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Do investors get benefits from corporate green sukuk issuance

This study evaluates whether investors benefit from green sukuk by examining the responses of stock returns to the announcements of corporate green sukuk (green Islamic bonds) issuance. Applying the standard event study methodology, it finds that stock returns respond positively and significantly to...

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Main Authors: Riaz, Tabassum, Selamat, Aslam Izah, Mohd Nor, Normaziah, Sheikh Hassan, Ahmad Fahmi
Format: Article
Language:English
Published: Bank Indonesia Institute 2024
Online Access:http://psasir.upm.edu.my/id/eprint/114635/1/114635.pdf
http://psasir.upm.edu.my/id/eprint/114635/
https://jimf-bi.org/index.php/JIMF/article/view/1944
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spelling my.upm.eprints.1146352025-01-22T00:44:56Z http://psasir.upm.edu.my/id/eprint/114635/ Do investors get benefits from corporate green sukuk issuance Riaz, Tabassum Selamat, Aslam Izah Mohd Nor, Normaziah Sheikh Hassan, Ahmad Fahmi This study evaluates whether investors benefit from green sukuk by examining the responses of stock returns to the announcements of corporate green sukuk (green Islamic bonds) issuance. Applying the standard event study methodology, it finds that stock returns respond positively and significantly to the announcements of green sukuk issuance, suggesting that investors perceive and react favorably to the announcement. This significantly positive response is observed both for the individual firm (through CARs) and for a sample of all firms (through CAARs). Thus, it can be concluded that investors benefit from the announcements of green sukuk issuance. Further, this study draws a comparative analysis of investors' response to the announcements of corporate green sukuk and corporate green bond issuance, and the findings also show that investors respond positively to the announcements of green bond issuances. However, the investors' response is slightly higher to the announcements of corporate green sukuk issuance compared to corporate green bonds, and the investors get slightly more benefit from green sukuk issuance as compared to green bond issuance. These finding inform policymakers for the formulation of strategies to attract investors by integrating green bonds with shariah principles to fund environment-friendly projects and consequently mitigate the climate change risk. Bank Indonesia Institute 2024-08-30 Article PeerReviewed text en cc_by_nc_4 http://psasir.upm.edu.my/id/eprint/114635/1/114635.pdf Riaz, Tabassum and Selamat, Aslam Izah and Mohd Nor, Normaziah and Sheikh Hassan, Ahmad Fahmi (2024) Do investors get benefits from corporate green sukuk issuance. Journal of Islamic Monetary Economics and Finance, 10 (3). pp. 445-470. ISSN 2460-6146; eISSN: 2460-6618 https://jimf-bi.org/index.php/JIMF/article/view/1944 10.21098/jimf.v10i3.1944
institution Universiti Putra Malaysia
building UPM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Putra Malaysia
content_source UPM Institutional Repository
url_provider http://psasir.upm.edu.my/
language English
description This study evaluates whether investors benefit from green sukuk by examining the responses of stock returns to the announcements of corporate green sukuk (green Islamic bonds) issuance. Applying the standard event study methodology, it finds that stock returns respond positively and significantly to the announcements of green sukuk issuance, suggesting that investors perceive and react favorably to the announcement. This significantly positive response is observed both for the individual firm (through CARs) and for a sample of all firms (through CAARs). Thus, it can be concluded that investors benefit from the announcements of green sukuk issuance. Further, this study draws a comparative analysis of investors' response to the announcements of corporate green sukuk and corporate green bond issuance, and the findings also show that investors respond positively to the announcements of green bond issuances. However, the investors' response is slightly higher to the announcements of corporate green sukuk issuance compared to corporate green bonds, and the investors get slightly more benefit from green sukuk issuance as compared to green bond issuance. These finding inform policymakers for the formulation of strategies to attract investors by integrating green bonds with shariah principles to fund environment-friendly projects and consequently mitigate the climate change risk.
format Article
author Riaz, Tabassum
Selamat, Aslam Izah
Mohd Nor, Normaziah
Sheikh Hassan, Ahmad Fahmi
spellingShingle Riaz, Tabassum
Selamat, Aslam Izah
Mohd Nor, Normaziah
Sheikh Hassan, Ahmad Fahmi
Do investors get benefits from corporate green sukuk issuance
author_facet Riaz, Tabassum
Selamat, Aslam Izah
Mohd Nor, Normaziah
Sheikh Hassan, Ahmad Fahmi
author_sort Riaz, Tabassum
title Do investors get benefits from corporate green sukuk issuance
title_short Do investors get benefits from corporate green sukuk issuance
title_full Do investors get benefits from corporate green sukuk issuance
title_fullStr Do investors get benefits from corporate green sukuk issuance
title_full_unstemmed Do investors get benefits from corporate green sukuk issuance
title_sort do investors get benefits from corporate green sukuk issuance
publisher Bank Indonesia Institute
publishDate 2024
url http://psasir.upm.edu.my/id/eprint/114635/1/114635.pdf
http://psasir.upm.edu.my/id/eprint/114635/
https://jimf-bi.org/index.php/JIMF/article/view/1944
_version_ 1823093214241882112
score 13.23648

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