ESG Software: 9 Solutions to Consider
You’ve probably heard the terms ESG and sustainability within a few sentences of each other and we wanted to shine a light on how this relates to your business. These topics are gaining steam and articulate where corporations and environmental sustainability intersect. For this reason, it’s worth taking a closer look at what each solution offers in the ESG space for organizations concerned with corporate governance and social responsibility.
What is ESG software?
ESG (Environment, Social, and Governance) software generally is designed to help with the tracking and reporting of environment, health, regulatory, social, and safety management initiatives. This software is typically designed to support corporate leaders by facilitating the aggregation of data across organizations or portfolios for actionable insights and streamlined reporting.
Effectively communicated policies and procedures can be used to fuel positive ESG initiatives that impact revenue, company valuation, and brand perception.
ESG software market size
The software industry within the ESG sector is expected to reach $571.74 million by 2028. The market is expected to only accelerate in the next few years.
Reasons for this are new regulations, governmental pressures, and increased scrutiny as shareholders, investors, and regulatory bodies look closer into sustainable corporate practices and compliance standards. However, since the ESG software space is still relatively new, there’s plenty of space for growth and investor participation.
What features to look for in ESG software?
ESG reporting is still an emerging software category and each day there are new tools you can employ to record footprint data, create reports, and ensure compliance across an organization.
Yet not all ESG software is built equally. While some advertise an end-to-end approach to sustainability reporting, management, and analytics, each tool has its own unique strengths. As you look through potential ESG software to onboard, these are some of the fundamental features worth considering:
Overall product strength: Looking at specifics like time in the market, leadership, historical performance, or even market share can give you a better idea of how well ESG software delivers on its promise. What mix of solutions does it offer?
Was it built for ESG governance specifically or was it created as an appendage to an adjacent tool? Questions like these can reveal the true nature of a solution and whether it’s software you can onboard that’s flexible enough to scale with the needs of your organization.
Data processing: Your ESG software should be able to process large amounts of data, especially because ESG reporting can be a complex endeavor with many data points. It’s worth considering the specific data points the ESG software in question successfully collects and reports on. Consider any needs for:
Sector benchmark reporting
Supply chain emissions coverage
Energy consumption rate data
Gender pay gap reporting
Workers demographics data
Freedom of association data
Accident and injury records
Modern slavery risk analysis
Governance body data
Collaborative tools: The need to access specific features that ease the collaboration process will highly depend on how sustainability management is handled internally. Working cross-functionally between teams is made easier with built in features that enable teams to work on data and create reports from a central source of truth.
Reliable support: The best ESG software solutions come with a reliable support team that can walk you through the nuanced needs of your organization. The team should be knowledgeable in emissions management and reporting—often in real time.
The 9 Best ESG software in 2022
Workiva is a leading ESG reporting platform, providing drag-and-drop capabilities that are user friendly and enable teams to create data sets and reports quickly. It also emphasizes automation by giving teams the ability to set up and automate task assignments, management approvals, and updating data.
Workiva’s focus is on making ESG management and reporting easy and accessible, not so much on complexity or the use of AI for advanced reporting. It can be a great tool for teams that struggle with disjointed data, time-consuming manual processes, and data assurance. For example, in terms of data connectivity, Workiva connects both cloud and on-premise data sources to ensure organizations are seeing the complete picture.
Novata is an ESG solution specializing in the private markets, giving general partners and portfolio companies a clear, simple, customized technology platform for seamless data collection, reporting, and insights.
Offering a fully customizable experience across the full spectrum of ESG metrics, Novata allows its customer base to design a full-service experience to make their ESG journey accessible and achievable.
Proof, formerly Proof of Impact, is an end-to-end solution for collecting, verifying, and visualizing comprehensive ESG and impact data. Through their purpose built API the Impact Catalyst® engine.
The Impact Catalyst® engine takes disparate ESG and impact metrics and puts them through a seven step filtration process, to ensure data reliability and accurate insights. Proof allows users to move away from the status quo of one time, costly, annual ESG reports, to shareable digital dashboards providing real-time insight for enhanced visibility ESG performance at any point in time, including historical data.
Novisto empowers you to track, improve, and measure your ESG data and reporting. As an all-in-one sustainability management platform, it equips companies with quicker data collection capabilities and improves data quality.
Much like other ESG software, Novisto presents itself as a single source of truth where all your ESG data can live. It makes it easy to oversee the impact of your most important ESG data and get a handle on financial performance.
5. Benchmark ESG
Through a series of APIs and remote collaboration features, Benchmark ESG connects teams and frameworks across organizations to ensure reporting quality and build trust with stakeholders.
When it comes to accessibility, Benchmark ESG makes sure it compiles and showcases data to users according to their organizational level. The reporting process becomes easy with its drag-and-drop functionality. Teams and organizations looking to improve the transparency and accuracy of their reports can consider a tool like Benchmark ESG as a possible solution.
Simplifying your ESG reporting and ensuring you’re tracking your best data against competitors are some of the capabilities Diligent offers. As a sustainability management solution, Diligent acts as a unifier of your data.
That’s to say, it automates the process of gathering your best data from spreadsheets, surveys, and other applications you use to keep track of data points like greenhouse gas calculations, global waste, disposal rates, and transport and commuting data.
If you’re an organization mainly looking for a suite of tools that ease the data collecting and reporting tasks, then Diligent is a solution worth considering, However, for more complex tasks that go beyond the basics, it may take consideration of more robust management options.
7. Locus Technologies
Locus Technologies combines both ESG reporting and EHS compliance under one centralized data system. It offers plenty of features like KPI dashboards, customizable review workflows, survey tools, GHG reporting, compliance calendars, and even the ability to create annual corporate CSI reports.
Locus Technologies is a viable financial-grade solution for sustainability management that automates the often time-consuming process of data collection, reporting, and management.
Sametrica takes an AI fueled approach to ESG data collection. Designed for investment firms, it comes with features to map and measure their environmental impact and optimize their investments.
Sametrica makes the process of handling automated analysis, benchmarking, and report creation a highly visual one. If you’re a small team that’s looking for a solution that includes logic model building and automated calculations, this is a tool worth considering.
9. Impact by Mesa
Impact is an ESG solution offered as part of a larger suite of tools by Mesa, a digital transformation technology group. Much like other ESG software options in the space, Impact offers solutions for strategy and sustainability planning, materiality analysis, ESG rating, and environmental reporting and analytics.
Easily one of its most standout features is its emphasis on stakeholder engagement tools. Impact can be accessed through a smartphone or a PC by any stakeholder in an effort to educate, support, and involve them in sustainability efforts. Additionally, Impact’s application makes it easy to collect and record stakeholder feedback, for a collective approach to ESG goals.
Do more with ESG software
Regulatory institutions, key stakeholders, and data providers are increasingly demanding transparent ESG data and reporting. Some of the necessary carbon accounting solutions focus holistically on ESG disclosures, providing resources and a platform that cover a range of ESG-related metrics. Others focus specifically on the niche and complicated process of measuring GHG emissions.
The integration of carbon accounting software, such as a Climate Management and Accounting Platform (CMAP) with a more broad ESG-related offering, would allow companies to get a much more granular look at their GHG emissions. The additional insights that CMAPs can offer companies enable them to create carbon reduction strategies, make ambitious decarbonization targets, and track progress towards them far beyond the capabilities of a pure play ESG software platform. Persefoni’s CMAP is a good option for companies that need help navigating the complex world of carbon accounting standards and disclosures and would like to develop a deeper understanding of their emissions.