How to Evaluate the Best Sustainability Reporting Tool or Platform for Your Organization - Last Updated: January 2, 2024

Today, most companies have committed to improving their sustainability performance and disclosures to meet growing transparency demands from investors, regulators, and customers. As a result, annual sustainability reporting has become a practice that's increasingly being done with specialized sustainability reporting and carbon accounting software instead of spreadsheets or generic file management systems.

What is Sustainability Reporting? A Quick Definition

Sustainability reporting, depending on how it's defined, can focus on environmental reporting and carbon emissions disclosure, or encompass all of a company's three ESG areas: environmental sustainability, social sustainability, and governance

A sustainability report is a communication and disclosure tool designed to increase corporate transparency about an organization’s sustainability performance, risks, and opportunities. Some sustainability reports strictly focus on environmental topics like emissions, climate action, and biodiversity impacts. Others sometimes also cover "social sustainability" information like employee diversity, health and safety, and other ESG KPIs. Sustainability reports should be clear, data-driven (rather than vague, anecdotal, or solely qualitative), authentic (not “greenwashing,” spin, or misrepresentation), and tell a clear story about how the company is pursuing better sustainability outcomes for its customers, stakeholders, and the planet, backed by evidence.

Sustainability reports are typically published by the sustainability, ESG, investor relations, or corporate affairs department of a company, and creating sustainability reports is a collaborative, cross-functional effort.

In most countries, sustainability reports are voluntary, not mandatory. However, recent 2023 and 2024 legal changes, announcements, and impending mandates in the United States, Canada, European Union (EU), United Kingdom, Singapore, Australia, and other regions are creating stricter disclosure obligations for many types or organizations - particularly publicly-listed companies - to measure, report, and disclose their sustainability performance.

Moreover, many investors and large companies - including Walmart, Disney, Nike, and Amazon - are increasingly asking their investments, vendors, suppliers, and partners to submit sustainability assessments and disclosures. Employees, customers, and communities are also increasingly likely to advocate for larger and more impactful sustainability commitments and climate action from companies.

Why Use Sustainability Reporting Software?

Sustainability reporting can be a complex process, particularly for larger enterprise businesses, as well as organizations who use the broad definition of "social sustainability." For a lot of the same reasons why it's better to use dedicated accounting software like Quickbooks or Oracle Netsuite to produce corporate financial reports like a 10-K, manual and spreadsheet-based sustainability reporting, carbon accounting, and data management is error-prone, inefficient, and has major visibility, collaboration, accuracy, and governance issues. It also just takes a lot more time.

Given that sustainability disclosure requirements are being written into everything from upcoming SEC regulation to procurement contracts in 2024, this is information that needs to be accurate, consistent, structured, and easy to access - and shouldn't tie up all your time to collect and communicate.

Moreover, sustainability reporting is a recurring annual obligation. It's much more efficient to use a system that's purpose-built for auditing, archiving, historical comparison, and benchmarking.

Brightest's integrated, all-in-one sustainability reporting platform

The Best Sustainability Reporting Software Platform in 2024

Given the nature of our work, we get asked questions like "what's the best sustainability reporting software" a lot. And, our honest answer is, there is no best solution overall. What really matters is what's the best solution for your organization and needs. The best solution for one company may not be the right answer for another.

So instead of trying to rank specific tools and brands, we thought it would be more helpful to share the evaluation framework we recommend companies consider when they're considering carbon accounting tools, or developing RFP or RFI requirements for a sustainability reporting platform.

For sustainability technology buyers, researchers, and analysts, consider these seven criteria to determine what the best ESG reporting software is for your organization:

Let's walk through each one:

1. Organization Size and Sustainability Reporting Scope

A global, enterprise brand has very different sustainability reporting needs and complexities compared to a small or medium business (SME). Smaller organizations need an easy-to-use, automated, lower-cost solution that can likely be used by one or two administrators to share data with larger customers and answer questionnaires. By comparison, global organizations have larger teams and more resources, but also require enterprise workflow and governance support, sustainability report audit and approval workflows, data quality controls, strict IT security, and comprehensive account management.

Be sure to consider:

2. Value Chain Type

Generally, there are five value chain archetypes or organizational structures when it comes to sustainability reporting:

Many sustainability reporting tools focus or specialize their product in specific industries, value chain types, or company sizes. Make sure to understand which use case(s) and sector(s) a sustainability reporting vendor serves through their website, case studies, client testimonials, and product roadmap.

3. Primary Sustainability Reporting Problem or Use Case

This is another area where it's important to be clear (internally) what your top priorities and criteria are. These can include:

While Brightest and many other sustainability platforms offer "all-in-one" solutions, by necessity every vendor has to prioritize and focus on specific capabilities at the expense of others. What's most important to your organization? What priority workflows do you want to set up first?

Make sure your specific needs and priorities align with the strengths of the sustainability solution(s) you evaluate.

4. Internal Team and Technical Resources

It's always good to be honest in self-assessing your own internal capacity and ability to integrate a sustainability reporting platform. This includes:

Different sustainability reporting software tools and platforms require different internal commitment levels and resourcing. They also offer different levels of ongoing support and service tiers. Be sure to discuss and understand this during your evaluation.

5. Other Sustainability Support Resources

After you assess your internal capacity and sustainability reporting expertise, you may decide you need additional external support. Will that come from the sustainability platform provider? Do you need to hire specialist consultants to support your ongoing deployment, data collection, and/or reporting? Make sure you adequately resource this project for success.

For example, during Brightest implementations, we frequently consult with our clients on their emissions factor needs and desired sustainability reporting frameworks to make sure they have the right, customized carbon accounting and sustainability reporting configuration to match their industry, business model, and value chain.

Do you need that type of help from your vendor? If so, discuss it with them up front and include that in your screening criteria.

6. Org Structure and Sustainability Data Collaboration

As we've written before, your organization structure is another important variable in selecting the right sustainability reporting technology for your company. Where does your sustainability data live today? Spreadsheets? Other software tools? Do you need to conduct surveys? Do you need help from other departments and stakeholders in the organization to collect specific data? What about supplier and value chain engagement?

Most organizations don't focus enough on developing sustainability data collection workflows. Think about what's most needed in your organization, look for opportunities to improve, and engage your sustainability reporting partners on best practices and ways they can support this.

Brightest automates sustainability data collection from different departments, sources, and systems, including integrations, spreadsheets, and surveys

7. Sustainability Reporting Software Compliance, Audit & IT Security Needs

If you operate in a region with higher levels of sustainability and environmental regulation like the European Union (EU), are a publicly listed firm, or work in a regulated industry like healthcare or finance, your organization will need a sustainability reporting solution that supports capabilities like:

In addition to other strong compliance and security controls. Make sure to work with your IT business partners to evaluate the security and controls of your sustainability solution provider.

Another related capability to consider is the depth of greenhouse gas (GHG) emissions reporting. Most companies perform carbon accounting as an input into their broader sustainability reporting. Does your sustainability reporting platform offer integrated, in-depth carbon accounting and emissions measurement? Or does that require an integration or add-on with one or more separate vendors? What are the costs and workflows for that type of solution?

It can be helpful to identify a sustainability reporting platform that also streamlines and supports your firm's carbon tracking and climate reporting efforts.

Your Next Steps with Sustainability Reporting Software

Hopefully this guide has shared some helpful questions you can use to determine the best partner to meet your sustainability reporting needs and support you on your ESG journey. And, of course, be sure to also consider important vendor intangibles like honesty, expertise, business ethics, and the quality of the relationship. Look for sustainability technology partners who are truly invested in supporting you and your organization.

These relationship aspects really matter.

And finally, a word of caution. Given the sustainability software space is so new, there's a lot of hype and marketing around it. Ultimately, every company does marketing (including us), and it's expected companies will try to position themselves in the best light. That said, be wary of buzzwords and marketing lingo like "Artificial Intelligence (AI)" and ask thoughtful questions. What does this AI actually do? Is it going assist me with a priority need or workflow?

Most modern software companies (including us) use AI and machine learning - the important question is 'why' and how does it actually help you? Is it essential to your success with the platform, or a nice-to-have?

Similarly, does the product actually exist and work the way it's being demonstrated? Is it in use by companies? Or are you being shown a demo environment that isn't actually in production and widespread use?

Above all, we wish you all the best as you continue ahead with your sustainability roadmap. If we can be helpful at all (at any step in your process), please get in touch. A central part of our mission and work here at Brightest is enabling better data-driven decision-making (and actions) that lead to a better future for us all.