Big firms push SMEs to meet ESG standards

Small and medium enterprises (SMEs) are facing growing pressure to meet environmental, social and governance (ESG) standards as big companies tighten sustainability reporting and require more disclosures from their suppliers, executives of the League of Corporate Foundations (LCF) said.

- Ehda M Dagoo

League of Corporate Foundations (LCF) executives, led by Chairman Shem Jose Garcia (third from left), said mandatory sustainability disclosures for listed firms are creating a ripple effect across supply chains, with suppliers--many of them SMEs--now required to report data on carbon emissions, labor standards and community initiatives. EHDA M. DAGOOC

Speaking during the group’s first Corporate Social Responsibility Convention in the Visayas, held at Maayo Hotel, foundation leaders said mandatory sustainability disclosures for listed firms are creating a cascading effect, prompting suppliers — many of them SMEs — to submit data on carbon emissions, labor standards and community programs.

While reporting requirements currently apply to publicly traded companies under Securities and Exchange Commission rules, large firms are increasingly requiring vendors to align operations with ESG benchmarks to support consolidated disclosures.