As part of initiatives to develop Malaysia’s value proposition as an Asian centre for
Sustainable and Responsible Investment (SRI) and green financing by virtue of its
leadership position in Islamic finance, Capital Markets Malaysia (CMM), an affiliate of
the Securities Commission Malaysia (SC), hosted the Sustainable Capitalism in South
East Asia Forum in London recently.
A global pioneer in Islamic finance, Malaysia is taking the lead in positioning Shariah-
based investing to responsible investors worldwide given its natural alignment to the
principles of sustainable and responsible investment (SRI).
International recognition of this alignment by organisations such as the UN-backed
Principles for Responsible Investments (PRI) and the Global Sustainable Investment
Alliance places Malaysia at the forefront of the sustainable investment market (ex
Japan) on account of its Islamic funds.
Speaking at the forum, Zainal Izlan Zainal Abidin, Deputy Chief Executive of the SC
said, “The SC will continue to facilitate the development of Malaysia’s sustainable
financing and investment ecosystem, leveraging our position as a leader in the
Islamic capital market, to encourage innovation and collaboration in advancing the
global sustainability agenda.”
Malaysia has also championed the use of Islamic finance, through the issuance of
green sukuk, as an innovative financing mechanism for funding the Sustainable
Development Goals.
The SC paved the way for the convergence of Islamic instruments and sustainable
financing with the introduction of the Sustainable and Responsible Investment Sukuk
Framework in 2014, which facilitated the issuance of the world’s first green sukuk
out of Malaysia in 2017. As at March 2019, six green sukuk have been issued to finance solar and small hydropower projects and green buildings.
Malaysia is also home to the world’s first Sustainable Development Goals Sukuk issued in 2018.
Speakers at the forum, panellists representing HSBC, PwC, Nomura Asset
Management, PRI, Maybank Islamic and the UNDP, among others, discussed how
global SRI trends are set to influence growth in Asia and how the synergies
between Islamic finance and SRI are expected to further contribute to the growth of
the sustainable finance and investment ecosystem in Asia.
