How does carbon accounting software help with ESG reporting?

ESG (Environmental, Social, and Governance) reporting has shifted from a compliance exercise to a strategic imperative for corporations around the globe. Businesses that prioritise ESG ultimately outperform their peers financially by 2.5 times, driving resilience and growth.

Carbon disclosure is central to ESG reporting; it is the cornerstone of environmental metrics. However, achieving accuracy and compliance in emissions reporting remains challenging for many organisations. Carbon accounting software provides a digital solution that transforms reporting into a cohesive, data-driven approach, allowing companies to meet regulatory requirements while advancing their decarbonisation goals.

What is carbon accounting software?

Definition

Carbon accounting software is a technological tool designed to streamline the measurement, management, and reporting of greenhouse gas (GHG) emissions. It consolidates emissions data across an organisation's operations and supply chain, ensuring alignment with globally recognised frameworks like the GHG Protocol.

Key functionalities:

Data collection: Aggregates emissions data from internal and external sources, covering Scope 1, 2, and 3 emissions.
Emissions calculation and management: Calculates the CCF based on the collected data and provides dashboards to analyse and understand emissions across operations and value chains.
Advanced reporting: Generates clear, stakeholder-friendly carbon reports for investors, customers, and regulators.
Decarbonisation planning: Helps identify actions with the greatest potential to reduce emissions effectively.

This software bridges raw operational data and actionable sustainability insights, making it vital for ESG reporting.

Why is carbon disclosure central to ESG reporting?

Carbon disclosure is the foundation of ESG reporting, holding significant weight within the Environmental pillar. It provides a measurable benchmark for tracking a company’s climate strategy, resource efficiency, and alignment with global decarbonisation goals. Its role extends beyond environmental metrics, influencing the Social and Governance dimensions by driving transparency, equity, and risk management.

Plan A Carbon Reporting — Carbon Reporting made simple with Plan A's Carbon Management Platform.

Key contributions:

Anchor for compliance and ESG scoring: Carbon data forms the backbone of reporting mandates like the ESRS, CSRD, and TCFD, and it carries significant weight in ESG ratings due to its quantifiability and direct link to global climate goals.
Strategic and financial value: Accurate carbon data enables CFOs to assess climate risks, optimise resource allocation, and evaluate opportunities for green investments, tying sustainability to financial resilience.
Stakeholder confidence: Transparent carbon disclosure demonstrates accountability, fostering trust with investors, customers, and regulators.
Broader ESG alignment: Insights from carbon data enable companies to innovate in renewable energy adoption, waste reduction, and supply chain decarbonisation, laying the foundation for achieving long-term ESG goals.

By prioritising carbon disclosure, companies not only strengthen their ESG narratives but also enhance their market positioning and operational efficiency.

How carbon accounting software transforms ESG reporting

The true power of carbon accounting software lies in its ability to transform ESG reporting into a strategic, efficient, and insightful process. Here’s how it delivers:

Accuracy and automation

Manual processes are labour-intensive and error-prone. Carbon accounting software automates the data collection process, ensuring consistent and reliable outputs while reducing resource consumption. This directly addresses the challenges of data quality, measurement, and comparability that are associated with ESG reporting.

Plan A CSRD Manager — Effortlessly collect data related to your E1 Disclosures with Plan A's CSRD Manager.

Compliance with regulations

‍Regulatory landscapes like the EU’s CSRD or the SEC’s climate disclosure rules are becoming more demanding. The software embeds compliance requirements, ensuring that reports meet international standards effortlessly. For companies navigating the complexities of CSRD reporting, the Plan A CSRD Manager offers tailored solutions that guide businesses step-by-step through their reporting journey.

Strategic insights

‍With predictive analytics and trend forecasting, organisations can use the software to:

Set and monitor science-based targets.
Evaluate performance against carbon neutrality goals.
Identify hotspots in their value chain and prioritise interventions.

Result: A more cohesive ESG narrative that drives decision-making at all levels.

Challenges that software solves for Sustainability Managers and CFOs

Carbon accounting software addresses key pain points faced by both sustainability and financial leaders:

Transparency in supply chain emissions: Scope 3 emissions often make up 70–90% of an organisation’s carbon footprint, yet are notoriously difficult to track. Software simplifies this by capturing emissions across upstream and downstream activities.
Data fragmentation: Emissions data is often siloed across departments or geographies. The software unifies this data into a centralised, accessible platform.
Aligning emissions data with financial metrics: CFOs need emissions data to inform climate-related financial disclosures. The software bridges the gap, linking emissions to costs, investments, and ROI.
Scalability for growth: Whether for SMEs or multinational corporations, the software scales to meet organisational needs, adapting as regulations and operations evolve.

Plan A Decarbonisation Analytics Dashboard — Plan A's Decarbonisation Analytics Dashboard allows for immediate transparency on value-chain wide emissions reduction progress, while emissions data to financial metrics.

5 actionable steps for leaders

To maximise the benefits of carbon accounting software, leaders should adopt a strategic approach:

Action	Detail
Assess needs and priorities	Determine which emissions (Scope 1, 2, 3) are material to your business and align your approach with leading frameworks like CSRD, ESRS, or SBTi to meet compliance and reduction goals.
Choose solutions with a decarbonisation-first focus	Prioritise platforms that go beyond compliance to enable precise carbon accounting, emissions forecasting, and actionable decarbonisation plans.
Foster cross-functional collaboration	Involve key stakeholders across departments and provide tools that streamline data collection, task management, and accountability for shared sustainability objectives.
Measure and communicate ROI	Quantify benefits like reduced costs, compliance risk mitigation, and operational efficiencies, and use these insights to continuously refine your sustainability initiatives.
Pilot, then scale for impact	Begin with a pilot project to validate the approach and demonstrate quick wins, then expand company-wide with scalable tools and strategies tailored to your organisation's needs.

Turning reporting into a strategic advantage

Carbon accounting software is more than a tool for emissions tracking—it is a strategic enabler for ESG success. By automating processes, preparing for compliance, and offering actionable insights, software empowers companies to lead in sustainability, transform operational efficiency and boost financial performance. In an era of increasing accountability, organisations must act now to harness the power of carbon accounting software. By investing in robust solutions such as Plan A, businesses can transform ESG reporting from a compliance obligation into a source of competitive advantage.

Schedule a call with Plan A's experts today to transform ESG reporting and accelerate the journey towards impactful sustainability.