Bursa Malaysia Launches World’s First Shariah-Compliant Carbon Exchange

Bursa Malaysia Launches World’s First Shariah-Compliant Carbon Exchange

by December 12, 2022

Bursa Malaysia announced the launch of the Bursa Carbon Exchange (BCX), touted to be the world’s first Shariah-compliant carbon exchange in the world.

The exchange will enable companies to trade voluntary carbon credits from climate-friendly projects and solutions, with the aim to offset their emission footprint and meet climate goals.

The BCX Rules, auction terms and conditions, online module and operational processes have been finalised.

Projects permitted to be traded include nature-based solutions or technology-based solutions, which result in avoidance, reduction or removal of GHG emissions.

Bursa Malaysia said that the first trades will be conducted via an auction which will facilitate price discovery for the new standardised carbon credit products listed on BCX.

The first trade via auction is expected to commence in March 2023.

Interested project developers and proponents who would like to supply carbon credits for the auction as well as corporate buyers who would like to participate in the auction and purchase carbon credits can register their interest here.

Tan Sri Abdul Wahid Omar

Tan Sri Abdul Wahid Omar

“In addition, leveraging on Malaysia’s position as the global Islamic financial marketplace as well as being the world’s leading exchange for Islamic fund raising and investment, Bursa Malaysia is the first exchange in the world to receive a Shariah Pronouncement for its Carbon Exchange and the standardised carbon products that the exchange will offer,”

said Tan Sri Abdul Wahid Omar, Chairman of Bursa Malaysia.

 Datuk Muhamad Umar Swift

Datuk Muhamad Umar Swift

“The launch of the Bursa Carbon Exchange is timely given the growing impact of global warming, and the important role voluntary carbon markets will play to support financing for climate-friendly projects and solutions.

 

Both buyers and suppliers will now be able to transact high-quality carbon credits and use them to offset their existing climate impact alongside their other internal carbon reduction initiatives”,

said Datuk Muhamad Umar Swift, CEO of Bursa Malaysia.