Dubai Islamic Bank (DIB), the largest Islamic bank in the United Arab Emirates, has launched its first-ever Sustainability-Linked Finance Facilities Financing Framework. This initiative makes DIB the first Islamic bank in the world to create such a framework, which aligns with the International Capital Market Association’s Sustainability-Linked Loan Principles

Accroding to MSN, the newly introduced framework clearly outlines the criteria for eligible Sustainability-Linked Finance Facilities. This allows DIB to issue financial instruments specifically for projects aimed at mitigating climate change. The framework includes predefined Key Performance Indicators and Sustainability Performance Targets, ensuring that the projects financed adhere to strict environmental standards.

Dr. Adnan Chilwan, the Group Chief Executive Officer at DIB, highlighted the importance of this development. He mentioned that the framework is a crucial component of the bank’s sustainability strategy called “Finance a Sustainable Future.” Dr. Chilwan stated that DIB aims to have 15% of its portfolio in sustainable finance by 2030. He added that this framework would assist clients in transitioning towards more sustainable business models that include clear environmental commitments.

To ensure transparency and accountability, DIB intends to publish an allocation and impact report each year for the duration of the sustainability-linked finance instruments. These reports will be assessed by an independent party to guarantee the integrity and effectiveness of the financed projects.