Malaysia’s foremost Islamic financier, Bank Islam Malaysia aims to boost its Shariah-infused environmental, social, and governance assets base to RM4 billion by the end of 2025 from the current base of RM2.62 billion.
The value as of mid-year was 16.4 percent higher compared to the RM2.25 billion recorded a year earlier, the bank said in a statement today to announce the launch of its ESG Risk Management Framework.
Bank Islam, began developing the framework in the third quarter of 2021 with the aim of introducing a fit-for-purpose ESG and climate risk management framework and enhancing the bank’s board oversight on ESG and climate matters. It will embed ESG risk considerations in its credit assessment process and leverage climate risk stress-testing to enhance the bank’s capabilities in addressing the impacts of climate change on the bank and its customers,” it said.
Group chief executive officer Mohd Muazzam Mohamed said that as part of the group’s broader aspirations to be the leading Islamic financier in Malaysia, it has implemented approaches to consider the ESG risk profile of its customers as part of its financing origination process.
“This move aims to improve our customers’ sustainability, as it aligns with regulators’ key global and local efforts in building a resilient financial system,” he said. The GCEO also said beyond developing assessment scorecards and mechanisms for ESG and climate risk, the bank will also support its customers in their transition to low-carbon development and contribute to Malaysia’s net-zero ambitions as part of their value-based intermediation initiatives.
