Artificial Intelligence in Green Finance Enhances Esg Performance for Sustainable Development

Artificial Intelligence in Green Finance Enhances Esg Performance for Sustainable Development | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Artificial Intelligence in Green Finance Enhances Esg Performance for Sustainable Development Mariam Sohail, Shahsuzan Zakaria, Faisal Sheraz, Amena Sibghatullah This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-7390574/v1 This work is licensed under a CC BY 4.0 License Status: Under Review Version 1 posted 14 You are reading this latest preprint version Abstract Green finance has a significant role in making appropriate investments in an ecological economy for a sustainable global economy. These include energy generation from renewable sources, increasing energy efficiency, reducing carbon emissions, and environmental conservation. However, Artificial Intelligence (AI) has taken a leading role in advancing as the premier analytical instrument for sustainability solutions in financial organizations. It aims to explore how AI supports ESG performance improvement by connecting green finance programs to its matrices. In the paper, by synthesizing 200 participants from the German banking industry, the researcher examines the mediating role of green finance in the relationship between the implementation of AI and ESG outcomes. A survey questionnaire with a structure of 5 closed-ended questions was used to investigate these relationships, and correlation analysis and structural equation modeling techniques were used to analyze the data underlying these relationships. Results show that AI is positively related to ESG performance, further providing that the positive relationship is partly explained by green finance. The published results uncover AI’s efficiency in advancing ESG performance through enhanced sustainability overviews, better resource management, and effective compliance. Given this, this paper presents a boon for policymakers and related financial institutions aspiring to adopt AI for sustainable finance, with conclusions and recommendations for improved adequate limits and future research focus. AI Green Finance ESG Performance Green FinTech Corporate Governance Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Under Review Version 1 posted Editorial decision: Revision requested 03 Nov, 2025 Reviews received at journal 23 Oct, 2025 Reviews received at journal 12 Oct, 2025 Reviewers agreed at journal 08 Oct, 2025 Reviewers agreed at journal 07 Oct, 2025 Reviewers agreed at journal 05 Oct, 2025 Reviewers agreed at journal 05 Oct, 2025 Reviewers agreed at journal 03 Oct, 2025 Reviewers agreed at journal 03 Oct, 2025 Reviewers invited by journal 03 Oct, 2025 Editor invited by journal 01 Oct, 2025 Editor assigned by journal 17 Sep, 2025 Submission checks completed at journal 09 Sep, 2025 First submitted to journal 09 Sep, 2025 You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-7390574","acceptedTermsAndConditions":true,"allowDirectSubmit":false,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":530259155,"identity":"1fbe57e5-52c4-43d4-b592-52d870915b1e","order_by":0,"name":"Mariam Sohail","email":"","orcid":"","institution":"University of Doha for Science and Technology","correspondingAuthor":false,"prefix":"","firstName":"Mariam","middleName":"","lastName":"Sohail","suffix":""},{"id":530259156,"identity":"2121ab78-d8c3-4aa4-a42c-985a897b6f48","order_by":1,"name":"Shahsuzan Zakaria","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAAyklEQVRIiWNgGAWjYDACCQY2hg8GNkASBNiI1MI4oyCNgY2NFC3MPB8OQ1UTo0V+dvOzhzMMzif2yXcnMHwoO8ygOyMBvxaDO8fMDT4Y3E5sY+PdwDjj3GEGsxuEtEgkmEnOgGph5m0jQov8jPRv0jwG5yBa/hKjheFGjhlQywGIFkZitBjcyCkDOizZuI0td8PBnnPpPGZnHhB02DaJD3/sZOc3n9344EeZtZzZcUIOQwYHgJiHQYAULRDAf4BkLaNgFIyCUTC8AQDrPUVhsXpzyQAAAABJRU5ErkJggg==","orcid":"","institution":"Universiti Teknologi MARA","correspondingAuthor":true,"prefix":"","firstName":"Shahsuzan","middleName":"","lastName":"Zakaria","suffix":""},{"id":530259157,"identity":"c4157c1b-b0cf-481a-914d-e4c37d0bab8c","order_by":2,"name":"Faisal Sheraz","email":"","orcid":"","institution":"Iqra National University","correspondingAuthor":false,"prefix":"","firstName":"Faisal","middleName":"","lastName":"Sheraz","suffix":""},{"id":530259158,"identity":"78f964bc-f057-4a9c-bf6a-f09f6dae18f3","order_by":3,"name":"Amena Sibghatullah","email":"","orcid":"","institution":"Universiti Teknologi MARA","correspondingAuthor":false,"prefix":"","firstName":"Amena","middleName":"","lastName":"Sibghatullah","suffix":""}],"badges":[],"createdAt":"2025-08-17 05:38:13","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-7390574/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-7390574/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":93716836,"identity":"1f9a5f14-c7c3-4060-8ceb-db3f7e37e6fb","added_by":"auto","created_at":"2025-10-16 20:02:38","extension":"docx","order_by":0,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":201546,"visible":true,"origin":"","legend":"","description":"","filename":"DiscoversustainabilityAIandESGUpdated.docx","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/cf3bb5140d752150cbfc0ee7.docx"},{"id":93716719,"identity":"185aeb69-1c9f-4cf3-bd20-bae2a069893f","added_by":"auto","created_at":"2025-10-16 19:54:38","extension":"json","order_by":1,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":5706,"visible":true,"origin":"","legend":"","description":"","filename":"72dd4a51d16c48bd836873bfafd1e9d5.json","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/d26e1c2d0cfb2a32ddb48501.json"},{"id":93716727,"identity":"30e6eb53-535a-4df4-aa58-215cba095394","added_by":"auto","created_at":"2025-10-16 19:54:38","extension":"xml","order_by":2,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":151541,"visible":true,"origin":"","legend":"","description":"","filename":"72dd4a51d16c48bd836873bfafd1e9d51enriched.xml","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/340721f73f9083dafd903fb5.xml"},{"id":93716831,"identity":"f8b84ded-4943-4e25-a755-94d9b927fee3","added_by":"auto","created_at":"2025-10-16 20:02:38","extension":"jpeg","order_by":3,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":129936,"visible":true,"origin":"","legend":"","description":"","filename":"floatimage1.jpeg","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/a1df35b5d8e90e2d61ec491c.jpeg"},{"id":93717342,"identity":"dd0c727f-3c6b-4797-a912-3422daf0f68a","added_by":"auto","created_at":"2025-10-16 20:10:38","extension":"jpeg","order_by":4,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":25240,"visible":true,"origin":"","legend":"","description":"","filename":"floatimage2.jpeg","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/92747cff15613c5c27f15856.jpeg"},{"id":93716834,"identity":"9d3d6dd8-03ee-4acc-be9e-890a842f6d7f","added_by":"auto","created_at":"2025-10-16 20:02:38","extension":"jpeg","order_by":5,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":1074,"visible":true,"origin":"","legend":"","description":"","filename":"floatimage3.jpeg","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/055b8e91a6f55921958a2c19.jpeg"},{"id":93717394,"identity":"4d5d008f-14b5-4738-ab8b-b3a7f1c3d9c3","added_by":"auto","created_at":"2025-10-16 20:18:38","extension":"png","order_by":6,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":28691,"visible":true,"origin":"","legend":"","description":"","filename":"floatimage4.png","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/057932be1ad1f9054c9421db.png"},{"id":93716723,"identity":"53e72789-07f6-4cf7-928b-2c9b31991e07","added_by":"auto","created_at":"2025-10-16 19:54:38","extension":"png","order_by":7,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":28771,"visible":true,"origin":"","legend":"","description":"","filename":"Onlinefloatimage1.png","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/f0ffbefc527f4b3ab2ffc598.png"},{"id":93717343,"identity":"ca549b1c-e5fe-4f5f-9242-a1f99ead1e03","added_by":"auto","created_at":"2025-10-16 20:10:38","extension":"png","order_by":8,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":6403,"visible":true,"origin":"","legend":"","description":"","filename":"Onlinefloatimage2.png","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/88cd637a2171729c5d620e64.png"},{"id":93716724,"identity":"fc0d1179-dbd6-49ee-a3c3-d98c0abe16e3","added_by":"auto","created_at":"2025-10-16 19:54:38","extension":"png","order_by":9,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":935,"visible":true,"origin":"","legend":"","description":"","filename":"Onlinefloatimage3.png","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/b69d510249c5e9bf68ccfda8.png"},{"id":93716729,"identity":"e20a59c8-6463-4f79-b9cb-b3ddce0726f7","added_by":"auto","created_at":"2025-10-16 19:54:38","extension":"png","order_by":10,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":27884,"visible":true,"origin":"","legend":"","description":"","filename":"Onlinefloatimage4.png","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/bb61b4f6f495c5d325c624b2.png"},{"id":93716730,"identity":"3663c7f3-055a-4760-a80f-7cb516219f95","added_by":"auto","created_at":"2025-10-16 19:54:38","extension":"xml","order_by":11,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":147468,"visible":true,"origin":"","legend":"","description":"","filename":"72dd4a51d16c48bd836873bfafd1e9d51structuring.xml","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/6c96840cadb9cc645216f8d9.xml"},{"id":93716731,"identity":"ff880ddb-e17b-4852-9769-d13f78074b9f","added_by":"auto","created_at":"2025-10-16 19:54:39","extension":"html","order_by":12,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":160005,"visible":true,"origin":"","legend":"","description":"","filename":"earlyproof.html","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1/831e98538f99aabd50dbc2fd.html"},{"id":93717607,"identity":"33719e24-91be-42d8-9d86-f88cf46ba94e","added_by":"auto","created_at":"2025-10-16 20:26:40","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":481180,"visible":true,"origin":"","legend":"","description":"","filename":"DiscoversustainabilityAIandESGUpdated.pdf","url":"https://assets-eu.researchsquare.com/files/rs-7390574/v1_covered_2582d0e6-8c52-4a99-aead-892814244ce1.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"\u003cp\u003eArtificial Intelligence in Green Finance Enhances Esg Performance for Sustainable Development\u003c/p\u003e","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":false,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"discover-sustainability","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":false,"externalIdentity":"disu","sideBox":"Learn more about [Discover Sustainability](https://www.springer.com/43621)","snPcode":"","submissionUrl":"","title":"Discover Sustainability","twitterHandle":"","acdcEnabled":true,"dfaEnabled":true,"editorialSystem":"stoa","reportingPortfolio":"Discover Series","inReviewEnabled":true,"inReviewRevisionsEnabled":true},"keywords":"AI, Green Finance, ESG Performance, Green FinTech, Corporate Governance","lastPublishedDoi":"10.21203/rs.3.rs-7390574/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-7390574/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eGreen finance has a significant role in making appropriate investments in an ecological economy for a sustainable global economy. These include energy generation from renewable sources, increasing energy efficiency, reducing carbon emissions, and environmental conservation. However, Artificial Intelligence (AI) has taken a leading role in advancing as the premier analytical instrument for sustainability solutions in financial organizations. It aims to explore how AI supports ESG performance improvement by connecting green finance programs to its matrices. In the paper, by synthesizing 200 participants from the German banking industry, the researcher examines the mediating role of green finance in the relationship between the implementation of AI and ESG outcomes. A survey questionnaire with a structure of 5 closed-ended questions was used to investigate these relationships, and correlation analysis and structural equation modeling techniques were used to analyze the data underlying these relationships. Results show that AI is positively related to ESG performance, further providing that the positive relationship is partly explained by green finance. The published results uncover AI\u0026rsquo;s efficiency in advancing ESG performance through enhanced sustainability overviews, better resource management, and effective compliance. Given this, this paper presents a boon for policymakers and related financial institutions aspiring to adopt AI for sustainable finance, with conclusions and recommendations for improved adequate limits and future research focus.\u003c/p\u003e","manuscriptTitle":"Artificial Intelligence in Green Finance Enhances Esg Performance for Sustainable Development","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2025-10-16 19:54:34","doi":"10.21203/rs.3.rs-7390574/v1","editorialEvents":[{"type":"communityComments","content":0},{"type":"decision","content":"Revision requested","date":"2025-11-03T07:47:43+00:00","index":"","fulltext":""},{"type":"editorInvitedReview","content":"","date":"2025-10-23T15:22:57+00:00","index":"hide","fulltext":""},{"type":"editorInvitedReview","content":"","date":"2025-10-12T05:12:53+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"61549397451033827746544389131505764590","date":"2025-10-08T16:27:58+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"10010717149977706029258931812182131525","date":"2025-10-07T16:24:51+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"117759770351863965140417766108582852745","date":"2025-10-06T03:56:04+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"11069506356630389482973492365182119318","date":"2025-10-05T15:44:43+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"15131769971575971786079909178746053599","date":"2025-10-03T14:14:11+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"263712234159855392149313478906379616379","date":"2025-10-03T06:43:18+00:00","index":"hide","fulltext":""},{"type":"reviewersInvited","content":"","date":"2025-10-03T04:25:16+00:00","index":"","fulltext":""},{"type":"editorInvited","content":"","date":"2025-10-01T12:26:17+00:00","index":"","fulltext":""},{"type":"editorAssigned","content":"","date":"2025-09-17T12:05:45+00:00","index":"","fulltext":""},{"type":"checksComplete","content":"","date":"2025-09-09T08:30:35+00:00","index":"","fulltext":""},{"type":"submitted","content":"Discover Sustainability","date":"2025-09-09T08:27:25+00:00","index":"","fulltext":""}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"discover-sustainability","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":false,"externalIdentity":"disu","sideBox":"Learn more about [Discover Sustainability](https://www.springer.com/43621)","snPcode":"","submissionUrl":"","title":"Discover Sustainability","twitterHandle":"","acdcEnabled":true,"dfaEnabled":true,"editorialSystem":"stoa","reportingPortfolio":"Discover Series","inReviewEnabled":true,"inReviewRevisionsEnabled":true}}],"origin":"","ownerIdentity":"f01e9c49-66ab-47b9-a1d8-2bef64465bbc","owner":[],"postedDate":"October 16th, 2025","published":true,"recentEditorialEvents":[],"rejectedJournal":[],"revision":"","amendment":"","status":"under-review","subjectAreas":[],"tags":[],"updatedAt":"2026-05-16T03:08:18+00:00","versionOfRecord":[],"versionCreatedAt":"2025-10-16 19:54:34","video":"","vorDoi":"","vorDoiUrl":"","workflowStages":[]},"version":"v1","identity":"rs-7390574","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-7390574","identity":"rs-7390574","version":["v1"]},"buildId":"8U1c8b4HqxoKbykW_rLl7","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}