Sustainability questions, simple answers
Europe has narrowed its reporting rules to the largest companies. Smaller suppliers will still be asked questions, and there is now a sensible way to answer them.
A few years ago, many smaller firms feared that European sustainability reporting would bury them in paperwork. The picture in 2026 is calmer and clearer.
What changed
In February 2026 the EU published Directive (EU) 2026/470, known as Omnibus I. It narrowed the Corporate Sustainability Reporting Directive to companies with more than 1,000 employees and more than €450 million in turnover. Most small and medium-sized companies are therefore outside the mandatory rules.
Just as importantly, the directive limits how much large companies may ask of their smaller suppliers. Companies with up to 1,000 employees may decline requests for information that go beyond the voluntary standard for SMEs, known as the VSME.
The voluntary standard
The VSME was published by EFRAG, the EU's technical adviser on reporting, in December 2024, and the European Commission recommended it in July 2025. It has a Basic module for the smallest firms and a Comprehensive module for those who want to say more. It covers matters such as energy use, emissions, staff and business conduct, in a format customers and banks increasingly recognise.
In the United Kingdom, the government published the UK Sustainability Reporting Standards, UK SRS S1 and S2, in February 2026, for voluntary use. British suppliers to European customers will often find the VSME the more practical reference.
Why it is worth doing anyway
Customers, banks and insurers still ask. A company that can answer calmly, with a short and consistent set of figures, looks well run and often gains an advantage in tenders and financing. The work also tends to pay for itself: measuring energy use month by month is one of the quickest ways to find savings.
Our advice is to start small. Collect the few figures in the Basic module, keep them in one place and update them once a year. Simple spreadsheets or accounting data are usually enough. Larger software can wait until a customer or lender genuinely needs more.
Questions to ask yourself
- How many sustainability questionnaires did your company receive last year?
- Do you know your monthly energy use per site?
- Could you answer the VSME Basic module today, and who would do it?
- Which customer or lender is most likely to ask next?
Sources
- Directive (EU) 2026/470 (Omnibus I), Official Journal, 26 February 2026. eur-lex.europa.eu
- EFRAG, 'EFRAG releases the Voluntary Sustainability Reporting Standard for non-listed SMEs (VSME)', December 2024. www.efrag.org
- European Commission, 'Commission presents voluntary sustainability reporting standard to ease burden on SMEs', 30 July 2025. finance.ec.europa.eu
- Department for Business and Trade, 'UK Sustainability Reporting Standards: UK SRS S1 and UK SRS S2', 25 February 2026. www.gov.uk
Published 1 October 2026 · © 2026 Habsburg Digital Ltd