South & Central America Investor ESG Software Market Size and Forecast (2021 - 2031), Regional Share, Trend, and Growth Opportunity Analysis Report Coverage: By Component [Software and Services (Training, Integration, and Other Services)] and Enterprise S
Description
The South and Central America investor ESG (Environmental, Social, and Governance) software market is projected to grow significantly, reaching an estimated US$ 103.43 million by 2031, up from US$ 39.49 million in 2024. This growth represents a compound annual growth rate (CAGR) of 14.7% from 2024 to 2031.
Executive Summary and Market Analysis
The expansion of the investor ESG software market in South and Central America is primarily driven by increasing concerns regarding climate risks, particularly in key sectors such as agriculture, mining, and energy. Companies in these industries are increasingly adopting ESG software to identify and address climate-related challenges, thereby mitigating their operational impacts. As businesses in the region strive to align with global sustainability trends, ESG software becomes essential for assessing and monitoring climate-related risks. This enables informed decision-making, strategic development, and the implementation of measures aimed at reducing carbon footprints and enhancing overall sustainability performance.
According to AXA Investment Managers, several Latin American countries have set ambitious renewable energy goals. For example, Colombia aims to conserve 30% of its land, reduce greenhouse gas emissions by 51% by 2030, and achieve carbon neutrality by 2050. Similarly, Chile is committed to carbon neutrality by 2050, with plans to phase out numerous thermal power plants by 2040 and transition major mining companies, such as BHP and Anglo American, to renewable energy sources. These proactive initiatives are expected to drive substantial growth in the investor ESG software market as businesses seek tools to track and report their sustainability performance in line with evolving regulations and investor expectations.
Strategic Insights
Market Segmentation Analysis
The South and Central America investor ESG software market can be segmented based on components and enterprise size. The market is divided into two main components: software and services. In 2024, the software segment held a larger market share, while the services segment is further divided into training, integration, and other services. Additionally, the market is categorized by enterprise size into large enterprises and small to medium-sized enterprises (SMEs), with large enterprises holding a more significant share in 2024.
Market Outlook
The integration of generative AI into investor ESG software is anticipated to introduce new trends in the market in the coming years. Generative AI enables investors to access, analyze, and interpret ESG data more effectively. This technology is poised to enhance ESG data analysis, reporting, and decision-making processes significantly. One of the key advantages of incorporating generative AI into ESG software is its ability to automate the creation of complex ESG reports. By quickly analyzing vast amounts of ESG data from diverse sources, generative AI can generate tailored and insightful reports for investors, including standard metrics and predictive analyses that identify emerging risks, opportunities, or trends in ESG performance. This automation not only saves time but also ensures that reports are accurate and comprehensive.
The advancements brought by generative AI in ESG software will lead to improved data accuracy, reporting efficiency, and predictive analytics. For instance, in July 2024, CO2 AI, a Paris-based sustainability platform, launched a generative AI-powered solution called Product Footprinting, designed to help companies compute product carbon emissions and reduce their environmental impact. This platform aims to assist large organizations in evaluating their impact and identifying levers to reduce it at scale, leveraging artificial intelligence. According to CO2 AI, the new solution addresses the need for more precise and rapid product carbon footprinting, as only 38% of companies receive adequate product-level data from suppliers. Similarly, in April 2024, Infor, a leader in industry cloud solutions, introduced Infor GenAI and ESG Reporting, aimed at enhancing productivity and tracking environmental impacts for customers across various sectors, including manufacturing and healthcare. By combining generative AI with industry-specific capabilities, these solutions enable customers to efficiently harness data and workflows, accelerating value realization while adhering to strict security and data privacy standards.
Country Insights
The South and Central America investor ESG software market includes key countries such as Brazil, Argentina, and other nations in the region. Brazil accounted for the largest market share in 2024, driven by its robust manufacturing sectors, including steel, food and beverage, telecommunications, pharmaceuticals, chemicals, and construction. These industries are increasingly focused on adopting sustainable strategies to meet their sustainability objectives, attracting global players to expand their operations in Brazil. For instance, in February 2023, Vela Software International Inc. acquired Nexo CS to enhance its ESG portfolio in Brazil, enabling customers to manage and organize large volumes of ESG-related data effectively.
Company Profiles
Key players in the South and Central America investor ESG software market include MSCI Inc., Workiva, Inc., London Stock Exchange Group Plc, Cority Software Inc., SAP SE, Sphera Solutions, Inc., FactSet Research Systems Inc., Morningstar Inc., Bloomberg LP, and Prophix Software Inc. These companies are employing various strategies, including expansion, product innovation, and mergers and acquisitions, to deliver innovative products to consumers and increase their market share.
Executive Summary and Market Analysis
The expansion of the investor ESG software market in South and Central America is primarily driven by increasing concerns regarding climate risks, particularly in key sectors such as agriculture, mining, and energy. Companies in these industries are increasingly adopting ESG software to identify and address climate-related challenges, thereby mitigating their operational impacts. As businesses in the region strive to align with global sustainability trends, ESG software becomes essential for assessing and monitoring climate-related risks. This enables informed decision-making, strategic development, and the implementation of measures aimed at reducing carbon footprints and enhancing overall sustainability performance.
According to AXA Investment Managers, several Latin American countries have set ambitious renewable energy goals. For example, Colombia aims to conserve 30% of its land, reduce greenhouse gas emissions by 51% by 2030, and achieve carbon neutrality by 2050. Similarly, Chile is committed to carbon neutrality by 2050, with plans to phase out numerous thermal power plants by 2040 and transition major mining companies, such as BHP and Anglo American, to renewable energy sources. These proactive initiatives are expected to drive substantial growth in the investor ESG software market as businesses seek tools to track and report their sustainability performance in line with evolving regulations and investor expectations.
Strategic Insights
Market Segmentation Analysis
The South and Central America investor ESG software market can be segmented based on components and enterprise size. The market is divided into two main components: software and services. In 2024, the software segment held a larger market share, while the services segment is further divided into training, integration, and other services. Additionally, the market is categorized by enterprise size into large enterprises and small to medium-sized enterprises (SMEs), with large enterprises holding a more significant share in 2024.
Market Outlook
The integration of generative AI into investor ESG software is anticipated to introduce new trends in the market in the coming years. Generative AI enables investors to access, analyze, and interpret ESG data more effectively. This technology is poised to enhance ESG data analysis, reporting, and decision-making processes significantly. One of the key advantages of incorporating generative AI into ESG software is its ability to automate the creation of complex ESG reports. By quickly analyzing vast amounts of ESG data from diverse sources, generative AI can generate tailored and insightful reports for investors, including standard metrics and predictive analyses that identify emerging risks, opportunities, or trends in ESG performance. This automation not only saves time but also ensures that reports are accurate and comprehensive.
The advancements brought by generative AI in ESG software will lead to improved data accuracy, reporting efficiency, and predictive analytics. For instance, in July 2024, CO2 AI, a Paris-based sustainability platform, launched a generative AI-powered solution called Product Footprinting, designed to help companies compute product carbon emissions and reduce their environmental impact. This platform aims to assist large organizations in evaluating their impact and identifying levers to reduce it at scale, leveraging artificial intelligence. According to CO2 AI, the new solution addresses the need for more precise and rapid product carbon footprinting, as only 38% of companies receive adequate product-level data from suppliers. Similarly, in April 2024, Infor, a leader in industry cloud solutions, introduced Infor GenAI and ESG Reporting, aimed at enhancing productivity and tracking environmental impacts for customers across various sectors, including manufacturing and healthcare. By combining generative AI with industry-specific capabilities, these solutions enable customers to efficiently harness data and workflows, accelerating value realization while adhering to strict security and data privacy standards.
Country Insights
The South and Central America investor ESG software market includes key countries such as Brazil, Argentina, and other nations in the region. Brazil accounted for the largest market share in 2024, driven by its robust manufacturing sectors, including steel, food and beverage, telecommunications, pharmaceuticals, chemicals, and construction. These industries are increasingly focused on adopting sustainable strategies to meet their sustainability objectives, attracting global players to expand their operations in Brazil. For instance, in February 2023, Vela Software International Inc. acquired Nexo CS to enhance its ESG portfolio in Brazil, enabling customers to manage and organize large volumes of ESG-related data effectively.
Company Profiles
Key players in the South and Central America investor ESG software market include MSCI Inc., Workiva, Inc., London Stock Exchange Group Plc, Cority Software Inc., SAP SE, Sphera Solutions, Inc., FactSet Research Systems Inc., Morningstar Inc., Bloomberg LP, and Prophix Software Inc. These companies are employing various strategies, including expansion, product innovation, and mergers and acquisitions, to deliver innovative products to consumers and increase their market share.
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