The Role of Islamic Financial Institutions in Achieving Sustainable Development with Special Reference to Environmental Protection

Abstract

The principles of Islamic banking and finance support the socially responsible development and environmentally sustainable activities. It has the ability to offer Shari'ah-based financial products to contribute in environmental protection and socio-economic development. In order to accomplish this agenda, Islamic finance should make efforts to mobilize resources for achieving the Sustainable Development Goals (SDGs) launched by the United Nations in 2015. This study adopts a qualitative method of inquiry and utilizes secondary information to investigate the ability of Islamic financial institutions (IFIs) in fostering sustainable development. Furthermore, this study contemplates that IFIs should communicate with regard to ecological issues: as finance providers, as pioneers in promoting the goals, as valuers, and as strong partners. A value-based template has been developed and utilized to demonstrate how it is feasible to play an important and vital role of Islamic Financial Institutions (IFIs) in environmental protection. Some strategic choices have been chosen based on the possibility of having a significant long-haul environmental advantage.