Abstract
This article introduces the various types of sukuk that exist in the Malaysian secondary market. The Malaysian sukuk market was initially debt-based which attracted criticism from the Shariah scholars from the Gulf and Middle East. However, the Malaysian sukuk market made a turn towards equity and ijarah sukuk and ventured into “green sukuk” or socially responsible investment (SRI) sukuk. To facilitate the financing of sustainable and responsible investment initiatives, the Securities Commission of Malaysia (SC) has launched the Sustainable and Responsible Investment (SRI) sukuk Framework in 2014. The introduction of the SRI sukuk framework is seen to be in line with the rising trend of “green bonds” and “social impact bonds” that have been introduced globally to facilitate and promote sustainable and responsible investing. The writer has presented different examples from both regions to show that the gap has been bridged. However, despite this convergence the author recommends a revisit of the controversial debt-based instruments by Malaysian Shariah scholars.
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