Investor Investment Behaviour in Socially Responsible Investment (SRI) Sukuk: Issue-Contingent Model Perspective Behavior

Abstract

The Socially Responsible Investment (SRI) Sukuk, a Shariah-compliant financial instrument, directs funds towards addressing social and environmental issues such as waqf assets, poverty, and microfinance development. Despite its potential, SRI Sukuk issuance remains low compared to conventional socially responsible investments (SRI). This study investigates the factors influencing investment in SRI Sukuk, focusing on moral intensity, organizational factors and intention of the Issue Continent Model (ICM). A survey of 88 fund managers analysed using Partial Least Squares Structural Equation Modelling (PLS-SEM) reveals that    
organisational factors directly affect SRI Sukuk investment behaviour. Moreover, both moral intensity and organisational factors influence investment indirectly through intention. The    findings emphasise the need for greater awareness and promotion of SRI Sukuk, particularly by governments in collaboration with Islamic scholars, to enhance demand. Highlighting the role of SRI Sukuk in funding socially responsible projects can strengthen moral intensity,   stimulating greater investment interest. The study suggests that addressing these factors can help increase SRI Sukuk issuance, contributing to broader social and environmental benefits