Malaysia’s UEM Group’s Sustainability Sukuk Framework Achieves Green Finance Milestone

RAM Sustainability has completed the external review of UEM Group Berhad’s (UEM) Sustainability Sukuk Framework and concluded that it meets recognized green finance standards.

UEM is a wholly owned subsidiary of Khazanah Nasional Berhad (Khazanah), Malaysia’s sovereign wealth fund. Khazanah has identified UEM as its green investment vehicle, and the company is involved in a variety of industries, including expressways, township and property development, engineering and construction, asset and facility management, and green industries.

RAM Sustainability opines that the green initiatives to be financed under the Framework for renewable energy, energy efficiency, clean transportation, and pollution prevention and control have the potential to contribute towards national decarbonisation targets as defined in the National Energy Transition Roadmap (NETR) and the 12th Malaysia Plan.

The Framework is aligned with the disclosure requirements of the SRI Sukuk Framework, ASEAN Green Bond Standards, and Green Bond Standards. It is also aligned with all core areas, and 10 out of 20 recommendations in the pre-issuance checklist of the Green Bond Principles.

UEM Group Berhad’s Sustainability Sukuk Framework is a significant development in the Malaysian green finance market. The Framework will enable UEM to raise funds from investors to finance green projects, which will contribute to Malaysia’s national decarbonisation targets.

The Framework is also aligned with international green finance standards, which will make it more attractive to foreign investors. This will help to boost UEM’s access to capital and support its green investment plans.