Transition sukuk

Climate change - transition - financing - Sharia-compliant finance - sukuk.

A transition sukuk is a Sharia-compliant financing instrument to enable an activity or business that is currently a large emitter of greenhouse gases, to:

• Reduce its emissions significantly
• In alignment with the Paris Agreement

Aviation's first transition sukuk

"Judges also praised the aviation sector’s first-ever sustainability linked financing – which also happened to be wrapped up in the industry’s first-ever transition sukuk.

Raising $600m and securing the $300m early repayment of a 2021 debt maturity, Etihad’s deal is supporting the firm’s efforts in three emissions-reduction work streams: (1) sustainable aviation fuels, (2) voluntary carbon offsets and (3) operational efficiencies.

Last year, the airline operated four flights using synthetic fuels."

ACT Deals of the Year Awards 2020 - highly commended - Etihad Airways

See also

• Emissions
• Fossil fuel
• Greenhouse gas
• Paris Agreement
• Sharia-compliant finance
• Sukuk
• Task Force on Climate-related Financial Disclosures
• TCFD Recommendations
• Transition
• Transition finance