EU Voluntary Sustainability Reporting Standard: Scope, Modules, Cap

Directive (EU) 2026/470 narrows the EU-level CSRD scope from financial years beginning on or after 1 January 2027, with Member State transposition required by 19 March 2027; Member States may separately exempt certain wave-one undertakings for financial years beginning in 2025 or 2026. Commission Delegated Regulation (EU) 2026/1560, adopted on 3 July 2026 and published on 21 September 2026, establishes the Voluntary Sustainability Reporting Standard (VSRS). It enters into force on 24 September 2026; its Article 3 value-chain cap applies from financial years beginning on or after 1 January 2027.

The VSRS matters for two kinds of reader. The first is the company now outside the Corporate Sustainability Reporting Directive (CSRD) that still needs to answer sustainability questionnaires to keep a credit line, win a contract or retain an investor. The second is a reporting team subject to Articles 19a or 29a that requests sustainability information from protected undertakings in its value chain: for financial years beginning on or after 1 January 2027, the statutory value-chain cap is limited to the datapoints listed in Annex II to Delegated Regulation (EU) 2026/1560. Both need to understand what the standard covers, who it is for, and how it sits against the mandatory European Sustainability Reporting Standards (ESRS).

Related reading: CSRD Sustainability Reporting.

The dates that anchor the VSRS timeline

The VSRS closes a sequence that began with the Omnibus simplification of the CSRD and ends with EFRAG guidance and tooling. The operative dates:

• 30 July 2025: the Commission issued Recommendation (EU) 2025/1710 on a voluntary sustainability reporting standard for small and medium-sized undertakings (the VSME). The VSRS is based on that recommendation in its original version.
• Early 2026: the Omnibus I directive, Directive (EU) 2026/470, amended the Accounting Directive and the CSRD. It raised the mandatory reporting thresholds and inserted Article 29ca, which empowered the Commission to establish reporting standards for voluntary use by 19 July 2026.
• 3 July 2026: the Commission adopted two delegated regulations, the revised ESRS as Delegated Regulation (EU) 2026/1563 and the VSRS as Delegated Regulation (EU) 2026/1560.
• September 2026: both delegated regulations were published in the Official Journal after the European Parliament and Council scrutiny period closed without objection.
• 9 October 2026: EFRAG hosts an event with the Commission to present the VSRS, explain the key changes introduced by the Omnibus, and discuss the practical shift from mandatory to voluntary sustainability reporting.
• 24 September 2026: Delegated Regulation (EU) 2026/1560 enters into force. 10 November 2026: Delegated Regulation (EU) 2026/1563 enters into force. Article 3 of Regulation (EU) 2026/1560, which establishes the value-chain cap, applies from financial years beginning on or after 1 January 2027.
• Current: EFRAG’s 2026 non-mandatory Voluntary Standard guidance is already available in the ESRS Knowledge Hub. EFRAG states that translations will be released in batches from November 2026, while the updated Digital Template, XBRL Taxonomy, XBRL Converter and Explanatory Note are scheduled for Q4 2026.
• Financial years beginning on or after 1 January 2027: the revised mandatory ESRS apply to CSRD-scope undertakings, with first reports due in 2028. The VSRS carries no equivalent mandatory application date because it is voluntary.

Where the VSRS comes from in law

The legal hook is Article 29ca of the Accounting Directive (Directive 2013/34/EU), inserted by the Omnibus directive. It empowers the Commission to adopt, by delegated act, sustainability reporting standards for voluntary use by undertakings which, on their balance-sheet date, do not exceed an average of 1,000 employees during the preceding financial year. Article 29ca states two purposes for those standards: to facilitate voluntary reporting by such undertakings, and to limit the information that may be required from them when they sit in the value chain of a larger reporting company.

Delegated Regulation (EU) 2026/1560 is the instrument that fills that empowerment. Article 29ca(2) requires the voluntary standard to be based on Commission Recommendation (EU) 2025/1710 in its original version, and to be proportionate to the capacities of the undertakings it is designed for. The 2026 Voluntary Standard is based on the original version of Recommendation (EU) 2025/1710 and retains its Basic/Comprehensive modular structure. Commission Recommendation (EU) 2025/1710 provided the basis for Delegated Regulation (EU) 2026/1560, which the Commission adopted as the legally binding instrument.

Two governance points follow from the same article. The Commission must review the voluntary standard at least every four years after it starts to apply, and it must take EFRAG technical advice into account when it does. Delegated Regulation (EU) 2026/1560 expressly allows voluntary reporters to use practical guidance provided by EFRAG. EFRAG has published 2026 non-mandatory guidance for the Voluntary Standard in its ESRS Knowledge Hub; that guidance is separate from the delegated act.

Who the standard is actually for

Directive (EU) 2026/470 changes the EU-level CSRD scope so that, for financial years beginning on or after 1 January 2027, Article 19a(1) applies to undertakings that exceed both EUR 450 million in net turnover and an average of 1,000 employees during the financial year, subject to the exemptions and derogations provided by the Directive. Member States must transpose the relevant Omnibus I amendments by 19 March 2027. For financial years beginning in 2025 or 2026, Member States may exempt certain wave-one undertakings that will fall outside the revised scope; that relief is not automatic EU-wide.

Annex I states that the Voluntary Standard is intended for undertakings that, on their balance-sheet dates, do not exceed an average of 1,000 employees during the preceding financial year. Article 2 of Delegated Regulation (EU) 2026/1560 allows undertakings not subject to mandatory reporting under Articles 19a and 29a to report voluntarily under the standard. That is the practical trigger. A mid-sized manufacturer that supplies a listed multinational, a private company seeking a sustainability-linked loan, or a fund portfolio company facing an investor questionnaire all sit in the same position: outside mandatory reporting, inside a value chain that generates data requests.

One point is worth stating plainly, because it is where the voluntary framing misleads. Under the amended EU-level Article 19a, for financial years beginning on or after 1 January 2027 an undertaking is in scope where it exceeds both EUR 450 million in net turnover and an average of 1,000 employees during the financial year, subject to Member State transposition of Directive (EU) 2026/470. An undertaking subject to Article 19a or 29a must use the mandatory ESRS and cannot use the Voluntary Standard to discharge that obligation.

What the Voluntary Sustainability Reporting Standard covers

The VSRS keeps the two-module architecture of the VSME. The Basic Module runs from disclosure B1 to B11 and is the entry level for every user, and the target level for micro undertakings. It covers the core indicators that value-chain partners most often ask for: greenhouse gas figures, a small set of environmental and workforce metrics, and anti-corruption information. The standard permits Option A, Basic Module only. Whether the Basic Module is sufficient for a particular supplier questionnaire depends on the information requested by that counterparty.

The Comprehensive Module adds disclosures C1 to C9, nine further items that banks, investors and large corporate customers request more often as due diligence deepens. These build on the Basic Module, and they move into areas such as strategy, targets and more granular workforce and human-rights information. The design assumption is that a company completes the Basic Module first and then extends into the Comprehensive Module only where its counterparties need it.

The structure rewards a scoping decision at the start. A company that reads its incoming questionnaires against the B and C disclosure lists can see quickly whether it needs only the Basic Module or the additional Comprehensive items, and can avoid gathering data that no counterparty has asked for.

The value chain cap is the load-bearing feature

For the reporting teams inside CSRD-scope groups, the ceiling the package creates matters more than the voluntary standard itself. The Omnibus protects a ‘protected undertaking’ that does not exceed an average of 1,000 employees during the preceding financial year and is in the reporting undertaking’s value chain. For financial years beginning on or after 1 January 2027, the value-chain cap established by Article 3 of Delegated Regulation (EU) 2026/1560 comprises only the datapoints specified in Annex II, not the full content of Annex I’s Basic and Comprehensive Modules. Our guide to the CSRD Omnibus value chain cap works through that mechanism in more detail.

For a sustainability-reporting request covered by the Directive, a protected undertaking has a statutory right to decline information beyond the cap. If a reporting undertaking requests information exceeding the cap, it must identify the excess information and inform the protected undertaking of that right.

The limit is drawn around the reporting obligation, not the full commercial relationship. The cap does not prevent requests made for other purposes. However, for contractual or other arrangements established to meet the Directive’s sustainability-reporting requirements, a reporting undertaking may not require a protected undertaking to provide information beyond the cap, and a contractual provision to the contrary is not binding. Requests for other purposes remain outside this cap, subject to applicable Union or national law.

How the VSRS differs from the mandatory ESRS

The two standards share a lineage but sit at different levels of demand. The mandatory ESRS, revised by Delegated Regulation (EU) 2026/1563 and set out across the cross-cutting standards and the ten topical standards from E1 to E5, S1 to S4 and G1, are built around a double materiality assessment: an undertaking identifies which sustainability matters are material to its impacts and to its financial position, then reports the datapoints those matters trigger. The revised mandatory standards cut the number of mandatory datapoints by over 60 percent and the total number of datapoints by over 70 percent against the first set, largely by removing voluntary datapoints, but the double materiality architecture remains. You can read our walk-through of the revised ESRS under the simplified CSRD for the mandatory-side detail.

The VSRS takes a different route. It is built around a defined set of disclosures in the Basic and Comprehensive Modules, so a smaller company works from a fixed list and does not run the full double materiality process the mandatory standards require. It does not carry the statutory assurance requirement that applies to mandatory CSRD reporting. Article 29d requires in-scope undertakings to prepare the management report in the prescribed single electronic reporting format, but sustainability-report tagging is not yet mandatory: the Directive expressly suspends the mark-up requirement until the relevant mark-up rules are adopted.

Digital reporting is optional for voluntary users. EFRAG says the updated Digital Template, XBRL Taxonomy, XBRL Converter, including a migration tool, and Explanatory Note are scheduled for Q4 2026. EFRAG’s converter technology supports generation of tagged Inline XBRL reports, but the adopted Voluntary Standard itself does not require use of that tooling.

Turning the standard into a working process

The practical path starts with the source texts and guidance. The 2026 Revised ESRS and Voluntary Standard are available in interactive format in EFRAG’s ESRS Knowledge Hub, and EFRAG’s 2026 non-mandatory guidance for the Voluntary Standard is already available there. EFRAG states that translations will be released in batches from November 2026. Our note on the EFRAG ESRS Knowledge Hub covers how the hub is organised.

From there the sequence is straightforward. Map the sustainability questionnaires already arriving from banks, customers and investors against the Basic and Comprehensive disclosure lists. Decide whether Basic Module coverage answers the current requests or whether Comprehensive items are needed. Gather the underlying data, greenhouse gas figures and workforce metrics first, since those recur across counterparties. Then decide on format: a narrative or spreadsheet response for straightforward requests, or the EFRAG Digital Template and converter where a counterparty wants a structured file. Financial institutions asking these questions are often driven by their own duties under the taxonomy and sustainable finance rules, which is why our explainer on SFDR pre-contractual template changes is useful context for anticipating what they will request.

Common misreadings to correct before you start

The first error is treating the value chain cap as a shield against all requests. It is a ceiling on the content that the mandatory framework can require. The cap does not prevent requests made for other purposes. For contractual or other arrangements established to meet the Directive’s sustainability-reporting requirements, though, a reporting undertaking may not require a protected undertaking to provide information beyond the cap, and any contractual provision to the contrary does not bind. Subject to applicable Union or national law, requests for other purposes fall outside this cap.

The second is assuming the Basic Module is only for the smallest companies. The Basic Module is the target level for micro undertakings, but it is the common floor for all VSRS users; a 700-employee company does not skip it and start at the Comprehensive Module. The Comprehensive items sit on top of the Basic set.

The third is reading the datapoint reduction figures as applying to the VSRS. The reduction of over 60 percent in mandatory datapoints belongs to the revised mandatory ESRS, which trimmed the first set adopted in 2023. The VSRS is a separate, deliberately smaller standard; it was never measured against that baseline.

Frequently Asked Questions

Is a company below 1,000 employees required to use the VSRS?

No. The standard is for voluntary use. A company below the CSRD thresholds has no legal obligation to report under the VSRS, and Article 29ca of the Accounting Directive frames it as a facilitation tool. The practical pressure comes from counterparties, not from the Directive.

Can a company in mandatory CSRD scope report against the VSRS instead of the full ESRS?

No. An undertaking that is subject to mandatory sustainability reporting under Article 19a or 29a must report against the mandatory ESRS as revised by Delegated Regulation (EU) 2026/1563. Exceeding the EUR 450 million net turnover and 1,000-employee thresholds is the principal scope test, but the Directive also contains exemptions and derogations. The voluntary standard does not discharge a mandatory reporting obligation.

Does the value chain cap prevent a bank from asking for more than the VSRS covers?

For financial years beginning on or after 1 January 2027, the cap limits sustainability-reporting requests to the Annex II datapoints where the counterparty is a protected undertaking, meaning that it does not exceed an average of 1,000 employees during the preceding financial year and is in the reporting undertaking’s value chain. The cap does not restrict requests made for other purposes, including requests required by other Union or national law.

What is the difference between the Basic and Comprehensive Modules?

The Basic Module, disclosures B1 to B11, is the entry level covering core indicators such as greenhouse gas figures, selected environmental and workforce metrics and anti-corruption information. The Comprehensive Module adds disclosures C1 to C9, the further items banks and investors tend to request as due diligence deepens. It builds on the Basic set.

Does a VSRS report need external assurance?

The VSRS does not carry the statutory assurance requirement that applies to mandatory CSRD reporting. A counterparty may ask for verification as a commercial condition, but the standard itself imposes no assurance obligation on a voluntary reporter.

Do we have to file a VSRS report digitally in XBRL?

No. The Voluntary Standard imposes no mandatory XBRL filing or tagging requirement. For mandatory CSRD reporting, Article 29d requires preparation in the prescribed single electronic reporting format, but sustainability-report mark-up is not yet mandatory until the relevant rules are adopted. EFRAG’s existing VSME digital tools pre-date the adopted Voluntary Standard; the updated Digital Template, XBRL Taxonomy and XBRL Converter for the adopted standard are scheduled for Q4 2026.

Where are the official texts and guidance?

The adopted standards sit in the Official Journal as Delegated Regulations (EU) 2026/1560 and (EU) 2026/1563, and the interactive texts plus the non-mandatory guidance are in the EFRAG ESRS Knowledge Hub, with further-language translations arriving from November 2026.

Related Articles

• Revised ESRS: Simplified CSRD Reporting in 2026: how the mandatory standards were cut and restructured under the Omnibus.
• CSRD Omnibus Value Chain Cap: the mechanism that limits what larger companies can require from smaller value-chain partners.
• CSRD Sustainability Reporting: a foundational guide to the Directive, scope and reporting duties.
• EFRAG ESRS Knowledge Hub: 2026 Revised ESRS: where the interactive texts and implementation guidance live.
• EFRAG 2026 Draft ESRS Datapoints List: the datapoint reductions behind the revised mandatory standards.
• EU Taxonomy Disclosure Simplification: Article 8 KPIs: the disclosure rules that drive many value-chain data requests.

Key Takeaways

• Commission Delegated Regulation (EU) 2026/1560 was adopted on 3 July 2026, published on 21 September 2026 and enters into force on 24 September 2026. Its Voluntary Standard is intended for undertakings that do not exceed an average of 1,000 employees during the preceding financial year; Article 2 permits undertakings not subject to Articles 19a and 29a to report voluntarily under it.
• Its legal basis is Article 29ca of the Accounting Directive, inserted by the Omnibus directive (EU) 2026/470, and it is based on Commission Recommendation (EU) 2025/1710 (the VSME) in its original version.
• The standard has two modules: a Basic Module (B1 to B11) as the common floor, and a Comprehensive Module (C1 to C9) that adds the items banks and investors request more often.
• For financial years beginning on or after 1 January 2027, the value-chain cap protects value-chain undertakings that do not exceed an average of 1,000 employees during the preceding financial year; the statutory ceiling is the datapoint list in Annex II to Delegated Regulation (EU) 2026/1560, not the full B and C disclosure lists.
• Voluntary use does not discharge a mandatory obligation: an undertaking that remains subject to Article 19a or 29a after any applicable exemption or derogation must report against the mandatory ESRS.
• The VSRS carries no statutory assurance and no mandatory digital tagging; EFRAG’s updated Digital Template, XBRL Taxonomy and XBRL Converter for the adopted standard are scheduled for Q4 2026.
• The interactive Voluntary Standard and 2026 non-mandatory guidance are already available in the EFRAG ESRS Knowledge Hub. EFRAG states that translations will be released in batches from November 2026, while its updated Voluntary Standard digital tools are scheduled for Q4 2026; the revised mandatory ESRS apply to financial years beginning on or after 1 January 2027.

Sources and References

• EFRAG, “European Commission adopts revised ESRS and Voluntary Sustainability Reporting Standard” (22 September 2026). efrag.org
• European Commission, “Commission adopts revised sustainability reporting standards to reduce administrative burdens” (3 July 2026). finance.ec.europa.eu
• Commission Delegated Regulation (EU) 2026/1560 (Voluntary Sustainability Reporting Standard). EUR-Lex
• Commission Delegated Regulation (EU) 2026/1563 (revised ESRS, amending Delegated Regulation (EU) 2023/2772). EUR-Lex
• Directive (EU) 2026/470 (Omnibus I), amending the Accounting Directive and CSRD and inserting Article 29ca. EUR-Lex
• Commission Delegated Regulation (EU) 2023/2772 (first set of ESRS). EUR-Lex
• Commission Recommendation (EU) 2025/1710 of 30 July 2025 on a voluntary sustainability reporting standard for SMEs (VSME). EUR-Lex
• European Commission, “Feedback on sustainability reporting standards: additional explanatory information regarding the value chain cap” (6 May 2026). finance.ec.europa.eu
• EFRAG ESRS Knowledge Hub and sustainability reporting resources. efrag.org

What to do before the value-chain cap applies from financial years beginning on or after 1 January 2027

The standard is settled and the clock to entry into force is short. A company below the CSRD thresholds should pull its recent sustainability questionnaires, map each request against the Basic and Comprehensive disclosure lists, and decide which module answers the demand it actually faces. For financial years beginning on or after 1 January 2027, a CSRD-scope reporting team should ensure that requests made for the purpose of its Directive sustainability reporting do not require protected value-chain undertakings, those that do not exceed an average of 1,000 employees during the preceding financial year, to provide information beyond the Annex II cap datapoints. Both actions turn on the same document, now available in the EFRAG Knowledge Hub, and both are cheaper to do before the requests for financial year 2026 data start landing.

Disclaimer: The information on RegReportingDesk.com is for educational and informational purposes only. It does not constitute legal, regulatory, tax, or compliance advice. Always consult your compliance officer, legal counsel, or the relevant supervisory authority for guidance specific to your institution.