22, 2021 / 9:00 AM / Bukola Akinyele- Yisau for WebTV / Header Image Credit:
finance has become a priority for many governments and institutions including
sustainability objectives within their mandates. According to Refinitiv, from
2017-Q1 2021, the ESG Sukuk was valued at a remarkable $12.6bn and ESG funds at
$756m. Islamic social financing must be an integral part of the solution for
financing sustainable development.
Through Islamic Finance
there are opportunities for enterprise development, trade, skills development,
Shariah-compliant product and services that key into sustainability and
socio-economic inclusion. According
to Madelena Mohamed, Director Islamic Banking and Takaful Department Bank
Negara Malaysia, sustainability has shifted from a mere conceptual aspiration
that is linked to the fundamental value of sharia, to an increased strategy
that organizations can leverage including Islamic Finance institutions.
She said, in recent years, there has been expansion in
the area of business sustainability, environment sustainability, and social
sustainability. Sustainability is gaining a lot of traction globally which
provides Islamic financial institutions with opportunity to get viewership and
influence financial development both within the financial group and
also the wider community.
According to her, Islamic financial institutions are
strengthening their value and stature within the financial group using
sustainability strategies. The developments are enabling tangible impact to be
seen and delivered by Islamic financial institutions, in the area of promoting
inclusive sustainable roles.
On his part, Dr Ali Adnan Ibrahim, Global Head of
Social and Sustainable Finance Al Baraka Banking Group, Bahrain explained that
the journey of sustainable development started in the 60’s, responsible
investing initiative started in U.S, climate finance commenced in the 90’s,
while 2000 led to the emergence of ESG, and in 2015 there was the emergence of
sustainability goals which brought about how the public and private
sector need to align itself with responsibility in the financial services with
Islamic finance as a key part.
He said, all ESG projects impact are under the
umbrella of sustainable finance which makes it very easy for Islamic banking
and Islamic financial institutions to converge and engage with other
stakeholders across the globe.
Mr. Rafe Haneef, Group Chief Sustainability Officer,
CIMB Bank said the origin of Islamic Banking focused on two key pillars
Sustainability Financial intermediation perspective and Social impact.
According to him, the aim of Islamic finance is not to promote negative impact
in the society.
Sectors that are harmful like alcohol, tobacco, arms,
ammunition, pornography and gambling have been excluded from the operation of
Islamic Finance. This shows that the social consideration has always played an
important role in the provision of Islamic finance across the world. The
objectives of Shariah aligns with the SDGs.
The Convergence of Islamic Finance Sustainability
webinar was organized by Refinitiv.
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