Voluntary sustainability reporting standards
On 17 December 2024, EFRAG released its technical advice on the voluntary sustainability reporting standard for non-listed SMEs and micro-enterprises (the ‘VSME standard’). This standard was developed at the request of the European Commission to meet the special needs of smaller entities that are not subject to the CSRD but would like to publish sustainability information on a voluntary basis.
At an EFRAG conference on 7 April 2025 (‘VSME in Action: Empowering SMEs for a Sustainable Future’), the Directorate-General for Financial Stability, Financial Services and Capital Markets Union (FISMA) discussed the future of this standard, which has become particularly important in light of the Commission’s proposals to reduce the reporting burden on entities (see the progress report on the Omnibus I package in this edition). According to the draft ‘Content’ Directive, the VSME should serve as a basis for the adoption of voluntary reporting standards for entities outside the scope of the future CSRD.
DG FISMA has therefore indicated that the VSME should be adopted as is, in the form of a European Commission recommendation, by June. Subject to the outcome of the ‘Content’ Directive negotiations (i.e. depending on the threshold ultimately adopted below which entities would not be required to publish a sustainability statement), the Commission may amend the VSME before its adoption by means of a delegated act. As a reminder, the Commission’s proposals of 26 February 2025 envisage the endorsement of voluntary sustainability reporting standards within four months of the entry into force of the ‘Content’ Directive.
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Tippawan Pumbansao Audit Partner - Bangkok
