The potential of sustainable and responsible investment (SRI) sukuk as a funding mechanism for affordable housing in Malaysia

Kassim, Salina and Engku Ali, Engku Rabiah Adawiah and Syed Azman, Syed Marwan Mujahid and Satar, Norizan and Che Haron, Roziha (2019) The potential of sustainable and responsible investment (SRI) sukuk as a funding mechanism for affordable housing in Malaysia. In: Social Outcomes Conference 2019, 5th-6th September 2019, Oxford, United Kingdom. (Unpublished)

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Abstract

This study aims to highlight the issues surrounding the mismatch between demand and supply of affordable housing and explore the potentials of Sustainable and Responsible Investment (SRI) sukuk as a financing mechanism for affordable housing in Malaysia. “Sukuk” is an Islamic bond which complies with Islamic religious laws. Under Malaysia’s sukuk framework, “affordable housing” is one of the social areas listed as an eligible project that can use utilise the proceeds from SRI sukuk issuance. However, until today, there hasn’t been any significant development of SRI sukuk in terms of idea and implementation targeted for affordable housing in Malaysia. The study employs a qualitative methodology through critical review of literature to explore the issues surrounding affordable housing in Malaysia and highlights the potential of developing SRI sukuk to help address these issues. The study finds various factors that caused the shortage of affordable housing in Malaysia which includes: the lack of proper planning on affordable housing development; high development and construction costs; and the lack of incentive for developers to develop affordable housing. The study posits that the development of SRI sukuk has the potential to help align the focus of stakeholders towards sustainably developing affordable houses. Findings of the study are expected to provide enriching inputs to the authorities especially in terms of diversifying the sources of financing for the delivery of affordable houses towards the M40 of the society. Specifically, it suggests the development of SRI sukuk as an alternative social financing model that can be used to sustainably and responsibly develop affordable housing in Malaysia. The inherent objectives of SRI sukuk, together with clear policies on affordable housing, allows for better focus and coherence in planning for the development of affordable houses which also provides a “meeting point” that can cater to the objectives of its various stakeholders.

Item Type:	Conference or Workshop Item (Plenary Papers)
Additional Information:	4600/83660
Uncontrolled Keywords:	SRI sukuk, social finance, funding mechanism, affordable housing, Islamic finance
Subjects:	BPH Islamic Economics > BPH437 Sukuk - Islamic Bond H Social Sciences > HG Finance H Social Sciences > HG Finance > HG3368 Islamic Banking and Finance
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Institute of Islamic Banking & Finance (IIiBF) Kulliyyah of Architecture and Environmental Design
Depositing User:	Dr. Syed Marwan Mujahid Syed Azman
Date Deposited:	16 Oct 2020 10:09
Last Modified:	16 Oct 2020 10:09
URI:	http://irep.iium.edu.my/id/eprint/83660

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