With the growing significanceof environmental sustainability, organizations are expected to be more transparent and accountable. NGOs (Non-Governmental Organizations) have a sustainable ecological component, but their sustainability reporting processes often lag due to the absence of artificial intelligence (AI) technology. Thus, this has been an influential game changer, enhancing the potential of Sustainability Reporting. This discussion paper analyzes the advantages and limitations of AI-powered sustainability reporting for NGOs. It aims to explore the potential benefits that AI may provide in increasing the accuracy, efficiency, and transparency of NGO sustainability reporting and highlight salient policy implications to encourage ethical usage of AI in NGO sustainability reporting. This study employs a qualitative research approach and utilizes secondary data sources. It discusses the potential of AI technologies to ease data collection and automate data analysis and reporting, which can help NGOs generate a more comprehensive picture of their environmental impact. Moreover, AI can enhance transparency by making data verification and investor participation in the development process in real-time. However, scrutiny of policy issues such as data privacy, data security, and bias in AI systems is needed. Through this study, the researcher aims to explore possibilities for NGOs to adopt AI in preparing more rigorous and credible sustainability reports. It explores these challenges and the lack of regulatory frameworks that allow for responsible and effective AI adoption in the non-governmental sector. By embracing AI-powered sustainability reporting, the average NGO can increase stakeholder trust and will, therefore, drastically enhance transparency and accountability and recruit the required resources for their environmental endeavors. This study provides critical information to governments and NGO leaders seeking to harness the capabilities of AI for a greener tomorrow.