CSRD for non-EU suppliers: what UK SMEs need to provide
The EU's Corporate Sustainability Reporting Directive does not apply directly to UK companies — but if you supply large EU businesses, they will ask you for sustainability data. Here is what to expect and how to prepare.
The Corporate Sustainability Reporting Directive (CSRD) is the most comprehensive sustainability reporting obligation the EU has ever introduced. It replaces the previous Non-Financial Reporting Directive (NFRD) and significantly expands the scope of mandatory reporting — from around 11,000 companies to an estimated 50,000 across the EU.
As a UK company, you are not directly subject to CSRD. However, your large EU customers are — and they are required to report on their entire value chain, including Scope 3 emissions and supply chain social practices. That means they will ask you for data, even if you have never filed a sustainability report in your life.
Timeline: when do EU buyers start asking?
| Company group | First report covers | Published |
|---|---|---|
| Large companies (previously NFRD-obligated) | FY 2024 | 2025 |
| Large companies (newly in scope under CSRD) | FY 2025 | 2026 |
| Listed SMEs | FY 2026 | 2027 |
| Non-listed SMEs (voluntary / VSME standard) | From FY 2026 | From 2027 |
Large EU companies in scope from 2025 are already collecting supply chain data now. If you supply them, expect requests this year.
What is the VSME standard — and why does it matter to you?
The EU has developed a simplified reporting standard for non-listed SMEs: the VSME (Voluntary Standard for non-listed SMEs). Even though it is voluntary for SMEs, large EU companies use it as a template when requesting data from their suppliers. It has two modules:
Basic module
Core sustainability information: governance, strategy, material risks and opportunities, greenhouse gas emissions (Scope 1 & 2), energy consumption, water use, waste management, workers' rights, supply chain practices.
Narrative module (PAT)
Deeper information on policies, actions, and targets — for SMEs whose large customers require more comprehensive data for their own CSRD reporting.
Why does CSRD affect UK suppliers who are not in scope?
Large EU companies subject to CSRD are required to collect sustainability data from their entire value chain — including Scope 3 emissions. That means they will ask their UK suppliers for greenhouse gas emissions, energy consumption, human rights practices, and environmental risk information, even though the UK suppliers themselves have no direct legal obligation to report.
Companies that cannot provide this data risk being excluded from supply chains — not because they have broken any law, but because their customer cannot fulfil its own reporting obligations without the data. Buyers increasingly use ESG compliance as a pass/fail criterion in procurement decisions.
Practical steps for UK SMEs
Conduct a materiality assessment
Identify which sustainability topics are material to your business and your stakeholders. CSRD requires double materiality: financial materiality (impact on the company) and impact materiality (impact on people and the environment).
Measure your greenhouse gas emissions
Start with Scope 1 (direct emissions from your own operations) and Scope 2 (purchased electricity). Scope 3 (supply chain) is increasingly requested. The ESG Stress Free dashboard helps you calculate and document your emissions.
Document your policies
Create written policies on the material topics: climate, biodiversity, water, circular economy, workers' rights, human rights in the supply chain, and business ethics. A one-page policy is better than none.
Set up data collection processes
Establish processes to capture sustainability data regularly — energy consumption, water use, waste volumes, workforce data. The earlier you start, the easier reporting becomes.
Engage your accountant or auditor
CSRD reports must be assured by a registered auditor. Speak to your accountant or auditor early about what will be required — they are increasingly familiar with CSRD assurance requirements.
ESG Stress Free helps UK suppliers prepare for CSRD data requests
Our CSRD-VSME assessment module guides you through all relevant questions, calculates your emissions, and produces a structured report you can share with your EU buyers and auditors — without needing a dedicated sustainability team.
Start your CSRD readiness assessment →Further reading
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Free CSRD supplier checklist
Download our CSRD-VSME checklist and find out exactly which data your EU buyers will ask for.