What is VSME?

Voluntary reporting for Small and Medium size Enterprises (VSME)

Responding to intense pushback from EU and other companies as reporting deadlines approach, on Feb. 26, 2025, the European financial reporting advisory group (EFRAG) submitted a new framework to facilitate ESG reporting for non-listed micro-, small- and medium-sized undertakings. Aligned largely with the European Sustainability Reporting Standard (ESRS), adopted on July 31, 2023, VSME is an abbreviated version for companies that do not yet have to comply with the Corporate Sustainability Reporting Directive (CSRD).

Definition of companies that can report under VSME

The standard applies to non-listed companies that fit into one of three categories based on their balance sheet total, their net turnover, and their average number of employees during the financial year as follows: Micro entities do not exceed two of the following thresholds:

€450,000 in balance sheet total

€900,000 in net turnover

An average of 10 employee

Small entities do not not exceed two of the following thresholds:

€5 million in balance sheet total

€10 million in net turnover

An average of 50 employees

Medium entities do not not exceed two of the following thresholds:

€25 million in balance sheet total

€50 million in net turnover

An average of 250 employees

VSME contains two modules - Basic and Comprehensive

The Basic module is recommended for micro-undertakings and constitutes a minimum requirement for small and medium entities. The Comprehensive module contains a large number of datapoints that are likely to be requested by banks, investors, and a company's clients in addition to the Basic module.

The full text of the standard can be downloaded here.