Chapter 4: The Role of Technology, AI, ML and DLT in Sustainable Finance and a Green Economy

Purpose: The purpose of this research is to explore how new technologies, such as DLT (distributed ledger technology), ML (machine learning) and AI (artificial intelligence), can support green economic growth and sustainable finance.

Need for the study: Awareness of environmental challenges highlights the importance of using technology to support and promote sustainable financial practices. Therefore, this study, among other things, aims to explore this importance by analysing how AI, ML and DLT can contribute to continuously improving innovation and efficiency in various sustainable finance projects.

Methodology: This study uses a literature review technique to examine technology use, sustainable finance, and the transition to a sustainable economy. To achieve this goal, qualitative interviews were conducted with professionals in the fields of sustainability, technology and finance to explore different practices and identify different strategies for developing the future of the finance industry.

Findings: Based on the findings of previous studies, AI, ML and DLT play an important role in improving risk management, increasing transparency and simplifying procedures that serve to make decisions in the sustainable finance sector. The transformation to a green and sustainable economy can be more straightforward if it relies on the ability of these important technologies to incorporate some ESG (environmental, social and governance) considerations into organisations’ plans for potential investments.

Practical implications: The study's findings will help software developers, financial institutions and policymakers promote and strengthen sustainable development. Furthermore, the use of technology, especially advances in AI, ML and DLT, offers various valuable perspectives for those engaged in the transition to more environmentally friendly financial practices, contributing to creating a more sustainable global economy.