Evolution of Sustainable Finance Frameworks in Emerging Economies: A Systematic Review of ESG Integration and Policy Instruments (2010–2025)

Abstract

The paper performs a comprehensive systematic narrative review of the development of sustainable finance frameworks in emerging economies for 2010–2025. It focuses on the interactions among policy instruments, ESG integration practices, and institutional contexts. The study identifies three evolutionary phases: early efforts, 2010–2014, characterized by pilot initiatives and multilateral influence; institutionalization, 2015–2019, where policy coherence and ESG mainstreaming were at play; and consolidation, between 2020 and 2025, driven by digitalization, global alignment, and data transparency. Informed by more than 90 peerreviewed studies and policy documents, the review evidences that regulatory instruments, market mechanisms, and voluntary frameworks together developed sustainable finance systems, albeit with uneven regional coverage. The results point at key drivers of regulatory clarity, investor demand, and technological innovation-and persistent barriers of governance deficiencies, data gaps, and market immaturity. By proposing an integrated framework on policy design, ESG adoption, and institutional strength, the research provides practical insights to policymakers, financial regulators, and researchers. The paper concludes that a coherent, data-driven, and adaptive policy ecosystem has been a prime driver for embedding sustainability into financial systems and achieving long-term development goals in emerging economies.