The Complete VSME Sustainability Reporting Guide for SMEs

What is the VSME standard, and who is it for?

VSME - Voluntary reporting standard for non-listed micro-, small- and medium-sized enterprises - is published by EFRAG, the same body that develops the mandatory European Sustainability Reporting Standards (ESRS) used by large companies under the CSRD. VSME is not mandatory for anyone. It exists specifically for businesses that fall outside CSRD's scope but are being asked for sustainability data anyway, by a customer, a lender, or a public tender.

The standard has two parts. The Basic Module covers the disclosures most buyers and banks actually ask for - things like energy use, water, waste, workforce basics, and governance. The Comprehensive Module adds the deeper detail a larger customer's due-diligence questionnaire, or a more demanding lender, might want on top. Because VSME names each disclosure with a code rather than leaving the format open-ended, a report built on it can be checked line by line against the standard - see the full Basic and Comprehensive module list here.

Why enterprise buyers value VSME data across supply chains

Large companies in scope of CSRD have to report their own Scope 3 emissions - the emissions that happen in their supply chain, not on their own premises. That requirement doesn't stop at the large company's front door; it pushes down onto every supplier that company buys from, including SMEs that were never directly in scope of any regulation themselves. A large buyer now has a real, regulatory reason to ask its smaller suppliers for emissions data, even though the supplier has no legal obligation to provide it.

This is exactly the gap VSME was designed to fill. Rather than every large buyer inventing its own supplier questionnaire format, VSME gives both sides a shared, standardized structure - the buyer gets data in a format its own reporting can actually use, and the supplier answers once, in a format that's reusable the next time a different customer asks the same kind of question.

Step-by-step VSME carbon compliance checklist

1. 1

   Mapping corporate operational boundaries

   Before any numbers get collected, VSME's Basic Module opens with the "basis for preparation" disclosure - essentially, defining exactly what the report covers. This means settling a few basic questions up front: which legal entity or entities the report covers, whether any subsidiaries are consolidated in or reported separately, and which twelve-month period the data covers. Getting this boundary wrong is the single most common reason a first-time VSME report needs to be redone - it's worth deciding deliberately rather than assuming.

   • Confirm the reporting entity. One company, or a parent plus subsidiaries?
   • Fix the reporting period. Match it to your financial year unless there's a specific reason not to.
   • Note anything excluded and why. A stated exclusion is fine; a silent gap isn't.
2. 2

   Extracting utility, fuel, and fleet data

   The energy and greenhouse gas emissions disclosure is where most of the actual work sits, and it's the part people most often either get stuck on or guess at. What you actually need is narrower than it sounds: twelve months of electricity bills (or the annual kWh/MWh figure if your provider shows it directly), and fuel records for anything your business directly burns - company vehicles, generators, boilers, or similar equipment. Rough, reasonable estimates are acceptable where a precise figure genuinely isn't available, as long as they're labeled as estimates rather than presented as exact.

Choosing software to track and maintain this data

A single VSME report is manageable by hand, in a spreadsheet, with an afternoon and a stack of bills. The problem most SMEs actually run into is what happens the second and third time - when a different customer's questionnaire arrives six months later, or the same customer asks again next year, and the underlying bills, assumptions and calculations from last time have scattered across emails and desktops. When evaluating how to track this data going forward, it's worth avoiding locking your business into a complex, expensive annual system sized for a problem you don't have - see our breakdown of the best carbon accounting software options for SMEs to weigh what actually fits a once-or-twice-a-year reporting need.