How do I comply with ESG requirements?

ESG compliance is not a one-time project — it is an ongoing management practice. The good news is that for most SMEs, the starting point is simpler than you think. You do not need to measure everything at once. You need to start somewhere, document it, and improve over time. Regulators and corporate buyers understand that SMEs are at an earlier stage than large companies.

Before doing anything else, establish which regulations apply to your business and when. Use our applicability guide and jurisdiction pages to build a clear picture. Note the difference between direct obligations (you must report) and indirect obligations (your customers require data from you). The two require different responses.

A materiality assessment identifies which ESG topics are most significant for your business — both in terms of your impact on the world and the world's impact on your business. For most SMEs, this is a straightforward exercise: list the ESG topics relevant to your sector, rate their significance, and focus your effort on the top five to ten. You do not need to report on everything.

You cannot manage what you do not measure. Start with the basics: Scope 1 emissions (direct from your operations), Scope 2 emissions (from purchased electricity), energy consumption, and any significant social or governance gaps. Most SMEs can complete a basic baseline measurement in a few days using publicly available emission factors and their existing utility bills and payroll data.

Address the most material gaps with practical actions: update your health and safety policy, introduce an anti-bribery policy, switch to a renewable energy tariff, or begin tracking supplier ESG data. Crucially, document everything. Evidence is what separates genuine compliance from greenwashing — and evidence is what your buyers and auditors will ask for.

Produce a summary ESG disclosure — even a brief one — and share it with relevant stakeholders. Use a recognised framework (GRI, TCFD, or your buyer's preferred questionnaire format) to structure your disclosure. Review your performance annually and set improvement targets. Over time, your ESG score will improve and your compliance burden will reduce.

• Waiting until you are asked. By the time a major customer sends you an ESG questionnaire with a two-week deadline, it is too late to build a credible response from scratch.
• Treating it as a one-off exercise. ESG data needs to be collected continuously, not assembled in a panic at year end.
• Overclaiming. Greenwashing is increasingly subject to legal action. Only claim what you can evidence.
• Ignoring the supply chain. Your own ESG score is only as good as the data you can collect from your suppliers. Start engaging them early.