Do SMEs have an ESG communication strategy? Exploring the quality and influencing factors of voluntary ESG disclosures using web-based and annual report channels

Business Strategy and the Environment. 2025. Vol. 34. No. 1. P. 1267–1286.

Cardoni A., Evgeniia Kiseleva

This paper evaluates the influencing factors and disparities between web-based and annual report channels for environmental, social and governance (ESG) disclosures by small and medium-sized enterprises (SMEs). In contrast to the prevalent use of case-studies in the context of SMEs, a quantitative study was conducted by performing a content analysis of the websites and annual reports of 100 manufacturing SMEs in Italy. Based on the collected evidence, SMEs exhibited a higher level of web-based disclosures compared to annual reports. These disclosure channels appear to be independent of each other, with financial resources significantly influencing the quality of annual reports (i.e. profitability as a proxy) and size impacting information available on websites (i.e. turnover as a proxy). Both channels may be explained by the resource-based view, while agency characteristics (such as having a Big Four external auditor or board size) have a relevant effect on the overall voluntary ESG disclosure score.

Keywords: SME, МСП, устойчивое развитие бизнеса, ESG