NEW YORK, November 21, 2023 /PRNewswire/ — Growing awareness of sustainability and the threat of a 1.5°C global temperature rise is leading to strategic shifts among governments and organizations. Companies are adopting carbon management tools to address the potential 18% GDP loss due to climate change by 2050. These tools, used to calculate, manage, monitor and report emissions, help measure operational emissions across the supply chain. This was reported by the global technology intelligence agency ABI researchThe carbon management software market is expected to grow at a CAGR of 19.7% $5.5 billion by 2032.
Scope 3 emissions, which can be 5 to 25 times higher than Scope 1 and Scope 2 emissions, make up up to 90% of the total environmental impact, according to the Carbon Disclosure Project (CDP). Accurate measurement of Scope 3 emissions is critical for companies to increase resilience and efficiency across the supply chain. “Only what is measured can be managed. Taking responsibility for carbon emissions is the first step toward mitigating catastrophic climate-related disasters. Accurately measuring Scope 3 emissions provides invaluable insights that will enable organizations to increase resilience and efficiency across the entire supply chain. -resilient the business and safeguard the value chain from climate-related financial threats,” explains Rithika Thomas, Sustainable Technology Analyst at ABI Research.
The carbon management market is shifting from voluntary to mandatory reporting due to regulations, increased awareness of climate change, digitalization of production, pressure from customers and investors, and the drive for transparency for competitive advantage. Legacy suppliers of Environmental, Social and Governance (ESG) software such as Enablon, Ipoint and Sphera dominate in Europe And North America. However, small and medium-sized enterprises (SMEs) and startups such as APlanet, Figbytes, Persefoni, NET0, Normative and Watershed compete fiercely by using data analytics, artificial intelligence, automation and predictive analytics to comply with regulations and expand their customer base to expand.
Currently, the sustainability software market is a mixed bag with overlapping features and functionality with ESG, carbon management, smart building management, life cycle assessment and related sustainability features. According to Thomas: “As the global carbon management market matures, Europe And North America will dominate the next five years as innovators and early adopters. As international and country-specific policies stabilize, there will be a significant shift in growth among the world’s software vendors and user base after 2026. Asiatic-Pacific and emerging markets.”
A robust ecosystem will develop around carbon software tools with specific expert solutions for each reporting aspect to address credibility, accuracy and auditability. Software developers must focus their efforts on automating calculations, building industry-specific solutions with data guarantees, and integrating AI and predictive capabilities to create value with actionable insights so that end users can truly thrive in today’s fragmented landscape. As forward-thinking companies and larger enterprises widely adopt carbon management tools, long-term strategic sustainability goals are becoming clearer with tangible short-term data,” concludes Thomas.
These findings come from the analysis report The Market for Sustainability Software Solutions Addressing ESG Reporting, Carbon Management, Building Operation and Product Design from ABI Research. This report is part of the company’s sustainability software market research service, which includes research, data and ABI Insights. Based on extensive primary interviews, Application Analysis reports present an in-depth analysis of key market trends and drivers for a specific application, which can focus on an individual market or geography.
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SOURCE ABI Research