VSME (voluntary SME sustainability standard)

The VSME (Voluntary Sustainability Reporting Standard for SMEs) is a voluntary sustainability reporting standard designed for small and medium-sized enterprises that are not required to report under the Corporate Sustainability Reporting Directive (CSRD). It was developed by EFRAG, the technical body advising the European Commission on sustainability reporting, which delivered the standard at the end of 2024.

Its purpose is to give SMEs a simple, proportionate and standardised framework to communicate their sustainability performance, without the complexity of the European Sustainability Reporting Standards (ESRS) that apply to large companies.

Origin and fit within the Omnibus simplification

The VSME is part of the European effort to reduce reporting burden. The European Commission endorsed the standard through a recommendation in 2025, and it is expected to serve as the basis for a future voluntary standard adopted formally once the simplification legislation known as the sustainability Omnibus package is finalised. The exact status of its adoption is worth checking, as the regulatory timeline is still evolving.

Modular structure

The VSME is designed with a modular structure that lets each company tailor the level of detail to its size and the needs of its stakeholders:

• Basic module: a reduced set of information that represents the recommended minimum, especially suited to the smallest companies.
• Comprehensive module: builds on the basic one with additional disclosures frequently requested by banks, investors and value-chain customers.

This gradation avoids forcing a micro-enterprise to face the same requirements as a medium-sized company with financing or customers that demand more information.

The effect on the value chain

One of the VSME's most relevant features is that it acts as a cap on the information large companies can require from SMEs in their value chain. Within the CSRD and its double materiality logic, in-scope companies need data from their suppliers, but the VSME seeks to prevent that demand from becoming a disproportionate burden for smaller companies by setting a common reference point.

Why it matters to an SME

Adopting the VSME can help an SME to:

• Respond in a standardised way to information requests from customers, banks and investors.
• Improve its access to sustainable finance.
• Better understand and manage its own performance, as a step towards a fuller sustainability report if needed in future.

Prepare your sustainability information with Manglai

Whether you report voluntarily with the VSME or are asked to by your value chain, you need reliable, well-structured data. Discover how Manglai can help you measure your footprint and prepare the sustainability information your company needs.