets owned and leased to other entities.

Category 14: Franchises

Emissions from franchisee operations not included in Scope 1 and 2.

Category 15: Financed Emissions

Mandatory for financial institutions. Emissions associated with investments, loans, and other financial services.

Materiality Screening

Not all 15 categories will be material for every company. UK SRS S2 requires assessing materiality using the GHG Protocol's five criteria and documenting exclusions.

Size

Magnitude of emissions relative to total Scope 3

Influence

Ability to influence emission reductions

Risk

Climate-related risks and opportunities

Stakeholders

Interest from key stakeholders

Outsourcing

Activities outsourced vs performed in-house

Documentation Requirements

UK SRS S2 requires disclosing which categories are included and documenting the basis for excluding any categories deemed immaterial. Quantitative thresholds should be established and justified.

The Data-Quality Hierarchy

UK SRS S2 requires prioritising Scope 3 inputs by data quality and disclosing the measurement approach, inputs, assumptions, extent of activity-specific data, and extent of verification. This is the key S2 differentiator.

Data Quality Ladder (Highest to Lowest)

Direct Measurement

Verified emissions data directly from suppliers/value chain partners

Primary Data

Activity data from suppliers with appropriate emission factors

Secondary Data

Industry averages, databases, and representative proxy data

Estimated Data

Activity-based and revenue-based estimation methods

Proxy Data

Financial proxies and sector-average extrapolations

UK SRS S2 Disclosure Requirements

• Measurement approach and methodology for each material category
• Inputs used and key assumptions made
• Extent of activity-specific vs proxy data
• Extent of verification obtained
• Data quality improvements planned

Financed Emissions (Category 15)

PCAF is the commonly used methodology for financial institutions, though not mandated by UK SRS. Asset-class attribution methods and data-quality scoring provide framework for consistent reporting.

Banking & Lending

Corporate loans: Outstanding balance attribution
Mortgages: Property energy consumption
Project finance: Project-specific emissions

Investment Management

Listed equity: EVIC methodology
Corporate bonds: Outstanding amount attribution
Real estate: Property-level emissions

PCAF Data Quality Scores

1Verified emissions data
2-3Reported & estimated data
4Activity & revenue estimates
5Sector average proxies

Key Exclusions

The ISSB amendment carried into UK SRS allows excluding certain categories so financed emissions are reported per IFRS S2:

• Derivatives: Financial derivatives excluded from financed emissions
• Facilitated emissions: Intermediation activities excluded
• Insurance-associated emissions: Underwriting excluded from Cat 15

Conversion Factors

DESNZ UK Government GHG Conversion Factors

Primary source for UK-specific emissions factors, published annually by the Department for Energy Security and Net Zero (DESNZ). Covers electricity, fuels, transport, and waste disposal.

Access DESNZ Conversion Factors

Supplementary Sources

• International databases (IEA, Ecoinvent, DEFRA)
• Industry-specific factors and benchmarks
• Regional emission factor databases
• Supplier-specific product carbon footprints

Factor Selection Priority

1. Supplier-verified product-specific factors
2. DESNZ UK Government factors (where applicable)
3. Representative regional/industry databases
4. International generic factors

Assurance Readiness

While assurance is not mandatory under the FCA proposal, preparing for voluntary third-party assurance improves data quality and stakeholder confidence.

ISSA (UK) 5000

UK assurance standard for sustainability information. The FRC will establish an interim assurance register by mid-2026.

• Limited vs reasonable assurance
• Scope 3 specific procedures
• Data validation requirements

Documentation

Maintain audit trail for all Scope 3 calculations, data sources, and methodology decisions.

• Calculation methodologies
• Data source documentation
• Quality control procedures

Disclosure Requirements

Companies must state whether they obtained voluntary third-party assurance for their Scope 3 data.

• Assurance provider details
• Level of assurance obtained
• Scope of assurance engagement

Implementation Roadmap

Phased approach from materiality assessment through to reporting and assurance readiness. Timeline is typically 12-18 months, driven by supplier engagement phases that cannot be compressed significantly.

Foundation Phase (Months 1-3)

Materiality assessment and gap analysis are pre-requisites before data collection begins. Running data collection without these creates wasted effort.

• Value chain mapping and spend analysis
• Category materiality screening (5 criteria)
• Business model risk assessment

• Stakeholder consultation on categories
• Quantitative threshold establishment
• Reporting boundary documentation

Data Infrastructure (Months 4-12)

Supplier engagement and data collection following the data quality hierarchy. Category 1 (Purchased Goods) and Category 11 (Use of Products) typically account for >70% of total Scope 3.

Tier 1: Primary

• Supplier engagement surveys
• Product carbon footprints
• Verified emissions data

Tier 2: Secondary

• Industry average factors
• DESNZ conversion factors
• Database emission factors

Tier 3: Estimates

• Economic input-output models
• Revenue-based estimates
• Sector average proxies

Quality Assurance & Reporting (Months 10-15)

Quality controls, uncertainty analysis, and disclosure preparation meeting UK SRS S2 requirements. Optional preparation for voluntary assurance.

• Data validation and QA procedures
• Uncertainty quantification
• Audit trail documentation

• UK SRS S2 disclosure alignment
• Assurance readiness (if desired)
• Continuous improvement planning

Timeline Reality Check

The 18-month average timeline reflects supplier engagement complexity that cannot be meaningfully compressed. Companies waiting for the FCA Policy Statement to begin preparation are already late for proposed 2028 Scope 3 comply-or-explain requirements.