IFN OnAir

Positioning ESG and Sustainable Finance and Investment - Policy, Regulation and Action (Session One)

Why is a united regulatory response to climate risk, such as that offered by JC3 and The Value-based Intermediation Financing and Investment Impact Assessment Framework (VBIAF), so important for the financial services industry as a whole? How do we evaluate initiatives designed to encourage investment and resource allocation into sustainable economic activity? How do we address the implications of various taxonomies, frameworks and standards, and identify what can now be labelled sustainable investments? Should taxonomies recognise and reflect market-specific regulations, and are we presenting a clear, consistent message? What industry-led measures would address and mitigate current challenges, such as greenwashing and inconsistent reporting standards? How can potential sustainability bond and Sukuk issuers successfully connect issuances to internal sustainability frameworks? Are there avenues to further capitalise on the synergies between sustainable finance and Islamic finance?

There has been, in the past couple of years, a strong push in Saudi Arabia for both Shariah compliant financing and SME funding, and the results are encouraging. In this podcast episode, Paul Melotto, CEO of Shariah compliant financing company Alraedah Finance, talks to IFN's Nessreen Tamano about the Saudi market.

In the backdrop of Norton Rose Fulbright lending a hand to UK charity Save the Children to access Zakat funds, the firm’s global chair, Farmida Bi, discusses the significance of the initiative as well as shares her two cents on the state of ESG finance within the context of the Islamic finance industry.

What are the global investment flows and trends that continue to influence the deployment of Shariah compliant capital in the UK today? What are recent significant developments in Shariah compliant private equity, and can we identify potential targets for private equity investment in the UK market? What are the latest opportunities and demands for Shariah compliant direct investment into the UK real estate markets? How significant is the private placement market in the UK Shariah compliant investment landscape? What structures are being employed to facilitate Shariah compliant investments in the UK, and what investment types and asset classes are in favor? Can we identify geopolitical events, international developments and transactions that may influence future investment trends, and what are other potential areas for the deployment of Shariah compliant capital in the UK market? We seek the views of an expert panel.

Moderator:

Mike Tirman, Partner, Ice Miller

Panelists:

Amir Firdaus, Partner, CFO, OFFA

Andy Thomson, Head of Real Estate, Bank of London & The Middle East

Dr Hurriyah El Islamy, Executive Board Member, Badan Pengelola Keuangan Haji (BPKH)

Moad Giebaly, Partner, Trowers & Hamlins

Dr Scott Levy, Founder, Al Waseelah

What represents innovation in the contemporary Islamic capital market: pioneering structures, sourcing underliers or the transition from ESG to impact? What options do hybrid or combination Sukuk offer issuers, particularly in asset-heavy industries, and why have such structures been so successful in the Gulf? How do Tier 1 and Tier 2 Sukuk offer financial institutions a flexible, efficient and user-friendly way of satisfying regulatory capital requirements, and what do perpetual Sukuk structures offer such issuers? What does the Bank of England Alternative Liquidity Facility offer financial institutions in terms of meeting regulatory requirements under Basel III prudential rules? What did the second sovereign Sukuk mean for Islamic finance in the UK, how was the deal structured and why was it successful? How has innovation been incorporated into Islamic project and infrastructure finance, particularly regarding concession agreements, cash contributions and investor protection? With ESG and sustainability continuing to grow in Islamic capital markets issuance, when will we see the measurement of impact? With the demise of LIBOR, is SOFR a good alternative for the Islamic capital market? We seek the views of an expert panel.

Moderator:

Dr Natalie Schoon, CEO, Redmoney Consulting

Panelists:

Ahsan Ali, Managing Director and Head, Islamic Origination, Standard Chartered Saadiq

Nitish Bhojnagarwala, Vice-President – Senior Credit Officer, Financial Institutions Group, Moody’s Investors Service

Safdar Alam, CEO, Maydan Capital

Shrey Kohli, Head of Debt Capital Markets and Product Origination, London Stock Exchange

How do policymakers balance the fulfillment of energy demands with the achievement of the principal goals of COP26? Why is a united regulatory response to climate risk so important for the financial services industry, and how do we evaluate initiatives that encourage investors to channel capital and resources into sustainable economic activity, climate transition and social responsibility? How do we address the implications of various taxonomies, frameworks and standards, and identify what can now be labeled green investments? How can potential green bond and Sukuk issuers effectively connect issuances to internal sustainability frameworks, and what is the likelihood of a UK sovereign green Sukuk? With ESG and sustainability continuing to grow in Islamic capital markets issuance, when will we see the measurement of impact? Are sufficient issuers engaging with independent, third parties to measure green, sustainable and social credentials? Can we further exploit the convergence of sustainable finance and Islamic finance, and develop suites of investment products that satisfy both criteria?

Moderator:

Hari Bhambra, Global Head of Compliance Solutions, Apex Group

Panelists:

Craig Reeves, Director and Founder, Prestige Funds

Abou Jallow, Senior Advisor to the CEO, International Islamic Trade Finance Corporation

Michael Rainey, Partner, King & Spalding

Sohail Ali, Partner, DLA Piper

Zalina Shamsudin, Head of International Programmes, Climate Bonds Initiative

The digitalization of Islamic financial services: what is working, what is viable and what is not? What do the answers to these questions mean for the evolution of UK Islamic financial services? What would assist domestic Islamic financial institutions in the further development of Islamic digital retail, wealth management, Takaful and pension offerings in the UK? What are notable milestones and achievements in the development of systems and software for Islamic banks and financial institutions and what technology is available to help financial institutions drive scale, integrity, efficiency and ultimately profitability? What opportunities are created by crowdfunding and peer-to-peer lending platforms for the joint ownership of Shariah compliant assets and investment projects in the UK? What does the growth of digital investment management platforms and robo-advisory mean for investment managers, and what new opportunities are available for Shariah compliant savers and investors? What are the potential uses and applications of digital assets in financial markets today, and how are these assets exchanged, listed and traded? Finally, does digitalization allow us to better address issues such as product authenticity and the minimization of uncertainty? We seek the views of an expert panel.

Moderator:

Vineeta Tan, Managing Editor, Islamic Finance news

Panelists:

Areeb Siddiqui, Founder and CEO, Kestrl

Hassan Daher, Founder and CEO, Qardus

Youness Abidou, Founder and CEO, Nester

We pose a series of high-level strategic questions to senior representatives of the UK Islamic financial services industry. What is Islamic finance’s response to a rapidly shifting macroeconomic environment, and will inflation lead to innovative Islamic financial solutions? What form and scale might this innovation take? How can UK Islamic finance and investment create a genuinely competitive advantage in key areas such as retail, commercial, corporate banking and wealth management? How are UK Islamic retail banks innovating customer acquisition and retention strategies, and how successful have these been? Are there inhibitions and limitations the Islamic financial services industry needs to acknowledge and overcome? Does Islamic finance want to become mainstream, or are we content with the alternative label? What’s working in financial technology, and who ultimately benefits: financial institutions, consumers or both? Is technology being fully utilized to address key customer concerns surrounding authenticity and the minimization of uncertainty? Having witnessed the growth of ESG and sustainable finance, on reflection, are there things Islamic finance could have done differently?

Moderator:

Stella Cox, Managing Director, DDCAP

Panelists:

Michael Rainey, Partner, King & Spalding

Dr Mohamed Damak, Senior Director, Global Head of Islamic Finance, S&P Global Ratings

Mohammed Paracha, Head of Middle East, Norton Rose Fulbright

Richard Thomas, Managing Director, Sustainable Economy

Dr Usman Chaudry, Chief Risk Officer and Executive Director of the Board, Gatehouse Bank