Green Sukuk Determinants: Influence of Corporate Governance and Social Responsibility

The climate of the planet is changing significantly annually. According to environmental scientists, global climate change is providing with some issues related to the increase in the average annual temperature. This leads to other problems in terms of water level increase in the oceans. Green sukuk are the additional financial instrument to green bonds to attract financing for environmental projects. The current research aims to determine whether there is a difference in the effect of corporate governance and social responsibility factors on sukuk and green sukuk. The sample for the first model contains 313 issues of sukuk and green sukuk, and for the second model contains 117 issues in the period from 2017 to 2021. The following main findings were obtained during this study: 1) a negative relationship between social responsibility factors and amount of green sukuk issued; 2) a negative relationship between green spread and the difference in social responsibility factors; 3) corporate governance factors have a significant effect on both amount of sukuk issued and green yield spread.