Regulatory technologies for enhancing sustainability compliance: a multivocal literature review

Anita Golzarjannat and Robin Gustafsson

Journal of Financial Regulation and Compliance, 2025, vol. 34, issue 3, 385-415

Abstract: PurposeAs sustainability regulations tighten, Regulatory Technologies (RegTech) solutions have become more crucial, enabling real-time monitoring, predictive risk analytics, automated reporting and data-driven decision-making to support compliance. The purpose of this study is to synthesize the existing body of knowledge from academic and gray literature – including insights from researchers, industry and governing authorities – to assess the capabilities enabled, challenges and limitations of using RegTech solutions for sustainability compliance.Design/methodology/approachA multivocal literature review approach was applied to synthesize insights from academic literature and gray literature. We adopt an information systems capabilities lens to assess how RegTech supports sustainability-related compliance needs. Given that RegTech is an emerging field where much of the practical development and discussions about RegTech and compliance technologies occur outside academia, a multivocal literature review approach bridges the gap between academia and industry and ensures a comprehensive and holistic analysis.FindingsThe findings reveal that RegTech enables automated compliance monitoring, and environmental, social and governance (ESG) risk management, enhances transparency in reporting and offers tools to mitigate greenwashing risks while also supporting sustainable investment and digital finance. In additon, varying maturity levels across platforms, high implementation costs and cybersecurity risks present further adoption challenges.Practical implicationsTo fully harness RegTech’s potential, interdisciplinary collaboration is crucial. Researchers in sustainability, finance, law, management and information systems should work together to develop frameworks, empirical studies and policy recommendations that address the operational, ethical and technical dimensions of RegTech. Strengthening partnerships between academia, industry and policymakers can help bridge the gap between conceptual research and practical implementation, ensuring that RegTech solutions are both effective and ethically sound. For industry, the integration of RegTech solutions presents a significant opportunity to improve sustainability compliance while reducing regulatory burden. Financial institutions, corporations and technology providers should prioritize investments in scalable and interoperable RegTech solutions that align with emerging regulatory and sustainability reporting standards such as the Corporate Sustainability Reporting Directive, Sustainable Finance Disclosure Regulation and global ESG disclosure standards.Originality/valueThis study’s originality lies in its comprehensive synthesis of academic and gray literature to evaluate the role of RegTech in sustainability compliance, a critical yet unexplored topic. Moreover, the study provides valuable insights for researchers, policymakers, regulators and practitioners on advancing standardized terminology across disciplines regarding the RegTech phenomenon and offers strategies and insights to enhance RegTech’s potential in driving sustainability compliance.

Keywords: Sustainability; Regulation; Compliance; Information systems capabilities; Regulatory technology (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jfrcpp:jfrc-04-2025-0074

DOI: 10.1108/JFRC-04-2025-0074

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