SC expands SRI Sukuk, Bond Grant Scheme to boost sustainable finance

PETALING JAYA: The Securities Commission Malaysia (SC) today announced the expansion of the Sustainable and Responsible Investment (SRI) Sukuk and Bond Grant Scheme to facilitate companies raising sukuk to meet their sustainable finance needs.

The grant is also now extended to SRI-linked sukuk issued under the SC’s SRI-linked Sukuk Framework, which was introduced in June 2022.

“The expansion of the grant will enable eligible SRI-linked sukuk issuers to apply to offset up to 90% of the external review costs incurred, subject to a maximum of RM300,000 per issuance,” the SC said in a statement.

The expansion is part of the Capital Market Masterplan 3’s priority to facilitate transition finance which supports Malaysia’s commitments and aspirations to transition to a low-carbon and climate-resilient economy. It aims to encourage the issuances of SRI-linked sukuk by corporates in carbon-intensive industries as they transition to better sustainability practices and low-carbon activities.

Established in 2018, the grant, formerly known as Green SRI Sukuk Grant Scheme, is also applicable to sukuk issued under the SC’s SRI Sukuk Framework and bonds issued under the Asean Green, Social and Sustainability Bond Standards.

In respect of the framework, the key distinguishing feature is the requirement to have external reviews at pre- and post-issuances, as the SC believes these will be crucial in providing independent opinion and verification on the issuer’s sustainable objectives as well as alignment to the framework.