ESG Software Guide: The best tech stack for every company

Discover the top ESG reporting solutions in our expert guide! Find out how to choose the right ESG provider for your sustainability strategy.

In this decade, responsible business practices are simply due diligence for businesses. At the same time, sustainability is a new and vast domain, driven by science and metrics. So how can companies effectively track, manage, and report on their sustainability initiatives? Enter ESG (Environmental, Social, and Governance) software. This comprehensive guide will take you through the world of ESG software, highlighting its importance, benefits, and the key technologies behind it:

Let’s dive in and discover the top software solutions for every sustainability need.

What Is An ESG Software?

ESG software is a digital tool that enables companies to streamline measuring, managing, and reporting on their sustainability initiatives.

What is ESG software? A definition

Who Needs ESG Software?

ESG software is not limited to specific industries or sectors. Whether you are in the energy sector, the food industry, manufacturing, technology, retail, or finance, ESG software is your ally in achieving sustainability goals. Moreover, with ESG reporting becoming mandatory across global markets and CSRD coming in 2025, companies with a multinational presence can benefit greatly from ESG software that simplifies reporting. The list would be remiss without supply chain partners, who can utilize ESG software to monitor and assess the sustainability performance of their suppliers. In short, ESG reporting software allows companies to focus on impact and drive their sustainable initiatives, instead of laboring to harmonize data and mine insights.

Why Use ESG Reporting Software?

When it comes to reporting on sustainability, relying on outdated formulas, fragmented data, and manual consolidation can be cumbersome and expensive. That’s where ESG software comes to the rescue, providing a streamlined solution that saves time and effort.

An infographic demonstrating the benefits of ESG reporting software, such as comparable metrics, automatic updates, saving time & costs, etc.

– Comparable metrics

An ESG reporting software ensures that your reporting metrics are standardized and comparable across the board. Comparability is a valuable benefit for anyone working with improving your ESG metrics and anyone consuming them.  Most importantly, it allows you to assess your sustainability performance within your operations as well as across peers and industry standards.

– Automatic updates

ESG software automatically collects and updates data, ensuring that your reports and metrics remain current and accurate without spending excess time or effort. This way, reporting metrics are ready to use, reflecting your sustainability initiatives year-round.

– Saves reporting time

ESG reporting solutions streamline the process of compiling reporting metrics by automating data collection, consolidation, and analysis. This eliminates the need for time-consuming data harmonization and manual calculations.

– Minimize costs

 Consulting services for ESG reporting and data consolidation come with a hefty price tag. As ESG platform can save you the cost of an expensive consultant working long hours to gather your ESG data, make sense of it, and prepare your sustainability report.

Here’s how easy ESG reporting is with CarbonCloud →

– Monitor progress against targets

An ESG platform provides insights into a company’s progress towards sustainability targets. With a constant feed of real-time metrics, it enables your company to stay on track, identify areas for improvement, and make impactful decisions toward sustainability goals.

ESG Software: The Technology Behind It

ESG software providers incorporate a range of advanced technologies to simplify corporate sustainability. 

  • Robust data management systems collect and manage large volumes of ESG data, ensuring accuracy and standardized metrics. 
  • Analytics tools dive deep into the collected data, facilitating data-driven decision-making and highlighting areas of improvement. 
  • Key Performance Indicators (KPIs) specific to environmental, social, and governance aspects help measure progress and track sustainability goals. 
  • Automation is core to any ESG platform, minimizing human error and ensuring the accuracy of ESG metrics.
  • Network infrastructure solutions like CarbonCloud ensure seamless connectivity and effective collaboration along the value chain, the most challenging aspect of ESG reporting.

Key ESG Software Features & Benefits

With a plethora of ESG software options available, it’s important to choose the one that aligns with your sustainability priorities. While there’s no one-size-fits-all solution, it’s crucial to meditate on your sustainability goals and focus on the business-critical areas. As of this decade, climate-related sustainability is a priority, given the global reporting mandate around emissions and increasing importance in the business world. So, take the time to prioritize and select the ESG software that best suits your needs from the smorgasbord of ESG platforms. Here are the most commonly used functions of the ESG software ecosystem.

ESG Solution Features & Functions

1. ESG Data Management

ESG data management software enables companies to collect, store, and manage their sustainability data efficiently. This way, organizations can centralize and harmonize their data in a streamlined platform, ensuring accuracy and comparability and reducing manual efforts. Data management is suitable for companies looking to improve data integrity and streamline their reporting processes.

2. ESG Data Analytics

With ESG data analytics software and its robust capabilities to analyze the collected data, companies gain deeper insights into their sustainability performance and also understand the impact of their initiatives. This way, they can make better data-driven decisions.

3. Sustainability KPIs

ESG KPI tracking software allows companies to define and track key performance indicators related to their sustainability goals. It provides a framework for measuring progress over time against specific targets and benchmarks. Combined with an analytics function, KPI tracking features help companies 

  • monitor their performance, 
  • identify gaps, 
  • take corrective actions,
  • set measurable targets, 
  • monitor performance, 
  • demonstrate their commitment to stakeholders.

4. ESG Metric Calculations

ESG software enables companies to compile the collected data into relevant ESG metrics and calculations. It automates the process of calculating carbon emissions, energy consumption, waste generation, and other sustainability metrics. This feature reduces manual effort and the subsequent time cost, minimizes human error, and ensures accurate and standardized ESG reporting. It is suitable for companies looking to streamline their reporting processes and ensure consistency in their sustainability metrics.

How to rapidly calculate your entire portfolio emissions with CarbonCloud →

5. Supply Chain Networks

An ESG network infrastructure provides seamless connectivity and communication along the value chain. It allows companies to collaborate with suppliers, customers, and other stakeholders to share sustainability data, goals, and initiatives. This feature facilitates transparency, engagement, and collaboration, enabling stewardship over sustainable supply chains and higher accuracy for supply chain data. Network infrastructure is suitable for companies looking to secure their sustainability performance throughout their production network and with collaborative efforts.

How does an ESG network work? →

6. Sandboxing

A sustainability sandbox environment is used for scenario analysis and product development testing. Companies can simulate different scenarios to understand the potential outcomes of their sustainability initiatives. Sandboxing also enables them to

  • test new products or processes, 
  • assess their environmental impacts,
  • explore innovative solutions,
  • assess the feasibility of new initiatives,
  • mitigate sustainability risks.

Many of the ESG platforms available on the market may have different combinations of these features but are usually outstanding in one or two. For example, CarbonCloud offers the full bundle of the features listed above, making the platform suitable for any company at any stage of sustainable work. However, CarbonCloud’s most novel and outstanding feature is the network infrastructure, which secures the scalability and success of a company’s ESG strategy not only here and now, but also in the future and throughout the supply chain. So how do you know where you are now and what you need to advance in the future?

Case Study
Succeeding with ESG Software

Cerelia, the global leader in fresh dough, has reduced the climate footprint of its OaYeah! pancakes by 30% from a single packaging swap, the result of their dedication and the actionable climate data and insights provided by CarbonCloud. Through carbon analytics, Cerelia was able to pinpoint the majority of emissions in certain ingredients and the amount of packaging used and act on it. The accessible insights from the platform as well as the quick visualization of the team’s work in metrics led to a change in attitude within the company, making sustainability a core part of their operations. CarbonCloud enabled them to communicate their reduced climate footprint to retailers, resulting in a positive response and easier product launches.

👉 Read the full story

Choosing the Right ESG Software

To effectively choose the right ESG software for your company, it is crucial to align the features with your organization’s priorities and targets. If you are just starting your sustainability journey, focusing on calculations and analytics can be the right strategic move. These features allow you to collect and analyze your sustainability data, providing valuable insights into your current performance and areas for improvement. By understanding your baseline and identifying key metrics, you can establish a solid foundation for your sustainability efforts and reporting.

On the other hand, if your organization is already advanced in its sustainability journey and has a comprehensive overview of its ESG performance, it may be time to set up the supply chain infrastructure with a network solution. This feature enables seamless connectivity and communication along the value chain, facilitating collaboration with suppliers, customers, and other stakeholders. By sharing sustainability data, goals, and initiatives, you can work together to drive sustainability improvements throughout the entire value chain.

The key is to choose the features that best match your current stage and objectives. Whether you are in the early stages or further along, leveraging the right features will enable you to optimize your ESG performance and make a positive impact.

Take the maturity assessment and identify your starting point, the features you need today and how to level up tomorrow.

How to Get Started with an ESG Solution

Ready to embark on your sustainability journey? Look no further than our ESG pilot guide. CarbonCloud is specifically designed for food producers, offering comprehensive solutions to measure, manage, report, and reduce Scope 1, 2, and 3 emissions. By leveraging CarbonCloud’s features and insights, you can navigate the complexities of sustainability reporting and make your sustainability work visible to everyone and anyone.

Ready for takeoff?

Download our guide and zoom in on the specifics of each Scope reduction pilot