How-to guide · 2026
How to Complete a VSME Sustainability Report: Step by Step
The VSME (Voluntary standard for non-listed micro-, small- and medium-sized undertakings) is EFRAG's voluntary reporting standard for SMEs. This guide walks through completing it end to end — confirming scope, picking the Basic or Comprehensive module, collecting your Scope 1, 2 and 3 figures, calculating intensity ratios and finishing the narrative disclosures — so you can answer a customer's ESG request or get ahead of the supply-chain reporting that increasingly lands on SMEs.
The short answer
To complete a VSME report, confirm the standard applies to you and choose the Basic module (a minimum set of disclosures) or add the Comprehensive module (extra disclosures larger customers and lenders often ask for). Then gather your company and NACE-sector basics, collect Scope 1, Scope 2 (both location- and market-based) and any available Scope 3 emissions in tCO2e, calculate intensity ratios per unit of revenue, complete the narrative disclosures using EFRAG's "if applicable" rule (you may omit a disclosure that genuinely does not apply, with a brief explanation), check for completeness and, if a customer requires it, prepare for optional third-party assurance. Most SMEs find the emissions data is the hard part — a tool like CarbonTool builds the Scope 1–3 inventory on GHG-Protocol methodology once and then maps it to the VSME template for you.
Who the VSME standard is for
VSME is a voluntary standard, published by EFRAG, for non-listed small and medium-sized companies that fall outside the mandatory scope of the CSRD. It gives SMEs a single, proportionate format to respond to sustainability information requests from banks, investors and larger customers — instead of filling in a different bespoke questionnaire for each one. It is most relevant if you are:
An SME outside mandatory CSRD scope
You are not legally required to report under the CSRD but want a credible, standardised way to share sustainability information.
A supplier to a larger company
A big customer has sent an ESG or carbon questionnaire and you need one consistent answer you can reuse, rather than a new spreadsheet per request.
Seeking finance or investment
A bank or investor wants sustainability data as part of lending or due diligence, and VSME gives a recognised, proportionate format.
How to complete a VSME report in 7 steps
Work through the steps in order. The first year takes the longest because you are building the data foundation; in later years you mostly refresh figures, so the report becomes a repeatable annual task.
- 1
Confirm VSME applies and pick Basic vs Comprehensive
Check that you are a non-listed SME outside mandatory CSRD scope — VSME is voluntary and designed for exactly this group. Decide which module you need: start with the Basic module (the minimum set of disclosures). Add the Comprehensive module only if a customer, bank or investor specifically asks for the extra disclosures it contains. Choosing the right scope up front saves you collecting data you do not need.
- 2
Gather company and NACE basic information
Collect your general company information: legal form, headquarters and site locations, number of employees (headcount or full-time equivalents), and your NACE sector code(s) so your activity is classified consistently. Note the reporting period (usually your financial year) and whether you are reporting on an individual-company or consolidated-group basis. This is the descriptive backbone the rest of the report hangs on.
- 3
Collect Scope 1, 2 and 3 emissions in tCO2e
Build a greenhouse-gas inventory in tonnes of CO2 equivalent (tCO2e). Scope 1 covers direct emissions you control — fuel burned on site and in company vehicles. Scope 2 covers purchased energy and must be reported both location-based (grid average) and market-based (your actual contracts/tariffs). Scope 3 covers value-chain emissions such as purchased goods, business travel and waste; report the categories that are material and available to you. Apply consistent, recognised emission factors to your activity data so the numbers are defensible.
- 4
Calculate intensity ratios per unit of revenue
Turn absolute emissions into a comparable metric by dividing total emissions by an activity measure — most commonly tCO2e per unit of revenue (for example tCO2e per million euros of turnover). Intensity ratios let a customer or lender compare you year on year and against peers regardless of company size, so keep the denominator and the period clearly stated.
- 5
Complete the narrative disclosures using the if-applicable rule
Fill in the qualitative disclosures the chosen module requires — for example energy use, water, pollution, workforce characteristics, health and safety, and governance or business-conduct practices. Use EFRAG's 'if applicable' rule: where a disclosure genuinely does not apply to your business, you may omit it, but state briefly that it is not applicable rather than leaving it blank. Keep answers factual, specific and supported by your underlying records.
- 6
Validate completeness and prepare for optional assurance
Review the report against the disclosure list for your module: every required field is answered or explicitly marked not applicable, units are correct (tCO2e, percentages, currency), and figures reconcile with your source data. Although VSME assurance is voluntary, some customers or lenders may ask for third-party verification — so keep your source documents, emission factors and calculations organised and traceable in case assurance is requested.
- 7
Reuse the report to answer customer ESG questionnaires
Treat your completed VSME report as the single source of truth for ESG requests. When a customer sends their own questionnaire, map your VSME answers to it instead of starting from scratch — most of what they ask is already disclosed. Refresh the figures each reporting period so the report stays current and you respond to new requests in minutes rather than days.
Basic vs Comprehensive module: what's the difference?
VSME is built in two modules. The Basic module is the minimum a company reports; the Comprehensive module adds disclosures that banks, investors and large corporate customers often request. Start with Basic and add Comprehensive disclosures where a counterparty asks for them.
| Aspect | Basic module | Comprehensive module |
|---|---|---|
| Purpose | A minimum, proportionate set of disclosures suitable for most SMEs. | Adds disclosures larger customers, banks and investors commonly request. |
| Emissions | Scope 1 and Scope 2 (location- and market-based); Scope 3 where available. | Builds on Basic with more detailed value-chain and target information. |
| Narrative depth | Core environmental, social and governance disclosures. | Additional disclosures, e.g. transition-related and climate-risk context. |
| Best for | A first report or a straightforward supplier ESG request. | When a specific counterparty asks for more than the Basic set. |
The Comprehensive module includes everything in the Basic module — it adds disclosures rather than replacing them. Always confirm the exact disclosure list against the current EFRAG VSME standard before you report.
Common mistakes to avoid
Reporting only one Scope 2 figure
Scope 2 should be reported on both a location-based and a market-based method. Providing only one is one of the most common gaps in a first VSME report.
Leaving disclosures blank
If something does not apply, say so. Use the 'if applicable' rule and write a short not-applicable note rather than leaving a field empty, which reads as missing data.
Inconsistent or undated intensity ratios
State the denominator (e.g. revenue) and the period for every intensity ratio so figures are comparable year on year and across modules.
No audit trail behind the numbers
Keep activity data, emission factors and calculations traceable. If assurance is later requested, you will need to show exactly where each figure came from.
How CarbonTool makes VSME reporting easy
The slow part of VSME is not the form — it is producing defensible Scope 1, 2 and 3 numbers and keeping a trail an auditor or customer can trust. CarbonTool is built for exactly this: 200+ GHG-Protocol emission-source templates so you do not have to source emission factors yourself, an automatic audit trail on every figure, a supplier portal to gather Scope 3 data, and one data backbone that maps the same inventory to VSME, CSRD, GRI, CDP and PCAF — so when you grow into mandatory reporting, you report once rather than starting again. It is built by the BuildGreen team in Europe, with transparent pricing and a free trial.
Related reading: CSRD readiness checker · CSRD software for Europe · Carbon accounting software in Romania · solutions by industry.
Got more questions?
Can't find what you're looking for? Check the FAQs below, or reach out and we'll get back to you within one business day.
No. VSME is a voluntary EFRAG standard for non-listed small and medium-sized companies. You typically use it because a customer, bank or investor has asked for sustainability data, or to get ahead of supply-chain reporting requests — not because the law requires it. Companies that fall inside the mandatory scope of the CSRD report under that regime instead.
The Basic module is the minimum set of disclosures and suits most SMEs and straightforward supplier requests. The Comprehensive module includes everything in Basic and adds further disclosures — more detailed value-chain, target and climate-risk information — that larger customers, banks and investors often ask for. Start with Basic and add Comprehensive disclosures only where a counterparty specifically requires them.
You report greenhouse-gas emissions in tonnes of CO2 equivalent (tCO2e): Scope 1 (direct emissions such as on-site fuel and company vehicles) and Scope 2 (purchased energy, reported both location-based and market-based), plus Scope 3 value-chain emissions where they are available and material. Apply recognised, consistent emission factors so the figures are defensible.
The first report takes longest because you are building the data foundation — gathering activity data, applying emission factors and completing the narrative disclosures. Using guided templates instead of sourcing emission factors by hand shortens this considerably. In later years you mostly refresh figures, so the report becomes a repeatable annual task that takes far less time.
Yes — that is one of the main reasons SMEs use it. A completed VSME report gives you a single, standardised source of truth. When a customer sends their own ESG or carbon questionnaire, you map your VSME answers to it rather than starting from scratch, so you can respond consistently across many customers and in much less time.
The VSME standard and its disclosure requirements are published by EFRAG, the body that develops EU sustainability reporting standards. Always work from EFRAG’s current version for the exact disclosure list. A carbon accounting tool such as CarbonTool builds your Scope 1–3 inventory on GHG-Protocol methodology and maps it to the VSME structure, so the underlying data is ready when you complete the template.
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