A TOTAL of RM8.3 billion has been issued under the Sustainable and Responsible Investment (SRI) sukuk framework since the Securities Commission Malaysia (SC) introduced it in 2014.

SC chairman Syed Zaid Albar says the funds raised were used to finance various green, social and sustainable projects, including renewable energy, quality education and affordable housing.

“We believe there are more opportunities for the capital market to help build a more inclusive and sustainable nation, and the SC is firmly committed to this cause,” he said in his opening keynote address at the Environmental, Social and Governance (ESG) Corporate Summit on “Driving Sustainability and Sustainable Transformation” today.

He said the SC acknowledges that for a successful net-zero transition, businesses will require significant financing to decarbonise.

“Towards this end, the SC is working to introduce market-based instruments to enable transition finance in Malaysia, thereby broadening financing options for companies at various stages of their sustainability journey.

“As sustainable finance becomes more mainstream, a credible and transparent common language on sustainability is required, which addresses the risk of green-washing,” he added.

Syed Zaid said a sustainable finance taxonomy is one tool for defining what constitutes sustainable economic activities; hence the SC recently published a consultation paper on principles-based SRI Taxonomy for the Malaysian capital market.

He said SRI Taxonomy aims at providing a more holistic view of sustainability by establishing guiding principles on economic activities that support ESG objectives.

“Notably, the SRI Taxonomy includes a social component to manage social risks and raise social standards.

“I invite you to participate in the consultation exercise and suggest ways to enhance the taxonomy and support a more sustainable Malaysia,” he said.

He added that enabling greater transparency and clarity on issuer-level transition pathways is another critical building block for a sustainable transformation.

“We need to identify, assess and measure the decarbonisation strategies of companies. Having robust sustainability reporting standards is a good place to start,” he said. – Bernama, February 17, 2022.