Sustainable Digital Transformation in Capital Markets: A Structural Equation Modeling Approach

DOI

10.2991/978-94-6463-872-1_37How to use a DOI?

Keywords

Sustainable Technology Adoption; Digital Transformation; Capital Markets; Structural Equation Modelling; Artificial Intelligence; Market Expansion

Abstract

The rapid advancement of digital technologies has significantly transformed capital markets, fostering efficiency, transparency, and sustainability. This study explores the role of Sustainable Technology Adoption (STA)—including AI adoption, algorithmic trading, and big data analytics—in shaping sustainable financial ecosystems. The research employs a Structural Equation Modelling (SEM) approach to assess how STA impacts Sustainable Operational Efficiency (SOE), Sustainable Market Expansion (SME), and Regulatory Compliance for Sustainability (RCS), and how these factors ultimately influence Investor Perception of Sustainability (IPS).

The findings reveal that STA enhances cost reduction, data management, and automation, leading to improved operational efficiency. Additionally, digital transformation facilitates market expansion through new geographic market penetration, client acquisition, and product innovation, thereby strengthening capital market sustainability. Regulatory compliance, including adherence to SEBI guidelines, risk mitigation, and investor protection, plays a crucial role in ensuring the long-term stability of digital financial markets. Furthermore, investor perception is positively influenced by the accessibility of e-trading platforms, security measures, and confidence in digital securities.

This study provides empirical insights into the interdependencies among digital innovation, sustainability, and financial market efficiency. It offers strategic recommendations for financial institutions, policymakers, and regulators to enhance sustainable digital transformation, ensuring long-term growth, risk mitigation, and improved investor confidence in capital markets.

Copyright

© 2025 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Arpita Agarwal
AU  - Vertika Goswami
PY  - 2025
DA  - 2025/11/04
TI  - Sustainable Digital Transformation in Capital Markets: A Structural Equation Modeling Approach
BT  - Proceedings of the 2nd International Conference on Sustainable Business Practices and Innovative Models (ICSBPIM-2025)
PB  - Atlantis Press
SP  - 575
EP  - 588
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-872-1_37
DO  - 10.2991/978-94-6463-872-1_37
ID  - Agarwal2025
ER  -