Unclear start, clearer continuation – The benefits of ESG are slowly emerging

By: Trademagazin Date: 2024. 11. 08. 11:43

The number of people interested in the new ESG regulation, which came into effect in January, is increasing beyond the scope of obligations, including among small and medium-sized enterprises. In addition, the deepening of the knowledge and its appropriate practical application still require time – it is clear from recent research conducted by Billingo, one of Hungary’s leading online invoicing platforms, among its users, which focuses on ESG (Environmental, Social, Governance) aspects familiarity and application. The research shows encouraging results, as those who have already dealt with the ESG topic successfully turned the incorporation of the approach into their operations to the advantage of their business. At the same time, it turned out that businesses need more extensive information about the ESG Act and sustainability aspects.

ESG (Environmental, Social, Governance) principles are gaining more and more emphasis worldwide, including in Hungary. In our country, the regulations of the European Union are the guiding principles, and although we are at the forefront of the EU countries in terms of application, the latest domestic regulations are still well under development in legal terms. The goal of the ESG approach is for companies to take into account and incorporate sustainability and social responsibility into their daily operations in addition to financial efficiency. The Hungarian ESG Act was adopted on December 12, 2023, according to which large listed companies already have due diligence and reporting obligations for sustainability purposes for the year 2024.

Large companies, then small and medium-sized enterprises, should expect gradually integrated obligations in the following years, in the form of sustainability reports and supplier questionnaires from large corporate customers. An extensive survey of 1,200 users of Billingo, one of the leading online invoicing services, examined their readiness, knowledge and attitudes on the subject.

Moderate awareness, positive outlook

A significant number of businesses – especially smaller businesses – are still finding out and gathering information about ESG requirements, while 67% of medium-sized businesses have already familiarized themselves with at least the outline of the content of the new ESG regulation. 61% of micro-enterprises and 64% of sole proprietors are not yet aware of the details of the regulation, but since the regulation has no effect on them for the time being, their awareness of 39% and 36% is an excellent ratio, indicating awareness.

Regarding the research results, Albert Sárospataki, CEO of Billingo, added:

“It is very important for businesses to monitor changes and obligations related to ESG regulations. Although the regulation does not affect everyone for the time being, sustainability principles are in the common interest of all of us. This is also a matter of our hearts at Billingó, so we support the relevant ESG guidelines, but it seems that companies will have to be helped with tools and information to comply with them, so that they do not see the process as an administrative burden, but as an opportunity. Achieving this will be no small challenge. Small businesses still have plenty of time to prepare, but it’s better to start as soon as possible to ensure future compliance is a smooth process.”

68% of the companies that have not yet been informed about the ESG regulation, but were aware of the background and focus of the regulation, spoke positively about the ESG goals, from the future application of which they mainly expect customer satisfaction, improving their reputation and gaining a better market position.