ESG Reporting updates and the strategic role of the voluntary standard for SMEs (VSME)
Deloitte recently delivered a webinar focusing on ESG reporting and reporting under the VSME. The event provided an update on the status of ESG reporting at law, including the impact of the Omnibus Directive on broader sustainability reporting. Attendees received a timely and up-to-date understanding of the current regulatory status quo and the key preparatory steps to be taken by entities within scope and those interested in reporting under the VSME.
This article provides a summary of the event’s key discussions and insights.
As ESG regulation continues to evolve rapidly and in unexpected ways, it is reshaping the corporate landscape significantly. During the session, key developments were discussed including the EU’s Omnibus Directive, the ongoing stop-the-clock discussions, and broader debates around competitiveness. These factors have had a profound impact on ESG reporting requirements. Despite shifting timelines, the expectations from clients, investors, and supply-chain partners remain clear and unwavering. This makes it an essential time for organisations to revisit their ESG strategies and consider how the VSME can support them, whether they are currently within scope or preparing proactively for future regulations.
Geopolitics, EU policy and lawmaking
The session began with an overview of the policy and geopolitical changes influencing ESG regulation. The presenters emphasised that the CSRD attempted to accomplish in a few years what took the Accounting Directive decades to achieve, by reframing how businesses approach long-term value and stakeholder expectations. Recent political developments, especially those related to competitiveness and proportionality, illustrated notably by the Draghi Report, have pushed the EU to simplify data points and revise scoping. While this may temporarily reduce legal certainty, it also creates an opportunity for Europe to remain competitive and for companies to align their ESG efforts with business priorities in a more pragmatic way.
No regrets approach
A key part of the session addressed which companies remain in scope and what this means in practice. The message was clear: ESG is not just about reporting. It is about maintaining a resilient organisation that continues to be relevant. Topics that often seem “non-financial” such as talent retention, working conditions and supply chain reputation were reframed as core business drivers that influence cost structures, operational stability and risk exposure. Environmental issues were also discussed from a cost-efficiency perspective, with energy management highlighted as one of the most direct ways companies can reduce expenses and strengthen resilience.
Even with simplification and postponement, this is not a time to slow down. At Deloitte we continue to take a no-regrets approach that uses this extra time to help companies currently out of scope develop the tools and structures they will need very soon.
VSME as key to create a future-proof business
The conversation around VSME highlighted the emerging value of its modular structure. The basic module already offers a practical foundation that any company focusing on long-term success can start using to collect and leverage ESG data. The presenters noted that while the reporting wave may feel quieter today, the same pattern occurred in financial reporting: periods of acceleration followed by consolidation, before the tide rose again. ESG will follow this cycle.
For clients, the takeaway is straightforward: the legislator has effectively given organisations valuable preparation time. Using this window wisely will help companies build a strong ESG strategy and be ready when the next reporting wave returns, because it will.
We look forward to the next event and the opportunity to continue exploring key topics that help organisations navigate the evolving business environment while emphasising the benefits of integrating ESG principles within the industry.
