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What is the VSME and Why is it Important for SMEs?

Increasingly, SMEs are expected to account for their sustainability efforts. The VSME provides a standardized, straightforward way to create these reports. Discover how this voluntary standard helps businesses uncover opportunities, mitigate risks, and comply with regulations.

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Illustration of a VSME report

What is the VSME and Why is it Important for SMEs?

VSME-ESRS Cover

More and more, businesses are expected to account for their sustainability efforts. While you may want to embrace sustainability, creating a new report for each request can be overwhelming. The VSME (Voluntary Reporting Standard for Small and Medium Enterprises) offers a solution for SMEs in Europe. This voluntary standard helps small and micro-enterprises create transparent and straightforward sustainability reports.

Want to Read the Full VSME-ESRS?

Click here to visit the EFRAG website.

Why the VSME?

The VSME, formally known as the VSME-ESRS (Voluntary Reporting Standard for Small and Medium Enterprises - European Sustainability Reporting Standard), is designed to help SMEs understand their social and environmental impact. It meets the growing demand for transparency from supply chain partners and regulatory bodies. Large corporations, required to report under the CSRD (Corporate Sustainability Reporting Directive), increasingly need data on their full value chains—including smaller suppliers. The VSME provides SMEs with a standardized way to meet these data requests without getting lost in complex forms and reporting requirements.

With a clear VSME annual report, SMEs can map out their current sustainability position and take meaningful steps toward a climate-neutral and circular future—goals set by Europe for 2050.

The Purpose of the VSME: Unlocking Opportunities and Knowledge in Sustainability

The primary aim of the VSME is to give businesses a clear understanding of their sustainability performance. The report helps SMEs:

  • Discover sustainability opportunities: The VSME makes it easier for businesses to identify areas for improvement, contributing to environmental benefits, cost savings, and operational efficiency.
  • Support better decision-making: The report provides data to align strategies with short-, medium-, and long-term goals, making businesses more sustainable and future-ready.
  • Mitigate risks: Resource scarcity and climate change pose risks. By gaining insight into their supply chain and sustainability risks, SMEs can prepare for future challenges.
  • Gain a competitive edge: Businesses proactively addressing CSR (Corporate Social Responsibility) are better positioned for tenders and partnerships.

Compliance with Regulations and Collaboration Opportunities

The VSME enables SMEs to meet the requirements of large clients while enhancing their own sustainable practices. As these clients are obligated under the CSRD to report on their suppliers, it’s increasingly likely they will request a VSME report. This can lead to stronger relationships, increased trust, and opportunities for innovation and collaboration.

Through this European standard, SMEs contribute to a future where the economy and the environment are in balance. Europe aims for a climate-neutral and circular system, safeguarding its citizens and economy against the risks of climate change and reliance on external resources.

Start Your VSME Journey Today

A VSME report offers more than just an overview—it’s a compass for sustainable growth and innovation. By starting to track your impact and performance today, you can take targeted actions to contribute to a healthier planet and build a strong, future-proof business.

With the VSME, you’re prepared for tomorrow’s demands and can unlock new opportunities in the growing sustainability market.

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