EFRAG has also developed a voluntary sustainability reporting standard for non-listed SMEs (VSME). The EC SME Relief Package of September 2023 refers to VSME as a measure to support SMEs in accessing sustainable finance. EFRAG's work on such a voluntary standard for non-listed micro, small and medium undertakings is outside the Corporate Sustainability Reporting Directive ('CSRD'). It stems from the market need to have a common point of reference to be used by SMEs to face growing sustainability data requests from business counterparties and lowering entry barriers for non-listed SMEs to sustainability reporting.

Educational videos on VSME ED

Unofficial translations of VSME ED

Publication of exposure draft (21 January 2024)

On 21 January 2024, EFRAG published its exposure draft of VSME (VSME ED or ED) designed to receive feedback from constituents on key aspects of the ED, including (i) the proposed architecture; (ii) the relevance of the proposed disclosures; (iii) the simplifications achieved; and (iv) the market acceptance. Based on market acceptance, the VSME is expected to standardise the current multiple ESG data requests (which represent a significant burden on non-listed SMEs), by reducing the number of uncoordinated requests they receive. This is expected to support them in having better access to lenders, investors and clients.

Consultation package:

Feedback received:

Feedback VSME ED outside online survey:Feedback VSME ED outside online survey.zip

VSME letters uploaded via online survey:VSME letters uploaded via online survey.zip

VSME online survey responses:VSME online survey responses.xlsx

Drafting the exposure draft (November 2022 onwards)

VSME was discussed for the first time by SR TEG on 17 November 2022. The EFRAG SRB decided on 27 January 2023 to follow the building block approach. In particular, the EFRAG SRB discussed the need to develop a single standard for all SMEs; or two separate standards (ESRS LSME and VSME). The technical activities leading to the drafting of the two standards after this meeting showed that the differences in purpose and perimeter of application of the two respective standards require different approaches to the requirements. Merging of the two standards would have failed to meet the needs of the respective constituencies.

Successively, the content of VSME was discussed in nine EFRAG SR TEG Meetings and eight EFRAG SRB meetings. In addition, internal meetings with the EFRAG SME Expert Working Group and workshops with EFRAG VSME community and several stakeholders representing SMEs, banks and large corporates were held.

Another important element was the internal consultation during the summer of 2023 to gather detailed feedback on VSME v2 from EFRAG SRB and SR TEG. The EFRAG Secretariat took most of the detailed comments on board; the few not accepted contradicted the methodological approach agreed by EFRAG SR TEG and SRB.

The VSME ED was approved on the 8 November 2023 at EFRAG SR TEG and 29 November 2023 at EFRAG SRB.