Leveraging artificial intelligence for ESG scoring and sustainable investment

Iota-Kaousar Nassr and Caroline Roulet
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Iota-Kaousar Nassr: Capital Markets and Financial Institutions Division, France
Caroline Roulet: Macroeconomic Policy and Research Division, France

Journal of Digital Banking, 2025, vol. 10, issue 2, 152-169

Abstract: This paper examines the use of innovative tools based on artificial intelligence (AI) for the assessment of environmental, social and governance (ESG) scores and the potential of alternative scoring to enhance sustainable investing. Despite numerous potential benefits, there is a lack of research on the application of AI algorithms in ESG analysis . This paper provides an in-depth statistical analysis on utilising AI tools for ESG scoring and compares their outcomes with conventional scoring methods. Based on variations in correlation coefficients over shorter versus longer time horizons for the same sample, the analysis suggests that AI-supported integration of traditional and alternative real-time signals could lead to more informed ESG assessment and decision making. This article is also included in The Business & Management Collection which can be accessed at https://hstalks.com/business/.

Keywords: artificial intelligence; machine learning; generative AI; large languagemodels; natural language processing; environmental; social and governance; rating divergences; sustainable investment (search for similar items in EconPapers)
JEL-codes: E5 G2 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:aza:jdb000:y:2025:v:10:i:2:p:152-169

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