UK Scope 3 Emissions Reporting in 2027: What Businesses and Freight Forwarders Need to Know

Published: 13 October 2026

UK sustainability reporting requirements are changing from January 2027. But does this mean every business must start reporting Scope 3 carbon emissions from freight transportation?

The short answer is no.

New reporting requirements are being introduced for certain UK-listed companies, bringing greater attention to emissions generated across their supply chains. However, there is currently no blanket legal requirement for every UK business or freight forwarder to report Scope 3 emissions under Categories 4 and 9 from January 2027.

Understanding what is changing, who is affected and how freight transportation fits into the reporting framework is important for businesses preparing for the coming years.

What is changing in UK carbon emissions reporting from 2027?

On 25 February 2026, the UK Government published the UK Sustainability Reporting Standards (UK SRS), comprising two standards:

• UK SRS S1: General requirements for sustainability-related financial disclosures.
• UK SRS S2: Climate-related disclosures, including greenhouse gas emissions.

These standards provide a framework for reporting sustainability-related risks, opportunities and climate-related information.

On 30 September 2026, the Financial Conduct Authority (FCA) published Policy Statement PS26/19, confirming new sustainability disclosure requirements for specified categories of listed companies.

The rules apply to accounting periods beginning on or after 1 January 2027, with the first annual reports under the new requirements expected in 2028.

The FCA has adopted a comply or explain approach. This means companies within the scope of the rules must either make disclosures in accordance with the applicable UK SRS requirements or explain why they have not done so.

Importantly, the FCA has provided a one-year transitional relief for Scope 3 emissions disclosures.

This means that, for a company with a calendar-year reporting period using the relief, its first reporting period covering Scope 3 under the new FCA regime would be 2028, with the annual report normally published in 2029.

Source: FCA Policy Statement PS26/19.

What are Scope 3 Categories 4 and 9?

The Greenhouse Gas Protocol divides corporate greenhouse gas emissions into three scopes.

Scope 1 covers direct emissions from sources owned or controlled by a business. Scope 2 covers indirect emissions associated with purchased energy. Scope 3 covers other indirect emissions occurring throughout a company’s value chain.

Scope 3 contains 15 categories, two of which are particularly relevant to freight transportation.

Category 4: Upstream Transportation and Distribution

Category 4 includes emissions from the transportation and distribution of purchased products between a company’s tier-one suppliers and its own operations, using vehicles or facilities that it does not own or control.

It also includes third-party transportation and distribution services purchased by the reporting company, whether for inbound freight, outbound deliveries or movements between its facilities.

For example, where a manufacturer purchases transport services from a freight forwarder to deliver its products to customers, those purchased transport services are generally accounted for under Category 4.

Category 9: Downstream Transportation and Distribution

Category 9 covers the transportation and distribution of products sold by the reporting company between its operations and the end consumer, where the transportation is not paid for by the reporting company.

A common misunderstanding is that all outbound freight automatically falls under Category 9.

This is not correct.

The GHG Protocol distinguishes between transportation services purchased by the reporting company, which fall under Category 4, and qualifying downstream transportation not purchased by the reporting company, which falls under Category 9.

Source: GHG Protocol Corporate Value Chain (Scope 3) Standard, Chapter 5.

Will Scope 3 freight emissions reporting become mandatory in 2027?

Not for every UK business.

Under the existing Streamlined Energy and Carbon Reporting (SECR) framework, UK quoted companies and qualifying large unquoted companies and limited liability partnerships already have statutory energy and greenhouse gas reporting responsibilities.

The SECR framework does not impose a general requirement for all businesses to report Scope 3 Categories 4 and 9.

The FCA’s new 2027 rules introduce UK SRS-based sustainability disclosures for certain listed companies. They do not automatically extend the same reporting obligations to every private business, SME or freight forwarder.

UK SRS S2 requires companies applying the standard to consider their entire value chain and all 15 Scope 3 categories, identifying which categories are included in their emissions disclosures.

This does not mean Categories 4 and 9 must appear in every company’s emissions inventory regardless of its activities.

For businesses with substantial freight transportation activities, however, those categories may be relevant to their Scope 3 assessment.

Sources: UK Government SECR guidance and UK SRS S1 and S2.

What does this mean for freight forwarders and logistics companies?

A freight forwarder may not be directly subject to the FCA’s new reporting requirements. However, its customers may be.

For example, an importer, manufacturer or retailer assessing its Scope 3 emissions may need information about transportation services purchased from third-party logistics providers.

This creates an important distinction between a legal obligation to publish emissions disclosures and a commercial request for emissions data from a customer.

A freight forwarder may be asked to provide carbon emissions information for individual shipments to help a customer prepare its wider Scope 3 inventory.

The GHG Protocol’s approach to value-chain accounting and the UK SRS S2 measurement guidance both recognise the importance of information obtained from suppliers and other businesses within a reporting company’s value chain.

UK SRS S2 also recognises that Scope 3 emissions may be estimated using appropriate activity data and emissions factors where direct measurements are unavailable.

For freight movements, relevant information can include transportation mode, shipment weight, distance travelled, activity data, calculation assumptions and the emissions factors used.

Clear reporting of the calculation method and underlying assumptions helps users understand how emissions estimates have been produced.

Is UK CBAM the same as Scope 3 freight reporting?

No. These are separate requirements.

The UK’s Carbon Border Adjustment Mechanism (CBAM) is scheduled to take effect on 1 January 2027.

CBAM will apply to specified imported goods within the aluminium, cement, fertiliser, hydrogen, iron and steel sectors.

Its purpose is to apply a carbon price to certain emissions embodied in imported goods.

It does not create a general requirement for freight forwarders to report Scope 3 Categories 4 and 9, and should not be confused with the FCA’s UK SRS sustainability disclosure framework.

Source: HMRC – Introduction of Carbon Border Adjustment Mechanism.

Should freight forwarders start preparing for Scope 3 reporting?

Although the 2027 regulatory changes do not make Category 4 and 9 reporting compulsory for all freight forwarders, understanding how to measure transportation emissions can help businesses respond to customer information requests.

The important starting point is understanding what information is available for each shipment and how any emissions estimates are calculated.

For businesses purchasing freight transportation services, having access to consistent shipment-level emissions data can support their assessment of relevant Scope 3 categories.

For freight forwarders, being able to provide that information gives customers another source of data for their wider carbon emissions reporting.

Calculating freight emissions with CocoonCarbon®

CocoonCarbon® provides shipment-level carbon emissions calculations for freight movements across road, air, sea, rail and courier transportation.

Businesses can use shipment information to calculate and report transportation emissions, helping them assemble the data needed to assess relevant Scope 3 freight activities.

The emissions category and any reporting obligation remain dependent on the individual business, its activities and the applicable reporting framework.

With UK sustainability disclosure requirements developing from 2027, understanding your freight emissions is an increasingly relevant part of supply-chain reporting.

Find out more at www.cocooncarbon.co.uk.

Official sources and further reading

1. Financial Conduct Authority – PS26/19: Aligning listed issuers’ sustainability disclosures with international standards – 30 September 2026.
2. UK Government – UK Sustainability Reporting Standards S1 and S2 – 25 February 2026.
3. UK Government – Environmental Reporting Guidelines, including SECR.
4. UK Legislation – The Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018.
5. GHG Protocol – Corporate Value Chain (Scope 3) Accounting and Reporting Standard.
6. UK Government – Introduction of Carbon Border Adjustment Mechanism.

Regulatory information is accurate as at 13 October 2026. This article provides general information and does not constitute legal or regulatory advice.