If you supply food processors, retailers, cooperatives, or exporters in Europe, you've likely heard about CSRD—the Corporate Sustainability Reporting Directive. This EU regulation is transforming sustainability reporting requirements for large companies and, by extension, their agricultural supply chains.
For farms and agricultural SMEs, CSRD raises practical questions: Does this apply to me directly? What will my buyers expect? How do I prepare without expensive consultants?
Understanding CSRD's Supply Chain Impact
CSRD requires approximately 50,000 European companies to publish detailed sustainability reports. These reports cover environmental, social, and governance topics including carbon emissions, biodiversity impacts, water use, and worker conditions.
The critical part: CSRD-obligated companies must report on their entire value chain, not just direct operations. For a food retailer or processor, that means they need sustainability data from the farms that supply them.
CSRD doesn't directly obligate most farms. However, your buyers are obligated, and they will ask you for data. Your ability to provide that data efficiently affects your relationship with EU buyers.
Think of it this way: Tesco, Carrefour, Nestlé, Danone, Unilever—they all have public sustainability commitments and CSRD obligations. They need your data to meet theirs.
The VSME Standard: CSRD-Lite for Farms
Recognizing that full CSRD reporting standards are disproportionate for small operations, EU regulators developed the VSME—Voluntary SME Standard. This simplified framework covers the same sustainability topics with reduced datapoints and less complexity.
The VSME is “voluntary” in the technical sense that regulators won't fine you. However, when your buyer asks you to report using VSME, it becomes voluntary in the same way that meeting buyer specifications has always been voluntary—technically optional, but commercially necessary.
VSME Datapoints for Agricultural Operations
Environmental datapoints are where agriculture diverges most from generic guidance:
- Energy consumption (diesel, electricity, heating fuel)
- Greenhouse gas emissions (Scope 1 and 2 minimum—including livestock methane and fertilizer N2O)
- Land use and management (hectares, crop rotation, tillage practices)
- Water extraction and consumption (irrigation, livestock, processing)
- Fertilizer and pesticide use (kg applied, active ingredients)
- Biodiversity impacts (habitat features, conservation measures)
- Waste generation (farm plastics, agrochemical containers, organic waste)
Social datapoints address your workforce:
- Health and safety metrics (machinery incidents, chemical exposure, livestock handling)
- Working conditions (hours during peak seasons, seasonal worker accommodation)
- Training and development (sprayer certification, machinery competence, first aid)
- Fair treatment (wages, contracts for seasonal staff, grievance mechanisms)
Governance datapoints cover your management practices:
- Who is responsible for sustainability decisions
- What policies guide your operations
- Farm assurance and certification status
- How you manage risks in your own supply chain (feed, inputs)
Materiality: What Matters Most for Farms
CSRD uses “double materiality”—you report on topics that affect your business financially AND topics where your business affects the world.
For agricultural operations, certain topics are almost always material:
- Climate/emissions—farms have significant direct emissions from livestock and soils
- Water—agriculture is a major water user, especially irrigated operations
- Biodiversity—this is HIGHLY material for farms (unlike most manufacturing). Land management directly affects ecosystems
- Soil health—your productive asset and a carbon sink
- Worker safety—farming is one of the most hazardous industries
Your buyer may provide guidance on which topics they consider material for their supply chain. If they specifically request water data, they've determined water is material to their reporting.