When it comes to sustainable, responsible and Islamic finance investing, action is spurred on not only by an ethical imperative, but also an enhanced commercial reality.
This was one of the consistent themes that emerged at the recently concluded fourth RFI Summit 2019 in Abu Dhabi.
Organised by the Responsible Finance and Investment (RFI) Foundation and Swiss Arab Network, the discussions centred around how to create a new socially responsible investment (SRI), combining sustainable, responsible and Islamic finance.
Speaking at the summit, an Abu Dhabi Future Energy Co (Masdar) executive said the renewable energy (RE) market started out as a high-cost and high-risk investment, not only for governments, but also for companies, banks and investors.
“Fast forward to today, however, the economic argument for renewables is undeniable. Technology-driven significant price reductions, combined with a substantially improved risk profile, makes renewables an increasingly attractive sector for investment for broader and diverse sources of capital,” said Masdar CFO Niall Hannigan in a statement released by RFI.
He said the recent hybrid refinancing deal for the 402MW Dudgeon offshore wind farm in the UK, which is owned by Equinor ASA, Masdar and China Resources Group, is a perfect example of the change in investor sentiment.
“What we are seeing is a greater appetite for money to go into SRI — but what helps to facilitate this is that it makes economic sense,” he said. Masdar is owned by Mubadala Investment Co PJSC.
The mainstreaming of RE has led to increased funding for projects relating to energy efficiency technology and smart homes/buil- dings, each of which is aligned to the Paris Agreement and Sustainable Development Goals.
Princess Sarah Zeid of Jordan delivered the event’s opening keynote address. — TMR