With 2023 carbon inventories complete, sustainability remains top-of-mind for American businesses in 2024. Faced with increasing societal expectations and regulatory climate disclosure requirements, companies are under mounting pressure to accurately measure, transparently report, and proactively reduce their carbon emissions.
Carbon accounting has always been complex and time-consuming. Still, the level of detail, data collection, and breadth of emissions sources involved in carbon reporting has made this exercise more intensive and demanding over time. Scope 1 and 2 emissions used to be enough. Those are table stakes now. Detailed, 15-category scope 3 emissions calculations are the new norm.
To ease the demand on resources, many modern businesses are switching to carbon accounting software capable of automating these intensive data collection, analysis, and carbon reporting tasks.
Currently, there are dozens of carbon accounting platforms on the market. But what is the best carbon accounting software for your company? Read on as we spotlight the top eight options.
What is carbon accounting?
Carbon accounting is the practice of measuring and analyzing a business’ direct, purchased, and indirect greenhouse gas (GHG) emissions. It operates similarly to financial accounting, but rather than focusing on financial impact, it considers climate change impact by measuring total GHG emissions and the source of those direct and indirect emissions.
While given the simple moniker of “carbon accounting,” several other GHGs—known as the Kyoto basket—are included in this calculation, including methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorochemicals (PFCs), nitrogen trifluoride (NF3), and sulfur hexafluoride (SF6).
While this has historically been done on a voluntary basis, recent regulatory actions—such as the SEC’s proposed climate change disclosure rule or the EU’s Sustainable Finance Disclosure Regulation (SFDR)—have sought to standardize the disclosure of GHG metrics across all publicly traded companies. And outside of regulatory mandates, both customers and supply chain investors have begun demanding that companies provide their emissions data.
By measuring annual emissions and changes over time, companies can:
- Gain a clearer understanding of their total environmental impact
- Identify opportunities for value accretive projects
- Stay compliant with prevailing regulations
- Minimize organizational risk, especially climate-related risks
- Provide investors with the data they need for a more informed decision-making process
- Prevent greenwashing
- Build brand equity
- Reduce business inefficiencies
- Promote sustainability
Key features to look for in carbon accounting software
What features should you look for to find the best carbon accounting software for your organization?
When evaluating your options, consider the following features and elements:
- Ease of integration – Any new piece of software should solve more problems than it causes. The top options will provide seamless integrations with other legacy accounting systems and applications so you can hit the ground running.
- Dynamic scope 1, 2, and 3 emissions calculations – Seeing as GHG emissions measurement will take up a significant portion of an organization’s carbon accounting efforts, a platform should be able to calculate their scope 1, 2, and 3 emissions in real-time, then convert those outputs into CO2 equivalents (CO2e).
- Data gathering and centralization – Software should be able to provide multiple ways to input gathered data, depending on the internal processes available at your company. It should also centralize and analyze emissions data into a central location, providing an audit trail of documents, notes, and tags. When it comes time to disclose company emissions, having your data in one place, along with an audit trail of document uploads, notes, and customizable tags, saves time and money. Along with environmental and ESG data, energy consumption, and GHG emissions, look for flexible dashboards and insights by location, team, and emission scope.
- Tracking – Underlying data used to calculate emissions typically comes from dozens, if not hundreds of disparate sources. Companies need to be able to track their emissions across different facilities and locations, month-to-month and year-over-year. And, for an accurate picture of scope 3 emissions, tracking will need to cover the entire supply chain.
- Ease of use – Even with powerful capabilities, the software should be user-friendly and intuitive, free from long training and set-up times. Companies—especially those new to carbon accounting—may need guidance to understand how their business activities impact emissions and how to reduce those emissions. Good sustainability platforms should also educate and engage stakeholders with insights into priorities and progress.
- Time to implement – The best time to start tracking your emissions data and energy consumption was yesterday. The faster the software can start running calculations and providing actionable insights, the better.
- Cost – Carbon accounting software can range from thousands of dollars to hundreds of thousands of dollars for enterprise solutions. You should look for a solution that is affordable yet able to scale your business.
- Compliant and up-to-date – Software should be aligned with the latest industry-leading guidance and maintain the most recent emissions factors, so you can be prepared for regulatory disclosures or third-party assessments.
- Forecasting abilities – Software should empower users to not just look backward but also forecast future emissions or conduct scenario analysis to highlight opportunities for optimization.
- Customer support – Software providers should provide comprehensive customer support so that users can maximize the value of the carbon accounting software.
- Tech-enabled – Many software providers claim to be SaaS platforms when, in truth, they’re mostly reliant on consultants to support their software offerings. The ideal platform should function on its own merits.
8 best carbon accounting software platforms
Looking for the best software to meet your organization’s specific carbon accounting needs and goals? Here are the top eight options on the market:
1. Sustain.Life
Sustain. Life’s tech-enabled platform seeks to simplify the process of helping the planet while improving your company’s bottom line. This comprehensive sustainability management software helps businesses measure their environmental data, manage their carbon emissions, and streamline sustainability reporting.
Benefits include:
- 3000+ emissions factors in the U.S. and abroad
- Powerful automated scope 1, 2, and 3 emissions tracking and carbon calculators to help with carbon and GHG emissions reduction
- Automated supplier surveys to gain insight into scope 3 emissions
- Customized emissions reduction plans based on your carbon footprint
- An easy-to-use interface that allows for quick adoption, traction, and ongoing engagement
- Cutting-edge tech and up-to-date methodologies
- Data quality and anomaly detection
Through the Sustain.Life platform, you’ll be able to input the relevant data and manage your sustainability programs internally.
2. Normative
Normative styles itself as a carbon accounting engine. A new cloud-based software, it can help businesses, both large and small, standardize and automate carbon accounting processes by providing GHG and environmental hotspot analysis, among other actionable insights.
Because it’s a relatively new product, it may be lacking in certain features that more established carbon accounting software can provide. Similarly, some users complain of slow load times. That said, the overall response to this platform has been largely positive.
3. Greenly
A France-based carbon accounting company, Greenly provides emissions measurement and mitigation solutions for SMBs, especially those in Europe. To that end, it automates and integrates data analysis with third-party solutions while helping design personalized strategies businesses can deploy to reduce their greenhouse gas emissions.
While it provides many of the baseline functions necessary from carbon accounting software—such as automatic scope 1, 2, and 3 emissions calculations—the program is limited in scalability and caters primarily to a European audience.
4. Sinai Technologies
Sinai focuses most of its capabilities on decarbonization modeling and planning. Equipped with this platform, users can reduce emissions, meet milestones, and gain a better understanding of their operational activities.
However, Sinai is not an all-in-one carbon accounting solution—it lacks many of the features, integrations, and tools that a growing company may need, especially if they don’t already have an established carbon emissions-reducing model in place.
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5. Sweep
Sweep, another French company, is an emerging carbon management tool that seeks to help large-scale companies measure their scope 3 emissions. Its regulatory-compliant trackers show where a business is on its path to net-zero while highlighting actions it can take to stay on course.
Sweep provides the essentials a business might need but lacks many of the emissions management bells and whistles that other accounts offer, such as advanced carbon reporting or sustainability experience. As a result, it offers limited scalability.
6. Microsoft Sustainability Cloud
Microsoft Sustainability Cloud is a long-awaited extension of its existing sustainable services. This program empowers companies to document, report, and, ideally, reduce a company’s carbon footprint via automated data analysis and actionable insights.
While it comes backed by Microsoft’s powerful carbon analytics and feature capabilities, ease of use and integrations tend to be lacking. It’s not just focused on carbon dioxide emissions, but the entire spectrum of ESG. As a result, it may be too broad in its service offering for many companies that are singularly focused on sustainability.
7. Watershed
Watershed is a carbon accounting software that provides businesses with a platform to measure, report, and reduce their carbon emissions. Its features include vendor data management, investor-grade reporting, benchmarking, customizable dashboards, and progress tracking.
Watershed is heavily reliant on back-end manual services. As a result, it also runs into the same scalability problems as many of the other carbon accounting software.
8. Persefoni
Persefoni is considered to be one of the leading carbon accounting software for enterprise businesses, providing financial and corporate sustainability reporting, accounting, and carbon accounting services. Aside from its well-regarded platform, Persefoni is also known for its relationships and partnerships within the sustainability space, both in the U.S. and abroad.
This software works well with large enterprises, though it’s likely too expensive for a small to medium-sized business.
Carbon accounting software for your growing business
Today, there are dozens of carbon accounting software platforms growing businesses can leverage to enhance their carbon accounting and carbon reporting capabilities. Most of these platforms will provide free demos that allow you to take them for a spin before committing to a final purchase.
As you shop around, remember to look for a platform that’s user-friendly, affordable, data-driven, and offers advanced features that can scale alongside your business. For that, there’s Sustain.Life.
Want to try it for yourself? Reach out for a demo today.
Sources
1. UNFCCC, “Kyoto Protocol - Targets for the first commitment period,” https://unfccc.int/process-and-meetings/the-kyoto-protocol/what-is-the-kyoto-protocol/kyoto-protocol-targets-for-the-first-commitment-period Accessed May 16, 2024
