Green finance and its Maqasid al-Shari’ah
The resurgence of green finance in the contemporary economic environment involves financial mechanisms that are designed to support environmentally sus�tainable projects and initiatives. It encompasses various instruments, such as green bonds and loans, directing funds towards activities that pr...
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| Main Authors: | , , |
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| Format: | Book Chapter |
| Language: | English English |
| Published: |
Routledge
2025
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| Subjects: | |
| Online Access: | http://irep.iium.edu.my/114071/3/114071_Green%20finance%20and%20its%20Maqasid%20al-Shari%E2%80%99ah.pdf http://irep.iium.edu.my/114071/2/Islamic%20Green%20Finance%20%283%29.pdf http://irep.iium.edu.my/114071/ https://www.routledge.com/Islamic-Green-Finance-A-Research-Companion/Billah-Hassan-Haron-Rosman-Billah/p/book/9781032672915 |
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| Institution: | Universiti Islam Antarabangsa Malaysia |
| Language: | English English |
| Summary: | The resurgence of green finance in the contemporary economic environment
involves financial mechanisms that are designed to support environmentally sus�tainable projects and initiatives. It encompasses various instruments, such as green
bonds and loans, directing funds towards activities that promote ecological conser�vation and climate mitigation. This approach reflects a global shift towards respon�sible and ethical financial practices, where considerations extend beyond economic
returns to encompass positive environmental and social impacts (Liu & Wu, 2023;
Khan, 2022).
Green finance, according to the Organization for Economic Cooperation
and Development (OECD), is described as financial activities geared towards
“achieving economic growth while reducing pollution and greenhouse gas
emissions, minimizing waste, and improving the efficiency of the use of nat�ural resources”. Over the past ten years, the global market for green finance has
experienced rapid expansion. This growth is evident in the creation of financial
instruments such as green-rated bonds, Green Sukuk, green loans, green invest�ment funds, and green insurance (OECD, 2023). Notably, the issuance of Green
Sukuk has become a recent addition to this landscape. While the inception of green
bonds dates back to 2008, the market has undergone substantial evolution. It now
plays a crucial role in mobilizing funds for the 17 UN Sustainable Development
Goals (SDGs) through the introduction of innovative structures, taxonomies, and
governance frameworks (Liu & Lai, 2021). In addition, the consequences of the
G-20 meeting in Chengdu, China, in July 2016 marked a transformative moment in
global finance. However, a study by Noh (2022) posits that the alignment of eco�nomic sustainability with Maqasid al-Shari’ah is deeply rooted in hifz al-mal, with
the effectiveness of Islamic social finance like Zakat and Waqf, in creating sustain�able practices among industrial players |
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