The effects of the CSRD on SMEs

Since the introduction of the Corporate Sustainability Reporting Directive (CSRD), large businesses are required to report on sustainability. This also has consequences for small and medium-sized enterprises (SMEs). How well can SMEs meet their customers' data requests? What challenges and opportunities do they see? The New Finance research group of The Hague University of Applied Sciences investigated, on behalf of the Ministry of Economic Affairs, how the CSRD affects SMEs.  

About the CSRD  

The CSRD is a European directive that requires large and listed businesses to report on sustainability in their annual reports, in addition to financial performance, based on various criteria. The CSRD focuses on three areas: environmental, social and governance. Although most SMEs are not directly subject to this reporting requirement, they may be indirectly affected by it. Indeed, large businesses that do fall under the CSRD have to offer insight into the sustainability of their entire value chain. This means they can ask their customers and suppliers, including SMEs, to provide sustainability information. 

Research into the consequences for SMEs 

The New Finance research group, part of the  Centre of Expertise Digital Operations & Finance, investigated the indirect effects of the CSRD on Dutch SMEs. The analysis is based on a survey of 431 respondents from a representative, ISO-certified business panel and 127 SMEs recruited through social media and newsletters. In addition, 48 interviews were conducted with SMEs, listed businesses, industry organisations, accounting firms and ministries from Germany and Denmark. 

Key findings  

The research shows that 24% of Dutch SMEs is already receiving sustainability-related data requests from their customers or suppliers at the end of 2024. For SMEs with more than 50 employees, this figure rises to 65 percent. The requested data mainly focuses on environmental aspects such as CO₂ emissions. 

Although a majority (60%) indicate that they can meet data requests well or excellently, others experience increased work pressure. Finding suitable IT systems and tools is particularly challenging. 

However, the CSRD offers not only obligations, but also opportunities. Some entrepreneurs see opportunities to improve their internal and external collaboration, strengthen their competitive position, and use sustainability data to make their business operations more sustainable. 

Recommendations for SMEs and stakeholders 

Based on the research, concrete recommendations were formulated for SMEs, large businesses, industry organisations and the government. Collaboration is essential for the successful implementation of the CSRD. User-friendly processes, standard reporting templates, accessible tools and knowledge sharing can help make implementation smoother. 

More information 

Read more about the CSRD, the research, the results and recommendations in the report Duurzaamheidsinformatie: De effecten van de CSRD op het mkb (Sustainability information: The effects of the CSRD on SMEs). 

Contact 

For more information about this project, please visit the website of the Ministry of Economic Affairs or contact Ludger Niemann, researcher with the New Finance research group ([email protected]).