Sustainability reporting without the CSRD: getting started with the VS Standard

For Irish businesses outside mandatory sustainability reporting, the EU’s Voluntary Sustainability Reporting Standard offers a practical way to respond to growing requests for information. Our new guide, Navigating the VS, explains where to start.

Being outside the scope of the Corporate Sustainability Reporting Directive (CSRD) does not mean sustainability reporting has disappeared from the agenda. Irish businesses may still be asked for information by larger customers, lenders, investors or public sector clients. The challenge is to respond consistently without building a reporting process that is more complex than the business needs.

The EU’s Voluntary Sustainability Reporting Standard (VS Standard) provides a common framework for doing so. Based on the earlier voluntary standard for SMEs, known as VSME, it is designed by EFRAG (European Financial Reporting Advisory Group) to provide a practical and proportionate sustainability reporting framework for organisations outside mandatory CSRD reporting that choose to report on their sustainability performance.

A proportionate place to start

The VS Standard offers two routes. Its Basic Module covers core sustainability information. An optional Comprehensive Module adds disclosures that may be useful where business partners, banks or investors need more detail.

This gives organisations a way to build a reporting approach around their circumstances and stakeholders’ needs. The standard is also aligned in concept with the European Sustainability Reporting Standards (ESRS), providing a foundation for organisations that wish to develop their reporting further.

Responding to value chain requests

Many businesses receive sustainability questionnaires from customers or financial institutions, sometimes with different questions and formats. A report prepared using a recognised standard can help organise the underlying data and make those conversations more consistent.

The VS Standard also has a specific role in limiting the information that companies reporting under the CSRD can require from certain smaller businesses in their value chains for CSRD reporting purposes. That limit does not apply to every request for sustainability information, such as a request made as part of a tender. Understanding the distinction is important when deciding how to respond.

What does the guide cover?

Our guide, Navigating the VS: Getting started with the EU sustainability reporting standard for voluntary use, explains:

• Who the VS Standard is intended to support.
• How its Basic and Comprehensive Modules work.
• How it compares with the ESRS.
• What the value chain information limit means in practice.
• The main challenges to consider when preparing a voluntary report.

How Forvis Mazars can help

A useful voluntary report starts with understanding why your organisation is reporting, who needs the information and what data you can reliably provide. Our sustainability team can help you assess the right reporting approach, establish practical data collection processes and prepare disclosures that meet your stakeholders’ needs.

If you are unsure whether the VS Standard is right for your organisation, get in touch with our sustainability team to discuss where to start.