What does sustainability mean for a Swiss SME?
Many Swiss SMEs are not directly required to report on sustainability, but are increasingly feeling the effects of the expectations of banks, customers and tenders. Much of it seems to be EU bureaucracy, and yet it is clear that the topic can no longer be completely ignored.
This ABC of sustainability offers an understandable classification and shows how SMEs can find a sensible entry point with manageable effort that can be implemented with existing capacities.
In recent years, sustainability has become a term that crops up everywhere: in political debates, in annual reports, in discussions with banks and insurers - and increasingly also in tenders and supplier evaluations. For large companies, the topic may now be part of their routine, but for many small and medium-sized enterprises it still feels like a complex, sometimes even impenetrable field. Between global targets, new legal frameworks and a multitude of abbreviations, it is easy to get the impression that you have to become an expert in climate policy, human rights, energy efficiency and reporting at the same time.
At its core, sustainability is not complicated at all. This article shows the most important building blocks of the modern sustainability landscape, explains why they are relevant for SMEs and classifies how a company with manageable resources can achieve structured, step-by-step sustainability management.
1 How it all began: From the environmental movement to sustainable development
Today's discussion about sustainability does not originate in Excel tables for greenhouse gas emissions, but in the fundamental social realization that economic growth and the resilience of our planet cannot be considered separately. The report ”Our Common Future”, published by the Brundtland Commission on behalf of the United Nations in 1987, provided a decisive impetus.
This contains the definition of sustainable development that is still valid today:
„Permanent sustainable Development is development that meets the needs of the present without risking future generations not being able to meet their own needs.“1)
These words are remarkable because they define sustainability not as an ecological problem, but as a question of justice between generations. They combine ecology, economy and social responsibility into a triad that later came to be known as „Triple Bottom Line“ became popular: People, Planet, Profit (or 3P's after People, Planet, Profit.)In the 1990s, companies began to embrace this view. Sustainability was increasingly seen not just as a moral responsibility, but as a strategic necessity - as part of risk management, reputation, innovation and long-term competitiveness. Today, sustainability is one of the most influential forces of transformation in the economy, and - through regulation, customer requirements and financial market logic - it is also reaching those companies that for a long time did not see themselves as part of the debate.
2. the basic concepts: CSR, corporate sustainability and the logic of responsibility
Before there were concrete rules or reporting standards, a series of basic concepts emerged that still shape the way we think about corporate responsibility today.
Corporate Social Responsibility (CSR) was one of the first. The idea behind it is that companies take responsibility for their actions, regardless of whether a law forces them to do so. For a long time, CSR was the moral compass of business: a promise to measure one's own decisions not only in terms of business efficiency, but also in terms of social impact.
This developed into Corporate Sustainability, a broader management concept that integrates sustainability into strategic planning, operational processes and internal management. Unlike CSR, which has often been implemented on a project-by-project basis, sustainable corporate management sees sustainability as an integral part of value creation: as something that is planned, managed and controlled in the same way as quality or finance.²
Closely linked to this is the Sustainability management. It describes the concrete implementation: setting goals, developing measures, measuring progress, defining responsibilities. Many SMEs have long practised sustainability management informally - they work with regional suppliers, focus on the development and long-term loyalty of their employees or modernize production processes. They just don't call it that.
3. global target images: The SDGs as a guide
In 2015, the United Nations adopted the 2030 Agenda with its 17 Sustainable Development Goals (SDGs).⁴ They cover topics such as climate protection, health, education, innovation, human rights and biodiversity. The strength of the SDGs does not lie in their legally binding nature - they are not laws - but in their role as a global orientation framework.
They help companies - and SMEs in particular - to understand the big picture. The SDGs show the areas in which social transformation is taking place and the expectations placed on companies in the long term. They create a common language that is understood worldwide in reports, tenders and sustainability strategies. Many companies now use the SDGs as a „map“ to identify their own positive and negative impacts.
4 ESG: The common language of business and finance
While the SDGs provide orientation, ESG creates structure.
ESG stands for Environmental, Social and Governance - in short: environmental, social and corporate governance. What was initially a tool for the financial sector is now a globally used framework for sustainability assessment. Banks, investors, insurers, rating agencies and large companies use it to assess risks, opportunities and responsibilities.
The importance for SMEs has grown enormously. Many are receiving ESG questionnaires for the first time because their customers are required to report themselves. Banks are increasingly taking sustainability risks into account in lending decisions. Insurers are asking about climate risks or occupational safety.
ESG is therefore less a legal requirement than a common language that defines how sustainability information is structured, compared and evaluated.
5. reporting standards: GRI, CDP, TCFD & Co. - voluntary, but groundbreaking
If ESG provides the structure, reporting standards answer the question of how reporting is actually carried out. These standards are often voluntary, but they are considered a quality benchmark in many industries.
The best known is GRI (Global Reporting Initiative).⁵ GRI describes in detail which topics a company should report on if it wants to make the material impacts of its business activities transparent - from water consumption and supply chains to occupational safety.
Also important is CDP (Carbon Disclosure Project), the global platform for the disclosure of climate data. Large companies are increasingly asking their suppliers to participate.
The TCFD recommendations (Task Force on Climate-related Financial Disclosures)), published by the Financial Stability Board (FSB), have in turn redefined the reporting of climate risks. They are already mandatory in several countries.
Finally, the IFRS Foundation (International Financial Reporting Standards) with the IFRS S1 and IFRS S2 created two new global standards that are strongly oriented towards the information needs of investors.
The following applies to SMEs: no one is asking them to comply with all of these standards at the same time. However, they provide a framework for quality and transparency that customers and banks are now increasingly using as a guide.
6 Legal developments: From transparency obligations to supply chain laws
In addition to voluntary standards, some countries have created binding rules that have an increasing impact on SMEs - either directly or indirectly.
The EU is driving this development with the new EU Directive Corporate Sustainability Reporting Directive (CSRD) and the associated detailed reporting standards ESRS (European Sustainability Reporting Standards) ⁶ From 2025, many large companies will have to disclose very detailed sustainability information. Switzerland has created its own TCFD-oriented requirements with OR 964a ff. and climate reporting.⁷
Although these regulations are not usually directly binding for SMEs, they do have an effect via the supply chain. Large companies must disclose their own ESG data - and therefore also the data of their suppliers.
This becomes even clearer when it comes to duties of care: The German Supply Chain Due Diligence Act (LkSG), the emerging EU framework CSDDD (Corporate Sustainability Due Diligence Directive) and the Swiss due diligence obligations on conflict minerals and child labor⁸ according to OR 964j require companies to identify and address risks in the supply chain.
In addition, there are climate policy instruments such as the EU CBAM (Carbon Border Adjustment Mechanism), which imposes a cost surcharge on CO₂-intensive imports. This is becoming increasingly relevant for export-oriented or industry-related SMEs.
7 Why the VSME standard is so important for SMEs
The voluntary reporting standard VSME - advertised Voluntary Sustainability Reporting Standard for Non-Listed SMEs - was developed by the European Financial Reporting Advisory Group (EFRAG) with a clear objective: to provide SMEs with a viable path to sustainability reporting, that neither overtaxes nor ignores the needs of smaller companies. ⁹
The background is simple, but crucial. With the new EU directive CSRD and the associated ESRS-standards, sustainability reporting for large companies has become more detailed than ever before. The logic is well thought out, but the scope is enormous. What is appropriate for an international corporation is simply not feasible for an SME - neither financially nor organizationally.
And yet SMEs are feeling this development directly. Large companies must disclose the impact of their own business activities and those of their supply chain as part of the CSRD. Banks must assess climate-related risks and collect ESG data for this purpose. Insurers are expanding their risk models. This increases the pressure on smaller companies to provide information that is actually required for reporting by much larger organizations. Major reporting obligations were intended.
This is precisely where the VSME on. It was created because it was recognized that:
- SMEs need their own reporting format that is tailored to their needs,
- ESRS and CSRD would be far too extensive for SMEs,
- Stakeholder groups nevertheless require comparable information,
- and there is no standard that is compatible with European standards, that convinces both banks and customers.
The VSME is therefore no Light-ESRS, but a Independent SME standard, which reduces the logic of large frameworks to the essentials. It focuses on those sustainability issues that are realistic and relevant for SMEs.
The result is a clearly structured standard that is divided into two modules according to complexity and maturity level: a basic module, that covers the minimum information that internal and external stakeholders can expect, as well as a a Comprehensive module, which SMEs with higher maturity or more complex requirements can use. Both are strongly oriented towards established frameworks such as the ESRS.
For SMEs - especially in Switzerland - the VSME is therefore a decisive step in the right direction. Gamechanger. He creates:
- ClarityWhich topics really count?
- FeasibilityWhat can we achieve with our resources?
- ConnectivityHow do we provide information that banks, customers and auditors understand?
- ProportionalityHow do we avoid overregulation and unnecessary expense?
- Future securityHow do we ensure that we keep pace when requirements increase?
The VSME thus solves a problem that has long preoccupied many SMEs: the gap between the oversized requirements of major standards and the desire to report in a professional, credible and structured manner.
For Swiss SMEs, there is another aspect to consider: Switzerland is not part of the EU, but its companies are deeply integrated into European value chains. They therefore feel the ESG requirements earlier and more directly than many assume. The VSME makes it possible for them, confident and self-determined to respond to these requirements - without the expense of the CSRD and without the impression of having to adopt a European regulatory corset.
In short:
The VSME brings order where many SMEs previously felt uncertainty.
It creates a common language, reduces complexity and makes sustainability reporting realistic, feasible and value-adding for smaller companies for the first time.
Banks, auditors and large companies are increasingly beginning to accept VSME reports as a reliable basis.¹⁰ For SMEs, this creates a format that is comprehensible, structured and future-proof.
8 A simple sustainability cycle for SMEs
Sustainability is not a project that is completed at a specific point in time. It is a cycle of learning, structuring, implementing and improving. Based on the structure of the VSME standard, SMEs can use the following five-step approach:
1. understanding
It all starts with orientation: Which topics really affect our business model? What expectations do customers, banks or insurers have? This understanding ensures that measures are targeted.
3. collect data
Sustainability can only be managed if it is measurable. Initially, existing data from accounting, human resources, energy or purchasing is often sufficient. Suppliers are included step by step.
2. structuring
In the second step, the whole thing is given a framework. The VSME standard offers SMEs a lean but connectable structure that can be easily integrated into existing processes. The key topics are also defined here.
4. reports
The report - ideally based on VSME - creates transparency for internal and external stakeholders. It also serves as a working tool for further development.
5. improve
After the report, the cycle starts all over again: targets are reviewed, measures are adapted and new requirements are integrated.
This approach helps to tailor sustainability activities to the company's own needs and opportunities and creates a continuous, learning-oriented development.
9. where ZEROVia comes in
ZEROVia builds on precisely this logic: a lean start, clear structure, smart data preparation and a report that respects both SME pragmatism and external requirements. The ESG Quick Check provides the initial orientation before the actual data collection and report creation begins.
The aim is simple: to make sustainability feasible for SMEs - without complexity, but with real impact.
The first step is simple
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Footnotes / Sources
[1] World Commission on Environment and Development (1987). Our Common Future. Oxford University Press.
https://sustainabledevelopment.un.org/content/documents/5987our-common-future.pdf
[2] Wikipedia (n.d.). „Sustainable corporate governance“. https://de.wikipedia.org/wiki/Nachhaltige_Unternehmensf%C3%BChrung
[3] Wikipedia (n.d.). „Sustainability management“. https://de.wikipedia.org/wiki/Nachhaltigkeitsmanagement
[4] United Nations (2015). Transforming our world: the 2030 Agenda for Sustainable Development.
https://sdgs.un.org/2030agenda
[5] Global Reporting Initiative (2023). GRI Standards. https://www.globalreporting.org/standards
[6] European Commission (2023). Corporate Sustainability Reporting. https://commission.europa.eu
[7] Swiss Code of Obligations, Art. 964a-964c; Swiss Climate Ordinance (2023). https://www.fedlex.admin.ch
[8] Federal Office of Justice (2023). Due diligence and transparency obligations (OR 964j-l). https://www.bj.admin.ch
[9] EFRAG (2024). Voluntary Sustainability Reporting Standard for SMEs (VSME). https://www.efrag.org
[10] European Commission (2024). FAQ on CSRD & SME reporting. https://commission.europa.eu