Global finance leaders commit to unlocking $30+ billion of capital through green and sustainability sukuk by 2025

The Islamic Finance Council UK (UKIFC), Her Majesty’s Treasury, Ministry of Finance in the Republic of Indonesia Ministry, Islamic Development Bank, London Stock Exchange Group and the Global Ethical Finance Initiative (GEFI) have come together today as founding partners to launch a High Level Working Group on Green Sukuk (HLWG). The 3-year initiative will direct investment  to reduce  greenhouse gas emissions in  the world’s regions in most need. 

The announcement follows work of the Global Islamic Finance and UN SDGs Taskforce and a recent report “Innovation in Islamic Finance: Green Sukuk for SDGs” commissioned by UNDP Indonesia in which the UKIFC estimated that an additional US$30+ billion of capital towards the SDGs can be raised by 2025 through green and sustainability sukuk. To unlock this finance the HLWG has been launched to coordinate international efforts. The report showed how  green and sustainability sukuk can be a viable financial instrument attracting billions of dollars of capital for green projects that support the delivery  of the Paris Agreement.

Islamic finance is not limited to Muslim countries and has the potential to support the delivery of the more ambitious Nationally Determined Contributions that will be agreed at COP26. This will be particularly attractive to the Organisation of Islamic Cooperation (OIC) whose 57 member states represent over 1.82 billion people (24% of the total world population) and include a number of low-income countries that are politically or culturally marginalised.