Malaysian Green Technology and Climate Change Corporation and Ficus Capital to Pioneer the First Shariah-compliant Green Technology Venture Capital Fund in the World
October 6, 2023
KUALA LUMPUR, October 6, 2023 – Malaysian Green Technology and Climate Change Corporation (MGTC) announced the World’s First Shariah-compliant Green Venture Capital Fund with Ficus Capital – a reputable investment firm focusing on Environmental, Social and Governance (ESG) and Islamic investments. YB Dato’ Sri Huang Tiong, the Deputy Minister of NRECC, led the official launch ceremony of the World’s First Shariah-compliant Green Venture Capital Fund known as the Greentech Fund. The launching ceremony was held at the International Greentech & Eco Products Exhibition & Conference Malaysia (IGEM 2023) at the Kuala Lumpur Convention Centre.
The primary objective of the Greentech Fund is to channel investments into green technology projects and enterprises that contribute to Malaysia’s ambition of achieving net-zero greenhouse gas emissions as early as 2050.
The Greentech Fund is dedicated to promoting green growth in which investors will actively participate in carbon offset schemes and reap financial rewards. This demonstrates how closely the fund adheres to ESG guidelines and highlights its potential to investors looking for financial gain and environmental impact. The investments are expected to reduce or avoid more than 9 million tons of greenhouse gas emissions through projects across various green industry sectors, such as Renewable Energy, Biofuel and Biomass Conversion, Waste Management and Biogas, Sustainable Agriculture and Forestry, Sustainable Transportation, and other environmental projects which complement several SDG pillars.
Investing in green projects and companies harmonises perfectly with our 'Madani Economy: Empowering the People' framework, aiming to enhance lives and reshape our economic landscape.” said Ts Shamsul Bahar Mohd Nor, Group Chief Executive Officer of MGTC.
Over the past 25 years, MGTC has led Malaysia's green industry, bringing in substantial green investments worth over RM50 billion, including reducing 16.4 million metric tonnes of carbon emissions through various programs and creating over twenty thousand green jobs. Initiatives such as the Green Technology Financing Scheme (GTFS), MyHIJAU Mark, and Green Tax Incentives have catalysed positive change in the sector. GTFS has played a pivotal role in propelling green technology development in Malaysia by providing essential financial backing. Yet, a notable financing gap emerged, over-subscribed by 45% for GTFS 1.0 and 15% for GTFS 2.0.
“A tactical approach to address these financial gaps is establishing the Greentech Fund. This will support innovation, encourage entrepreneurship, and propel the expansion of sustainable enterprises in Malaysia by providing equity-based funding to green projects and businesses. It significantly expands the sustainable finance choices accessible to eco-friendly projects and businesses. This aligns with our goal of decreasing carbon emissions, contributing RM100 billion in green investment, and creating 230,000 green jobs by 2030.” Ts. Shamsul Bahar added.
Ficus Capital recognises the vast potential within green investments, particularly in Southeast Asia, primarily focusing on Malaysia. “Our fund is strategically designed to offer attractive returns to investors while aligning with their growing interest in carbon offset opportunities. Partnership with MGTC is pivotal in advancing the growth of projects and companies in Malaysia while reinforcing our dedication to fostering sustainability and contributing to the nation's green aspirations,” said Abdullah Hidayat, Co-Managing Partner of Ficus Capital. Unlike conventional financing, this fund adheres to Shariah principles, ensuring fair and transparent contracts for its fund’s projects and companies. Fair in this context means that the fund will not impose any interest charges in its investment agreements, and transparency shows that contracts are based on market prices and risk-sharing arrangements.
The fund is fully aligned with ESG principles, making it a champion of responsible investing. The fund focuses on the Quadruple Bottom Line, encompassing People, Planet, Profit, and Principle. This framework is an integral part of the larger ESG-Islamic framework embraced by the fund, highlighting its dedication to holistic sustainability.
MGTC is an agency under the Ministry of Natural Resources, Environment and Climate Change (NRECC) mandated to accelerate green growth, advance climate action and inculcate a green lifestyle. Guided by the National Green Technology Policy (NGTP), the National Policy on Climate Change (NCCP), the Green Technology Master Plan 2017-2030 (GTMP) and the Twelfth Malaysia Plan, MGTC carries out programs and initiatives to support stakeholders at all levels. By 2030, through its various programs and initiatives, MGTC aims to facilitate RM100 billion in green investments, create 230,000 green jobs and help Malaysia achieve its net-zero GHG emissions as early as 2050 target.
About Ficus Capital
Ficus is the world's first ESG-Islamic venture capital company, founded in 2018 by a team of seasoned professionals with over 70 years of combined experience in banking, investment, technology, and entrepreneurship. This pioneering firm is registered with the Securities Commission Malaysia and is known for its unique approach, focusing on the Quadruple Bottom Line (QBL), which emphasizes People, Planet, Profit, and Principle within its portfolio companies. Ficus Capital is committed to adhering to Shariah-compliant principles and upholding strong ESG values, setting a high standard for responsible and ethical investment practices.
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