KUALA LUMPUR – Islamic social finance has the potential and is well-placed to provide the requisite support for post-pandemic poverty alleviation and economic recovery, the Securities Commission Malaysia (SC) said.
Deputy chief executive Datuk Zainal Izlan Zainal Abidin said in the realm of social finance, the SC has introduced frameworks to facilitate the use of capital market instruments to advocate and drive financial inclusion and social impact, such as Sustainable and Responsible Investment (SRI) sukuk and waqf-featured funds.
“Moving forward, the SC will focus on enhancing its Islamic capital market ecosystem to be more conducive for impact investing, to facilitate the integration of impact assessments with Islamic social finance instruments.
“This will enable measurable impact investments in the areas of socio-economic development — thereby ensuring investors will be able to gauge whether the capital invested has achieved its desired objectives,” he said in his keynote address at the Leveraging Islamic Finance to Develop a Sustainable Capital Market: The Malaysian Experience webinar on December 3.
Apart from regulations and frameworks, Zainal said a key enabler in the development of a holistic sustainable finance and investment ecosystem is to ensure that all segments of the financial sector are equipped with the skills and technical expertise needed to facilitate product innovation.
In this regard, he said Capital Markets Malaysia supports the SC’s initiatives to develop capital market intermediaries’ expertise in sustainable finance and investing through its three centres of excellence (COEs).
“These COEs support capacity development and showcase the track records of three key stakeholder groups: corporations; asset owners and asset managers; and financial sector intermediaries,” he said.
In September, he said the SC launched its third Capital Market Masterplan (CMP3), which will serve as a strategic framework for further development of Malaysia’scapital market over the next five years.
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