The EU adopted a recommendation on the introduction of a sustainability reporting standard for SMEs

By: Trademagazin Date: 2025. 07. 30. 11:20

The European Commission has adopted a recommendation to introduce a voluntary sustainability reporting standard for small and medium-sized enterprises (SMEs) to reduce administrative burdens and facilitate the easier sharing of sustainability information among market participants, the Brussels-based body announced on Wednesday.

The proposed voluntary standard aims to help SMEs that are not covered by the Corporate Sustainability Reporting Directive (CSRD) but still face sustainability reporting requirements from large companies or financial institutions.

The standard recommended by the Commission was developed by EFRAG, the technical advisory body for sustainability reporting.

The body encourages large companies and financial institutions to request data from SMEs based on this standard where possible.

For smaller companies, voluntary reporting can improve access to sustainable finance and help them monitor and confirm their own sustainability performance.

The European Commission adopted a simplification package in February, which proposed to extend the mandatory reporting requirements of the CSRD only to companies with more than 1,000 employees.

This would introduce a voluntary reporting system for smaller companies, based on the current recommendation.