ESG Disclosure for SMEs: What You Need to Know and How to Prepare
As Environmental, Social, and Governance (ESG) disclosure requirements expand globally and within Korea, small and medium enterprises must begin preparing now. Even if current mandates target large corporations, the ripple effects on SMEs are significant and growing.
Mandatory Disclosure Overview
Korea's ESG disclosure roadmap is accelerating. Starting with large listed companies, mandatory sustainability disclosure is phasing in across the Korean market. The adoption of ISSB (International Sustainability Standards Board) standards as the baseline for Korean disclosure means alignment with global expectations. By 2026, companies with assets over 2 trillion KRW must comply, with smaller thresholds expected to follow in subsequent years.
What SMEs Need to Know
Even though SMEs may not face direct disclosure mandates immediately, the indirect impact through supply chains is substantial. Large corporations subject to mandatory reporting are increasingly requiring ESG data from their suppliers. This means SMEs in the supply chains of Samsung, Hyundai, SK, and other major conglomerates must be prepared to provide environmental and social performance data on demand.
Key Disclosure Areas
1. Environment (E)
2. Social (S)
3. Governance (G)
Step-by-Step Preparation Guide
Common Challenges and Solutions
How KITIM Can Help
KITIM provides comprehensive ESG disclosure preparation support, from initial gap analysis to full reporting system implementation. Our consultants specialize in helping SMEs build cost-effective ESG data management systems and prepare for both voluntary and mandatory disclosure requirements.