Green Finance From A Fiqh Perspective

While financial activities continue at a fast pace in our age, the planet we live on is going through severe shocks. While pushing the limits for their luxury and comfort, people, on the one hand, get what they want to a certain extent; on the other hand, they destroy themselves by destroying many things entrusted to them by the divine will, especially the environment. In this respect, although we may leave financial legacies of high material value to future generations, we deprive them of invaluable values that cannot be bought. This is because, although the increase in mass production and industrial products after the Industrial Revolution increased humanity's material well-being, it sterilised its spiritual area and condemned them to narrower areas in terms of a clean environment. Thus, while billions are spent to achieve material welfare, the environment entrusted to it at zero cost is destroyed by industrial wastes. People are preparing their fatal end with their own hands. The 41st verse of Surah Ar-Rum in the holy Qur'an points to this fact in a very general way and with the following expressions:

“Corruption has spread on land and sea as a result of what people’s hands have done, so that Allah may cause them to taste the consequences of some of their deeds and perhaps they might return ‐to the Right Path‐.”

The word “corruption” mentioned in this verse refers to all kinds of evil such as injustice, inequity, blood, tears, world wars, nuclear disasters, excessive armament, environmental pollution, drugs, alcohol, sexual perversions, terrorism and anarchy. In another verse, the following is stated by drawing attention to the danger related to water resources:

Say, “Consider this: if your water were to sink ‐into the earth‐, then who ‐else‐ could bring you flowing water?” (Al-Mulk, 67/30)

At first, some states, realising the harmful side effects and destruction of the technology they sanctified, began spending billions of money on preventing the destruction in question and repairing what was destroyed. For example, various campaigns were launched to prevent environmental pollution and protect thenatural environment. Serious investments have been made and continue to be made for this purpose. At this point, green, a symbol colour, was chosen first. Green; represents pure, clean, natural and unspoiled environment. Everything environmentally friendly has now been painted green and used as green. In fact, the financial world also got its share from this, and the concept of "green finance" was created. This is because irresponsibly and selfishly supporting every project simply for profit has been shown to pose severe environmental problems.

Green finance is a positive concept used by organisations that provide financial support for environmentally friendly projects. This concept aims to bring together the financesector and the business world with environmentally friendly projects, products and technologies. Because fossil fuels, which are uncontrollably and unconsciously 

consumed, significantly increase the risk of global warming and climate change. Therefore, it is essential to prefer using renewable energy such as solar and wind energy, both in the business world and in daily life. Those who want to reduce the rate of toxic gas released into the atmosphere, environmental pollution and carbonfootprint daily have to turn to energy-efficient alternative products. For this, the use of products, services and projects in renewable and efficient energy should be encouraged. At this point, “green finance” comes to the fore and is used.

Financial institutions operating within the scope of green finance provide financing support for nature and environment-friendly projects. The primary purpose ofthese projects is to produce effective, comprehensive and market-oriented solutions to environmental problems. Today, some areas where technologies are defined as environmentally friendly include renewable energy sources, energy efficiency and saving, protection of natural life, recyclable contents and waste, reducing greenhouse gas emissions, reducing air and environmental pollution, using plant-based products and raw materials, reduction of consumption and industrial ecology. Even all these and similar areas show how extensive the deterioration is.

When the balance between the built and the destroyed, the deteriorated and the reformed is not observed, disaster is inevitable when acted unconsciously. For this reason, the concepts of "maslahad" and "mafsadad", which have their origins in Arabic, have a central place in Islamic literature in general and in fiqh literature in particular. Mafsadad refers to everything that is harmful to religion, people, society and nature, while maslahad refers to everything that benefits them. The dominant group is considered when something is "mafsadad" or "maslahad". According to this, what is more than 50% is generally considered as maslahad, and what is below this rate is considered as mafsadad, and its ruling is determined accordingly. In fact, these two concepts are so crucial in terms of Islamic thought and fiqh that a principle like "def-i mefâsit celb-i menâfi" is put forward when it is desired to summarise the goal of Islam and Islamic rulings. In other words, religion and religious decrees aim to protect and obtain whatever is in favour of people, society, religion and the environment and to eliminate whatever is to their detriment. In the meantime, is the abolition of the mafsadad or the attainment of the maslahad a priority? This question is answered with the rule: "Def-i mefâsid is a child of celb-i menâfi". In other words, eliminating harm is 

prioritized over obtaining the benefit. Accordingly, it is religiously objectionable to finance a project that has some benefits but is more damaging to religion, society,environment and nature in the long and short term. Those who bear responsibility for humanity should not support such projects.

Finally, let us state that the sector that the concept of green finance suits best is the participation sector. The following statements are included in almost every standard prepared for this sector: The transaction to be made and the activity to be financed must not be contrary to the principles and standards of participation finance. For example, the following statements are included in the stock certificate standard:

“It is permissible to establish companies whose field of activity does not contradict the principles and provisions of Islam and to issue the shares of these companies. The establishment of companies that do not comply with this fundamental principle and the issuance of their shares are not permissible.

Among activities contrary to Islam's principles and provisions, activities that harm the environment and living things are also counted. Therefore, the essential attitude that will make green finance reach its goal will always be to support beneficial activities and stay away from illegitimate ones.

TKBB, Member of the Central Advisory Board Prof. Dr. Abdullah Kahraman