Value Chain Cap – What CSRD Companies Can Still Request From Their Supply Chain
The starting point
To meet their own ESRS reporting obligations, particularly on value-chain-related topics, CSRD-obligated companies regularly request sustainability data from their business partners. Without a shared framework, this has led in practice to very different, individually designed and sometimes very extensive questionnaires.
What the cap actually limits
The Value Chain Cap provides that, to the extent a request to a smaller, non-CSRD-obligated business partner relates to the requesting company's own CSRD reporting obligation, it may generally only request what the Voluntary Standard sets out. Requests going beyond that would need to be flagged accordingly – and the smaller business partner generally has the right to decline such additional disclosures, for example where the information isn't available to them.
Important: the cap only applies to CSRD-related requests
The cap applies solely to requests serving the larger company's own CSRD reporting obligation. For other information needs – for instance, under individual contractual arrangements, procurement policies, or sector-specific requirements not directly tied to CSRD reporting – scope for further requests generally remains. The cap is therefore not a general limit on every information request along the supply chain, but specifically tied to the CSRD reporting purpose.
Why this also matters in practice for large companies
For sustainability teams at larger companies, this means reviewing existing supplier questionnaires and data collection processes: where they serve CSRD reporting, they should align with the scope of the Voluntary Standard. At the same time, the standard can serve as a shared reference point to harmonise supplier requests and reduce the company's own collection effort.
No free pass for a company's own reporting
The cap only concerns requirements placed on smaller business partners. A CSRD company's own ESRS reporting obligation, including the materiality assessment of value-chain-related topics, remains unaffected.
European Commission: Commission adopts revised sustainability reporting standards to reduce administrative burdens for EU businesses while maintaining high-quality disclosures, 3 July 2026.
European Commission: Commission Delegated Regulation of 3 July 2026 establishing sustainability reporting standards for voluntary use by undertakings protected by the value chain cap, C(2026) 5011 final.
European Commission: Annexes 1 and 2 to the Commission Delegated Regulation – Voluntary Standard.
Disclaimer: This article is provided for general information purposes only and does not constitute legal, tax, accounting, auditing or other professional advice. The application of the VS depends on the specific facts and circumstances of each reporting entity. The interpretation and practical application of the relevant requirements may evolve over time. Further publications, FAQs, regulatory guidance, industry practice and views expressed by the auditing profession may result in additional or different interpretations.
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