The European Commission has adopted a recommconcludeation on voluntary sustainability reporting for compact and medium-sized companies (SMEs).
The EU’s ‘Omnibus I simplification package’ in February proposed to limit mandatory sustainability reporting under the CSRD to large companies with more than 1,000 employees. For companies with up to 1,000 employees, the Commission proposed a voluntary reporting standard to be adopted by the EU executive and based on today’s recommconcludeation.
The recommconcludeation presents a voluntary standard that will build it simpler for SMEs that are not covered by the Corporate Sustainability Reporting Directive (CSRD) to respond to specific requests for sustainability information from large financial institutions and companies.
The voluntary standard for SMEs (VSME) was developed by EFRAG, the Commission’s technical advisory body for sustainability reporting.
The Commission is encouraging large companies and financial institutions that seek sustainability information from SMEs to base their requests on the voluntary standard as far as possible.
SMEs may also wish to voluntarily report sustainability information to improve their access to sustainable finance and better understand and monitor their own sustainability performance, thereby improving their resilience and competitiveness.
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