Debunking the interplay between sustainable and technological development: insights from the financial market

The concept of twin transition developed pursuant to the idea that sustainable development and digital transformation can operate as mutually reinforcing objectives within a coherent regulatory framework. This article critically investigates this assumption by looking at EU financial market regulation. Drawing on concrete cases (robo-advisory services, DLTs and AI applications in sustainable finance) the research shows that the digital finance and sustainable finance regulatory streams have developed largely in isolation from one another, favouring “additive complex” frameworks, where each new instrument tend to impose requirements that layer upon, rather than integrate with, existing obligations. Absent genuine regulatory integration, financial institutions often face cumulative compliance obligations, rather than efficiency-enhancing synergies; these elements, overall, reduce the capacity of the “twin transition regulation” to achieve its policy goals.