This isn’t a bad approach but it’s not a panacea: small companies can be pretty messed up too, albeit perhaps in different ways.

The impact is local though, it would be only a problem if the median small company is more messed up than the large co.

It not likely to happen because being small there are more threats or market forces to deal with so they cannot do as they please. Monopolies or just economies of scale affords large co and the small number of executives that control them outsized influence - both good and bad.