KUALA LUMPUR, Malaysia (July 5): The FTSE4Good Bursa Malaysia Shariah (F4GBMS) index was launched by Bursa Malaysia Bhd and FTSE Russell to track Shariah-compliant constituents in the FTSE4Good Bursa Malaysia Index (F4GBM). Bursa Malaysia said in a statement that as of June 2021, the index would include 54 members and will be evaluated semi-annually in June and December. The Securities Commission Malaysia Shariah Advisory Council’s methodology will be used for screening.
According to the company, the new F4GBMS index will be used by fund managers to create new investment products based on a portfolio of shariah-compliant stocks driven by sustainable investing principles.
“We are thrilled to provide a Shariah-compliant version of our venerable F4GBM index, which has played a critical role in recognizing publicly traded companies who have improved their ESG policies and disclosures.”
The F4GBMS index was created to meet the growing demand for Shariah-compliant investment instruments. With the convergence of ESG and Islamic investment, this new index gives local fund managers a new dimension by incorporating shariah principles into an ESG index “Datuk Muhamad Umar Swift, chief executive officer of Bursa Malaysia.
According to him, the index demonstrates Bursa Malaysia’s dedication to serving the market’s indexing demands, as the bourse works to diversify and expand its index offerings to include more topic and style indexes.
The FTSE4Good indexes have provided investors with comprehensive ESG benchmarks covering several stock markets, including Malaysia, according to Helena Fung, head of sustainable investment, APAC, at FTSE Russell.
“FTSE4Good indexes, which are widely followed by ETFs and other passive vehicles, have a strong track record of driving improvements in corporate sustainability performance by gradually raising eligibility standards.
“It was critical that we introduce shariah compliant versions of the popular FTSE4Good Bursa Malaysia Index in collaboration with our partners at Bursa Malaysia to meet investor demand for ESG and shariah compliant index solutions,” she said./n
