VSME in France: Obligations, Regulatory Challenges and Opportunities

Understanding VSME: a voluntary standard for French SMEs

The VSME (Voluntary Sustainability Reporting Standard for SMEs) is a European framework developed by EFRAG to help companies with 1,000 employees or fewer structure their environmental, social and governance reporting. Unlike CSRD, it is an entirely voluntary framework, designed to be proportionate to the resources and capabilities of small and medium-sized businesses.

Since September 24, 2026, the standard has been set out in Delegated Regulation (EU) 2026/1560 under the name VS. The delegated regulation replaces the Commission recommendation of July 30, 2025. Our article on what changes with the VS lists the changes.

The VSME is built around around forty datapoints across 11 disclosures (B1 to B11) in its Basic module, covering the main ESG issues. It can be extended to a Comprehensive module (9 disclosures, C1 to C9) for companies ready to deepen their approach.

A voluntary but strategically relevant framework from 2026

VSME remains voluntary in 2026. No legal obligation requires companies not subject to CSRD to adopt it, even though the delegated regulation that sets it out has been in force since September 24, 2026. It is open to companies with 1,000 employees or fewer, and there is no minimum size. Companies with 10 employees or fewer can leave out the more complex environmental data, as our article on optional data for micro-companies explains.

That said, indirect pressure is growing: large companies subject to CSRD must collect ESG data from their suppliers and partners. An SME that adopts VSME gains a common language to respond to these requests and maintain its position in the value chain. For financial years starting on or after January 1, 2027, a CSRD client cannot require from a supplier with 1,000 employees or fewer more information than Annex II of the VS lists. The supplier can refuse questions beyond this value chain cap, and the client must flag them.

This voluntary but structured approach also benefits SMEs seeking responsible financing or investors with ESG criteria.

VSME, CSRD, ESRS: what are the scope differences?

VSME sits within a broader ecosystem that includes CSRD — the European directive requiring large companies to publish sustainability reporting — the ESRS, which define the technical content, and VSME, the voluntary framework designed for companies with 1,000 employees or fewer that are not subject to CSRD. Our article on the differences between VSME and CSRD covers the use cases for each company profile.

This complementarity explains why VSME is gaining traction: it responds to the information needs of clients and investors today, and it sets the limit on what CSRD clients can require from their smaller suppliers.

Double materiality: a strategic lever, not a constraint

Even though it is not mandatory under VSME, double materiality is a key tool for building a coherent ESG approach.

It involves analysing:

• The company's external impact on ESG issues (pollution, employment, governance).
• The internal impact of ESG issues on financial performance (risks, opportunities, resilience).

This approach structures priorities and guides indicator selection. An SME can start without this step and integrate it when updating its reporting.

Indicators, tools and support

The VSME Basic module requires around forty datapoints across 11 disclosures (B1 to B11). EFRAG provides an Excel template for structuring data collection and presentation, and the XBRL format is recommended for standardising exchanges with investors.

Specialist platforms like Ditto automate data collection, pre-fill certain datapoints (from EcoVadis, for example) and generate a compliant report. Human support complements these tools to define the most relevant policies and targets.

The absence of a mandatory audit does not remove the need for internal rigour: evidence must be traceable (invoices, HR records, ESG policy documents).

French specificities and opportunities to seize

In France, SMEs form the backbone of the value chains of large groups subject to CSRD. Adopting VSME allows them to replace multiple client questionnaires with a single, recognised document — and to demonstrate their CSR commitment internationally.

Observed benefits include:

• Stronger commercial and financial credibility.
• Better access to tenders and procurement processes.
• Improved internal management of ESG impacts.

VSME thus becomes a competitive advantage rather than an administrative burden. Using purpose-built digital tools like Ditto, a French SME can produce its first VSME report in a matter of days from existing data.

VSME in France — Key Takeaways