Global ESG Reporting Market is set to see a healthy CAGR of 15% by 2027

Environmental, social, and governance (ESG) data measures a company’s non-financial performance and sustainability practices.

The three main pillars of ESG are as follows:

• Environmental Data such as the amount of greenhouse gases emitted by a company into the atmosphere, energy usage data, water usage data, waste reduction data, carbon footprint reduction data, waste reduction data.
• Social Data such as fair pay and living wages data, adherence to labor laws, workplace health & safety, equal employment opportunity.
• Governance Data such as corporate governance, compliance, ethical business practices, accounting transparency and integrity.

ESG metrics can be classified into quantitative and qualitative. Quantitative metrics include numerical data which can be directly measured and compared such as energy usage, water usage, greenhouse gas emissions, energy usage, while qualitative metrics include non-numerical data that are harder to measure and compare such as the company's labor practices, commitment to diversity, equity and inclusion (DEI)and others. This data is used to generate reports that shows a company's ability to implement ESG initiatives successfully.

Rising Demand from Investors and Companies Triggers the Growth of the Global ESG Reporting Market

ESG metrics are rapidly being used by investors to examine businesses they plan to acquire or invest in. ESG software tracks the ESG initiatives and investors use ESG reports to screen investments, align investments, and avoid companies with the risk of environmental damage, corruption, and social missteps. ESG reporting is also being used by companies to report their efforts and progress on climate change, corporate social responsibility (CSR) initiatives, regulatory compliance, goal tracking and governance and sustainability.

“Nowadays, investors while examining companies look for ESG disclosures to steer their investment decision-making. Investors perceive that organizations that perform well on ESG metrics are relatively less risky, better positioned for long-term growth, and better equipped for uncertainty.”-Marketing Director, ESG Reporting Software Provider, United States

Increasing Application of Artificial Intelligence (AI) provides Ample Opportunities for Companies in their Sustainability Journey

The introduction of AI is transforming the whole ESG landscape. It is rapidly being used to collect and analyze huge chunks of ESG data, automate tasks, recognize patterns, and make predictions. AI is being rapidly used to assess a company’s exposure to ESG risks, such as climate change, labor practices, and corporate governance. It can also being used to automate compliance tasks, such as reviewing regulatory filings and recognizing compliance gaps. Citing the emerging growth prospects of the global ESG reporting market, all leading players operating in the global market have introduced a various number of AI-related products.

For instance,

• In March 2023, Novem ESG launched its software which is automated by Artificial Intelligence (AI) for analysis of data against ESG (Environment, Social and Governance) regulations and checklists.

Competitive Landscape Analysis: Global ESG Reporting Market

Some of the leading and established players operating in the global ESG reporting market are Wolters Kluwer , 普华永道 , Workiva , Nasdaq , Cority , Greenstone , Diligent , Emex Software , Novisto , Diginex , Sphera , IsoMetrix Software , NovemESG , C3 AI .

Aggressive Growth Strategies Adopted by the Market Players to Establish Their Strong Foothold in the Global ESG Reporting Market

All the leading players operating in the global ESG reporting market are adopting aggressive growth strategies such as launching new products, acquiring firms, and entering into collaborations or partnerships to gain a larger market share in the global market.

For instance,

• In July 2023, Wolters Kluwer launched TeamMate+ ESG. The solution offers easy and quick access to ESG reporting standards and enables auditors to offer assurance over ESG reporting.
• In May 2023, leading global enterprise Environmental, Health, and Safety (EHS) software provider Cority, acquired Greenstone, a sustainability & ESG reporting software provider.

The global ESG reporting market is poised to witness a healthy growth in the coming years due to growing pressure on companies to measure, disclose, and make progress on ESG initiatives, technological innovations in ESG reporting software, and aggressive growth strategies adopted by the key market players operating in the global ESG reporting market.

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