Voluntary guideline for sustainability data from SMEs

Small and medium-sized enterprises aren’t exactly asking for more paperwork. Still, they’re increasingly facing questions from large customers or banks about sustainability. The European Commission is now introducing a voluntary standard to help address this.

This guideline is aimed at SMEs that do not fall under the CSRD. The idea: if larger companies need sustainability data, it’s best they request it using the same standard. Less hassle, more clarity.

EFRAG came up with the format

The standard was developed by EFRAG, the Commission’s technical advisory body on sustainability reporting. And no, companies aren’t required to use it. But they can, if they choose.

Some SMEs may decide to report voluntarily, to get a clearer view of where they stand on sustainability. Or because it can make access to sustainable financing just that little bit easier. In both cases, the guideline offers a useful framework.

Not yet law, but that could change

On 26 February, the Commission proposed limiting mandatory sustainability reporting to companies with over 1,000 employees. For those below that threshold, a voluntary standard is on the way, based on the current recommendation.

So for now, this recommendation serves as a kind of interim step. Until the delegated act is finalized and officially adopted. What it will include may still change. And when will it happen? That depends on how quickly the negotiations between lawmakers move forward.

Ec.europa.eu