This chapter explores the convergence of two major developments: the rise of environmental, social, and governance (ESG) investing and the exponential growth of artificial intelligence (AI) technology. The increased demand for diverse ESG instruments, such as green and ESG-linked loans, will be aligned with the rapid growth of the global AI market, which is expected to be worth $1,394.30 billion by 2029. AI can assist in identifying and pricing climate risks, setting more ambitious ESG goals, and advancing sustainable finance decisions. However, delegating sustainable finance decisions to AI poses serious risks, and new principles and rules for AI and ESG investing are necessary to mitigate these risks. This chapter highlights the challenges associated with norm-setting initiatives and stresses the need for the fine-tuning of the principles of legitimacy, oversight and verification, transparency, and explainability. Finally, the chapter contends that integrating AI into ESG non-financial reporting necessitates a heightened sense of responsibility and the establishment of fundamental guiding principles within the spheres of AI and ESG investing.

Sustainability involves the adaptation of today's business model to the dynamic nature of the current digitalized environments. In other words, corporations need to make sure that resources, especially technology, are being used responsibly and efficiently to improve the lives of the present generations and future generations as well as strengthen their relationships with the environment. In 2020, the United Nations estimates an investment in the range of $5 trillion to $7 trillion to achieve the SDGs (Craig 2021). This calls for a broader understanding of the behavior of investors, and how these investments are used towards solving sustainability-related problems such as poverty, environmental degradation, pollution and inequality. Artificial Intelligence (AI) has the potential to address these societal problems including sustainability. The climate crisis and the degradation of the physical environment are complex problems that require the most innovative and advanced solutions.

Using data collected in a global survey during 2019, the report analysed a sample of 151 fintechs and incumbents across 33 countries to paint a rich picture of how artificial technology is being developed and deployed within the financial services sector. While 77% of respondents noted that they expect AI to become an essential business driver across the financial services industry in the near term, the report found that the way incumbents and fintechs are leveraging AI technologies differ in a number of ways. A higher share of fintechs tend to be creating AI-based products and services, employing autonomous decision-making systems, and relying on cloud-based systems. Whereas incumbents appear to focus on "harnessing AI to improve existing products. This might explain why AI appears to have a higher positive impact on fintechs' profitability."

Fintech startup MioTech on Monday announced the closure of its Series A funding round, which was led by Horizons Ventures. The venture firm is the private investment arm of Hong Kong-based businessman and billionaire Li Ka-shing and is an existing investor in the startup. In 2017, Horizons Ventures invested in the Series A round of the artificial intelligence (AI) platform, which was closed after raising $7 million. Though the company did not disclose the amount it received in the fresh funding round, the proceeds will be utilized in hiring talents and R&D. "The financing will be used to recruit more talents and invest in R&D. It will further strengthen MioTech's data and technology edge, and help MioTech become the industry acknowledged platform for Green Finance and Sustainable Investment in Asia," Jason Tu, co-founder and CEO of the company, said.

Greta Thunberg is 16 and lives in Sweden. Until February last year, she was just another student concerned about the environment. Today, she's become the world's most influential climate activists, after founding'Fridays for Future', a movement that encourages school students to take time off from class to participate in demonstrations against their countries' governments for breaching environmental laws. Greta believes that we're heading towards a natural disaster and the planet's destruction if we fail to change our habits as a society. And that includes everyone, from large industries to the individual citizen.