The global ESG software market, valued at $2.62 billion in 2024, is set for rapid expansion. A new report from SkyQuest Technology Consulting projects a Compound Annual Growth Rate (CAGR) of 12.5% from 2025 to 2032, pushing the market to an estimated $6.72 billion by 2032. This robust growth is primarily driven by escalating regulatory requirements, increased investor scrutiny, and a rising corporate emphasis on sustainability and ethical governance.
ESG Software Market Dynamics:
The ESG software market is primarily driven by the increasing regulatory pressure on companies to comply with sustainability standards and disclose ESG-related data transparently. Organizations across industries are adopting ESG software to streamline data collection, reporting, and compliance processes, helping them meet evolving global regulations and investor demands for sustainable business practices.
Additionally, growing awareness among consumers and investors about corporate social responsibility is pushing companies to integrate ESG factors into their strategic decision making. A major trend shaping the market is the integration of advanced analytics and AI within ESG platforms, enabling deeper insights into sustainability performance, risk management, and scenario planning.
Recent Developments in ESG Software Market
In January 2024, Osapiens, a German-Spanish ESG tech startup, announced its expansion into the U.S. market with plans to open a New York office and pursue acquisitions. Supported by a $120 million Series B round led by Goldman Sachs Growth Equity, the move involves strategic collaborations aimed at localizing ESG software solutions for North American regulations. Osapiens doubled its customer base and revenue in 2024, signaling rapid growth.
In April 2024, UK-based investment firm Redwheel completed its acquisition of Ecofin, a sustainability-focused boutique managing $1.4 billion in assets. The acquisition enhances Redwheel’s ESG investment capabilities, allowing the firm to offer more comprehensive sustainable investment strategies in energy transition, biodiversity, and clean technologies. Ecofin was previously part of Tortoise Capital Advisors.
In June 2024, Wolters Kluwer N.V. launched CCH Tagetik ESG & Sustainability for Carbon Emissions, a new solution designed to assist companies in reporting and disclosing direct and indirect carbon emissions, including Scope 3 emissions. This initiative aims to help organizations comply with the Corporate Sustainability Reporting Directive (CSRD). The updated offering integrates pre-configured carbon data management capabilities based on the GHG protocol, the globally recognized standards for greenhouse gas accounting.
Major Hurdles for the ESG Software Market
The ESG software market faces several critical challenges that could hinder widespread adoption:
Lack of Standardized Reporting Frameworks: It’s difficult for organizations to accurately measure and benchmark sustainability performance across industries and regions due to the absence of consistent ESG reporting standards.
Data Fragmentation: Companies often struggle with inconsistencies and inefficient reporting because ESG data must be gathered from diverse sources, including internal systems, supply chains, and third-party providers.
Limited Technical Expertise/Resources (SMEs): Many businesses, particularly small and medium-sized enterprises, lack the necessary technical expertise or resources to implement and maintain sophisticated ESG software solutions effectively.
Competitive Landscape:
The ESG software market is witnessing heightened competition as established tech firms, niche software providers, and emerging startups strive to differentiate through innovation, scalability, and regulatory alignment. In a notable 2024 example, Osapiens, a fast-growing ESG software provider based in Germany and Spain, announced a strategic collaboration with global investors including Goldman Sachs Growth Equity. As part of its $120 million Series B funding round in January 2024, Osapiens expanded its international footprint by establishing a US office and initiating acquisition plans.
