What is the VSME?

The VSME Directive (Voluntary Sustainability Reporting Standard for SMEs) is a European directive specifically designed to support SMEs in sustainability reporting. Whereas larger companies are covered by the CSRD (Corporate Sustainability Reporting Directive), the VSME is a simplified reporting standard for companies that are not directly subject to CSRD obligations, but do face sustainability obligations through customers, financiers or sector standards, or want to start working on sustainability themselves. 

With the possible introduction of the Omnibus proposal , more companies will fall outside the direct CSRD obligation. Nevertheless, the VSME also offers an opportunity for these companies to professionalise their sustainability understanding - without the full burden of CSRD compliance. In doing so, it is important to realise that many companies, for example as suppliers to a CSRD-compliant organisation, may still be asked to report according to the VSME. This potentially applies to tens of thousands of companies, as an estimated 25,000 to 100,000 companies are covered by CSRD. 

These are the benefits of the VSME for your business 

The VSME helps you understand your sustainability strategy in an efficient and structured way and leverage this in your market position. This offers three key benefits: 

1. Access to finance 

Banks and investors are increasingly demanding an understanding of ESG (Environmental, Social, Governance) factors in lending. The VSME guideline makes it easier to collect and present sustainability information, making you as a company more attractive to financiers who want to support sustainable businesses. 

2. Maintain and strengthen customer relationships 

As a supplier to CSRD-compliant companies, you increasingly get requests to share sustainability data. Large companies are held accountable for the sustainability of their entire supply chain. By proactively demonstrating how your company operates sustainably, you meet these requirements and strengthen your position as a trusted partner. 

3. Competitive advantage and market position 

Companies that report on sustainability in a transparent and structured way position themselves better in tenders, collaborations and contract negotiations. The VSME gives you a clear, standardised way to demonstrate your sustainability efforts and create value for customers and stakeholders. 

Learn more about the benefits of sustainability insight in this article >

Why use the VSME? 

Customers and larger companies you work with in the chain do have to report according to CSRD and will ask questions like, "What are you doing in terms of sustainability?" The VSME helps you give a structured and professional answer to that - even if you are still in the early stages.  Do you get stressed by all those requests? In this 'first help with a VSME request' you will see exactly what to do.

Good to know is that the VSME is structured in modules. For small companies, there is a basic route/module with only the key points of sustainability reporting. Think: basic environmental, human rights, governance information. For medium-sized companies and those with more experience in sustainability, there are more extensive reporting options. Think chain obligations or customer questions. 

The structure of the VSME is similar to that of the European CSRD/ESRS, but has deliberately been kept much more compact and simple. This makes it possible to dovetail with the sustainability questions of customers, supply chain partners and financiers, without companies being directly confronted with the full complexity of the CSRD. 

All frequently asked questions about VSME can be found here >

How to deploy VSME? 

If you want to reap the benefits of the VSME guideline, there are some practical steps you can take. Here's how to use the VSME: 

• Determine which sustainability information is relevant: focus on the ESG factors that are most important to your sector and customers. This is where you get VMSE data.

• Ensure streamlined data collection: use tools and processes to easily collect data on your carbon emissions, energy consumption and social impact. 

• Integrate sustainability reporting into your business operations:make it an integral part of your strategy and communication to clients and funders. 

• Use VSME as an opportunity for growth:see sustainability reporting not as a burden but as an opportunity to strengthen your market position and make finance more accessible. 

Conclusion: seize the opportunity to strengthen your business 

The VSME guideline provides companies not subject to CSRD with an accessible way to make their sustainability efforts transparent. This increases your chances of securing funding, helps you meet customer expectations and gives you a competitive advantage in a market where sustainability is increasingly important. By committing to sustainability reporting now, you will prepare your business for the future and ensure that you remain attractive to both funders and major customers.