There has been a series of issuances since the debut of the green sukuk in France in 2012, including the issuance of a sukuk in Malaysia earlier this year that is part of a larger $ billion Multi-Currency Sukuk Issuance Programme for sustainable development that was ten times over-subscribed. Globally, the increasing involvement of governments across the Middle East and North Africa (MENA) region in various projects for renewable energy and clean, efficient technologies indicate strong growth prospect for sukuk to support these green technology projects. Backed by the international Green Sukuk Working Group that has been instrumental in the development and issuance of green sukuk since its establishment in 2012, this segment of the Islamic capital market that advocates for greater socially responsible investment is expected to flourish further. 4  BIS central bankers’ speeches  Reducing information asymmetry – a key pre-requisite for sustainable financing Islamic finance has strong potentials to contribute towards a sustainable financing ecosystem for the green technology sector. I have shared with you the different facets of Islamic finance that can meet the needs of green businesses. Key to this is the need to reduce the information asymmetry between Islamic financial institutions and businesses. The GTFS framework has been instrumental in assisting to bridge the information gaps between financiers and businesses. Islamic financial institutions now have to build its capacity and capabilities to assess the viability of the green projects despite its complexity.
There are many forces that would drive the green technology industry into the future; demographic change, urbanisation, globalisation, scarcity of resources and the challenge arising from climate change. These forces would inevitably transform society towards a green economy. Its usage in traditional industries would promote the development of new technology and recast existing one. Green technologies have also proven to drive modernisation in the traditional industries, in terms of better utilisation of energy and natural resources and could prove to be a strategic advantage in doing business. Some have aptly compared the green revolution to the industrial revolution, an era that had profoundly changed our civilisation. Just as the transformative 19th-century innovations changed businesses, so too will green technologies alter industries, companies and societies for the environmental good, thus with these changes create new opportunities for businesses. The shift towards a green economy affects all stakeholders – decision makers, and policy formulators, companies and their customers. Increasingly, investors are emphasizing sustainability to the environment as an important investment criterion. In Malaysia, the New Economic Model incorporates sustainability as one of its key principles and it has been identified as a Key Strategic Reform Initiative. In 2009, we have made a commitment in Copenhagen to reduce up to 40% in terms of carbon emission intensity of GDP by the year 2020. The National Green Technology Policy launched during the same year provides direction and motivation for the growth of the green technology industry and to enhance its contribution to the national economy.