Artificial Intelligence in Sustainable Finance: Mapping ESG Integration and Risk Detection Frameworks
Year: 2025
Type: article
Study design: Systematic Review
Abstract: This systematic review explores how Artificial Intelligence (AI) is being incorporated into sustainable investment practices, with a particular focus on its influence on decision-making processes, risk assessment, and the enhancement of environmental, social, and governance (ESG) outcomes. Drawing on 40 peer-reviewed studies published between 2018 and 2025, the review synthesizes the evolution of AI applications in responsible finance and identifies five major research clusters: (1) AI-driven ESG performance and sustainable finance integration, (2) AI, FinTech, and blockchain innovation for green finance, (3) AI-enhanced risk detection and financial resilience, (4) systematic and theoretical foundations of AI in sustainable finance, and (5) ethical, governance, and responsible AI frameworks. Findings reveal that machine learning, natural language processing, and big data analytics are increasingly used to evaluate ESG indicators, optimize investment strategies, and improve transparency in sustainability reporting. However, several challenges persist, including algorithmic bias, data heterogeneity, limited model interpretability, and the absence of standardized ESG metrics. These limitations highlight the need for greater model transparency, ethical accountability, and interdisciplinary collaboration between data scientists, financial practitioners, and policymakers. The review is framed by theoretical perspectives, including the Resource-Based View and Responsible AI frameworks, to contextualize AI’s role in sustainable investment. Also, this review demonstrates that AI is not merely a technological tool but a transformative driver of sustainable investment practices. By fostering responsible innovation, improving data reliability, and supporting evidence-based decision-making, AI has the potential to build a more transparent, resilient, and inclusive financial ecosystem, accelerating the global transition toward sustainable development.
DOI: 10.14419/166t8v12
Authors: Boutahir Omar, Lahlou-Kassi Habiba
Institution: Université Privée de Fès
Subfield: Finance
Domain: Social Sciences
SDG: Climate action
Open Access status: bronze
OpenAlex ID: W7117355363