Kuala Lumpur, Malaysia, 25 February 2022 – The capital city of Kuala Lumpur, has seen the holding of a two-day Islamic Finance International Conference (the International Conference) under the theme “Connecting the Dots: Harnessing Islamic Finance to Accelerate the Achievement of the SDGs”.
The major event, held on 24-25 February 2022, was jointly organized by the United Nations Development Program (UNDP Malaysia), along with Securities Commission Malaysia (SC), Islamic Banking & Finance Institute Malaysia (IBFIM), Chartered Institute of Islamic Finance Professionals (CIIF) and Islamic Development Bank (IsDB) Group.
More than 500 high-level professionals participated in the International Conference which covered various topics within the Islamic finance sphere such as Islamic Social Finance, Islamic FinTech for Social Impact, and Impact Assurances and Measurement in Islamic Finance’s Sustainability Agenda. Panellists and moderators of the aforementioned sessions came from various backgrounds within the finance and Islamic finance sectors.
The International Conference began with a welcoming remark by Datuk Syed Zaid Albar, Executive Chairman of the SC and an opening address by Ms. Usha Rao-Monari, Associate Administrator of UNDP. The event also saw insights through keynote speeches from Datuk Zainal Izlan Zainal Abidin, Deputy Chief Executive of SC and Datuk Shaik Abdul Rasheed Abdul Ghaffour, Deputy Governor of Bank Negara Malaysia.
Ms. Usha Rao-Monari highlighted that “the alignment of the SDG financing agenda and Islamic finance presents a clear opportunity to attract capital from across the global financial system and enables the shift from ‘billions to trillions’ needed to achieve the goals.” He elaborated: “Islamic finance and SDG-sensitive impact investing are both founded on similar rigorous ethical and social criteria that emphasize inclusiveness and a deeper and more cooperative meaning of business–society relations”.
This was the general theme of the international conference which aimed to expand the discourse on how progress towards Sustainable Development Goals (SDGs) can be accelerated by positioning Islamic finance and Islamic social finance as important enablers across the globe.
She said UNDP is scaling up efforts to engage countries in Islamic finance as a vital complement to the overall mobilization of financing for the SDGs. With its presence in over 170 countries, UNDP has a unique vantage in mobilizing Islamic finance organizations to join forces with the conventional streams of financing the SDGs, and then also, on monitoring, reporting and communicating their overall impact on sustainable development.
In 2016, together with the Islamic Development Bank (IsDB) Group and UNDP launched the Global Islamic Finance and Impact Investing Platform aimed at strengthening Islamic finance & Impact investing as leading enablers of the global thrust towards implementation of the SDGs.
This investment platform launched its Green Sukuk Initiative in 2018, in collaboration with the SC, and IsDB’s Islamic Corporation for the Development of the Private Sector (ICD). To date, the initiative has provided technical assistance to Turkey, Uzbekistan and Pakistan. Through a new Technical Assistance agreement between UNDP and IsDB, the initiative will expand its services this year to other countries that are members of the Organization for Islamic Cooperation (OIC).
The International Conference clearly emphasized the appeal of Islamic finance as a whole, in terms of its ability to promote inclusion and stability, as well as its potential to expand the footprint of socially responsible and impactful investments.
Datuk Shaik Abdul Rasheed, Deputy Governor of Bank Negara Malaysia, in his keynote speech, pointed out the impact technology can have on Islamic finance, mentioning that “with the right and responsible application, emerging technologies can amplify the impact of Islamic finance in meeting sustainability goals.”, thereby hinting at the value of the inclusion of Fintech in the progression of Islamic Finance. According to the Deputy Governor, “Islamic financial institutions should nurture the mindset of partnership. Having a supportive ecosystem as well as a wide network of trusted partners is key to bolster the effectiveness of value delivery.”
The necessity of partnerships was further brought forward by Tan Sri Dr. Mohd Daud Bakar, Chairman of the Shariah Advisory Board of Bank Negara and the SC, who stated that Fintech alone cannot tackle the challenges that lie ahead in incorporating the philosophy of ESG and SDGs in the Islamic financial world.
Another keynote speaker was the Head of Islamic Development Bank’s Center of Excellence in Kuala Lumpur, Mr. Mohamed Abida, who underlined that the underlying values of Islamic finance such as social responsibility, inclusiveness, equitable sharing of risks, and sharing societal benefits, have a major role in promoting long term sustainability and inclusive growth. He pointed out the crucial role of Fintech in contributing to the global socio-economic development through the upscaling of digital banking and Fintech solutions, thereby expanding the footprint of Islamic finance. At the same time, to boost market confidence, he said that the adoption of high-level standards for impact assessment must be undertaken. “This will help ensure effective management and transparent integrated reporting on Islamic finances’ performance,” he concluded.