SC to launch social exchange by end of year - chairman

SC chairman Datuk Seri Awang Adek Hussin

KUALA LUMPUR: The Securities Commission Malaysia (SC) is expected to launch the Social Exchange, the first of its kind in Asean, by the end of this year, with registration for the exchange slated for the first quarter of 2025, said its chairman Datuk Seri Dr Awang Adek Hussin.

The Social Exchange is a dedicated fundraising platform for projects with positive social outcomes through the mobilisation of private and philanthropy capital in meeting the needs of the underprivileged.

Awang Adek said the SC will establish an advisory committee to speed up the implementation of the social exchange with proper governance and assurance in the framework.

"This (the framework) is to promote the raising of funds and more importantly to ensure the funds raised in the exchange will be used properly for their intended purpose," he said in a press conference on the sidelines of the Global Forum on Islamic Economics and Finance (GFIEF) at the Kuala Lumpur Convention Centre today.

Prime Minister Datuk Seri Anwar Ibrahim announced yesterday two capital market-related initiatives at the GFIEF - the establishment of Malaysia’s first Social Exchange; and the introduction of fundraising for waqf developments through peer-to-peer (P2P) financing and equity crowdfunding (ECF) platforms.

According to Awang Adek, the advisory committee for the establishment of the Social Exchange will be chaired by the SC, with the participation of representatives from the Ministry of Finance and Bursa Malaysia Bhd, along with other relevant parties.

"One of the countries that have actually done this is India, and it runs on their stock exchange, so we will have to explore whether it can be run by Bursa Malaysia here, but that is to be determined on how we want to implement it. One of the objectives of the advisory committee is that once people know that we already have a credible framework, then a lot more people will come to contribute," he said, adding that the SC has also studied the mechanism of India's implementation of its Social Exchange.

Elaborating further, Awang Adek noted that among the key focus areas of the eligible projects under the Social Exchange will encompass diverse themes aligned with the Sustainable Development Goals (SDGs), including social welfare, quality education, capacity building and good health and wellbeing. It will also include waqf-related projects and environmental sustainability and conservation projects.

Awang Adek also highlighted that the exchange will benefit, amongst others, entities such as non-governmental organisations (NGOs), social enterprises or Islamic religious councils to fund their projects that have positive social outcomes.

Meanwhile, during his address at the GFIEF, Awang Adek also announced that the SC is putting in place concrete steps to support the national sustainability agenda and strengthen Malaysia as a regional Sustainable and Responsible Investment (SRI) hub.

"SRI Shariah screening for public-listed companies (PLCs) will be introduced later this year.

"It is hoped that these efforts will refresh the regulatory ecosystem for sustainability, facilitate a just transition, and enhance further the alignment between Shariah and sustainability," he said. - Bernama