Companies Act 2014 section 1596

Consolidated sustainability reporting

Section 1596 sets out the consolidated sustainability reporting obligations for large parent companies (known as applicable holding companies), requiring them to include a dedicated sustainability section in their group directors' report.

• Applicable holding companies must include a clearly identifiable dedicated section in the group directors' report covering both the group's impacts on sustainability matters and how sustainability matters affect the group's development, performance and position
• The sustainability section must contain detailed disclosures on the group's business model and strategy, time-bound targets (including greenhouse gas reduction targets for 2030 and 2050), due diligence processes, principal risks, and relevant indicators across short-term, medium-term and long-term horizons
• During the first three years of application, where full value chain information is unavailable, directors must explain the efforts made to obtain it, why it could not be obtained, and their plans to secure it in future
• Companies that comply fully with the consolidated sustainability reporting requirements under this section are deemed to have also satisfied their obligations under section 327(3)(b) (business review in the directors' report) and section 1590 (individual entity sustainability reporting)