Voluntary sustainability reporting: What's the point, and when does it make sense?

Voluntary sustainability reporting – but why?

Conversations with CEOs and CFOs are currently often centred around one question: Why invest time, resources and budget in sustainability reporting if the company is not required to report under the CSRD and the economic benefits cannot readily be quantified?

Many companies are currently facing precisely this question – both those that are expected to fall outside the scope of the CSRD as a result of the increased thresholds and those for which mandatory sustainability reporting was never envisaged in the first place.

The thresholds for mandatory sustainability reporting have been increased significantly. Under the revised requirements, the CSRD will generally apply to companies that have both more than 1,000 employees and annual net turnover exceeding EUR 450 million. As a result, many companies that had expected to become subject to mandatory sustainability reporting, or had already begun preparing for it, will no longer fall within its scope.

At the same time, companies that were already outside the scope of the CSRD are increasingly considering how they should respond to sustainability information requests from customers, banks and other business partners.

This creates a common question:

If we are not required to report under the CSRD, how should we approach sustainability reporting going forward?

The new standard for voluntary sustainability reporting provides a European framework for companies outside the scope of the CSRD. The European Commission adopted the standard as a delegated act on 3 July 2026. The so-called Voluntary Standard builds on the framework previously known primarily as the VSME.

The delegated act has been submitted to the European Parliament and the Council for scrutiny. The scrutiny period is two months and may be extended by a further two months. If no objections are raised, the act may subsequently be published in the Official Journal of the European Union and enter into force. At the time of publication of this article, it is not yet in force.

The Voluntary Standard will therefore provide companies with a European framework for voluntary sustainability reporting. However, the existence of a standard does not answer the underlying business question:

What specific purpose should voluntary reporting serve for the company?

Only once that purpose has been defined is it possible to assess whether applying the Voluntary Standard may be appropriate – and what level of reporting would be proportionate.

What is the Voluntary Standard?

The Voluntary Standard is intended for companies outside the scope of mandatory CSRD reporting. It is designed to provide a consistent and proportionate framework for voluntary sustainability information that may be used in communications with customers, banks, investors and other business partners.

The standard also forms the basis of the so-called Value Chain Cap, which limits the sustainability information that companies subject to the CSRD may request from certain smaller companies in their value chains.

The standard consists of two modules:

• The Basic Module contains core environmental, social and governance disclosures.

• The Comprehensive Module includes additional information that may be particularly relevant to banks, investors and larger corporate customers.

The Comprehensive Module may only be applied together with the Basic Module. The appropriate scope will depend on the company’s specific information needs, intended users and existing data structures.

A standard is not a business case

The existence of a voluntary standard does not automatically mean that applying it will make sense for every company.

A sustainability report may be formally complete and professionally presented without creating any clear value for the company or its stakeholders. Conversely, a relatively simple, internally maintained information base may already be valuable if it makes frequently requested information available consistently and at short notice.

The potential benefit therefore does not necessarily lie in publishing a report. It may instead consist of:

• responding more efficiently to recurring information requests;

• using a common data basis for different questionnaires;

• being able to provide information to customers, banks and other business partners;

• defining internal responsibilities and calculation methods more clearly;

• obtaining a consistent overview of selected sustainability matters; or

• supporting a deliberately chosen market position with transparent information.

The Voluntary Standard is intended, in particular, to help companies outside the scope of the CSRD respond to specific information requests from larger companies and financial institutions.

Whether this creates meaningful value for an individual company will nevertheless depend on its business model, intended users and specific information needs.

A public report is not necessarily required

The term sustainability reporting often creates the impression of an extensively designed report published on the company’s website.

However, the Voluntary Standard does not necessarily require public disclosure.

Its primary purpose is to provide information to actual or potential business partners. A company may decide for itself whether it also wishes to make the report publicly available.

Different forms of application are therefore possible:

• an internally maintained sustainability information base;

• a standardised information package for customers or banks;

• a report provided to selected business partners; or

• a publicly available sustainability report.

This distinction is important. A company may need structured and reliable sustainability information without necessarily requiring a publicly available report.

Why the benefits are often difficult to quantify directly

The economic benefits of voluntary sustainability reporting are often difficult to measure in isolation. A report does not automatically lead to higher prices, additional contracts or improved financing terms.

The practical benefits may instead arise indirectly: information does not have to be collected again for every request, responses remain consistent across different users, and follow-up questions in customer, financing or supplier processes may be reduced.

Whether this creates meaningful value will depend on the company’s specific circumstances and requirements.

Sustainability information as a baseline expectation

For some companies, basic sustainability information may increasingly become a baseline expectation rather than a differentiating factor.

Having the information available does not necessarily create a competitive advantage. However, if reliable information is entirely unavailable, this may lead to additional coordination efforts and uncertainty among customers, banks or other business partners.

The relevance of this effect will depend, in particular, on the company’s customer base, its role in the value chain, the strategic significance of sustainability in its market and the information requests it receives. The Voluntary Standard is intended to provide a common and proportionate reference framework for these purposes.

Three possible starting points

Companies may approach the Voluntary Standard from very different starting positions:

1. Respond to specific requests: Sustainability information is initially provided only when requested.

2. Build a structured information base: Existing data and processes are organised so that recurring requirements can be addressed consistently.

3. Position deliberately: Sustainability information is also used for communication, management purposes or strategic positioning.

The appropriate approach will depend on the intended users, the company’s existing structures and its objectives. This starting position should therefore be assessed individually.

Reporting is not a substitute for a sustainability strategy

A sustainability report can make existing measures and structures visible, but it cannot replace missing responsibilities, data or processes.

The starting point should therefore not be the report itself, but the question of which information is actually needed, what information is already available and what can be provided on a reliable basis.

This assessment determines the appropriate form and scope of reporting.

When a limited first step may be appropriate

A complete and publicly available sustainability report does not have to be the right first step for every company.

Where the intended users, information needs or data structures have not yet been sufficiently defined, it may be more appropriate to begin by assessing the company’s current position and structuring the relevant information.

Companies should not, however, assume prematurely that no future requirements will arise. Customers, banks, tender processes or other companies in the value chain may require sustainability information even where the company itself is not subject to the CSRD.

Define the objective before determining the scope

Before deciding how to apply the Voluntary Standard, companies should consider:

• Who needs the information today or may need it in the future?

• What requirements may arise from customers, banks or the value chain?

• Which data and processes are already in place?

• Should the initial outcome be an internal information base, an information package for business partners or a public report?

Only then can the company assess whether the Basic Module is sufficient, whether additional disclosures may be appropriate and which form of communication best fits its circumstances.

A pragmatic way to get started

A sensible starting point will generally not be the design of a report, but a focused assessment of the company’s current position.

Getting started does not necessarily have to become a multi-year transformation project. With a clear project structure, a manageable group and site structure and sufficiently available data, a first robust reporting foundation – particularly for the Basic Module – may be established within a matter of weeks.

The actual timeline will depend, among other factors, on the availability and quality of the data, the number of entities and sites involved and whether information needs to be calculated for the first time.

The key is neither to launch an extensive reporting project prematurely nor to discontinue existing structures without first assessing their potential future value.

Is external assurance required?

External assurance is not required in order to apply the Voluntary Standard.

Whether individual metrics or reports should nevertheless be voluntarily assured will depend on their intended use and the expectations of the relevant users.

Conclusion: Voluntary reporting is not an end in itself

Whether the Voluntary Standard is appropriate will depend on the company’s specific information needs, existing data and business objectives.

Its potential value may lie less in immediate financial benefits and more in improved responsiveness, more consistent information and clearer internal structures.

Getting started does not necessarily require either a complete public report or a long-term transformation project.

The key question is therefore not:

Should companies report voluntarily?

But rather:

What specific business objective should the reporting achieve – and what scope is appropriate for that purpose?