For many years the bulk of investor and stakeholder pressure on ESG issues focused on larger companies. Indeed, recent findings by The Conference Board in collaboration with Esgauge and Heidrick & Struggles show that most smaller publicly traded firms remain on the sustainability-disclosure sidelines. But with the SEC’s ESG disclosure rules right around the corner, and with evidence that investors expect smaller companies to do more on ESG, that’s no longer a tenable position for firms regardless of size.
CEOs of smaller companies might be tempted to dismiss sustainability reporting as the exclusive province of large multinationals. Yet just last year shareholders voted on 15 resolutions on environmental and social topics at Russell 3000 companies (that includes almost all U.S. publicly traded companies) with less than $5 billion in revenue. Notably, six of these resolutions passed.
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