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Towards Green Economy Transformation Through Islamic Green Financing: Managing Risk And Fostering Sustainable Growth For The Real And Financial Sectors

Author

Listed:
  • Ferry Syarifuddin

    (Bank Indonesia)

Abstract

This study investigates the preferences of various Islamic Financing Instruments to promote green economy ransformation adopting ANPBOCR (Benefit, Opportunity, Cost, Risk) approach, with two groups of experts as the respondents, namely academicians and practitioners. The first finding shows, that ‘Benefit’ aspect is the most preferred, urgency to conduct green economy transformation. Among criteria in the benefit aspect, natural resource damage prevention and reduction are the primary issues which is in line with maqasid al-Syari’ah (objectives of Islamic law). Using standard formula, the second finding shows that Islamic Asset Management is the most preferred Islamic financial instrument to perform green economy transition. Meanwhile, the third finding shows that in the short-term, Islamic Asset Management is more preferred financial instrument. Whereas, Islamic corporate and investment banking is the most preferred and crucial for long-term when transforming economy to green.

Suggested Citation

  • Ferry Syarifuddin, 2022. "Towards Green Economy Transformation Through Islamic Green Financing: Managing Risk And Fostering Sustainable Growth For The Real And Financial Sectors," Working Papers WP/05/2022, Bank Indonesia.
    • Handle: RePEc:idn:wpaper:wp052022
    as

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    References listed on IDEAS

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    1. Fabio De Felice & Antonella Petrillo & Orrin Cooper, 2013. "An integrated conceptual model to promote green policies," International Journal of Innovation and Sustainable Development, Inderscience Enterprises Ltd, vol. 7(4), pages 333-355.
    2. Isaac Akomea-Frimpong & David Adeabah & Deborah Ofosu & Emmanuel Junior Tenakwah, 2022. "A review of studies on green finance of banks, research gaps and future directions," Journal of Sustainable Finance & Investment, Taylor & Francis Journals, vol. 12(4), pages 1241-1264, October.
    3. Thomas L. Saaty & Luis G. Vargas, 2013. "The Analytic Network Process," International Series in Operations Research & Management Science, in: Decision Making with the Analytic Network Process, edition 2, chapter 0, pages 1-40, Springer.
    4. Thomas L. Saaty & Luis G. Vargas, 2013. "Decision Making with the Analytic Network Process," International Series in Operations Research and Management Science, Springer, edition 2, number 978-1-4614-7279-7, April.
    5. Geddes, Anna & Schmidt, Tobias S., 2020. "Integrating finance into the multi-level perspective: Technology niche-finance regime interactions and financial policy interventions," Research Policy, Elsevier, vol. 49(6).
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Green Economy Transformation; Islamic Green Financing; ANP; BOCR;
    All these keywords.

    JEL classification:

    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • G20 - Financial Economics - - Financial Institutions and Services - - - General

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