VSME – Voluntary sustainability reporting standard for SMEs

CSRD reporting has begun, and many Finnish companies have been preparing their first official sustainability reports at the start of 2025. At the same time the EU Commission has published proposals to simplify sustainability reporting as part of its Omnibus I package. The abbreviation VSME has also surfaced, referring to a potential framework for companies excluded from mandatory reporting to engage in voluntary sustainability reporting. What is VSME, and what does it include?

The start of sustainability reporting was postponed by two years in accordance with the EU Commission’s Stop-the-Clock Directive. In addition, the Omnibus package includes a proposal to ease the reporting thresholds. The final thresholds for reporting companies have not yet been determined, but according to the proposal, only companies with over 1,000 employees would be required to report in accordance with the ESRS standards. Smaller companies could, if they wish, report voluntarily based on the VSME standard, which is intended for SMEs. The VSME standard, prepared by EFRAG, was approved at the end of 2024. EFRAG has also been tasked with reviewing the ESRS standards with the aim of reducing the number of data points and easing the burden of mandatory reporting.

What is VSME?

VSME is a voluntary sustainability reporting standard developed by EFRAG for non-listed small and medium-sized enterprises. The VSME standard is intended for companies that wish to prepare a voluntary sustainability report on their operations. The VSME report is based on EFRAG’s ESRS standards and includes similar data requirements as the mandatory reporting standards. However, the requirements under the VSME standard are less extensive and more limited than those in mandatory sustainability reporting.

Which companies can benefit from VSME reporting?

For most companies, the reason for voluntary sustainability reporting is that they are part of a larger supply chain. For example, their customer may fall under the scope of the CSRD or be conducting scope 3 emissions calculations. A larger company that examines its entire value chain in its sustainability reporting may set various requirements for companies in its supply chain, such as providing emissions data, setting SBTi targets, or preparing a sustainability report. Companies that are part of such value chains may want to consider voluntary sustainability reporting in order to be able to respond to potential data requests or even formal requirements. Of course, the primary reason for voluntary sustainability reporting may also be the company’s own interest in assessing the sustainability of its operations and publicly reporting on related matters, especially its progress in promoting sustainability.

What does VSME include?

The VSME standard is based on the ESRS standards, which were developed for reporting under the CSRD. However, VSME is a significantly lighter set of standards and consists of two parts: the Basic Module and the Comprehensive Module. If a company wants to start preparing its own sustainability report based on VSME, it must at minimum follow the content requirements of the Basic Module. Additionally, if the company has stakeholders such as investors or financiers, the Comprehensive Module may provide valuable additional information to include in the report.

VSME and emissions calculation

The VSME standard is in many ways a lighter framework compared to the ESRS standards required for companies under the CSRD. However, the voluntary SME standards cover the same thematic areas as the sustainability reporting standards, and the reporting requirements are divided into environmental, social, and governance-related impacts. The content of these requirements is also simpler and less extensive.

From the emissions calculation perspective, the VSME standard requires companies to calculate at least their scope 1 emissions (from their own operations) and location-based scope 2 emissions (from purchased energy). In addition, the company should report these greenhouse gas emissions relative to its revenue (GHG intensity). If desired, the company may also calculate its scope 3 emissions, which cover the entire value chain. Scope 3 calculations are also based on the standards of the GHG Protocol.

We have now launched a scope 1 and 2 calculator on the OpenCO2net platform for companies following the VSME standard. The calculator is available for free testing by anyone, with a limited selection of emission factors. If you wish to access a more comprehensive version of the calculator, along with a downloadable report and summary for example, for verification or auditing purposes, you can contact OpenCO2net’s experts via the link found under the calculator or through this page. If you’re unsure about which emission factors or input data your company should enter into the calculator, book a demo with our experts and we’ll assess your company’s needs together!

OpenCO2net is a carbon footprint platform built by experts, offering all the tools you need to support your company’s climate work. The VSME calculator is a lightweight and easy-to-use carbon footprint tool that allows companies to get started in a simple and cost-effective way. In addition, we offer access to tools for calculating scope 1–3 emissions, product carbon footprints, and the OpenCO2 API, which enables you to integrate emission factors directly into your company’s own systems. Don’t hesitate to get in touch with us to learn more about our tools and services!