Is the Final VSME Tailored for Impact?
The Voluntary Sustainability Reporting Standard (VSME) simplifies sustainability reporting for non-listed SMEs, addressing some of the unique challenges faced by impact actors, thanks to input from impact stakeholders.
At the request of the European Commission, EFRAG (European Financial Reporting Advisory Group) developed the Voluntary Sustainability Reporting Standard for non-listed SMEs (VSME). This standard is designed for enterprises not falling under the mandatory scope of the EU’s Corporate Sustainability Reporting Directive (CSRD). It aims to address the unique sustainability reporting needs and capacity of non-listed small and medium-sized enterprises (SMEs), enabling them to access sustainable finance and contribute to the transition towards a more socially and environmentally sustainable economy.
By providing a standardised framework, the VSME replaces the uncoordinated and burdensome ESG questionnaires often requested by different stakeholders, such as banks, investors and business partners. Additionally, it introduces a proportionate set of indicators designed to simplify reporting and help non-listed SMEs embark on their sustainability journey while monitoring their performance over time.
EFRAG submitted its final technical advice on the VSME to the European Commission on 17 December 2024 (find the VSME standard here), following a comprehensive public consultation held between 22 January and 21 May 2024, which gathered input from diverse stakeholders, including Impact Europe. This policy brief will show how that input shaped VSME and what it means for stakeholders throughout the impact ecosystem.
With the financial support of:
