EFRAG introduces VSME: New standard for voluntary sustainability reporting by SMEs

What is VSME and how does it support SMEs?

The European Financial Reporting Advisory Group (EFRAG) has completed the voluntary reporting standard for unlisted micro, small and medium-sized enterprises (VSME — Voluntary Reporting Standard for Non-Listed Micro, Small, and Medium-Sized Undertakings). On December 12, 2024, this standard was officially confirmed by the European Commission. It was announced as part of the SME Relief package as a key measure to support SMEs.

The VSME was developed specifically for companies that are not covered by the mandatory Corporate Sustainability Reporting Directive (CSRD). The aim is to make it easier for these companies to access sustainable financing through standardized sustainability reporting and to promote economic transformation towards greater sustainability.

The two VSME modules: basic and comprehensive module

The new standard is divided into two modules:

1. Basic module: Covers basic sustainability requirements
2. Comprehensive module: Includes additional data points for specific requirements

These modules help SMEs efficiently provide the required sustainability data for business partners such as banks, investors and large companies. The VSME minimizes the effort involved in unstructured data requests and at the same time creates new financing options for SMEs.

Helping SMEs implement VSME

Although VSME can be used across sectors, industry-specific requirements may require additional data collection. In order to help SMEs implement the standard efficiently and promote its acceptance, EFRAG is planning a comprehensive package of measures for 2025. This includes the development of practice-oriented guidelines and training materials, the implementation of targeted information and awareness-raising events, and the provision and development of digital tools and platforms. The aim is to provide SMEs with user-friendly resources to efficiently design their sustainability reporting and adapt it to market requirements.

The VSME as a milestone for sustainable reporting for SMEs

The VSME is not fully developed and still has compatibility problems with existing standards such as the German Sustainability Code (DNK). However, it represents a decisive milestone for SMEs who want to make their contribution to a sustainable economy while strengthening their competitiveness.