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La Lorraine Bakery Group

La Lorraine Bakery Group (LLBG), a Belgian family-owned company with over 85 years of expertise in the milling and bakery sector, partnered with Karomia to complete their Double Materiality Assessment (DMA) and begin their CSRD gap analysis. With Karomia’s AI-powered platform, LLBG rapidly identified key Impacts, Risks, and Opportunities (IROs), reduced ESG team workload, and laid a solid foundation for their future CSRD compliance.

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Van Moer Logistics

Van Moer Logistics, a leading integrated logistics service provider, faced the complex task of completing their Double Materiality Assessment (DMA) to meet CSRD reporting requirements. By leveraging Karomia’s AI-driven platform, they transformed a manual, time-consuming process into an efficient, streamlined workflow, saving time, reducing workload, and ensuring audit-ready compliance.

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Beyond Compliance : The Future of ESG
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The Increasing Demands for High-Quality ESG Data

Better Insight with ESG Data

We’re living through a period of deep change. Climate is changing. Trade routes are being reshaped. Supply chains are facing regular disruptions. Volatility and uncertainty have become the norm. In such a world, understanding a business’s sustainability is not a luxury — it’s a necessity.

Sustainability today goes far beyond a simple checklist. It’s multifaceted, encompassing how a business uses resources, its exposure to climate hazards like floods or wildfires, its resilience to supply chain disruptions, and its preparedness for emerging environmental challenges — from PFAS to microplastic pollution — and social regulations. It includes whether it’s contributing to or protecting biodiversity, and how fairly it treats its workforce and those of its suppliers. And it demands strong governance — to actively prevent exposure to corruption and reputational risks.

This isn’t just critical for the business itself. Financial institutions, investors, regulators and customers all rely on this information to make sound decisions. High-quality, granular ESG data has become as essential as financial metrics and is even more crucial for long-term planning and credible ESG reports.

Banks and Insurers Are Making ESG Data Mandatory

Financial institutions are already moving ahead. The EU’s “banking package” — CRR III and CRD VI — is making ESG risk a core part of prudential rules. No longer just a disclosure obligation, ESG risk now affects capital requirements, board responsibilities, and supervisory expectations. Banks must gather data on emissions, energy efficiency of real estate, location of physical assets, exposure to high-emitting sectors, and clients’ transition plans. They’ll need the data to model the impact of climate scenarios on default probabilities, collateral values, and sectoral risk.

This transforms how banks assess credit and portfolio risk. Climate-adjusted cash flow projections, forward-looking stress tests, and integration of ESG factors into internal models will become the norm. Institutions lacking reliable ESG data will be forced to use proxies or third-party datasets — with all the governance and audit implications that come with it.

Insurers face similar obligations. The updated Solvency II framework hardwires ESG into every part of risk management — from underwriting to scenario analysis. Sustainability-risk plans must be board-approved and quantified. Climate scenarios must span 30-year horizons and feed into solvency assessments. Weak ESG modeling won’t just be frowned upon — it may lead to capital surcharges.

The message is clear: ESG isn’t a side issue. It’s part of core financial stability, and regulators are watching closely.

The Solution: One ESG Report, Done Right

So how can companies keep up with this growing demand for high-quality, consistent ESG data and simplified ESG reporting?

The answer lies in simplification and standardization. At Karomia, we champion the VSME standard — one report, done well, built for verification and reuse. No more fragmented disclosures across formats and frameworks. No more bureaucracy for the sake of compliance.

Instead, companies should produce one high-quality ESG report that serves all stakeholders — banks, insurers, investors, customers and regulators. Automation plays a key role: not to generate meaningless boilerplate, but to help collect real ESG data, track progress, and ensure consistency over time.

This kind of streamlined, high-quality ESG reporting allows institutions to confidently incorporate non-financial risk into their models. It reduces the burden on companies while increasing trust in their ESG reports. And it supports the broader shift toward a more resilient, future-proof economy.

In a fast-changing world, we need long-term thinking. ESG isn’t just a buzzword — it’s a powerful lens through which we understand business resilience, risk, and opportunity. Let’s assess the risks and opportunities our businesses face and provide institutions with high-quality ESG data in a way that’s smart and efficient, not burdensome.

One ESG report. Done right. That’s the future of ESG.

Isabel and Karomia Partner to Simplify ESG Reporting via Kube Platform

Isabel and Karomia have entered into a strategic partnership to enhance the ESG reporting capabilities for small and medium-sized companies. This collaboration brings together the power of Kube - Isabel’s trusted platform for the secure exchange of verified corporate data - and Karomia’s ESG expertise and VSME reporting engine.

Empowering smaller companies to meet growing ESG expectations

The partnership will allow SMEs to perform proportionate ESG reporting according to the VSME standard(*). Even though companies may not be legally required to report on ESG (e.g. as could be the case with CSRD), there’s a growing demand from banks, investors, and supply chain partners for structured ESG data. For other SMEs, ESG is deeply embedded in their corporate identity, making it only natural for them to want to share and highlight their ESG profile.

A future-proof ESG reporting solution built on a trusted platform

By embedding Karomia’s ESG engine into the Kube platform, Isabel offers SMEs a unique, user-friendly solution to register and share their ESG data with key stakeholders, particularly within the financial sector.

The Kube platform is already trusted and used by the 4 major Belgian banks for the exchange of KYC data in the context of AML (Anti-Money Laundering). Today Kube already holds the verified KYC data of more than 300.000 corporates. The scope will now be extended with ESG data which makes Kube a unique asset for corporates facilitating the secure exchange of their data in today’s digital economy.

"Isabel is known for its reliable solutions that support companies in their day-to-day financial operations and interactions within the digital economy. The recently launched Kube platform for secure data exchange is a clear example of this. ESG represents a new and important pillar, with significant challenges in terms of data management and sharing. Thanks to our collaboration with Karomia, we are further expanding Kube with future-oriented solutions for ESG reporting,” says Kris De Ryck, CEO of Isabel.

“At Karomia, we believe that ESG reporting should be straightforward, reliable, and within reach for every SME. With Kube-ESG, we combine Isabel’s trusted capabilities in secure data exchange with our expertise in ESG reporting and our proven, user-friendly platform. Together, we are making it easier for businesses to collect, manage, and share their ESG data and empower them to build a more sustainable future,” says Luc Machiels, CEO of Karomia.

The Kube ESG platform will be launched in autumn later this year. Isabel and Karomia will closely monitor regulatory developments, including the evolution of the Omnibus Directive, to ensure that the Kube platform stays tuned with the dynamic ESG reporting requirements.

(*) Under current legislation, companies that fall under the VSME standard (Voluntary Standard for non-listed micro-, small- and medium-sized enterprises) are those that do not exceed two of the following three thresholds: €25 million in total assets, €50 million in net turnover, or an average of 250 employees over the financial year. While these companies fall outside the mandatory scope of the Corporate Sustainability Reporting Directive (CSRD), the ongoing discussions around the Omnibus proposal could further raise the CSRD threshold to cover only companies with over 1000 employees, increasing the relevance of the VSME as a voluntary ESG reporting framework for SMEs facing growing market-driven sustainability disclosure demands.

About ESG

The Voluntary Standard for non-listed micro-, small-, and medium-sized enterprises (VSME) has emerged as a key recommendation for SMEs seeking to navigate growing demands for sustainability transparency. While SMEs are not (yet) subject to mandatory ESG reporting under the Corporate Sustainability Reporting Directive (CSRD), especially with the potential increase of the threshold to 1000 employees under the Omnibus proposal, they increasingly face pressure from banks, business partners, and customers to disclose ESG information. This pressure is amplified by upcoming banking regulations — notably the Capital Requirements Regulation (CRR III) and Capital Requirements Directive (CRD VI) — which will require banks from 2026 onwards to assess ESG risks across their loan portfolios.

To comply, financial institutions must collect reliable and consistent ESG data from their clients, including SMEs. In practice, however, providing such data is a complex challenge for many SMEs, who often lack the resources and guidance to report effectively. The VSME standard offers a simplified, voluntary framework to help SMEs meet these expectations, ensuring they remain competitive, finance-ready, and aligned with evolving sustainability requirements without the heavy burden of full CSRD compliance.

About Isabel

Isabel connects and simplifies the administrative and financial processes of companies, accounting agencies and banks and ensures the smooth and reliable exchange of documents, payments and identifications and automates access to them. The products - Isabel 6 (multi-bank payment platform), Ponto (open banking), Kube (verified corporate data) and IntelliSuite (fraud monitoring) - enable seamless, secure and reliable data and money flows. Trusted by more than 50,000 companies to access a network of more than 2,000 banks, Isabel processes more than 2,300 billion euros annually and the company will celebrate its 30th anniversary in 2025. At the heart of the Isabel brand lies a distinctive commitment to unify the banking sector, software providers and our customers to build community-powered banking solutions. This Belgian regulated company, headquartered in Brussels and acting under the supervision of the National Bank of Belgium, focuses primarily on the Benelux market. At Isabel, we want to be the cornerstone of trust in an era defined by rapid technological advancement and, as such, contribute to a stronger, more efficient and secure digital economy.

To keep up with Isabel, visit our website or LinkedIn page.

About Karomia

Karomia helps companies overcome two of the biggest hurdles in sustainability reporting: managing complex regulatory requirements and structuring a company’s information into a compliant ESG report. Its AI-driven platform simplifies the Corporate Sustainability Reporting Directive (CSRD) & VSME reporting process. Karomia empowers organizations to move beyond the bureaucracy of ESG reporting towards sustainable impact. Since its founding in 2024, Karomia has supported over 60 companies across Europe and the US with their ESG reports (both CSRD & VSME aligned). The company is an innovative, fast-growing scale-up redefining ESG reporting for modern enterprises. Based at the iconic Wintercircus in Ghent, Karomia is backed by leading investors including Imec.istart Future Fund and Entourage.

To keep up with Karomia, visit our website or LinkedIn page.

How VSME Helps SMEs Overcome ESG Reporting Barriers

Although small and medium-sized enterprises (SMEs) across Europe may no longer fall under the strict reporting obligations of the Corporate Sustainability Reporting Directive (CSRD), they are still feeling the pressure. The directive has created a ripple effect: stakeholders now expect greater transparency, no matter the company size. Yet for most SMEs, the costs and complexity of traditional ESG reporting simply don’t add up.

That’s where the VSME standard comes in. Developed by EFRAG, the Voluntary Sustainability Reporting Standard for SMEs (VSME) is designed to simplify ESG disclosures for small and medium-sized businesses. Unlike the CSRD, the VSME standard is lean, practical, and proportionate, giving SMEs a more accessible way to meet growing demands.

📊 Want the full breakdown? Check out our complete VSME guide to dive deeper into the standard, its structure, and how it compares to the ESRS.

In this article, we’ll show how VSME reporting helps your business overcome the three biggest ESG reporting barriers.

“Sustainability Reporting Is Too Complex”

The original CSRD requirements are extensive, especially for small teams. Understanding the directive, identifying material topics, mapping disclosures to ESRS standards—it can feel like mission impossible.

VSME simplifies complexity without cutting corners

That’s why EFRAG’s VSME standard exists. Rather than overwhelm small businesses, it offers a framework focused only on what matters most, delivering clarity, consistency, and relevance.

In fact, the VSME Comprehensive Module covers the maximum ESG dataset reasonably expected from SMEs by banks, investors, and CSRD-reporting clients. So by using the VSME, you're not just ticking boxes, you're building real stakeholder trust.

To accommodate SMEs at different stages, the VSME offers two modules:

  • Basic Module: 11 core disclosures (B1–B11) on topics like energy use, workforce, and anti-corruption. Ideal for small teams responding to standard ESG data requests.
  • Comprehensive Module: Adds 9 more disclosures (C1–C9) for businesses needing deeper transparency, without requiring full ESRS compliance.
VSME standard: basic module vs comprehensive module

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“We Don’t Have Enough Resources”

Under CSRD, SMEs often spent excessive time and budget producing dense, compliance-driven reports. That left little room for real sustainability action.

Resource-friendly by design

The VSME standard was built specifically to avoid that trap. It retains the core principles of the ESRS framework while removing unnecessary burden.

Here’s how it helps:

  • Simplified structure: The Basic Module contains ~40 data points; the Comprehensive Module ~100. That’s a fraction of full CSRD requirements, and much easier to interpret.
  • Smarter data collection: Most required info is already available internally. No complex stakeholder interviews or vague metrics.
  • Targeted reporting: VSME’s materiality-based structure lets you skip irrelevant sections and focus on what actually matters.

And with the right VSME tool, like Karomia, the process becomes even lighter. Just upload your existing documents and company data, and let the platform prefill your disclosures based on context. Reports are generated in hours, not months.

“We Don’t See the Financial Benefits”

For many SMEs, ESG has felt like a cost center, not a business opportunity. But that perception is quickly changing.

ESG is now a growth lever

Banks are preparing for CRR III and CRD VI, which will require them to assess ESG risk in their lending starting 2026. That means they’ll need consistent, comparable ESG data from clients.

Buyers subject to CSRD must report on their supply chains. If you're not providing ESG data, you risk losing contracts.

Talent and consumers are also paying attention. Job seekers and buyers increasingly prefer companies that align with their values.

The VSME standard helps SMEs meet all of these expectations without overextending. It turns ESG reporting into a business enabler, not just a compliance task.

Preparing your VSME report today helps you:

  • Improve financing opportunities
  • Stay competitive in procurement
  • Attract values-driven customers and employees

Early adoption also positions you as a strategic, future-ready partner in ecosystems where VSME vs CSRD isn’t just a technical difference, it’s about proving you're serious about sustainability.

The EFRAG VSME standard empowers SMEs to report on sustainability in a way that’s realistic, relevant, and resource-friendly. As expectations rise across finance and supply chains, VSME reporting gives you a head start.

Redefine VSME Reporting with Karomia

Karomia’s AI-powered VSME tool helps you:

  • Start with what you have: Upload documents and info, and Karomia will prefill your disclosures with contextual accuracy.
  • Go from data to report in hours: No manual formatting or complex mapping.
  • Share what matters: Deliver a clear, structured report that meets stakeholder expectations.

Take the first step toward easier, smarter ESG reporting—book a demo today.

CSRD Reporting Guide
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DMA Guide

Comprehensive Guide to Double Materiality Assessments

CSRD Guide

Comprehensive Guide to Corporate Sustainability Reporting Directive (CSRD)

VSME Guide

VSME Standard for SMEs: A Practical Guide to ESG Reporting

Webinar Replays
Stakeholder Engagement Webinar

Learn in 30 minutes how to engage your stakeholders in an effective and efficient way during your Double Materiality Assessment.

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Omnibus & Your ESG Report: What’s Next?

Unpack the Omnibus proposal and its impact on your ESG reports. Learn how AI can do all the heavy lifting to get your report done.

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DMA Masterclass

Learn how to conduct a CSRD compliant but pragmatic double materiality assessment with our masterclass video

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CSRD Compliance

Watch our webinar replay to learn how to effectively and efficiently ensure compliance of your Double Materiality Assessment. With insights, practical tips, and strategies from Karomia.

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La Lorraine Bakery Group

La Lorraine Bakery Group (LLBG), a Belgian family-owned company with over 85 years of expertise in the milling and bakery sector, partnered with Karomia to complete their Double Materiality Assessment (DMA) and begin their CSRD gap analysis. With Karomia’s AI-powered platform, LLBG rapidly identified key Impacts, Risks, and Opportunities (IROs), reduced ESG team workload, and laid a solid foundation for their future CSRD compliance.

La Lorraine Bakery Group
Van Moer Logistics

Van Moer Logistics, a leading integrated logistics service provider, faced the complex task of completing their Double Materiality Assessment (DMA) to meet CSRD reporting requirements. By leveraging Karomia’s AI-driven platform, they transformed a manual, time-consuming process into an efficient, streamlined workflow, saving time, reducing workload, and ensuring audit-ready compliance.

Van Moer Logistics
Aluminium Duffel

Aluminium Duffel, a leading manufacturer of aluminum rolled products, turned to Karomia to simplify their Double Materiality Assessment (DMA) process and ensure compliance with CSRD reporting. In just one weekend, Karomia’s innovative tool helped them finalize months of work, collect data from 56 stakeholders, and reduce administrative burden.

Aluminium Duffel
beMatrix

beMatrix, a leading provider of modular aluminum frames for temporary constructions, faced the overwhelming challenge of completing their Double Materiality Assessment (DMA) as part of their CSRD reporting. With Karomia’s step-by-step platform, they streamlined the process, saving significant time and effort while achieving compliance with precision.

beMatrix
Karomia Partners
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La Lorraine Bakery Group

La Lorraine Bakery Group (LLBG), a Belgian family-owned company with over 85 years of expertise in the milling and bakery sector, partnered with Karomia to complete their Double Materiality Assessment (DMA) and begin their CSRD gap analysis. With Karomia’s AI-powered platform, LLBG rapidly identified key Impacts, Risks, and Opportunities (IROs), reduced ESG team workload, and laid a solid foundation for their future CSRD compliance.

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