Devout Muslim investors looking for an environmentally friendly investment vehicle may be in luck.
A green sukuk working group has been set up by the Gulf Bond and Sukuk Association, the Clean Energy Business Council of the Middle East and North Africa, and the Climate Bonds Initiative.
Sukuk are sharia-compliant investment securities similar to bonds. The working group aims to develop best practice and promote the issuance of sukuk to finance projects designed to mitigate or adapt to the effects of climate change.
Aaron Bielenberg of the Clean Energy Business Council, said: “There is a growing number of projects, for example renewable energy in the Middle East, that are ideally suited to sukuk investors. This group will help investors more easily identify sharia-compliant, clean energy investment opportunities.”
The working group intends to rely on certification from the Climate Bonds Initiative to identify appropriate projects.
The Initiative’s first set of certification standards was launched in November, setting out guidelines on how bonds financing windpower projects should be assessed.
It is working to extend these standards to solar power and energy efficiency.
source: Financial Times