| Azlan Othman |
THE United Nation’s (UN) initiative of Sustainable Development Goals (SDG) provides the Islamic Finance an opportunity to redefine its role pertaining to people empowerment (eg. social finance and MSME), socio-economic development (eg. profit sharing and poverty), and the environment (creating new Islamic financial instruments such as green Sukuk – green financing and carbon emissions) through sustainable and responsible investments.
This was highlighted by Professor Dr Abdul Ghafar bin Ismail from the Faculty of Economics and Islamic Finance at the Universiti Islam Sultan Sharif Ali (UNISSA) in his presentation entitled ‘Sustainable Development Goals and Islamic Finance’ at the second and final day of the Brunei Darussalam Islamic Investment Summit (BIIS) 2017 yesterday at The Empire Hotel & Country Club.
The SDG, officially known as ‘Transforming Our World: The 2030 Agenda for Sustainable Development’, is a set of 17 ‘Global Goals’ with 169 targets between them.
It is spearheaded by the UN through a deliberative process involving its 193 member states as well as global civil society.
Professor Dr Abdul Ghafar added, “SDG creates opportunities like creating a value-based proposition to widen the definition of Islamic Finance by deepening the system, institutions and instruments as stated in the Constitution of Brunei Darussalam and to expand the Muslim funds (also stated in the Constitution of Brunei Darussalam).”
The Global Agenda enhances these possibilities for the Islamic Finance as SDG’s goals and values are not only parallel with Islamic Finance practices but also relevant and applicable.
He also pointed out that SDG brings challenges to the Islamic Finance practices such as in addressing the compliant and principle issues.
There is also a need to address the Maqasid Syariah issue and public policy issues.
Meanwhile, Dato’ Mohamad Nasir bin Abdul Latif, Deputy Chief Executive Officer (Investment Division) of the Employees Provident Fund, Malaysia touched on ‘Simpanan Syariah: EPF Malaysia’s Experience’.
Among others, he highlighted that all EPF members regardless of religion, race and nationality may choose the ‘Simpanan Syariah’ which is managed and invested based on ‘Akad Wakalah’.
He said the EPF Board has been appointed and entrusted to act on behalf of its members to oversee the management and investment of their EPF savings, to ensure that they are in accordance with the Syariah principles.
Dato’ Mohamad Nasir also highlighted that the challenges facing the EPF scheme is to grow the Syariah assets and to diversify its stock investments but pointed out that it is not difficult to get Syariah-compliant stocks.
“In developed markets, we are able to get them but the stocks are quite limited in Asia,” he said.
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