.png)
Accurate sustainability data management is complex, if not impossible, without the right ESG software. You need to collate data, update, analyze, and report on it while also keeping everyone in the loop. Before you know it, sustainability reporting will feel like you’re just calculating numbers and trying to keep up with new regulations.
But it doesn’t have to be like that. Creating sustainability programs can be a smooth, transparent, and mission-driven process with the right software on the table.
To save you headaches, we’ve put together the ultimate guide to the world of ESG software. We’re explaining what it is, why you need to invest, what vendors top global lists and how they are different.
What is ESG software?
ESG software are tools and platforms that help you collect, track, manage, report, and act on your Environmental, Social, and Governance (ESG) data.
This means being able to optimize and improve how you work with all the company data that relates to sustainability, social responsibility, and corporate governance to make sure you comply with all the relevant regulatory requirements.
On top of that, it helps you increase transparency within the company and satisfy stakeholder and shareholder expectations on visibility and regulatory compliance.
Why invest in ESG reporting software?
The ESG landscape is shifting so quickly that it is hard to keep up and as more and more regulations come into play, the relevance of ESG software providers is hard to debate.
Here are some of the main reasons why investing in ESG data software today is a good idea:
Reporting on your ESG impact is becoming mandatory, not voluntary
Being a “virtuous” company and supporting sustainable growth is becoming less of a standout and more of an international standard.
In the past decade alone, global ESG regulations have increased by 155% and are expected to become even stricter in the coming years.
Manual reporting is not scalable
The bigger the company the more of a hassle ESG reporting is.
If there’s no way you can keep track of all the reporting in real time and within a single spreadsheet, ESG monitoring software is the way to go. Manual reporting is time-consuming and can easily get clunky, it leaves plenty of room for human error and will never scale along with your business.
ESG compliance software removes the risk of inaccuracies
ESG reporting needs to be handed in regularly, ideally every quarter.
On top of that, companies need to follow multiple regulations and frameworks at the same time, such as CSRD, CSDDD, CDP, and GRI. All of these add more complexity to the very process of reporting, increasing the probability of data gaps and inaccuracies.
Manual data aggregation causes format inconsistencies
In the Sustainability Reporting and Data Management Report 2024, Reuters Events, very deservedly so, says that “sustainability reporting is becoming an Alphabet Soup of acronyms and jargon that confuses practitioners”. Indeed, there is a fair amount of confusion as to what you need to report, how, and how you can pull all that data into one cohesive narrative.
ESG software platforms remove that problem by aggregating data from different business units and standardizing your reporting in a lean and efficient manner.
ESG software solutions are known for their cost efficiency
On top of all the accuracy benefits, automating your ESG reporting means you can save on labor and external auditing costs that would otherwise go into emissions data collection and aggregation.
It helps you with risk management and reduction
Being superficial with ESG reporting means your company is vulnerable to developing blind spots, which could result in a lot of risks such as negative environmental impacts, social risks like human rights violations, and governance issues such as corruption.
And now that we have established the importance of having reliable ESG management software in your toolkit, let’s look at the providers you should consider first.
The 12 best ESG software to investigate in 2024
We’ve shortlisted the top ESG software options that can meet the needs of just about any team, company size, and industry out there.
1. ESG Flo – Best-in-class AI-driven ESG software
Developed within Bain & Company, ESG Flo is the best ESG reporting software and that silver bullet solution that leverages AI to enable companies to generate ESG audit-ready metrics from raw data.
ESG Flo’s AI automates data collection and processing across all ESG disclosures. It captures previously inaccessible data, drastically reducing manual work, saving time and costs, and ensuring audit-ready accuracy.
Feed it any relevant information like invoice documents, HR data, ERP system extracts, supplier data, or geo-spacial data and it will automatically generate reports following just about any reporting framework there is.
ESG Flo can also help you calculate your carbon footprint by analyzing your Scope 1, 2, and 3 emissions – all with minimum human oversight.
Use cases & AI
- If you need to extract invoice data, the AI will extract data from utility invoices in various formats and languages (using Large Language Models and Optical Character Recognition).
- For qualitative data extraction, the tool will scan documents to surface relevant sections to answer disclosure questions
- For anomaly detection, the AI will monitor data trends to flag anomalies
- To help you with smart emission factor matching, the tool will recommend emission factors to calculate Scope 1, 2, 3 emissions
- For cross-framework interoperability, the AI auto-populates data across reporting frameworks, eliminating manual entry
‘We’ve automated a very manual process, saving time and resources for other projects. It’s been better tracking, a single source of truth, and much higher visibility,’ says Samuel Shiroff, Senior Director Global Sustainability at EnerSys.
💡Relevant: How EnerSys uses GenAI to drive efficiency, ensure accuracy, and safeguard sustainability & ESG data
On top of that, along with this all-in-one ESG tracking software functionality, you can also get professional support from consultants that will help you do things like double materiality assessment, gap assessment, CDP submission, and others so you can be completely sure about the accuracy of your reporting efforts.
‘This is a one-stop-shop for us. We don’t have to go to multiple data owners to get information. The tool does exactly what we need it to."’- Sonali Samani, Head of Environmental, Social and Governance at IWG.
2. Workiva – Best for streamlined financial and ESG reporting
Workiva is a cloud-based data management system for compliance and reporting. In fact, this tool means many different things for many different users, and ESG is only one of its segments.
On the sustainability side specifically, you can count on CSRD and standard ESG reporting. You can also find this tool handy for financial reporting, regulatory reporting, controls management, and statutory reporting.
On G2, Heather, a Financial Services Director said, 'Being able to have a single source of data that is shared across multiple business functions and overall enterprise is absolutely changing the way we view risk, financial reporting, and ESG reporting.’
But it’s also important to consider the limitations that come along with this ESG tracking software. Some users on G2 point out that the tool is not very user-friendly and that ‘there are often platform glitches that can be frustrating when you are working on time-sensitive projects.’
3. Greenly – Best for SMBs and startups
Greenly is a sustainability platform that can help you with ESG management, carbon footprint reporting, CSRD reporting, and carbon offsetting.
Among the main standout points, users mention that the tool makes it easy for them to view source data and company emissions, simplifying the process of sharing relevant information with non-technical teams.
Another useful thing is that this tool will help you set reduction goals and monitor your progress over time. You can expect to collaborate on decarbonization strategies across various teams, which could be particularly useful for complex supply chains.
However, one of the biggest downsides here is that the tool requires major time investment to get started and comes with a hefty price tag.
“Finalizing our carbon footprint and validating our data took quite a bit longer than we had anticipated,” said an ESG Director on Capterra.
4. Novisto – Best for mid-market and large companies doing ESG reporting
Novisto is a comprehensive ESG data collection software that helps you collect, manage, analyze, and report on ESG data with no major hassles.
Novisto can help you with anything from data collection and integration to regulatory compliance and reporting with analytics. The tool uses automation to replace time-consuming processes that go into data gathering and creation, which helps you improve the quality of data and reduce the probability of human error.
Similarly to ESG Flo, this tool can service many industries, like real estate, manufacturing, energy, and finance.
Although there’s a robust system of features the tool supplies you with, users note that ‘the platform is still maturing and may not have absolutely every type of functionality a client might want.’
5. Plan A – Companies that want to decarbonize their business
Plan A is your carbon manager and sustainability ESG reporting software that will help you automate and centralize your ESG efforts. It can help you with anything from data collection to carbon footprint measurement and standard ESG reporting.
The platform offers customizable templates that match the global sustainability frameworks like GRI, SASB, TCFD, and others.
Just like Greenly, it can help you set and achieve reduction targets and explore various decarbonization pathways. And you can also expect to become CSRD-ready with their double materiality assessment, gap analysis, and external assurance.
6. Coolset – Best for startups and SMEs to do ESG reporting
Coolset is a sustainability management and compliance platform that aims to help small and medium-sized enterprises (SMEs) take control of their emissions and develop action plans around relevant data. The tool automates decarbonization and helps you get rid of those outdated Excel practices.
Coolset also helps you make sustainability auditing a lot easier and streamlines CSRD reporting. What’s more, if you discover that there’s a vendor in your network causing your sustainability numbers to go wrong, this tool helps you find options to switch to more relevant vendors.
There’s no doubt that this is one of those ESG reporting software companies that will help you improve the durability of your business. However, since this product is relatively new to the sustainability space, some of its features might still need time to mature.
‘The values we use for calculating the footprint on Scope 1,2,3 are sometimes still a bit high and too generic,” a user on G2 says.
7. Sweep – Best for carbon accounting and ESG data management
Sweep is carbon accounting and ESG data management software that helps you collect, manage, and act on your ESG data. Targeting companies of different sizes and across different industries, this tool makes their sustainability journey easier and more organized.
This platform can help you achieve different sustainability goals, such as getting audit-ready, meeting disclosure requirements, understanding your value chain performance, setting data-driven sustainability strategies, and tracking your carbon and ESG data.
In a nutshell, this tool’s functionality is highly comparable to those of Plan B, Normative, Persefoni, Watershed, and a string of others.
8. Persefoni – Best for carbon accounting and climate management data
Persefoni is a climate management and carbon accounting platform that also makes ESG reporting easier. It helps your business measure its carbon footprint, develop decarbonization strategies, and comply with all the latest regulations in the ESG space, like SEC, CSRD, SECR, and others.
Many users point out that it takes you some time to get started with the tool and set up all templates, but the team tends to be very supportive with that.
However, because this platform primarily focuses on carbon footprint management, compared to other ESG reporting software on the market this one is somewhat limited.
‘I can't create a complete sustainability report in Persefoni, would be nice to extend GHG with further dates, photos, diagrams and text in Persefoni, so the requirements to a complete sustainability report could be generated,’ points out a user on G2.
9. Workday – Best for tracking social impact
Unlike many other ESG software companies, Workday is primarily about human capital management and reporting on the ’S’ part of ESG data, the social impact. This tool helps you manage payroll, benefits, HR, and employee data. If you need to do extensive social reporting, analyze supplier risk, and develop streamlined workforce reporting, this might be your stop.
Happy users point out that the platform helps you keep all records in one space, which you can access whenever and wherever you need – the system is well-organized and highly collaborative.
However, many users also comment on the high costs that come with this software and call it a ‘money pit’, saying that it is ‘a software company that charges you for regular updates to their software’ and mention the high costs of their user training courses that are subpar.
10. Watershed – Best for enterprise sustainability programs
Watershed is an enterprise sustainability platform that helps you build high-level sustainability programs based on overall company objectives. With the information gathered, you can measure, report, and act on your climate impact to provide relevant disclosures and remain compliant with the latest regulations.
The software will work for companies across different industries, like consumer goods, apparel, retail, technology, and others. On the ESG reporting side specifically, the tool will help you understand all frameworks and regulation requirements and pull all your data together for numbers to speak words.
11. Position Green — Best for all-in ESG reporting
Position Green is a platform that can tend to all of your ESG needs. The tool provides a ’sustainability suite’ where you can consolidate all your ESG data, analyze it, and drive impact based on the findings. On top of that, the tool helps you tap into your supply chain and see how it is contributing to your sustainability numbers.
Many users mention the ease of use that comes with this platform and say you can start reporting without any prior education. The reporting functionality is broken into bite-sized segments which can make it easy for every user to track progress and see where your reporting is standing.
However, Kristian, a Sustainability Manager and a Position Green user, says that there’s quite a lot of manual work that goes into working with this tool:
‘The software does require a lot of manual data handling after exporting the data. I miss visualizations of relevant data that is included in other software'
Related: Top 7 Position Green alternatives of 2024 + user reviews
12. AuditBoard — Best for ESG compliance and risk management
Last but not least, AuditBoard is an ESG software tool that helps you audit your data, surface risks, and develop various ESG programs. Along with ESG reporting, it also has several features that will help you automate compliance, analyze IT risk, and manage vendor risk.
Users say the tool is highly customizable and easy to use, plus it also integrates well with other systems which is useful when you need to consolidate all data. However, it seems that the templates you get in the tool need a lot of work before they get usable:
'The out-of-the-box dashboards and reports are not helpful.’ - Pooja, AVP of ERM & Climate Change.
What’s next?
If you have already built a business case for investing in ESG software, there are a few things to do before you settle for the best match:
- Make a list of the top ESG software solutions available on the market (provided above).
- Clearly define your use cases and pain points you want solved with the help of automation.
- List out your must-haves and dealbreakers, such as cost limitations, lack of certain functionality, certifications, or the time it takes to get started with the tool.
- Based on your software requirements, shortlist your favorites, request demos and quotes, and run a trial with a few of them to see which one clicks.
ESG Flo is the best pick to try first, it is an all-in-one solution for measuring and managing ESG data as well as calculating and acting on your carbon footprint. For a free tour around the platform, book your demo today!
