Dr Asim Ali Bukhari
Up to 1,400 years ago, Islam gave us the doctrine regarding the behaviour of all human beings toward the natural environment and resource utilization. Through the principle of the vicegerency of mankind on Earth, Islam defines what the role of mankind should be and how he should fulfil that role. It establishes that mankind is the representative of Allah (God) on earth, and Allah has entrusted mankind with the various natural resources on earth.
With this stewardship, Allah has placed responsibility and accountability on mankind with respect to his use of these worldly resources. In Islam, the possession of worldly resources is linked with accountability toward their use.
This creates a balance within the natural ecosystem by granting rights followed by responsibilities to human beings. The Qur’an says: “Then, on that day, you will be questioned about the bounty (of God).” (Qur’an 102:8). Unfortunately, mankind deviated from this path of sustainable production and consumption and adopted the practices of environmental degradation and unsustainable use of natural resources.
The results of this deviation have been catastrophic in the form of global climate change, food shortages, growing pollution, and scarce natural resources. It is time to realize that the survival of mankind lies in reverting to the teachings of Islam and crafting an economic system that synergizes with the Islamic philosophy of sustainable development.
The basic philosophy of Green Banking is similar to Islamic teachings. Green Banking proposes a balance between business operations and natural environmental conservation by the banks. It requires banks and other industries to fulfil their responsibilities toward the natural environment. This congruity of Green Banking with religious principles can increase its effectiveness and efficiency in dealing with the current global environmental crisis.
Islam is a religion that forbids extravagance in any form or purpose. This underlying philosophy can also be found in the various dimensions of Green Banking like green buildings. Similar to the concept of “green buildings,” Islamic architecture follows the laws of simplicity and resource efficiency by stressing the use of construction materials that do not cause any undue harm to the environment or the future occupants of the building.
According to Islam, a building must serve as an asset, not a liability, to the natural environment and society. Islamic architecture follows the same green guidelines as green buildings by incorporating effective ventilation systems, indoor and outdoor plantations, and the use of construction materials that can lessen the severity of the weather conditions.
Another synergy between Green Banking and Islamic principles is the conservation of resources. Islam has termed the natural resources as ‘ni’matullah’ meaning “the gifts of Allah” bestowed upon mankind. It teaches strict responsibility regarding the usage and consumption of these resources and forbids excessive and unequal resource usage and wastage.
It is stated in the Qur’an: “Indeed, the wasteful are brothers of the devils, and ever has Satan been to his Lord ungrateful” (Qur’an 17: 27). There are approximately 485 verses in the Holy Qur’an about the Earth, showing the great importance of the ecosystem in Islam.
The environmental element of Green Banking can be observed in the teaching of Hazrat Ali ibn Abi-Talib (A.S), as he instructed a man about the usage of land by stating: “Partake of it gladly, so long as you are a benefactor, not a despoiler; a cultivator, not a destroyer”. Like all the other natural resources, Islam considers the wastage of water a sin and has preached the responsible use of this resource. Discussion about the usage and value of water appears in the Holy Qur’an in over 50 verses and 40 surahs.
Since its inception in the 1970s, the Islamic finance industry has grown to almost US $3 trillion globally. In Pakistan, the Islamic banking industry is also depicting positive growth trends with the market share of Islamic banking assets and deposits in the overall banking industry standing at 19.5% and 20.5% respectively by end of June 2022.
Developing Muslim countries like Pakistan can combat climate change and develop a climate-resilient and sustainable economic infrastructure by greening the country’s Islamic capital markets; greening Islamic social finance; mobilizing Islamic project finance for green infrastructure; and developing Green Islamic banking services. Climate mitigation projects in the transport, energy, agriculture, water, and sanitation sectors can also be financed through various green Islamic finance instruments. Islamic banks can issue green Sukuk in the alternative energy, real estate, and transport industries to support the development of sustainable, environment-friendly green buildings and the electrification of public transport.
The awqaf, takaful (insurance) and blended finance programs of the Islamic finance industry also hold significant potential to help fund various green projects supporting Pakistan’s green, resilient, and inclusive economic recovery. Multilateral development banks such as the Islamic Development Bank can play a key role in supporting member countries, through technical support and catalytic financing, in developing Islamic Green banking industries and building climate finance portfolios.
The path to success in this world and the hereafter has already been taught to us 1400 years ago. Unfortunately, we got blindsided by manmade ideologies and business models. However, it is not too late to realize that Islamic banking and Green Banking are two sides of the same coin.
The global ‘Go Green’ movement or the sustainable development ideology has been already provided to Muslims a long time ago and through a profoundly better perspective. This has been acknowledged on a global level as according to the United Nations Development Program (UNDP), “the role of Islam could be one of the decisive factors tipping the planet toward a sustainable future”.
Ulama and Religious scholars can play a pertinent role in this regard by creating awareness regarding the inherent connection between Green Banking and Islamic Banking among all the concerned stakeholders. Pakistan can progress along an environmentally, socially and economically sustainable path by adopting the ideology of Green Islamic Banking.
