From Structure to Purpose: Green and Social Narratives, and the Shifting Morality of Islamic Finance in Kuala Lumpur

Abstract

Background: The anthropology of sustainability documents and interprets diverse visions of sustainable and liveable futures. Islamic scholars and financiers are now debating the distinctive contribution of Islamic finance to global sustainability. While mainstream global finance has only recently begun to pay explicit attention to social and environmental sustainability, Islamic economics has always emphasised the need to benefit society, the community, and the environment. Objectives: We ask what has been the influence of the emergence of green and social finance upon Islamic finance in Malaysia, the global centre of Islamic finance. Methods: The study is based on collaborative, co-productive ethnography and autoethnography, and textual analysis of working documents of the Securities Commission Malaysia, focusing on how environmental requirements are expressed in new financial products, known as green sukuks, or green Islamic bonds. Results and conclusions: We have found that much of the moral debate in Islamic finance has revolved around the distribution of financial risk: when investors share the risk of failure, they can participate in society rather than merely exploiting social relations, yet the emergence of ‘green’ Islamic finance appears to shift the centre of moral gravity away from risk structuring towards technical criteria of sustainability, replicating the growth-oriented anthropocentric managerialism of mainstream finance.