SC to launch SRI funds framework by year-end

When contacted, Advancecon group chief executive officer Datuk Phum Ang Kia said it was unable to give a new date for the prospectus launch at this juncture, pending queries from the SC.

KUALA LUMPUR: The Securities Commission Malaysia (SC) will launch a sustainable and responsible investment (SRI) funds framework by year-end to strengthen Malaysia’s position as a centre for Islamic funds and finance.  

SC Development and Islamic Markets managing director Zainal Izlan Zainal Abidin said the framework, to be launched in the second half of the year, would be based on Islamic values, as both SRI and Islamic finance have similar principles.

It would enable  fund managers to offer products that combined SRI elements and were Shariah-compliant, he told reporters on the sidelines of the “Responsible Investment Forum”, jointly organised by the SC, Bursa Malaysia Bhd and the United Nations’ Principles for Responsible Investment.

Zainal Izlan also said the number of companies with good environmental, social and governance (ESG) principles under Bursa Malaysia’s FTSE4Good had increased to 43 from 24 since it was first introduced in 2014.

FTSE4Good index measured the performance of public-listed companies demonstrating strong environmental, social and governance practices.  

Meanwhile, global SRI assets have increased 25% cent to US$22.9 trillion (US$1=RM4.29) between 2014 and 2016.

Although the SRI was relatively new in Malaysia, Shariah-compliant assets under management accounted for 30 per cent of the Asian SRI market (excluding Japan).

Zainal Izlan also said the SC had initiated the SRI sukuk framework in 2014.

“We are trying to find a new growth driver for the Islamic capital market segment,” he added. 

In January, the SC launched an Islamic fund and wealth blueprint which outlined strategies to create more products and services that meet both SRI and Islamic finance requirements. - Bernama