The Responsible Finance & Investment Summit 2018 concluded with the release by the RFI Foundation of a report about Islamic financial institutions’ perceptions and actions on their environmental and social impacts. «The report includes a detailed survey of over 30 Islamic financial institutions’ sustainable finance practices – says Blake Goud, CEO, RFI Foundation – The survey finds growing awareness that Islamic finance has an ethical mandate to address social and environmental impacts linked to the activities they finance. The results of a survey, coupled with an examination of more than 30 case studies from Islamic finance and within Muslim majority countries finds that key challenges on implementation, building internal and external stakeholder awareness about the financial impact of environmental and social issues, and highlight the need for greater capacity building within the Islamic finance ecosystem».
The survey results are incorporated into some recommendations and conclusions including:
– Development well-structured strategies and enhanced policies for environmental and social issues within Islamic financial institutions including incentive programs tied to social and environmental outcomes;
– Greater consideration of how awqaf (perpetual endowments) can be mobilized in support of sustainable infrastructure, education, healthcare, food security, renewable energy, and water management, among others
– Training employees and management in Islamic financial institutions to enhance their focus on environmental and social issues in their business decision-making process, including a more proactive role for Shari’ah scholars on sustainable business practices.
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