ESG FOCUSED SOFTWARE MARKET (2025 - 2030)

The ESG-focused software market was valued at USD 2.77 billion in 2024 and is projected to grow at a CAGR of 10.7% from 2025 to 2030. By 2030, the market is expected to reach USD 5.1 billion.

The software market, ESG-oriented, is characterized by a fast-moving digital environment in which technology is connected with environmental, social, and governance concepts to make responsible decisions in any industry. The innovativeness of the platforms and analytic tools defines this market in the following manner: organizations can track, quantify, and publish sustainability performance with precision and transparency. With stakeholders becoming more and more demanding of accountability, companies are now resorting to ESG-based solutions to reinforce compliance, enhance risk management, and increase the creation of long-term value. The increase of global awareness about climate change, higher regulatory standards, and the rise of socially aware investors, who give priority to ethical and sustainable practices, contribute to fuelling the market. Software solutions that emphasize ESG processes not only facilitate the reporting process but also offer predictions, and thus companies can predict future problems ahead, allocate resources efficiently, and be consistent with the global sustainability criterion. Besides, the combination of artificial intelligence, big data analytics, and blockchain is reforming the process of following and certifying ESG data, which is more reliable. The financial and energy industry, healthcare, and retail industry are among the industries utilizing the solutions to fulfill the emerging expectations as they seek to gain a competitive advantage. As demand is picking up, the ESG-focused software market remains a crucial facilitator of responsible business change in a data-driven global economy.

Key Market Insights:

63% of companies estimated that they’ll be ready for the new EU reporting regime, yet ~59% name data availability/quality as a major implementation obstacle, and fewer than half have completed key preparatory steps (double-materiality, taxonomy checks, data validation). PwC

Over 50% of corporates and investors identify poor or inconsistent ESG data as the biggest constraint, creating strong demand for solutions that standardize, verify, and automate reporting.

84% of firms are maintaining or accelerating decarbonization targets, while companies with transition plans rose ~44% in 2023, pressuring software providers to enable target-setting and performance monitoring.

70–80% of global consumers say sustainability matters in purchase decisions, with many willing to pay premiums driving companies to invest in ESG tracking and verification software.

Emerging ESG platforms leverage AI to extract 70–85% accurate metrics from unstructured disclosures, signalling a new wave of software innovation focused on automation, auditability, and compliance.

Market Drivers:

Rising Regulatory Mandates and Stakeholder Expectations are Driving ESG Software Adoption.

The growing focus on transparency and accountability in the whole world is compelling organizations to implement ESG-centered software solutions as fast as possible. There is a tightening of disclosure policies by governments and measurable evidence of sustainable policies by investors, consumers, and employees. Companies are likely to report correctly on the environmental impact, social responsibility, and standards of governance, and manual processes will not suffice to comply. The ESG software allows companies to consolidate complicated information, meet the global standards, and provide credible disclosures. This increasing tide of rules and demands of stakeholders becomes a potent force, which guarantees the ongoing implementation and investment in the innovative ESG technologies.

Advanced Analytics and Digital Integration are Accelerating ESG Reporting Transformation.

Another strong force that is driving the ESG-based software market is technological innovation. Firms are becoming more interested in artificial intelligence, machine learning, blockchain, and predictive analytics to improve the pace and accuracy of sustainability reporting. These digital instruments not only centralize data gathering, but they also produce actionable insights that can assist organizations in the prediction of risk, resource management, and resilience of their long-term planning. ESG software promotes proactive decision-making and competitive advantage with real-time dashboards, scenario modelling, and other advanced visualizations. With the increased pace of digitalization in industries, the adoption of intelligent ESG platforms is a necessity that can drive responsible business growth.

Market Restraints and Challenges:

The ESG-oriented software market has significant threats that may stop its development. The complexity of regulatory compliance in different regions is one of the major limitations because companies have to constantly change software solutions to comply with different and various sustainability reporting requirements, adding burdens and costs to operational challenges. Furthermore, the high cost of implementation and the barrier to integration are also a high impediment since the implementation of an ESG platform may be costly and demand a smooth integration with the current enterprise systems, which may be prohibitive, especially to small organizations and slow in its widespread adoption.

Market Opportunities:

The ESG-focused software market presents significant growth opportunities driven by the rising emphasis on corporate sustainability and responsible business practices. Organizations worldwide are increasingly seeking solutions to monitor, measure, and report their environmental, social, and governance performance, creating demand for advanced analytics, real-time reporting, and automated compliance tools. Additionally, the integration of artificial intelligence, machine learning, and predictive analytics in ESG software enables deeper insights, proactive risk management, and data-driven decision-making, offering software providers a chance to deliver high-value solutions that support enterprises in achieving their ESG objectives efficiently.

ESG FOCUSED SOFTWARE MARKET

Market Segmentation:

Segmentation by Type:

• Cloud-Based
• On-Premises
  

Cloud-based ESG software is leading the market because it provides scalable and flexible solutions to the tracking, analysis, and reporting of sustainability metrics across organizations, making it easily accessible. These platforms enable enterprises to amalgamate ESG data across various sources, create real-time intelligence, and ensure compliance with any emerging regulatory provisions effectively. The large-scale use of cloud computing, as well as the need to be able to access it remotely and report together, is the booster of the great popularity of the segment in the market.

The subcategory of solutions based on clouds is also the most rapidly developing, and this is due to the incorporation of AI, machine learning, and predictive analytics, contributing to better monitoring of ESG performance and decision-making. Cloud implementations are more and more popular among companies due to their affordability, automatic updates, and scalability as the company expands, which makes this category the major contributor to market growth in the ESG software segment.

Segmentation by Application:

• Reporting and Compliance Management
• Risk Management
• Portfolio Management
• Data Management and Integration
• Benchmarking and Performance Tracking
   

The largest segment of applications in the ESG-oriented software industry is Reporting and Compliance Management, which is influenced by the growing demand of organizations to comply with complex and changing regulatory standards. To offer better streamlining of data collection, automation of disclosures, and adherence to international standards of sustainability, companies are adopting sophisticated ESG reporting instruments. Through these solutions, the enterprises can be kept transparent, the manual effort of the enterprises is minimized, and precise ESG reports are produced that meet the expectations of the stakeholders and the regulatory requirements.

Risk Management is becoming the quickest expanding application category, driven by the necessity of organizations to actively discover and measure as well as avoid ESG-related threats. As increasing numbers of companies begin to consider the effects of environmental, social, and governance factors on their business processes, organizations are using sophisticated analytics and AI-based ESG risk platforms to predict possible dangers, improve decision-making, and safeguard long-term value. The development of the segment is also aided by the fact that there is a growing interest on the part of investors and the escalation of the usage of data-driven risk management frameworks in industries.

Market Segmentation: Regional Analysis:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East and Africa

The highest share of the global adoption is concentrated in North America, as the largest market for ESG-oriented software. This leadership can be influenced by the strong regulatory frameworks, prevalence of corporate sustainability programs, and the existence of big multinational businesses that are actively engaged in the pursuit of ESG compliance. Its high-technological base, the early introduction of digital reporting solutions, and the presupposition of the high interest of the investors toward the transparent ESG reporting further support its leading role, which makes North America the most significant location of ESG software implementation and innovations.

The region of Asia-Pacific is becoming the most dynamic, which is supported by the fast industrialization, the rising environmental concerns, and the rise of social responsibility in businesses. China, India, Japan, and Australia are the countries where the rate of ESG platform adoption is increasing, driven by government incentives, further digitization of enterprises, and an increase in foreign investment in green projects. The priorities of the region toward carbon neutrality, enhancing corporate governance, and introducing advanced analytics in ESG reporting are leading to strong market growth, which makes Asia-Pacific a key growth catalyst in the international ESG-oriented software market.

COVID-19 Impact Analysis:

The COVID-19 pandemic strongly affected the Global ESG-focused software Market. In the early days of the pandemic, most companies experienced operational issues, such as supply chain shortages and labor availability, which influenced their capacity to handle and report ESG-related information well. Nevertheless, the pandemic enhanced the use of ESG-oriented software as well since companies understood the role of sustainability and resilience in overcoming the crisis. The increased emphasis on social responsibility, employee welfare, and environmental concerns in the context of the pandemic led to an improvement in ESG practices and reporting infrastructures in companies. This led to the emergence of a higher demand for software solutions that could assist organizations in monitoring their ESG performance, risks, and ensure that they conform to the new rules that may arise. Timely data and insights were also the requirements of the pandemic, and an improved level and greater integration of ESG-oriented software solutions were created. Altogether, the COVID-19 pandemic became a driving force of the ESG-oriented software market development, and nowadays, numerous companies consider ESG a vital part of their business strategy in the long run.

Latest Market News:

• In May 2023, Cority, a leading provider of Environmental, Health, Safety, and Quality (EHSQ) software, acquired Greenstone Ltd., a UK-based company specializing in ESG and sustainability reporting solutions. This acquisition aimed to enhance Cority's ESG capabilities, offering clients a more comprehensive suite of tools to manage and report on sustainability metrics.
   
• In August 2024, private equity firm Thomas Bravo explored the sale of Cority, valuing the company at approximately $2 billion, including debt. This move indicated Cority's significant position in the ESG software market and the growing interest in sustainability-focused technology companies.
   
• In June 2024, Experion Technologies, a provider of digital transformation services, partnered with ESG Playbook to offer comprehensive solutions addressing sustainability, risk management, and regulatory compliance. This partnership aimed to integrate ESG considerations into enterprise operations, reflecting the increasing importance of sustainability in business strategies.
   
• In December 2024, Spanish startup Dicycle raised €6 million in a Series A funding round led by Samaipata. The investment aimed to enhance Dicycle’s ESG data management platform, which utilizes artificial intelligence and cloud technology to help organizations measure their carbon footprint and comply with environmental regulations. The company also planned to expand its operations into Germany, Italy, and the UK.
   

Latest Trends and Developments:

The global ESG-focused software Market is experiencing some important trends and developments that are influencing its development. Among the trends, it is possible to mention the growing use of AI and machine learning in ESG-oriented software to improve data analysis, automate the processes of reporting, and offer more precise insights into the ESG performance. The technologies are aiding businesses to curb data management challenges and enhance the quality of their ESG reports. The other trend is the increased integration of ESG-specific software with other enterprise systems, like ERP and CRM, and form more comprehensive and unified systems that have the potential to serve much broader business functions. Also, the need for industry-specific ESG solutions based on the specific challenges and needs of various fields, including finance, manufacturing, and energy, is growing. There is also an increasing trend in the development of cloud-based and subscription-based models of ESG software, which gives companies greater flexibility and less cost when managing their ESG data. Such tendencies and shifts are pushing the changes in the innovation of the ESG-based software market and bringing it to grow.

Key Players in the Market:

1. SAP SE
2. Salesforce.com Inc.
3. Wolters Kluwer N.V.
4. Refinitiv
5. Workiva Inc.
6. S&P Global Inc.
7. IBM Corporation
8. Enablon
9. Intelex Technologies ULC

Diligent Corporation