Best ESG Software Solutions: a Comprehensive Comparison and Evaluation Guide

Best ESG Software Solutions: a Comprehensive Comparison and Evaluation Guide

Companies are turning to ESG software to manage and report on their sustainability initiatives as ESG (Environmental, Social, and Governance) investing grows in popularity. According to a recent Globe News Wire report, the worldwide ESG software market will reach $1.9 billion by 2028. With so many options available, it can be difficult for businesses to select the best solution. That is why we have developed a detailed comparison and evaluation guide to assist you in navigating the top ESG software solutions on the market. In this article, we'll go through everything from carbon emissions to societal impact for you to be able to find the best ESG software for your company.

What is ESG software and how does it work?

ESG software is a type of software that helps businesses manage and report on their environmental, social, and governance initiatives. Such solutions typically incorporate data gathering, analysis, reporting, and stakeholder engagement capabilities.

The software collects essential sustainability statistics by combining with numerous data sources, including energy consumption, greenhouse gas emissions, waste management, labor practices, and board diversity. After that, the program aggregates the data into a single database and uses analytics to generate insights on the company's sustainability performance.

Such software can also produce reports that adhere to industry standards like the Global Reporting Initiative (GRI) or the Sustainability Accounting Standards Board (SASB). These reports assist businesses in communicating their sustainability performance to stakeholders such as investors, consumers, and workers.

Introduction to ESG and its importance for businesses

ESG has grown more significant for businesses around the world in recent years. It is a set of criteria used by investors and stakeholders to assess a company's performance in areas including sustainability, social responsibility, and ethical governance practices. 

What are the benefits of using custom ESG software for my business?

It is becoming more essential for organizations for a variety of reasons. 

First, customers are becoming more aware of their social and environmental effects, and they prefer to purchase from companies that share their beliefs. Customers who are willing to pay a premium for sustainable and socially responsible products and services are more inclined to choose companies that promote ESG. Besides, a recent McKinsey & Company study discovered that organizations with outstanding ESG performance outperform their peers in the long run.

Second, investors are considering environmental, social, and governance initiatives when making investing decisions. Many investors believe that companies committed to sustainability and social responsibility are better positioned to prosper in the long run because they face fewer reputational and regulatory concerns.

Third, ESG is critical for risk management. Companies that fail to solve environmental, social, and governance issues may face financial and legal consequences in the future, including fines, lawsuits, and reputational harm. As a result, controlling environmental risks can assist firms in reducing their exposure to such risks and improving overall performance.

Limitations of off-the-shelf ESG software solutions

While commercial ready-made solutions can assist businesses to manage and report on their sustainability efforts, they do have significant limits.

How does custom ESG software development compare to off-the-shelf solutions?

One restriction is that off-the-shelf solutions may not be fully configurable to the demands of an organization. Every company has different environmental, social, and governance priorities and goals, and a one-size-fits-all software solution may not be able to meet all of them.

Another restriction is that off-the-shelf software solutions may not be as accurate as customized ones. Pre-packaged software solutions may not adequately capture the exact ESG data required by businesses, or the data may not be updated in real-time.

Furthermore, ready-made ESG software solutions may not be able to integrate with a company's existing systems and software, which can create data silos and make it difficult to gain a complete picture of a company's sustainability performance.

While off-the-shelf software solutions can be a useful starting point for companies looking to incorporate ESG principles into their corporate strategy, they may not be the best fit for every business. Whereas, customized ESG solutions can address these limitations and provide more tailored solutions for individual companies.

Benefits of custom ESG software development

Companies wishing to manage and report on their sustainability initiatives might benefit from custom software development. 

Here are some of the primary advantages of developing custom ESG software:

Customized solutions: Custom software can be developed to address a company's specific ESG priorities and objectives. This can assist businesses in capturing specific data that may not be available in off-the-shelf solutions, as well as providing a more personalized approach to managing sustainability performance.

Improved sustainability performance: Custom ESG software can enable real-time data tracking and analysis, allowing businesses to find opportunities for improvement in sustainability performance. Companies may make more informed decisions about how to manage their environmental, social, and governance impact by emission tracking and reporting on sustainability measures. 

Custom ESG software can automate the reporting process, saving businesses time and resources. Besides, companies can develop customized reports that match their specific reporting needs by connecting ESG data with other business systems.

Competitive advantage: Companies that embrace sustainability goals might gain a competitive edge by implementing a tailored ESG software solution. Such companies may attract investors, customers, and other stakeholders who value sustainability by demonstrating a commitment to environmental, social, and governance principles and providing transparent data on sustainability performance.

The custom software development process for ESG solutions

Typically, the software development process for building ESG data management software consists of multiple stages, which include:

  1. Gathering of requirements: The development team collaborates closely with the company at this stage to determine its particular ESG priorities and goals. The team gathers information on the company's sustainable initiatives as well as data tracking and reporting needs.
  2. Design: Once the requirements have been defined, the development team builds a design that describes the architecture, data model, user interface, and other critical characteristics of the software solution. Before continuing further with development, the company needs to examine and approve the design.
  3. Development: During this step, the development team creates the unique ESG software solution. Based on the design parameters, they build the solution using the right programming languages, frameworks, and tools.
  4. Testing: Once the solution has been developed, it will be tested to ensure that it fits the company's criteria for functionality, usability, and data correctness. Before proceeding with deployment, any problems or issues must be detected and fixed.
  5. Deployment: The ESG software solution is deployed and configured on the company's servers during this stage. To guarantee a smooth deployment, the development team collaborates closely with the company's IT staff.
  6. Ongoing maintenance: After the solution is launched, it will require continuing maintenance to ensure appropriate operation. The development team will provide support and update or upgrade the solution as needed.

Key features to look for in custom ESG software

What features should I look for in a custom ESG software solution?

There are a number of important aspects to look for in the best ESG reporting software that aids businesses in managing and reporting on their sustainability initiatives.

The following are some crucial characteristics to consider:

Data management: The software must be able to gather and organize ESG data relevant to the company's sustainability objectives and programs. This contains information on carbon emissions, energy use, water use, trash management, and other things.

Reporting: Specialized ESG data software should have automated reporting features that may produce individualized reports that adhere to the organization's particular ESG reporting needs. The reports should promote regulatory compliance by offering insights into important sustainability KPIs and performance indicators.

Advanced analytics tools should be offered by the software to help businesses find patterns, threats, and opportunities relating to their sustainability performance. This involves benchmarking against other businesses in the industry, scenario research, and predictive analytics.

Engagement of stakeholders: Custom ESG software should offer options for engaging stakeholders, such as polls and feedback processes. This can assist businesses in obtaining input from clients, staff members, investors, and other stakeholders and incorporating it into their sustainability plan.

Integration: Custom ESG tracking software must be easily compatible with other corporate systems, like those that handle finances and supply chains. This can assist businesses in getting a complete picture of their sustainability performance across the board.

Security: The software should be designed with robust security features, including data encryption, access controls, and data backup and recovery capabilities.

Custom ESG solution vs popular ESG solutions: comparison table

Now let's compare ESG data collection software options that are currently popular on the market with their custom solution alternatives based on their key characteristics and functionalities. 

Our analysis reveals that while pre-packaged solutions may appear to be more convenient and efficient, customized ESG monitoring software is undoubtedly a superior choice. A tailored solution not only encompasses all the features of other options but also offers the added benefit of being entirely customizable to meet a company's specific needs. This level of flexibility allows businesses to achieve their sustainability goals with greater precision and accuracy, leading to improved long-term performance.

Examples of companies that have successfully implemented custom ESG software solutions

Custom ESG software solutions have been successfully used by numerous businesses across different industries to enhance their sustainability performance and reporting. 

Here are a few of them:


Unilever is a manufacturer of consumer goods. It has adopted a customized ESG software system to monitor and report on its sustainability initiatives. The software enables Unilever to manage sustainability data across its global activities and generate automated reports that comply with industry requirements. This aids in the tracking of greenhouse gas emissions and waste reduction.


Nestle, a food and beverage company, has incorporated a tailored ESG system to monitor the environmental impact of its operations, including energy use, greenhouse gas emissions, and water use. The system also has tools for reporting and engaging stakeholders, allowing Nestle to measure and improve its sustainability performance.


The corporation has created an ESG software system that enables it to monitor its progress toward sustainability objectives, such as cutting waste and carbon emissions. The software generates reports that adhere to industry standards and delivers real-time statistics on energy use and trash management across the company's global activities.


Intel has implemented a customized ESG software solution that integrates data from various sources, including manufacturing plants and supply chain partners. The software provides real-time data reporting and analysis on waste management, greenhouse gas emissions, and energy use, allowing Intel to track and improve its sustainability performance.


From vehicle manufacturing to disposal, BMW has deployed an ESG software solution that tracks the environmental impact of their vehicles. The solution offers insights into the sustainability performance of BMW's supply chain partners, allowing the company to identify areas for improvement and make more sustainable decisions.

Factors to consider when choosing a custom ESG software development partner

When choosing a custom ESG software development partner, there are several factors to consider that can help businesses find a company that meets their specific needs. 

Here are some of the essential factors to consider:

Experience: Look for software companies with experience developing custom ESG software solutions for businesses in your industry. An experienced partner will have a better understanding of the unique sustainability challenges and reporting requirements your company is facing.

Expertise: Choose a partner with expertise in sustainability data management, reporting, and analytics. They should have a solid understanding of ESG frameworks, industry standards, and regulatory requirements to ensure your software meets compliance standards.

Customization: Ensure that the partner can provide a fully customized software solution that meets your specific sustainability goals and initiatives. This includes a software solution tailored to your data needs and unique reporting requirements.

Integration: The software providers should be able to integrate the ESG management software with other business systems, such as financial and supply chain management systems, to provide a comprehensive view of your sustainability performance.

Security: Choose a partner with experience in developing secure software solutions. The ESG software should have robust security features, including data encryption, access controls, and data backup and recovery capabilities.

Cost: Evaluate the cost of developing a custom ESG software solution with the partner. Consider the development and ongoing maintenance costs, as well as the potential return on investment from improved sustainability performance and reporting.

How can I get started with developing a custom ESG software solution for my business?

If you're looking for a tailored ESG software solution to meet your unique business needs, contact Apiko today to learn more about our custom software development services.