| Salient Features |
Sri Sukuk |
SIB |
| Syariah Compliance |
Submission of documentation and data for Syariah review by SCM is mandatory. |
Syariah compliance is not regulated by any established policy. |
| Syariah based contract |
Must adhere to at least one of the core tenets of Syariah principles as determined by SCM's Syariah Advisory Council (SAC). |
Not govern by any Syariah principle |
| Sukuk/bond issuer |
A corporation as defined by Section 2(1) of the CMSA and a non-domestic government |
Public-private partnership |
| Rating Requirement |
The issuing of SRI Sukuk necessitates a credit rating, which can only be provided by a credit rating agency listed with SCM |
Imposes no rating constraints |
| Transferable and tradability |
Enables the sale and purchase of Sukuk |
A commissioner, service provider, and investor enter into a payment-by-results contract that is not tradable or transferrable. |
| Guarantee of capital. |
Kafalah (guarantee) on capital in the issuing of Sukuk musharakah and mudarabah may be offered by a third party |
Capital is not guaranteed, If the SIB initiative fails, investors stand to lose their capital |
| Financial Risk |
In the event of default, risk can be shared between investors and the obligor through the use of a guarantee mechanism known as kafalah. |
Failure to satisfy the KPI, the risk is shifted to the investors, who risk losing both the return and their initial investment. |
| Reporting and Transparency disclosure |
The disclosure of information to the public in disclosure documents such as prospectus and annual report related to all the data about the eligible SRI Project and its intended outcomes, and the compliance on ESG guidelines |
Two reports are required from issuers: (i)Progress report- development that details accomplishments, difficulties, and potential for growth(ii) final Report – Accomplishment of requirements and distinctive factors contribute to project success or failure |
| Return mechanism |
Pre-determined coupon/profit rate at the time of contract inception |
The rate of return will be determined by the program's success. A higher success rate would normally imply better returns, but with a capped upside |
| Methodology of assessment |
Pay for success (using specific KPI) |
Pay for success |
| Appointment of independent assessor |
An independent third party may be appointed by the issuer to evaluate the Eligible SRI project. |
The cost of an independent audit is borne by the issuer. |
