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Sustainability software is quickly becoming a must-have for all businesses as they aim to manage their emissions and ensure compliance with regulatory requirements. As businesses increasingly look to adopt tools to streamline their sustainability management and reporting processes, sustainability leaders must be aware of what tools are best suited to the specific needs of their organisation to ensure they can effectively achieve their sustainability goals.
What is sustainability software?
Sustainability software refers to systems and tools that help organisations manage their sustainable transformation and improve environmental, social, and governance (ESG) performance. Sustainability software encompasses many applications, including managing emissions data, tracking carbon emissions across the value chain, setting reduction targets, identifying reduction levers, and reporting on sustainability performance in line with regulatory requirements.
Businesses use sustainability software to collect and analyse emissions data to develop effective strategies to reduce their environmental footprint, comply with regulations, and achieve sustainability goals. Additionally, this software often supports reporting and communication with stakeholders about corporate sustainability efforts—critical to gaining a competitive edge in today’s landscape.
Corporate sustainability refers to business approaches and practices that create long-term value by embracing opportunities and managing risks derived from economic, environmental, and social developments. This concept involves companies operating in a manner that is both economically viable and socially and environmentally responsible, ensuring their operations do not harm future generations' ability to meet their needs.
Credit: Plan A
The types of sustainability software
As businesses are left with no choice but to prepare a budget for sustainability, they must be aware of the array of tools and platforms that can be leveraged to reach their sustainability goals as efficiently and effectively as possible. The following tools are integral to businesses aiming to improve their sustainability practices and reduce their environmental footprint:
Carbon management software
Carbon management software is used by organisations to measure, manage, and report their carbon emissions. It is a tool that helps in quantifying the greenhouse gas (GHG) emissions and supports the strategic decision-making process for carbon reduction initiatives. As companies use carbon management software to measure, track, and manage their carbon emissions and overall carbon footprint, they leverage features such as carbon accounting, emission tracking, scenario modelling, and reporting to assist businesses in understanding and reducing Scope 1, 2, and 3 emissions across the entire value chain.
ESG and sustainability reporting software
ESG and sustainability reporting software assists organisations in collecting, managing, and disclosing data on ESG criteria. ESG and sustainability reporting software is crucial for reporting sustainability performance and ensuring compliance with regulatory requirements. Beyond compliance, ESG and sustainability reporting software helps organisations track their progress towards sustainability goals and communicate their ESG efforts to stakeholders such as investors, customers, and employees.
LCA and PCF software
Life Cycle Assessment (LCA) and Product Carbon Footprint (PCF) software are tools used to assess the environmental impacts associated with all the stages of a product's life from cradle to grave (i.e., from raw material extraction through materials processing, manufacture, distribution, use, repair and maintenance, and disposal or recycling). LCA and PCF software allows businesses to gain granular insights into the environmental footprint of their products, identify hotspots for improvement, and make informed decisions to reduce environmental impacts such as carbon emissions, energy consumption, and resource depletion. Ultimately, these tools are key to understanding and minimising the environmental impacts of products.
Decarbonisation software
Decarbonisation software refers to software tools designed to support the planning and implementation of strategies to reduce carbon emissions, transition to low-carbon or carbon-neutral operations and undergo sustainable transformation. This software may include features such as emissions data collection, measurement, management, target-setting, reduction planning, and scenario modelling. Decarbonisation software is particularly critical for energy-intensive industries such as manufacturing, energy, and transportation to model and simulate decarbonisation scenarios, helping companies achieve net-zero targets. Ultimately, decarbonisation software assists businesses reduce their greenhouse gas (GHG) emissions, meet regulatory requirements, meet the increasingly sustainable demands of stakeholders, attract investors, and contribute to the global effort to combat climate change.
Benefits of using sustainability management software
Companies that leverage the power of sustainability management software will unlock a wide range of benefits, such as:
Improved operational efficiency as businesses can:
- Save time and money by automating emissions collection and calculation rather than manually collecting and calculating emissions using spreadsheets.
- Save time and money by effortlessly storing and tracking historical data from past years in one centralised platform.
- Save time and money by gaining granular insight into emissions hotspots, thus accurately informing emissions reduction strategies.
- Reduce internal costs by receiving support to increase supply chain efficiency, increase energy efficiency and reduce waste. McKinsey highlights a 60% potential improvement in operating profits via the reduction of resource costs.
- Reduce the need for consultants and FTEs to save time and money. For instance, an average Corporate Sustainability Reporting Directive (CSRD)- affected business is estimated to face €320 000 per year in business costs to ensure compliance with the CSRD.
Improved business wellbeing, value and performance as businesses can:
- A comprehensive sustainability strategy can increase employee satisfaction, retention, and engagement. Businesses implementing sustainability strategies have been found to achieve up to a 16% increase in employee productivity and a 50% reduction in turnover. Meanwhile, a report by Deloitte found that companies with highly engaged employees experience 3x the revenue growth rate of their competitors with low engagement levels.
- Increase brand value by demonstrating a commitment to social and environmental issues. In doing so, businesses can differentiate themselves and build stronger connections with customers who value responsible practices. Findings highlighted that sustainability drove a 60% increase in customer commitment, and ESG products drove 56% of total growth in the last five years—surpassing expectations by 18%.
Enhanced competitiveness as businesses can:
- Increase stakeholder trust, attract investors, and reduce capital costs. With more than 80% of mainstream investors now considering ‘ESG’ information when making investment decisions, companies implementing sustainability can access capital more efficiently and realise up to a 10% reduction in the cost of capital.
- Increased innovation as businesses engage with suppliers on sustainability and decarbonisation performance, thus providing a competitive edge in a rapidly evolving corporate landscape.
Risks of not using sustainability management software
Meanwhile, businesses that do not adopt sustainability management software risk facing several potentially detrimental consequences, such as:
Damaged brand reputation and value due to:
- Reduced employee engagement due to a need for more commitment to sustainability, with studies showing that companies with high employee satisfaction ratings outperformed their competitors by 2.3% to 3.8% annually.
- Sales decreased due to damaged consumer perception. Studies showed that 72% of consumers stated they were actively buying more environmentally friendly products than they did five years ago. In comparison, 81% said they expected to buy even more over the next five years.
Decreased competitiveness due to:
- More significant external costs result from emissions trading systems (ETS) which place a hefty price on CO2 emissions carbon taxes. Carbon taxes in the EU have risen 488.57% from $16.36 per metric ton in 2018 to more than $96.29 in 2023.
- Costs due to unnecessary waste and non-compliance. High to severe ESG incidents have been found to lead to an average 6% loss of market capitalisation.
How to choose the right sustainability software for your company
There are several key considerations that businesses must evaluate when browsing for effective sustainability software:
- Science and expertise: Businesses must seek sustainability software underpinned by a certified methodology to ensure accuracy, reliability and thus well-informed sustainability decision-making. Sustainability software with carbon accounting methodology backed by leading certifications (e.g. TÜV Rheinland) ensures that clients have access to the most accurate data rooted in science. Meanwhile, GHG Protocol-compliant software ensures businesses can accurately compare emissions across all scopes and facilities, obtain benchmarks for their industry, and identify emissions hotspots against which they can take reductive action.
- Emissions coverage: Sustainability software must enable businesses to accurately and seamlessly calculate their emissions across scopes 1, 2, and 3. Given that the vast majority of emissions are from scope 3, sustainability software must also enable businesses to measure and track emissions accurately across the wider supply chain.
- Data-driven: Effective sustainability software should facilitate hassle-free data collection, input, and analysis via a centralised platform. Data collection does not need to be tedious, and effective sustainability software should allow organisations to seamlessly consolidate their data in one secure hub to ensure they can quickly gain immediate visibility on company emissions.
- Decarbonisation first: Businesses looking to drive meaningful change to reap the long-term benefits of sustainability must make decarbonisation a key priority when adopting sustainability software. Decarbonisation-oriented sustainability software will ensure users can effectively reduce their emissions and sustainably transform business, rather than just offsetting or compensating - which exposes businesses to the perils of greenwashing.
- Reporting: ESG and sustainability reporting are essential when seeking out sustainability software. An effective sustainability software will align with the latest industry-leading guidelines and consistently update emissions factors, enabling businesses to align with regulatory disclosures or evaluations by external parties seamlessly. Carbon accounting platforms that place ESG and sustainability reporting as a critical focal point means that companies tailor the reporting tool to their specific business needs to report on their sustainability progress seamlessly. In doing so, they will ensure they can adhere to international regulations and protocols and easily export such reports to internal and external stakeholders. This strategic software choice allows companies to harness the advantages of climate disclosure, safeguard and enhance their corporate reputation, proactively stay ahead of evolving regulations, and ultimately elevate their competitive edge.
- Dedicated support: Whilst sustainability management software forms the basis of any viable sustainability strategy, businesses that choose software that offers dedicated support can reach their long-term targets and bolster their overall sustainability strategy. For instance, sustainability software with dedicated backing on crucial topics such as data input, transformation and decarbonisation should be a top priority for any organisation seeking a competitive advantage.
- Relevant partnerships: Choosing a sustainability software provider with a robust ecosystem of partnerships with reputable companies is a strong indicator of their industry knowledge, expertise, and ability to cater to current and future climate change and emissions requirements. For instance, Plan A hosts an array of partnerships with sustainability providers that cater to businesses across all industries – meaning that businesses are able to undergo comprehensive sustainable transformation using the one platform.
- Customer references: Customer references play a crucial role when selecting sustainability software, as they offer firsthand insights into the software’s effectiveness and reliability. By reviewing the relevance of existing users to your company and their experience, potential buyers can assess how well the software meets their specific sustainability goals, such as reducing carbon footprint or sustainability reporting. Customer testimonials also provide valuable information on the software’s ease of use, customer support quality, and specific use cases. These references help mitigate risks associated with investing in new technology by showcasing proven track records and user satisfaction, making them an essential factor in the decision-making process.
- Walk the talk: Any sustainability software provider devoted to sustainable transformation will also walk the talk by engaging in sustainability initiatives. Accordingly, businesses seeking sustainability software should prioritise B-corp-certified carbon accounting providers as they meet the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose.
The 7 best sustainability softwares
1. Plan A
Plan A Sustainability Software is the industry-leading, all-in-one sustainability management platform that combines corporate carbon accounting, decarbonisation, and ESG reporting software into one intuitive hub.
The green-tech pioneers host a data-driven sustainability management platform that combines cutting-edge technologies and the latest scientific standards and methodologies (e.g. TÜV Rheinland certified and GHG Protocol compliant). The sustainability software solution automates CO2 emissions calculation, carbon reduction planning, and regulation and ESG reporting, empowering businesses to ensure CSRD-readiness, transform sustainably and manage their entire net-zero journey in one platform.
Plan A’s platform takes the leading spot for sustainability software as businesses that use the platform only have to use one software for their entire decarbonisation journey. Accordingly, Plan A provides end-to-end carbon analysis that allows enterprises to efficiently measure and reduce scope 1, 2, and 3 emissions, decarbonise operations and value chains, comply with ESG regulations, and communicate performance to internal and external stakeholders. Additionally, Plan A boasts an in-house team of experts in sustainability, carbon accounting, decarbonisation, policy, and customer success, ensuring the sustainability journey of their clients is beyond seamless.
Plan A’s prominent reputation in the world of sustainability software is reflected in its expansive customer base, which includes leaders such as KFC, Alphabet, N26, BNP Paribas, Chloé, Flix, Sorare, BMW, Trivago, Deutsche Bank, Payhawk, and the European Union. Plan A is also a global exclusive partner of Visa. Founded in 2017, Plan A has received several awards, including the Generali’s SME EnterPRIZE Award 2021 and the prestigious Europas Award 2021.
2. Fairly Made
Fairly Made measures products' environmental and social impact, enabling brands to prioritise and centralise their CSR strategy. The platform allows fashion brands to assess and manage their products' environmental and social impacts by providing insight and facilitating transparency and traceability throughout the product supply chain, from raw materials to finished goods, enabling brands to make more sustainable and ethical choices.
Whilst the product environmental footprint software has played a vital role in sustainably reshaping the fashion industry as businesses increasingly measure and improve the impact of their products, Plan A’s has partnered with Fairly Made - integrating PCF data to facilitate granular emissions calculations. As Plan A & Fairly Made join forces to seamlessly integrate PCF and CCF data, such accuracy ensures fashion brands can achieve regulatory compliance, drive efficiency, and leverage precise decarbonisation recommendations.
3. Workiva
Workiva provides ESG-oriented Software, a comprehensive solution for reporting and compliance with ESG (Environmental, Social, and Governance) standards. It integrates various functionalities such as automated KPI calculations, a central data repository, alerts, version control, and audit trails. The software supports alignment with reporting frameworks like SASB, GRI, and CDP and can be used for ESG reporting.
4. Diligent ESG
Diligent's ESG Software provides a robust platform to help organisations effectively manage and report on their environmental, social, and governance (ESG) commitments and performance. It centralises ESG data, enabling companies to monitor, act on ESG risks, and comply with evolving regulations and standards. The software includes automated data collection, dynamic reporting with configurable dashboards, and integration with other governance, risk, and compliance programs. It also supports benchmarking against multiple standards, including the WEF, TCFD, CDP, GRI, and SASB, facilitating tailored, efficient reporting.
5. Sphera
Sphera is a comprehensive ESG performance and risk management software under The Blackstone Group's umbrella. Sphera approaches emissions management through integration, emphasising organisational safety enhancement and liability reduction to foster trust and cultivate a positive environmental image. Sphera's software centres on dissolving information silos by centralising reporting, data, and management tools. In addition, Sphera’s platform cultivates collaborative efforts within teams dedicated to safety and sustainability pursuits.
6. IBM Environmental Intelligence Suite
The IBM Environmental Intelligence Suite is a legacy software focused on data management. Functioning as an emissions management tool, it offers rudimentary climate risk analytics with the assistance of IBM's AI capabilities. A significant component of IBM's offering revolves around risk assessment and response strategies. Its attributes empower organisations to monitor disruptive climate patterns, aiming to integrate carbon accounting into operational processes. For businesses searching for a carbon accounting software tailored for sizable corporations and equipped for projecting future carbon emissions, the IBM Environmental Intelligence Suite may be a suitable choice; however, it may not provide a more personalised experience than many organisations require.
7. Microsoft Sustainability Cloud
The Microsoft Sustainability Cloud extends Microsoft's commitment to sustainable initiatives. This offering allows companies to document, disclose, and curtail their environmental impact via Microsoft's Sustainability Manager. Microsoft envisions customers leveraging this platform to magnify progress and reshape their business strategies through robust ecological, social, and governance (ESG) capabilities. However, the carbon accounting solution may be best suited for mid-market and small-to-medium business (SMB) clients, yet definitive conclusions still need to be made.
In conclusion, the rapid ascent of sustainability software underscores its critical role in modern business operations, catering to an urgent need for business-wide sustainable transformation and decarbonisation. Sustainability software not only enhances operational efficiency and regulatory compliance but also significantly bolsters a company's competitive edge by improving stakeholder relations, increasing employee engagement, and attracting investments. However, the selection of the right sustainability software necessitates careful consideration of various factors such as emissions coverage, data management capabilities, and alignment with leading scientific standards and methodologies. Additionally, the importance of robust customer references and dedicated support cannot be overstated, as these elements are crucial for ensuring the software's effectiveness in meeting specific organisational sustainability goals.
