Montreal tech company Novisto is raising $9.6 million ($8 million USD) in funding for its software-as-a-service platform that helps corporations report their environmental, social, and governance (ESG) data.
Novisto’s new funding is coming from White Star Capital with participation from Diagram Ventures. Novisto says it will use the cash to triple the size of its engineering and product teams as it expands into the European market.
Along with the capital, Novisto is also announcing that Jetblue airlines is now a customer. Jetblue was originally founded by David Neeleman, who previously had worked for Southwest Airlines, and went on to found Brazil’s Azul Airlines and now the new Breeze Airlines in the US.
What is ESG reporting?
Novisto’s platform focuses on ESG reporting, which provides potential investors more transparency about the company. An ESG report offers a snapshot of a business’s impact within the environmental, social and governance areas.
The reporting helps investors avoid companies that might pose a greater financial risk due to their environmental performance or other social or governmental practices.
While this reporting is voluntarily for most countries, there are increasing global regulations regarding corporate ESG data reporting. However, there has been a massive surge in ESG reporting in the past few years. Many companies now integrate their ESG reporting in their annual reporting to demonstrate how sustainability is embedded in their business.
It seems as though companies will continue to be rewarded for their ESG transperancy.
For example, companies with strong ESG performance have “demonstrated higher returns on their investments, lower risks and better resiliency during a crisis.” Moreover, as of July 2020, 90 percent of S&P 500 companies had published their annual corporate sustainability/ESG reports.
Where does Novisto fit in?
The Montreal company says it streamlines every step of the sustainability management journey while helping companies “own their ESG narrative.” With Novisto’s software, the company says organizations can “leverage the power of automation to collect and consolidate their sustainability data, improve their reporting, and gain insights for better decision making.”
Novisto’s centralized ERP-like platform enables executives and ESG practitioners to accelerate the integration of sustainability into corporate strategy, and stay on top of changing regulations and capital markets.
“Corporate ESG reporting and management is now essential for investors and other important stakeholders,” said Novisto’s CEO, Charles Assaf. The investment, said the CEO, “will enable us to unlock… our vision to become the world’s leading software solution for integrated ESG data, management, and reporting.”
Sara Bogdan, JetBlue’s head of ESG, said the airline is focused on a lower-carbon future and achieving net-zero carbon emissions for its operations by 2040. Novisto will help Jetblue “plan, measure, and ultimately achieve our ambitious goals in this area.”