This report presents a practical and comprehensive framework for Diversity, Equity, and Inclusion (DEI) management tailored to the realities of small and medium‑sized enterprises (SMEs). The framework builds on empirical insights from surveys and focus group discussions carried out by the DEI4SME project team, complemented by independent research conducted at the University of Vaasa. Together, these sources offer a robust, evidence‑based understanding of the current state of DEI in European SMEs and the challenges and opportunities that organisations and their employees encounter. We first provide an overview of the status of DEI in SMEs across Europe, identifying key gaps and areas where support, clarity, and practical tools are urgently needed. Drawing on these identified needs, we outline concrete actions that are feasible and effective within SME contexts—actions that help address barriers experienced by both organisations and the individuals working within them. Building on this foundation, the report introduces a four‑part DEI engagement framework designed to guide SMEs through practical implementation. The framework covers: Embedding DEI in daily work practices, Integrating DEI into people management, Embedding DEI in strategic management, and Strengthening compliance and governance efforts.Each area includes three maturity levels that illustrate how SMEs can progressively deepen their engagement, from initial steps to advanced integration, enabling firms to choose development paths that suit their size, resources, and ambitions. The resulting framework serves as a tool for reflection, planning, and implementation. It supports SMEs, especially those in Europe, in becoming active contributors to addressing structural DEI challenges while simultaneously enhancing their competitiveness and resilience. By developing a framework for how “doing good for society” can align with “doing good business,” the report encourages SMEs to become meaningful change agents in their ecosystems and beyond.