Top 10 ESG Investment Opportunities in 2026
LONDON, January 31, 2026 — As the global ESG market continues to evolve, emerging technologies are playing a pivotal role in driving sustainable business practices. This article explores the top 10 ESG companies revolutionizing the sector through innovative solutions in AI, blockchain, and carbon tracking for real-time reporting and supply chain transparency.
Sarah covers AI, automotive technology, gaming, robotics, quantum computing, and genetics. Experienced technology journalist covering emerging technologies and market trends.
Executive Summary
LONDON, January 31, 2026 — As environmental, social, and governance (ESG) factors become integral to corporate strategies, innovative startups are leveraging cutting-edge technology to deliver solutions that enhance sustainability across industries. The global ESG investing market reached $33.64 trillion in 2024 and is projected to exceed $125 trillion by 2032 at an 18.1% CAGR, driven by advancements in AI-driven monitoring and blockchain transparency. This analysis profiles the top 10 ESG technology companies founded between 2021-2023 that are reshaping compliance, carbon accounting, and supply chain management.
Key Insights Overview
- Carbon accounting startups raised approximately €270 million in 2024, up from €178 million in 2023
- AI-driven platforms are pivotal for real-time ESG compliance and monitoring, with solutions segment commanding 69% market share
- Blockchain technology is revolutionising supply chain transparency, ensuring ethical sourcing and traceability
- The EU Corporate Sustainability Reporting Directive (CSRD) affects 50,000+ companies, creating massive compliance demand
- Nearly 70% of institutional investors remain committed to sustainability integration despite political headwinds
Expert Perspectives
"Corporate sustainability reached a turning point in 2025 — shifting from market differentiator to core value driver," noted analysts at Verdani Partners. "Sustainability has moved beyond an outward-facing, commitment-driven stage into a more mature phase defined by deeper operational integration."
According to the US SIF 2025 Trends Report, the current environment represents "recalibration rather than retreat" — investors adapt language and protocols but remain committed to integrating sustainability as a financial materiality issue.
S&P Global observes that "the question is how organizations can advance their sustainability strategies while navigating an increasingly fragmented world where the rules of engagement are changing."
Trend Analysis
| Rank | Trend | Adoption Rate | Industry Impact | Key Example Company |
|---|---|---|---|---|
| 1 | AI-Augmented ESG Monitoring | High (69% market share) | Compliance and Reporting Enhancement | Persefoni, Climatta |
| 2 | Blockchain for Supply Chain | Moderate | Supply Chain Transparency | Safeflows |
| 3 | Scope 3 Carbon Accounting | Growing rapidly | Full Value Chain Emissions Tracking | Carbonfact, Sumday |
Leading ESG software platforms like Persefoni (which raised $179 million total including a $23 million extension in March 2025) are integrating AI to provide real-time emissions analysis. The shift towards circular economies is accelerating as companies transition from traditional dispose-and-replace models to sustainable product lifecycle management.
Top 10 ESG Companies Founded 2021-2023
1. Persefoni
Persefoni, founded in 2019 and headquartered in the United States, operates the Climate Management and Accounting Platform (CMAP) serving enterprise clients across financial services, manufacturing, and technology sectors. The company has raised $179 million in total funding, including a $50 million Series B in August 2023 and $23 million extension in March 2025. Key investors include TPG Rise, Prelude Ventures, and NGP Energy. Persefoni's platform features PersefoniGPT, an AI-powered assistant that automates emissions factor matching and regulatory compliance workflows, serving clients including major asset managers and Fortune 500 companies.
2. Watershed
Watershed, founded in San Francisco in 2019, provides enterprise carbon accounting covering carbon, water, and waste metrics alongside a carbon marketplace for offset procurement. The company raised $100 million in Series C funding in February 2024, bringing total funding to $170 million. Investors include Kleiner Perkins and Sequoia Capital. Watershed's platform is used by major enterprises including Stripe, Airbnb, and Shopify to measure, report, and reduce their environmental footprint across all three emission scopes.
3. Fortifai
Fortifai, founded in Oslo, Norway in 2023, offers an ESG compliance platform specifically tailored for small and medium enterprises (SMEs), addressing a critical gap where smaller businesses struggle with complex regulatory requirements. The company secured €1.7 million in seed funding in 2023 from Sure Valley Ventures, Midwich Ignite, and Focal. Fortifai's platform simplifies CSRD and ESRS compliance for SMEs that lack dedicated sustainability teams, providing automated reporting workflows and regulatory guidance in accessible formats.
4. Climatta
Climatta, founded in 2023, has emerged as a leader in AI-driven ESG software with a focus on real-time utility monitoring and automated emissions tracking. The platform enables companies to actively manage energy consumption patterns, identify efficiency opportunities, and reduce emissions. Climatta's technology integrates directly with building management systems and utility providers to provide granular visibility into Scope 1 and 2 emissions, supporting clients in manufacturing, commercial real estate, and hospitality sectors.
5. Safeflows
Safeflows, launched in 2023, uses blockchain technology and smart contracts to create verifiable, tamper-proof records within supply chains. The platform addresses growing demand for ethical sourcing verification, enabling companies to demonstrate compliance with due diligence requirements under regulations like the EU Corporate Sustainability Due Diligence Directive. Safeflows' technology is particularly valuable for industries with complex multi-tier supply chains including fashion, electronics, and food production.
6. Carbonfact
Carbonfact, founded in Paris in 2021, operates a carbon management platform designed specifically for the fashion industry, one of the world's most carbon-intensive sectors. The company raised $15 million in Series A funding in April 2024 from Alven, Headline, and Y Combinator. Carbonfact's platform enables fashion brands to measure product-level carbon footprints, comply with EU textile regulations, and identify reduction opportunities across materials, manufacturing, and logistics.
7. Sumday
Sumday, founded in Tasmania, Australia in 2023, provides accessible carbon accounting software specifically designed for small and medium businesses that lack sustainability expertise. The company raised AUD $5.3 million in seed funding in 2024 from Planeteer Capital, Blackbird Ventures, and Wedgetail. Sumday's platform automates emissions calculations from business data, generates regulatory-compliant reports, and provides actionable recommendations tailored to SMB budgets and capabilities.
8. LoneReport
LoneReport, founded in 2023, positions itself as a comprehensive ESG reporting platform that integrates multiple data sources to provide unified sustainability insights. The platform serves companies transitioning from spreadsheet-based ESG tracking to automated reporting systems, offering pre-built templates aligned with GRI, SASB, and TCFD frameworks. LoneReport's integration capabilities enable seamless data collection from ERP systems, building management platforms, and third-party ESG data providers.
9. Daycisiv
Daycisiv, founded in 2023, focuses on AI-driven supply chain risk assessment with particular emphasis on ESG factors. The platform identifies and quantifies risks associated with supplier environmental practices, labour conditions, and governance standards, enabling procurement teams to make informed sourcing decisions. Daycisiv's technology supports companies in building resilient, sustainable supply chains aligned with emerging due diligence regulations and investor expectations.
10. AgroRisk
AgroRisk, founded in 2023, operates a climate risk SaaS platform specifically for the agriculture sector, helping agribusinesses assess physical climate risks to operations and supply chains. The platform combines climate modelling with agronomic data to provide location-specific risk assessments, enabling farmers and food companies to adapt production strategies, optimise insurance coverage, and communicate climate resilience to investors and customers.
Market Size Forecasts
| Research Firm | Market Segment | 2024 Size | 2030 Forecast | CAGR | Source |
|---|---|---|---|---|---|
| Fortune Business Insights | ESG Investing | $33.64 trillion | $125.17 trillion (2032) | 18.1% | View Report |
| Grand View Research | ESG Investing | $28.36 trillion | $79.71 trillion | 18.8% | View Report |
| MarketsandMarkets | ESG Advisory | $15.62 billion | $59.59 billion | 25.0% | View Report |
| Mordor Intelligence | ESG Software | $4.10 billion | $8.90 billion | 16.9% | View Report |
Why This Matters for Stakeholders
The rising emphasis on ESG presents significant opportunities and risks for stakeholders. According to Clarkston Consulting, 89% of investors now consider ESG issues in some form as part of their investment approach, while 82% of consumers say brand values should reflect their own.
For enterprises, alignment with sustainable practices leads to enhanced brand value, operational efficiencies, and reduced capital costs — 50.1% of investors report that companies with higher ESG scores experience lower financing costs. For investors, ESG-focused opportunities promise both financial returns and portfolio risk mitigation, particularly as climate-related events are expected to cost suppliers $1.3 trillion by 2026.
Forward Outlook
Looking ahead, mandatory disclosure regimes will accelerate ESG adoption globally. The EU CSRD requires first reports in 2025/2026, while ISSB standards have been adopted across 40 jurisdictions covering nearly 60% of global GDP. Latham and Watkins notes that "business and legal leaders who successfully disentangle economic, political, and legal risk with clear strategic focus will be best positioned to capitalise on ESG imperatives."
The Harvard Law Forum observes that "companies, investors, and asset holders will need to remain agile and informed" as ESG regulation continues to evolve. Nature and biodiversity are emerging as the next frontier after climate, with ISSB developing a global nature standard expected by October 2026.
References
- ESG Investing Market Size, Share and Growth Report 2025-2032 - Fortune Business Insights
- ESG Investing Market Size and Growth Report 2030 - Grand View Research
- ESG Advisory Market Size, Share and Industry Analysis 2030 - MarketsandMarkets
- ESG Software Market Size, Growth Drivers and Trends 2030 - Mordor Intelligence
- Persefoni Raises $23 Million - ESG Today, March 2025
- Carbonfact Carbon Management Platform for Fashion - TechCrunch, April 2024
- 2026 Sustainability Trends: 10 Signals Defining the ESG Implementation Era - Verdani Partners
- US Sustainable Investing Trends 2025-2026 - US SIF
- Top 10 Sustainability Trends to Watch in 2025 - S&P Global
- ESG and Sustainability Insights: 10 Things Top of Mind - Harvard Law Forum
- ESG and Sustainability Insights 2026 - Latham and Watkins
- 5 ESG Trends That Will Shape Business in 2026 - Forbes, Bernard Marr
About the Author
Sarah Chen
AI & Automotive Technology Editor
Sarah covers AI, automotive technology, gaming, robotics, quantum computing, and genetics. Experienced technology journalist covering emerging technologies and market trends.
Frequently Asked Questions
What is the projected size of the global ESG investing market by 2030?
According to Fortune Business Insights, the global ESG investing market was valued at $33.64 trillion in 2024 and is projected to reach $125.17 trillion by 2032, growing at an 18.1% CAGR. Grand View Research provides a more conservative estimate of $79.71 trillion by 2030 at an 18.8% CAGR. The ESG advisory services segment shows even faster growth, with MarketsandMarkets forecasting expansion from $15.62 billion to $59.59 billion by 2030 at a 25% CAGR.
How is AI technology transforming ESG compliance and carbon accounting?
AI-driven platforms now dominate the ESG software market with a 69% market share for solutions-based offerings. Companies like Persefoni ($179 million total funding) use AI to automate emissions factor matching and generate regulatory-compliant reports. Carbonfact, backed by Y Combinator with $15 million in Series A funding, applies AI to calculate product-level carbon footprints in the fashion industry. These technologies reduce the time and expertise required for compliance, making ESG reporting accessible to mid-market companies facing CSRD and ISSB requirements.
What regulatory changes are driving ESG software adoption in 2026?
The EU Corporate Sustainability Reporting Directive (CSRD) affects over 50,000 companies, requiring standardised sustainability disclosures starting in 2025-2026. Additionally, the International Sustainability Standards Board (ISSB) standards have been adopted across 40 jurisdictions covering nearly 60% of global GDP. According to Latham and Watkins, these mandatory disclosure regimes are shifting ESG from voluntary initiatives to compliance requirements, creating significant demand for software platforms that automate data collection and reporting workflows.
Which ESG software startups have raised the most funding recently?
Persefoni leads with $179 million in total funding including a $23 million extension in March 2025, serving enterprise clients with its Climate Management and Accounting Platform. Watershed raised $100 million in Series C funding in February 2024, bringing total funding to $170 million, with investors including Kleiner Perkins and Sequoia Capital. Carbonfact secured $15 million in Series A funding in April 2024 from Alven and Y Combinator. Collectively, carbon accounting startups raised approximately €270 million in 2024, up from €178 million in 2023.
Why are investors maintaining commitment to ESG despite political headwinds?
According to the US SIF 2025 Trends Report, nearly 70% of institutional investors remain committed to sustainability integration, characterising the current environment as recalibration rather than retreat. Clarkston Consulting research shows 89% of investors consider ESG issues in their investment approach. The financial rationale remains compelling: 50.1% of investors report that companies with higher ESG scores experience lower capital costs, while climate-related events are expected to cost suppliers $1.3 trillion by 2026, making ESG risk assessment a financial necessity rather than optional consideration.
