V.S.M.E

Frequently Asked Questions: 

• What is the Voluntary Sustainability Reporting Standard for SMEs (VSME)?

  The Voluntary Sustainability Reporting Standard for SMEs (VSME) is a sustainability reporting framework developed by the European Financial Reporting Advisory Group (EFRAG) for non-listed small and medium-sized enterprises. It provides a practical way for businesses to report their environmental, social and governance (ESG) performance without the complexity of the Corporate Sustainability Reporting Directive (CSRD). VSME helps SMEs demonstrate sustainability performance, respond to customer requests and prepare for future regulatory developments. 

• Is VSME reporting mandatory?

  No. VSME is a voluntary reporting standard designed for SMEs that are not directly required to comply with the Corporate Sustainability Reporting Directive (CSRD). However, many organisations choose to adopt VSME because customers, investors, lenders and supply chain partners increasingly request sustainability information. Implementing VSME can help businesses remain competitive and better prepared for evolving ESG expectations.

• Who should use the VSME Standard?.

  A VSME report typically includes information on a company's environmental impact, greenhouse gas emissions, energy and resource use, workforce, governance, business ethics and sustainability policies. Depending on the reporting module selected, businesses may also disclose climate-related risks, targets and other sustainability metrics relevant to their operations. 

• What information is included in a VSME report?

  A VSME report typically includes information on a company's environmental impact, greenhouse gas emissions, energy and resource use, workforce, governance, business ethics and sustainability policies. Depending on the reporting module selected, businesses may also disclose climate-related risks, targets and other sustainability metrics relevant to their operations. 

• What is the difference between VSME and CSRD?

  VSME is a voluntary sustainability reporting framework for non-listed SMEs, while CSRD is a mandatory reporting directive for certain large companies and listed organisations within the European Union. VSME provides a simpler, proportionate approach to sustainability reporting, allowing SMEs to communicate ESG information without meeting the full reporting requirements of the European Sustainability Reporting Standards (ESRS). 

• Does VSME require a Double Materiality Assessment?

   A formal Double Materiality Assessment is not a mandatory requirement of the VSME Standard in the same way it is under CSRD. However, businesses may still benefit from identifying the sustainability topics that are most relevant to both their organisation and stakeholders. This helps ensure reporting focuses on the issues with the greatest business and sustainability impact. 

• What are the benefits of implementing VSME?

  Implementing VSME can help businesses strengthen customer relationships, meet supply chain sustainability requirements, improve access to finance, enhance ESG transparency and prepare for future regulations. It also provides a structured framework for measuring sustainability performance and identifying opportunities for continuous improvement. 

• How long does it take to prepare a VSME report?

  The time required depends on the size and complexity of the organisation and the availability of sustainability data. Businesses with existing environmental and management systems may complete the process more quickly, while organisations starting from scratch may require additional time to gather information, develop policies and establish reporting processes. 

• Can VSME help my business win more contracts?

  Yes. Many large organisations and public sector bodies now request sustainability information from suppliers as part of procurement and supply chain due diligence. Producing a VSME report demonstrates your commitment to sustainability, improves transparency and can strengthen your position when competing for contracts where ESG performance is considered.

• Can VSME be integrated with ISO management systems?

  Yes. VSME aligns well with internationally recognised management systems such as ISO 14001 (Environmental Management), ISO 9001 (Quality Management), ISO 45001 (Occupational Health and Safety) and ISO 50001 (Energy Management). Organisations with certified management systems often find it easier to collect the data and evidence required for sustainability reporting. 

• How can CG Business Consulting help with VSME reporting?

  CG Business Consulting provides end-to-end support for organisations implementing the VSME Standard. Our consultants help businesses understand the reporting requirements, identify relevant sustainability data, develop practical reporting processes and prepare clear, credible VSME reports. We work with organisations across multiple sectors to simplify sustainability reporting while supporting broader ESG and business improvement objectives. 

• Why should my business start VSME reporting now?

  Although VSME is voluntary, expectations around sustainability reporting continue to grow across supply chains, financial institutions and procurement processes. Starting now enables businesses to build reliable ESG data, improve decision-making and demonstrate their sustainability credentials before reporting becomes a competitive requirement. Early adoption also reduces the effort required to respond to future customer or regulatory requests.