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IBM unveils acquisition of Envizi to add ESG analytics tools

With Envizi in the fold, the tech giant will be able to expand the environmental analytics capabilities of its platform and better enable customers who undertake ESG initiatives.

IBM revealed that it completed the acquisition of Envizi in a move aimed at enabling customers to accelerate environmental initiatives.

Financial terms of the deal were not disclosed.

IBM, founded in 1911 and headquartered in Armonk, N.Y., is a tech giant whose offerings include Cognos Analytics With Watson -- formerly Cognos Analytics -- and the IBM Cloud Pak for Data.

Envizi, meanwhile, is an analytics vendor founded in 2004 and based in Eveleigh, Australia, with offices in London, San Francisco and Toronto and a specialization in environmental, social and governance (ESG) data.

Environmental data

The vendor's AI-powered platform automates the collection and consolidation of more than 500 types of environmental data and is designed to enable users to analyze and report on their environmental goals and assess sustainability risk.

Existing customers include Microsoft, Qantas, CBRE Group and Uber.

According to IBM, the acquisition adds to the tech giant's growing investments in AI-powered software, which includes IBM Maximo for asset management, IBM Sterling for supply chain analysis and the IBM Environmental Intelligence Suite (EIS), which all work together to enable organizations to develop resilient and sustainable operations and supply chains.

Specifically, IBM said the acquisition of Envizi will enable IBM customers to automate the information generated between corporate environmental initiatives and the endpoints used in daily operations and will make sustainability efforts more scalable. And once assimilated, Envizi will integrate with IBM Maximo, IBM Sterling, the IBM EIS and both IBM Turbonomic and Red Hat OpenShift.

Envizi, meanwhile, is a good acquisition for IBM, according to Doug Henschen, an analyst at Constellation Research.

IBM moves into ESG

Envizi is a very capable, dedicated ESG analytics solution, so the acquisition quickly thrusts IBM more deeply into the ESG arena.
Doug HenschenAnalyst, Constellation Research

"Envizi is a very capable, dedicated ESG analytics solution, so the acquisition quickly thrusts IBM more deeply into the ESG arena, particularly on the environmental front," he said. "I see Envizi as a particularly good fit because of IBM's deep consulting bench. You don't just buy a product to address environmental, social and governance mandates and initiatives."

With Envizi in the fold, IBM will be able to provide customers with both guidance and technology as they develop ESG strategies and install the reporting mechanisms needed to carry out those strategies, Henschen continued.

"There's a huge need for consulting guidance as well as technology," he said. "What's more, ESG is a nascent arena where standards are in flux or have yet to be written, so it's about putting the strategy and tech in place and adjusting the targets as standards and mandates evolve."

According to Kareem Yusuf, general manager of IBM AI applications, the acquisition -- made public Tuesday -- will provide IBM customers with a single environment for analyzing and understanding emissions data.

A sample Envizi dashboard
A sample Envizi dashboard displays data related to an organization's work to cut emissions.

Scaling up for Envizi

David Solsky, co-founder and CEO of Envizi, meanwhile, said that becoming part of IBM will enable Envizi to scale much faster than it was capable of on its own. That, in turn, will help the vendor provide a broader array of customers with the tools needed to reduce the carbon footprints of their operations.

While IBM's acquisition of Envizi is the first instance in 2022 of a vendor adding ESG analytics capabilities, Henschen said he does not expect it to be the last.

He noted that in addition to IBM, the Salesforce-Tableau combination is another enterprise that has recognized the growing importance of ESGs, and he predicted that a 2022 trend will be vendors adding more tools to enable ESG reporting.

Those IBM users who take advantage of Envizi's capabilities will have to implement Envizi in addition to their existing data and analytics infrastructure.

But Henschen said he'd like to eventually see vendors make ESG tools part of their own platforms rather than accessible only through connectors and integrations.

"It's my hope, for the sake of affordability and broad adoption, that mainstream data platforms -- data warehouse/data lake -- and BI/analytics vendors will be able to come up with ESG solutions akin to their many industry solutions," Henschen said. "But I expect we'll have to see more maturation and standardization in the ESG space before vendors can develop broadly applicable ESG solutions."

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