Green disclosure regulations: navigating greenwashing in Islamic finance services

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Authors: Dona Budi Kharisma, Albertus Sentot Sudarwanto, Agus Yudha Hernoko, Diana Tantri Cahyaningsih
Cited by: 1
References: 30

Abstract

Purpose This paper aims to construct green disclosure regulations to prevent greenwashing in Islamic finance services. Design/methodology/approach This research is legal research with the statute approach and comparative approach methods. The legal materials used are regulations regarding green finance that are enforced in several countries such as Indonesia, Malaysia and the UK. Findings Sustainable finance, from an Islamic perspective, is a financial approach that is not solely oriented towards financial profit but also considers environmental sustainability, social justice and compliance with Sharia principles. However, greenwashing has become a serious issue and problem along with the increasing trend of investment in Islamic finance. The Green Disclosure Regulations (GDR) serve as a transparency framework that establishes requirements for Islamic finance players to disclose sustainability information and assist investors in making informed decisions about investing in projects aligned with sustainability goals. Research limitations/implications This research identifies sustainable regulations in the Islamic financial services implemented by several countries in the world. Practical implications The GDR proposed in this study can be useful as a guideline for all countries to develop sustainable regulations in Islamic finance services. Social implications The recommendations in this study are important to realize green finance as a sustainable finance in Islamic financial services. Originality/value This research analyzes regulatory issues and formulates green disclosure regulations in Islamic financial services. This research is important for preventing greenwashing in Islamic financial services so that green finance as a sustainable financial instrument can be realized.

Fields of Study & Subjects

Sustainable Finance and Green Bonds Islamic Finance and Banking Studies Governance Compliance and Sustainability

Publication details

Journal / source
International Journal of Law and Management
Publisher
Emerald
Pages
1–21
Publication date
6 January 2026
Language
EN