Sustainability Reporting Obligations in Switzerland: What SMEs Need to Know in 2026

Switzerland has introduced mandatory sustainability reporting through the Code of Obligations (Swiss CO Art. 964a-c), which entered into force on 1 January 2022. The first reporting obligation applied to financial year 2023. While most SMEs are not directly in scope, the indirect effects through supply chains are significant.

Disclaimer: This is for informational purposes and does not constitute legal advice. Consult a qualified legal professional for guidance specific to your situation.

Who Is Directly Affected?

Under CO Art. 964a, reporting is mandatory for public-interest entities (Unternehmen von öffentlichem Interesse) as defined in Art. 2 of the Revisionsaufsichtsgesetz (RAG). These are specifically:

• Listed companies (companies with equity securities listed on a Swiss stock exchange)
• FINMA-supervised entities (banks, insurance companies, and other entities supervised by the Swiss Financial Market Supervisory Authority)

In addition to being a public-interest entity, the company must exceed two of the following thresholds in two consecutive financial years:

• 500+ full-time employees (annual average)
• CHF 20 million+ in total assets
• CHF 40 million+ in revenue

Currently, only approximately 200 companies in Switzerland are directly in scope. The thresholds are cumulative requirements on top of the public-interest entity criterion — a private company with 500+ employees is not automatically subject to reporting.

These companies must report on environmental, social, employee, human rights, and anti-corruption matters, with the report approved by the board and general assembly.

The Climate Ordinance

The Swiss Climate Ordinance, which entered into force on 1 January 2024, adds specific climate-related disclosure requirements for companies already subject to Art. 964a–c. This includes climate risk assessments and transition planning.

How This Cascades to SMEs

Although only ~200 companies report directly, the cascade effect is substantial:

• Supplier questionnaires: Reporting companies must disclose value chain impacts, so they request GHG emissions and energy data from their suppliers.
• Procurement criteria: Sustainability performance increasingly affects supplier selection and contract renewals.
• Due diligence: CO Art. 964j–964l requires companies to track supply chain risks related to child labour and conflict minerals.
• EU CSRD cascade: Swiss SMEs supplying to EU companies subject to the Corporate Sustainability Reporting Directive (CSRD) face similar data requests. Note that CSRD Waves 2 and 3 have been delayed by 2 years under the EU Omnibus I regulation (entered into force 19 March 2026), with the scope threshold raised to 1,000+ employees AND EUR 450M+ net turnover.

The VSME Solution

The EFRAG VSME Standard, formally adopted as EC Recommendation 2025/1710 on 30 July 2025, provides a proportionate framework for SMEs. Benefits:

• Respond to client requests with a standardised, recognised report
• Prepare for future regulation as requirements tighten
• Access better financing as banks integrate ESG criteria
• Demonstrate credibility to partners and customers

Timeline

• 1 January 2022: CO Art. 964a–c enters into force
• FY 2023: First mandatory reporting year for in-scope companies
• 1 January 2024: Climate Ordinance enters into force (additional climate disclosures)
• 2024–2025: Large companies begin requesting supply chain data from SME suppliers
• 2026: Increasing pressure on SMEs to provide sustainability information; EU Omnibus I delays CSRD expansion but data requests continue

What to Do Now

1. Assess your exposure — do any clients fall under mandatory reporting (Swiss Art. 964a or EU CSRD)?
2. Start collecting energy, workforce, and governance data.
3. Create a voluntary VSME declaration to demonstrate readiness.

QuickVSME makes it straightforward to produce a VSME-compliant declaration with Swiss KBOB Ökobilanzdaten emission factors. Get started now.

Sources

• Swiss CO Art. 964a-c
• EFRAG VSME Standard
• KBOB Ökobilanzdaten