Green Sukuk: The Introduction of Islam's Environmental Ethics to Contemporary Islamic Finance

60 Pages Posted: 21 Mar 2015

See all articles by Umar F Moghul

Umar F Moghul

University of Connecticut - School of Law; Michigan State Univ - College of Law

Samir Safar-Aly

Independent

Date Written: March 19, 2015

Abstract

This article explores the parallels between Islamic ethics and environmental consciousness and demonstrates the market potential of coupling environmental sustainability with Islamic capital markets. A ‘green’ sukuk, the subject case study, has the potential to build a pioneering bridge between socially-responsible and Islamic investment communities. Given the breadth of projects a sukuk can finance, the scope of Islamic and conventional socially-responsible investors, and large-scale renewable energy and energy diversification initiatives, a ‘green’ sukuk would engender business growth while addressing environmental and energy concerns and pave the way for future Islamic and socially responsible agendas like community rejuvenation and sustainable farming. Islamic finance may thereby effectuate tangible impact and respond to stakeholder criticisms. We recommend: (i) legislation of standards to support Islam’s environmental ethics alongside compliance assessment bodies, (ii) the inclusion of environmental ethics in contemporary Islamic legal-financial analytics, and (iii) audits describing environmental impact and efforts.

Suggested Citation

Moghul, Umar F and Safar-Aly, Samir, Green Sukuk: The Introduction of Islam's Environmental Ethics to Contemporary Islamic Finance (March 19, 2015). Georgetown International Environmental Law Review (GIELR), Vol. 27, No. 1, 2015, Available at SSRN: https://ssrn.com/abstract=2580864

Umar F Moghul (Contact Author)

University of Connecticut - School of Law ( email )

65 Elizabeth Street
Hartford, CT 06105
United States

Michigan State Univ - College of Law ( email )

318 Law College Building
East Lansing, MI 48824-1300
United States

Samir Safar-Aly

Independent ( email )

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