ESG and VSME for Hungarian SMEs: What Is Mandatory, What Is Recommended (2026)

TL;DR: The 2026 Sustainability Omnibus (Directive (EU) 2026/470) significantly narrowed mandatory ESG reporting: CSRD now applies only to larger companies (>1,000 employees and >EUR 450m turnover). Most SMEs are not directly obligated, but large customers and banks request ESG data. The VSME — the voluntary, simple ESG standard — is the best answer.

Why this matters to you

Many SME leaders hear that "ESG is coming" and cannot tell whether it applies to them. After the 2026 simplification, most SMEs fall outside mandatory CSRD reporting — but enterprise partners and banks still expect ESG data through the supply chain. So the question is not legal obligation but business access: a company that cannot provide ESG data may be excluded from tenders or get worse financing terms.

ESG in a nutshell

⚪ Concept. ESG spans three dimensions: Environmental, Social, and Governance. In business terms, sustainability is a risk, financing, and market question — not merely a "green" image.

What is mandatory? — CSRD after the Omnibus

🔴 Legal requirement. The Sustainability Omnibus (Directive (EU) 2026/470) was published on 26 February 2026 and entered into force on 18 March 2026. As a result, the mandatory scope of CSRD (corporate sustainability reporting) narrowed: reporting applies, as a rule, to entities exceeding EUR 450m turnover and 1,000 employees. Smaller companies are exempt from the most complex ESG reporting. Strategic details are in CSRD/CSDDD Strategic Interpretation(HU).

What is recommended? — VSME, the SME entry point

🟡 Recommendation. The VSME (Voluntary Sustainability Reporting Standard for non-listed SMEs) is the voluntary, simple ESG reporting standard for non-listed SMEs. The European Commission issued a recommendation on it on 30 July 2025; it was developed by EFRAG. Its aim is to help SMEs efficiently answer data requests from CSRD-scope large companies and banks.

VSME has two modules:

• Basic module — the minimum most SMEs should complete.
• Comprehensive module — broader, if partners request more data.

🟢 Good practice. VSME is a strong tool because it standardises the answer: instead of many ad-hoc ESG questionnaires, data can be provided within one recognised framework.

What this means in practice — ESG first steps for SMEs

1. Clarify scope — is the company directly obligated (likely not), or affected as a supplier?
2. Map partner expectations — what ESG data do customers/banks request?
3. Choose a VSME module (basic or comprehensive).
4. Collect data — energy, emissions, workforce, governance basics.
5. Compile a first VSME report.
6. Embed into the process — so the next data request is routine.

Risk and opportunity

Risk: without ESG data, exclusion from the supply chain or less favourable financing; greenwashing allegations for unsupported claims. Opportunity: a prepared ESG data structure can unlock better credit terms, a tender edge, and stronger brand value.

How Regcytech helps

Regcytech clarifies ESG exposure, sets up the data-collection process, and supports VSME/CSRD alignment and supplier ESG data provision. (Regcytech is not an auditor or certification body.)

FAQ

Is ESG mandatory for SMEs? After the 2026 simplification, most SMEs fall outside mandatory CSRD reporting, but they are effectively affected via supplier and bank ESG data requests.

What is VSME? The voluntary, simple ESG reporting standard for non-listed SMEs, with basic and comprehensive modules.

What changed in 2026? The Sustainability Omnibus narrowed CSRD's mandatory scope (>1,000 employees + >EUR 450m) and simplified requirements.

Related content

• CSRD/CSDDD Strategic Interpretation(HU)
• Supply Chain: Cyber & ESG Due Diligence(HU)
• Practical Green IT Guide(HU)