Securities Commission chairman Datuk Mohammad Faiz Azmi
KUALA LUMPUR: Islamic finance must leverage three key drivers, mainly climate action, digital inclusion and Islamic innovation, to serve a higher purpose for Malaysia, Oman and the rest of the world, said Securities Commission (SC) chairman Datuk Mohammad Faiz Azmi.
He said that strategic approaches to Islamic finance, such as SC’s Maqasid Al-Shariah Guidance for the Islamic Capital Market Malaysia, released in 2023, and Oman’s Vision 2040, illustrate that finance must be more than just about making a profit.
Mohammad Faiz emphasised that actions to improve climate resilience and adaptation are no longer optional, and Malaysia has made strides with a 2.8 million euro (1 euro = RM4.92) grant from the Green Climate Fund to develop the National Adaptation Plan (MyNAP) secured earlier this year.
"After Malaysia’s devastating floods in 2021, which caused RM6.1 billion in losses, this has become a national priority,” he said in his keynote address today at the Islamic Finance News (IFN) Oman Forum 2025 in Muscat, Oman.
Mohammad Faiz said Oman’s Blue Carbon initiative, with its 100 million mangroves, and the Wadi Dayqah Dam, which safeguards water supply and flood control for Muscat and Qurayyat, are inspiring examples.
Meanwhile, the SC chairman said that regarding digital inclusion, Islamic fintech in Malaysia is thriving, with the industry valued at US$13 billion (US$1 = RM4.21) in 2024 and projected to almost double by 2028.
"The underlying objective is for these digital tools and solutions to deliver inclusion, not exclusion - through fractional access for retail investors and for underserved communities and micro, small and medium enterprises,” he said.
With respect to Islamic innovation, Mohammad Faiz said Islamic finance thrived by offering alternatives, such as sukuk instead of bonds, Islamic funds instead of conventional funds and even takaful instead of insurance.
"Potential next steps involve pioneering impact-linked sukuk that reward social outcomes, structuring tokenised Islamic social funds that democratise access to higher returns and lower costs of transactions, and embedding Maqasid-based disclosures that tie growth to justice, dignity and stewardship,” he said.
Mohammad Faiz added that together, Oman and Malaysia, as well as the wider community, have the opportunity to build an Islamic market ecosystem that not only progresses but simultaneously uplifts societies and protects the planet and generations to come. - Bernama
