The VSME standard can seem abstract if you read it simply as a text. It becomes concrete as soon as you treat it for what it really is in practice: a structured response to a specific request. This page turns the standard into a four-step method for the managing director of an SME or micro-enterprise, a CSR officer or a consultant providing support.
If you are new to the subject, start with the basics: what the VSME standard is, its modules and its status. Here, we move on to practice.
Why you are getting started: a request from a customer, a bank or a call for tenders (pull logic)
The VSME is a voluntary framework: on 8 November 2026, no company is legally required to produce a VSME report, and there is neither a penalty nor a filing obligation. In practice, however, few SMEs take it up of their own accord. The trigger is almost always external:
- a contracting customer sends you an ESG questionnaire because it must itself document its value chain;
- a bank or an investor includes sustainability criteria when assessing an application;
- a call for tenders, public or private, includes an environmental and social section.
This is what is known as a pull approach: demand drives the reporting, rather than the company pushing it out of its own accord. Taking the request as your starting point shapes the whole method. It tells you who you are producing it for, which disclosures are actually expected, and how far you need to go – without overdoing it. A supplier approached by a large group does not have to meet every demand: this point is covered in our page on the VSME and the value chain, which explains how the value chain cap works.
Remember the principle: start from the request you have received, identify who is making it and what it covers, then build your report to answer it properly. The method below takes you through this.
Step 1: choose your module (Basic only or Basic + Comprehensive)
The VSME is organised into two modules. The Basic Module brings together eleven disclosures, numbered B1 to B11. It is the common core for all companies applying the standard. The Comprehensive Module adds nine further disclosures, C1 to C9; it does not replace the core but comes on top of it – producing the Comprehensive Module therefore means first completing the Basic Module.
The first decision is therefore simple to state: do you stick to the Basic Module, or do you add the Comprehensive Module? Here again, the answer depends on the request. A basic customer questionnaire is often satisfied with the core. A bank, an investor or a demanding contracting customer may expect information that falls under the Comprehensive Module – a strategy, greenhouse gas reduction targets, human rights policies.
Decision table: Basic only or Basic + Comprehensive
To decide, compare three dimensions: the expected content, the collection effort, and the trigger behind your approach.
- Basic Module only – Content: the eleven disclosures B1 to B11 (basis for preparation, practices and policies, energy and emissions, pollution, biodiversity, water, resources and waste, workforce, health and safety, remuneration and training, convictions for corruption). Effort: moderate, as most of the data already exists within the company. Typical trigger: a routine customer questionnaire, a first voluntary step, a call for tenders with a light ESG section.
- Basic Module + Comprehensive Module – Content: B1 to B11 plus the nine disclosures C1 to C9 (strategy, climate targets, climate risks, more detailed social data, human rights, etc.). Effort: higher, as some disclosures require analysis and not just data collection. Typical trigger: a request from a funder or a large contracting customer expecting a greater level of detail.
One important principle governs all of this: the standard applies ‘where applicable’. A disclosure that is irrelevant to your business – you have no industrial site, no particular discharges – does not need to be filled in artificially. Choose the most appropriate scope, not the heaviest. This page remains the reference URL for this choice of module; we do not duplicate this comparison elsewhere on the site.
Step 2: map and collect the data (B1 to B11)
Once the module has been chosen, most of the work consists of gathering the data. The good news: in an SME, most of this information already exists, scattered across the accounts, payroll, energy bills and contracts. The challenge is not to create data but to retrieve it and make it reliable. This is precisely where an accounting firm can step in, since it already holds a large share of the sources.
The eleven disclosures of the Basic Module fall into three groups.
Environmental data (energy, emissions, water, waste)
The environmental core of the Basic Module covers, in particular, energy and greenhouse gas emissions (disclosure B3), pollution of air, water and soil (B4), biodiversity (B5), water (B6) and resource use, circular economy and waste management (B7). The sources are generally tangible: electricity, gas and fuel bills, meter readings, waste transfer notes, collection contracts. Energy and emissions is often the most requested item; greenhouse gas calculators exist to help with this conversion, a topic we cover in our page on VSME tools and software.
Social data (workforce, health and safety, training)
The social section covers the general characteristics of the workforce (disclosure B8), health and safety (B9), and remuneration, collective bargaining and training (B10). Here, the sources lie in payroll, the staff register, the document unique d’évaluation des risques (the mandatory French occupational risk assessment document), records of workplace accidents and the training plan. This is data that every company with employees already produces for its routine employment obligations.
Governance data (ethics, corruption)
The governance section of the Basic Module includes the basis for preparation of the report (disclosure B1), practices, policies and future initiatives (B2), and any convictions and fines for corruption (B11). The Comprehensive Module goes further into these areas, for example with human rights policies and processes (C6) or the gender ratio in the governance body (C9). These disclosures are often factual statements based on internal registers and procedures.
Do you have 10 employees or fewer?
The delegated act of 3 July 2026 lightens the Basic Module for you: energy consumption and greenhouse gas emissions (B3), water withdrawal and consumption (B6), and the application of circular economy principles and waste tonnages (B7) become optional — the text marks them ‘voluntary for undertakings with 10 employees or fewer’. These same disclosures are also excluded from the value chain cap: a contracting customer therefore cannot request them from you on that basis.
Step 3: the data → source → evidence matrix (working file)
This is the step that distinguishes a credible report from a mere statement. For every figure published, you must be able to answer two questions: where does this data come from, and where is the evidence that supports it? To do so, build a three-column matrix, which becomes your working file.
- The data point – the disclosure to be published, as it will appear in the report (for example: energy consumption and the associated emissions, under disclosure B3).
- The source – where it comes from (the energy bills for the financial year, the supplier’s statement, the internal tracking spreadsheet).
- The evidence – the archived, retrievable supporting document (the scanned invoice and the calculation workings, filed in a dated folder).
A complete line reads as follows: emissions → energy bills → archived supporting document. Repeated for each disclosure, this matrix does three things. It makes the report defensible if a customer or funder asks questions. It makes the process repeatable from one year to the next. And it prepares for a possible third-party review: an accounting professional can offer a voluntary assurance engagement, and a well-kept working file is a prerequisite for this. This point is covered in our page on the VSME as an engagement for accounting firms.
Step 4: write and consolidate the report (transparency, restraint, no greenwashing)
Writing comes last, once the data has been gathered and traced. Three principles should guide it.
- Transparency – say what you measure and how. Specify the scope adopted, the items covered and any limitations of your figures. A data point presented with its method is worth more than an impressive but opaque one.
- Restraint – the VSME is not a communications exercise. The expected format is factual, structured and free of hype. You publish information, not a sales pitch.
- No greenwashing – only announce what you can prove. A target without a plan, a commitment without an indicator or a figure without a source carries a far greater credibility risk than having no report at all. The ‘where applicable’ principle allows you to leave aside what does not concern you: make use of it rather than inventing.
Finally, remember that the VSME does not require double materiality and does not make an audit mandatory. The report is consolidated at entity level and does not have to be filed with any authority. Its strength lies in its rigour, not in an official stamp.
How long it takes and how often (annual update)
The time required depends mainly on the maturity of your data. A first report takes more effort, as you need to locate the sources and build the working file. Subsequent years are quicker: the data → source → evidence matrix is already in place and only needs updating.
The natural approach is an annual update, aligned with your financial year, since most sources – energy, payroll, purchasing – already follow this rhythm. A VSME report is not a static document: it is rerun every year with the new data. Building a good working file from the outset is therefore the best investment of time you can make.
Common mistakes to avoid
- Trying to fill in everything. That is what the ‘where applicable’ principle is for. Artificially completing an irrelevant disclosure adds noise and weakens the whole report.
- Choosing the Comprehensive Module by default. If the request does not require it, the Basic Module is enough. You can always add more later.
- Publishing without evidence. A figure without an archived source becomes unmanageable at the first question and impossible to reproduce the following year.
- Confusing reporting with communication. The VSME calls for factual restraint, not self-promotion.
- Giving more than is asked. When dealing with a contracting customer, answering beyond the expected scope exposes you unnecessarily. Know what you owe, and no more – see the value chain page.
- Starting from scratch every year. Without a structured working file, each financial year repeats the initial effort.
The VSME is a standard developed by EFRAG, submitted to the European Commission on 17 December 2024, and then endorsed by Commission Recommendation (EU) 2025/1710 of 30 July 2025. It is a non-binding soft law instrument. Applying the VSME therefore remains voluntary: no penalties, no mandatory filing.
In parallel, a voluntary standard (‘VS’) was adopted by the Commission through delegated act C(2026) 5011 of 3 July 2026, then published in the Official Journal of the EU on 21 September 2026 (Delegated Regulation (EU) 2026/1560): it has been in force since 24 September 2026, and the Recommendation ceased to produce legal effects on that date. VSME and VS are two related but distinct instruments. The acronym ‘VS’ is not defined in the enacting terms of the delegated act, but it is now used by EFRAG, by the Autorité des normes comptables (French accounting standards authority) and by the Portail RSE (the French Ministry of the Economy’s CSR portal). We follow these developments in our regulatory watch.
FAQ
Where should the VSME report be filed?
Nowhere, in the regulatory sense. On 8 November 2026, the VSME is a voluntary framework: there is no obligation to file it with any public authority or register. The report is sent directly to whoever requested it – a customer, a bank, a client company – or published on your own initiative, for example on your website. Its value comes from its content and traceability, not from an official filing.
Is a third-party verifier needed?
No, it is not mandatory. The VSME does not make an audit mandatory and does not require any external verification. However, an accounting professional – a chartered accountant or a statutory auditor – can offer a voluntary assurance engagement to lend credibility to your report with a funder or a large customer. It is an option, not a requirement. We explain what such an engagement involves in our page dedicated to accounting firms.
Is the Basic Module enough?
In most cases where the request comes from a routine customer questionnaire, yes. The Basic Module (disclosures B1 to B11) is the common core for all companies applying the VSME. The Comprehensive Module (C1 to C9) is added when a funder or a contracting customer expects a greater level of detail. See the decision table in Step 1.
Where should I start if I am new to the standard?
With the definition and status of the standard: first read our main page on the VSME standard. You can then compare the VSME with other frameworks using our VSME comparison, before coming back here for implementation.
Sources and verification — checked on 8 November 2026
Every regulatory statement on this page has been checked against the official text. The references below allow you to verify it for yourself.
- Commission Delegated Regulation (EU) 2026/1560 of 3 July 2026 (adopted under reference C(2026) 5011) ‘supplementing Directive 2013/34/EU of the European Parliament and of the Council by establishing sustainability reporting standards for voluntary use by undertakings protected by the value chain cap’ — legal basis: Article 29ca(1) of Directive 2013/34/EU. Published in the Official Journal of the EU (L series) on 21 September 2026, in force since 24 September 2026 (Article 4); its Article 3 (value chain cap) applies to financial years beginning on or after 1 January 2027. Official text on EUR-Lex · version adopted on 3 July 2026 (PDF, European Commission). Relevant articles: 1 (definition of the cap), 2(1) (who may apply the standard), 3(2) (the cap covers only the data points in Annex II), 4 (entry into force), recital 5 (end of the legal effects of the Recommendation, message to funders). Transmitted to the Parliament and the Council on 3 July 2026 (Council document 11697/26 of 9 July 2026).
- Commission Recommendation (EU) 2025/1710 of 30 July 2025 (endorsement of EFRAG’s VSME), OJEU of 5 August 2025 — text on EUR-Lex. Recital 5 of Delegated Regulation (EU) 2026/1560 provides that it ‘should be considered as no longer producing legal effects’ from the entry into force of that regulation, i.e. on 24 September 2026.
- EFRAG — VSME/VS digital template and XBRL taxonomy, version 2.0.0 of 4 November 2026 (prepared in accordance with the voluntary standard (VS), Delegated Regulation (EU) 2026/1560 published in the Official Journal of the EU on 21 September 2026; it replaces version 1.3.0 of 11 June 2026, which EFRAG says should no longer be used) — EFRAG page.
A question about timing? The progress of the texts is tracked, with dates, in our regulatory watch.