EFRAG is pleased to announce the delivery of its technical advice on the Voluntary Sustainability Reporting Standard for non-listed micro-, small-, and medium-sized undertakings (VSME), following the express request of the European Commission (EC) confirmed on December 12, 2024.
The VSME is a key step toward simplifying sustainability reporting for SMEs and supporting their access to green financing opportunities, as outlined in the European Commission’s SME Relief Package of September 2023.
Development and Consultation
Between January 22, 2024, and May 21, 2024, EFRAG conducted a public consultation on the Exposure Draft of the VSME. Input was received from a broad range of stakeholders, including SMEs, industry associations, banks, accountants, and national standard setters.
Feedback from this consultation informed further simplifications, and the final VSME was approved by EFRAG’s SR TEG on October 22, 2024, and by the SRB on November 13, 2024.
Key Features of the VSME
The VSME provides a standardized approach to sustainability reporting for non-listed SMEs, designed to reduce the burden of responding to multiple, uncoordinated ESG data requests. It features:
- Two Modules: A Basic Module and a Comprehensive Module, covering disclosures relevant across sectors while allowing flexibility for sector-specific needs.
- Market-Driven Design: The VSME replaces disparate questionnaires with a cohesive framework, creating opportunities for SMEs to access sustainable finance and better manage sustainability data.
The standard aligns with the Corporate Sustainability Reporting Directive (CSRD) but is tailored for undertakings outside its mandatory scope.
Next Steps
EFRAG has committed to supporting the implementation of the VSME through a series of initiatives in 2025, including:
- Issuing digital tools, support guides, and educational materials.
- Hosting outreach and awareness-raising events.
- Monitoring the development of tools and platforms to facilitate adoption.
Leadership Perspectives
Patrick de Cambourg, EFRAG SRB Chair, highlighted the significance of the VSME, stating:
“The issuance of the VSME confirms EFRAG’s commitment to contribute to a more sustainable economy. Designed to reduce the burden on SMEs, it also opens new business and financing opportunities while enhancing management insight.”
Chiara Del Prete, EFRAG SR TEG Chair, emphasized the collaborative process, noting:
“The development of the VSME has been an enriching experience. Strong stakeholder support has guided every step, and we look forward to promoting tools and synergies to strengthen the SME ecosystem.”
The VSME represents a significant milestone in aligning SME reporting with sustainability goals, ensuring these businesses are equipped for a greener economy.
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