CSRD for SMEs: what you need to know

What is the CSRD?

The European Corporate Sustainability Reporting Directive (CSRD) is an EU law that falls under the European Green Deal. It aims to make businesses in Europe operate more sustainably. Large and listed SMEs are therefore required to report on the impact of their chain on 3 main themes: people, the environment, and governance. This not only looks at the impact of their own business, but also at the impact of their suppliers, subcontractors, and customers. Exactly what companies must report is set out in the European Sustainability Reporting Standards (ESRS).

• Read more about Responsible Business Conduct (RBC) on the website of the Netherlands Enterprise Agency (RVO).
• You can read about levels of energy consumption and greenhouse gas emissions, for example, on the Green Deal Dashboard of Statistics Netherlands (CBS, in Dutch).
• Read when the mandatory reporting for large businesses will be introduced step by step.

What does the CSRD mean for SMEs?

Do you supply products or services to large businesses or listed SMEs? Then you may have to deal with requirements from your buyers or customers who must comply with the CSRD. They may ask you to provide information about the sustainability of your products, services, or business operations, such as your CO2 emissions and your use of materials. They may also ask about the health and safety of your employees, for example, the number of workplace accidents.

What to do about the CSRD

You can prepare for questions from large companies. Consider what sustainability means for your business. And what you want to do with sustainable enterprise. Talk about this, for example, with your most important customers or stakeholders. Discuss what sustainability issues are important to them. And what they expect from your company in the field of sustainable enterprise. Do they need certain information about the sustainability of your business?

Which sustainability topics are important to you?

You can also investigate which sustainability topics are important to your business and what choices you want to make. Consider, for example, whether zero-emission zones mean you should invest in electric vans. Also look at what information about sustainability you already have in your company, such as data on CO2 emissions. This will help you decide how you can cooperate with your stakeholders' requests.

Voluntary reporting makes you an attractive business partner

As owner of an SME, you can also choose to voluntarily report your sustainability results. With sustainable business practices, you are an attractive partner for businesses that must meet CSRD targets. This means you are a step ahead of less sustainable businesses when it comes to bidding for a government tender, for example. And you are already dealing with increasingly strict legislation, such as the energy efficiency of your office building or zero-emission zones in many cities. By starting to gather information early, you can prepare in time. Find out more about the consequences of the CSRD and ESRS for companies.

Using the VSME for your report

Would you like to draw up a sustainability report yourself? You can use the Voluntary reporting standards for SMEs (VSME-ESRS). These are separate standards for non-listed SME businesses that want to report voluntarily. The standards make sharing data with your customers easier.

The VSME-ESRS consist of modules:

• a basic module for SMEs that are just starting to report
• a comprehensive module aimed at sharing more extensive information with business partners, for example, policy, actions, and targets, for SMEs that are already further ahead

What should you do about data requests from CSRD-compliant customers?

You can prepare for requests from customers by gaining insight into and collecting your data. For example, about your:

• energy consumption
• working conditions
• number of work-related accidents
• total water extraction
• estimated CO2 emissions

See what data you have available that you already need to report on. Such as the reporting obligation for work-related mobility of persons (WPM) if you have a business with more than 100 employees. You can also use this data if you get questions from customers who must comply with the CSRD. Also look at your sector to see what the important sustainability themes are. Sector organisations can help with your preparations.

You can also use the VSME-ESRS standards to collect and share your data. You can start with a basic report. The modular setup makes it easy for you to start small and expand when you are ready to do so.

If you would like to know more about collecting and reporting data for a sustainability report, please also read the Step-by-step guide to Mandatory CSRD.

Use other people's examples

Look at the sustainability reports of other businesses (in Dutch) in your sector that have already produced a report. These reports can help you when you start collecting data yourself. Or look at these examples of sustainability reporting .

What role can sector organisations play in the CSRD?

Sector organisations (in Dutch) can play an important role in helping to collect and provide data. Risks and opportunities often occur throughout the sector. In agricultural industries, for example, biodiversity and animal welfare are important. In the construction industry, the emphasis is on material use and scope 3 emissions.

Collaborating within your sector organisation provides insight into the joint process and how others deal with it. Various sector organisations are working on methods and tools for data provision. Contact your sector organisation to ask what they can do for you.

Examples of things sector organisations can do:

• identify the sector's risks and opportunities
• conduct risk analyses
• collect data
• identify stakeholders and weigh their interests
• collect and share examples of businesses within the sector
• increase knowledge within the sector on ESG themes
• information campaigns