CEBU CITY, Cebu (PIA) -- The Security of Exchange Commission (SEC) is encouraging the Small Medium and Large Enterprise (SMLEs) to adopt sustainability reporting to help the country attain the Sustainable Development Goals (SDG).

SEC director Rachel Esther Gumtang-Remalante defined sustainable development as “development which meets the needs of the present without compromising the ability of future generations to meet their own needs.”

“In other words, sustainability refers to practices and processes that meet the needs of the present without compromising the ability of the future generation to meet their own needs. It encompasses environmental, social, and economic consideration,” explained Remalante.

Remalante said MSMEs play a pivotal role towards achieving the SDGs.

“The big bulk of the companies are under the MSME, and there is a small portion covering .41 percent for the large companies,” said Remalante.

SEC recently kicked off its roadshow on the Small and Medium Industries and Large Enterprises Embracing Sustainability (SMILEES) in Cebu City to promote sustainability reporting among the SMLEs. 

MSMEs in the Philippines

Based on the 2022 Philippine MSME Statistics issued by the Philippine Statistics Authority, 99.59 percent of the 1,109,684 total business enterprises operating in the country are classified as MSMEs. 

Only 0.41 percent belong to the large enterprise category. 

“As you can see, the total contribution is actually larger than the large corporations. They comprise 65.10% of the total employment that are created for this industry,” said Remalante.

She cited the SDGs where MSMEs can help contribute, such as SDG 1 (No Poverty), SDG 4 (Quality Education), SDG 7 (Affordable and Clean Energy), SDG 8 (Decent Work and Economic Growth), SDG 9 (Industry, Innovation, and Infrastructure), SDG 12 (Responsible Consumption and Production), and SDG 13 (Climate Action). 

Sustainability reporting

According to the SEC, sustainability reporting is instrumental in the transparency of an organization's practices and its impact to measure and set performance targets. 

Remalante explained that the SEC issued Memorandum Circular No. 4 in 2019, which serves as the agency’s guidelines for publicly listed companies (PLCs) to have a sustainability report. 

“That sustainability report, we require PLCs to actually submit a sustainable report attached to their annual report submitted every year,” Remalante said. 

Global Reporting Initiative (GRI) country manager, Engr. Ma. Katreena Pillejer said the sustainability report serves as a communication tool with the stakeholders. 

“This is like a handbook for them to know where you are right now and what comes after your sustainability performance,” Pillejer said during the roadshow. 

Sustainability reporting enables companies to define their baseline on non-financial performance and determine factors that may require improvement, which can result in attracting more investors. 

Approach to SDGs

One of the roadshow participants, Pamela Bermejo Ongsuco of the Rolling Hills Group of Companies, said she is glad that the government is recognizing the MSME’s role and contribution to the Philippine economy. 

“If you can see the bulk of the small and medium enterprises, having to comply with the same standard and same framework, I think we can see a lot. The whole picture of the Philippines compliance to the sustainability initiative of the UNDP (United Nations Development Programme),” Ongsuco said. 

She said the roadshow gave her a chance to learn more about sustainability reporting and how it can help their business.

“The roadshow was an opportunity for us, perhaps because I came from a specific industry and it is a challenge how sustainability should be incorporated in our line of business because we are in the funerary services. So, it opened a lot of questions. Ideas should really be thrown to the management as to how we can contribute in achieving the goals for sustainability,” she added. (JJT/PIA 7)