KUALA LUMPUR: Unity Group has introduced the world’s first syariah-compliant climate sukuk, reinforcing Malaysia’s role as a pioneer in combining Islamic finance with climate-focused investments.
The RMB200 million Unity Climate Sukuk, denominated in Chinese renminbi, was launched in partnership with Tek Securities Ltd and supported by Labuan’s key financial players. It marks the world’s first private sukuk issued in renminbi directly linked to carbon credit generation and verified emissions reductions.
Unity Group chairman and CEO Mansfield Wong said the sukuk reflects Malaysia’s growing reputation as a leader in sustainable and innovative finance.
“This programme is designed to integrate climate finance with syariah principles, creating a unique pathway for investors who are committed to sustainability as well as compliance,” Wong said at the launch today.
He added that the sukuk is not only groundbreaking in its structure but also crucial for building investor trust through transparency and accountability.
The programme will be tied to projects registered under a recognised carbon registry, monitored in real time by independent verifiers to prevent greenwashing.
The sukuk aims to attract a diverse pool of investors seeking ESG-aligned opportunities in Asia.
According to Unity Group, revenue streams will come from verified carbon credits and underlying renewable energy projects.
Wong emphasised that positioning Malaysia, specifically the Labuan International Business and Financial Centre (Labuan IBFC), as a hub for climate sukuk is strategic in the regional financial landscape.
“Labuan is increasingly being recognised as a forward-thinking jurisdiction for Islamic and sustainable finance. With this sukuk, we are not only highlighting innovation but also Malaysia’s global leadership in bridging Islamic capital markets with climate goals,” he said.
Tek Securities director Prof Datuk Dr H’ng Paik San welcomed the initiative, stressing its potential to advance both climate action and sustainable investment models.
“Climate change mitigation requires financing mechanisms that are not only innovative but also credible and transparent. This sukuk links financial instruments directly to real, measurable environmental outcomes,” he said.
H’ng noted that tying sukuk proceeds to verified carbon credits represents a practical step toward addressing emissions reductions.
He also highlighted the academic sector’s role in providing expertise to ensure that environmental standards are upheld.
Unity Group underscored that the sukuk will incorporate stringent monitoring systems, including verification by accredited third-party validators. nvestors will be able to access data in real-time to track project outcomes, thereby reinforcing accountability.
Wong said these safeguards are vital to differentiate genuine green financing instruments from projects accused of greenwashing.
Market observers note that the sukuk’s renminbi denomination may broaden its appeal to investors in China and across Asia, offering both diversification and alignment with Belt and Road sustainability objectives.
Wong said Unity Group is confident the sukuk will set a benchmark for future Islamic sustainable finance products. “We believe this initiative can encourage more issuers and investors to explore innovative structures that serve both profitability and environmental stewardship.”
The launch comes at a time when global demand for ESG-focused investments continues to grow, despite concerns about inconsistent standards and market scepticism.
Malaysia’s move, through Unity Group and Labuan IBFC, positions it at the forefront of efforts to establish robust and credible instruments in this sector.
Unity Climate Sukuk’s pilot projects will be based in Selangor, with scalability plans across Malaysia and potentially into the wider Asean region.
H’ng said partnerships between the private sector, academia and regulators will be key in sustaining momentum.
“This sukuk is a milestone, but more importantly, it sets a precedent. Collaboration is the only way to ensure we meet climate targets while maintaining investor trust,” he added.
With the launch, Unity Group and its partners hope to catalyse greater adoption of Islamic sustainable finance globally, positioning Malaysia as a model for integrating faith-based principles with urgent climate needs.
