should I indicate whether we have a policy for work-life balance of staff

Work-life balance is separate from leave regulations

This question concerns policy, not whether you comply with statutory leave regulations. In the VSME context, work-life balance falls under the broader social pillar, together with employment conditions such as whether staff are covered by a collective labour agreement The client wants to know whether there is a concrete, documented policy — think of arrangements regarding working from home, flexible working hours, parental leave above the statutory minimum, or a right to be unreachable outside working hours. An informal practice ("we are flexible about it here") is not a policy in the sense of this question.

If you have not put this in writing, then "no" is the factually correct answer, even if the practice within the company is quite flexible. If you are unsure whether something you do have — for example a remote working arrangement in the employment contract — counts as "work-life balance policy", the answer cannot yet be given with certainty: that requires a brief check of what exactly is on paper. This topic is often filled in together with other personnel questions, such as those concerning training hours per employee or the gender distribution in the workforce — it is worthwhile to go through that batch in one go because the supporting documents often come from the same HR administration.

Basis for this question in the VSME module

Work-life balance is a standard indicator in the social pillar of the EFRAG VSME standard, the voluntary basic module for non-listed SME enterprises. The standard itself does not prescribe a policy — it only asks whether one exists and, if so, what it contains. Directive (EU) 2022/2464, the CSRD, is the reason larger supply chain partners pass these questions on to their SME suppliers: they themselves must report on their value chain and use the VSME basic module as a standardised format to collect this from suppliers.