THE SUSTAINABLE PERFORMANCE OF ISLAMIC REITS AND THEIR SOCIAL CONTRIBUTIONS: MALAYSIA AS CASE STUDY.
Keywords:Real Estate Investment Trust (REIT), Financial Performance, Social Responsibility, International Integrated Report Requirements (IIRR)
The institutions that are committed to the Islamic tenets logically have got general sustainable
performance and positive social impacts. Thus, this study aims to evaluate the sustainability in
Malaysian Islamic REITs’ performance in terms of dividends distributions, net profit and share
price. Also, discovering the social contributions of them that often is link to the material
performance. The methodology will include a mixed quantitative and qualitative case study
approach to assess the performance and social responsibility of Listed IREITs in Bursa
Malaysia through a modelling set of questions. From the findings, two main different trends
can be highlighted (improving & deteriorating) relating to Malaysian IREITs' performance.
The golden start-up period of Malaysian IREITs persisted only for 5 years in terms of their
positive financial performance, which it reflected an increase in the net income and raise in the
share price of each fund of them. After 5 to 6 years from the inception, the negative financial
performance generally was noticed especially in share price. Moreover, it can be said that
Malaysian Islamic Real Estate Investment Trusts (REITs) do not make a positive social
contribution based on the social responsibility activities mentioned in their annual reports. The
implication is that social responsibility plays a fundamental role in the performance of Islamic
REITs (IREITs), and this study highlights the importance of considering their social impacts,
which have often been overlooked in previous studies focusing mainly on financial
Ali, S. S. (2007). Islamic Capital Markets Products, Regulations and Development. In Islamic Economic Studies, 15.
Anagnostopoulou, S. C., Gounopoulos, D., Malikov, K., & Pham, H. (2021). Earnings management by classification shifting and IPO survival. Journal of Corporate Finance, 66. https://doi.org/10.1016/j.jcorpfin.2020.101796
Benefield, J. D., Anderson, R. I., & Zumpano, L. V. (2009). Performance differences in property-type diversified versus specialized real estate investment trusts (REITs). Review of Financial Economics, 18(2),70–79. https://doi.org/10.1016/j.rfe.2008.04.001
Chuweni, N. N., & Eves, C. (2019). Measuring Technical Efficiency Of Malaysian Real Estate Investment Trusts: A Data Envelopment Analysis Approach. 17(1), 319–327. https://www.planningmalaysia.org/index.php/pmj/article/view/608/475
Diala, O. A., Ewurum, N., & Francis, C. (2021). Affordable Housing Ambidexterity of Real Estate Investment Trusts: SWOT Analysis for N-REITs. European Journal of Business and Management, July.https://doi.org/10.7176/ejbm/13-12-02
Dusuki, A. W. (2010). Practice and prospect of Islamic real estate investment trusts (I- REITs) in Malaysian Islamic capital market. Journal of Islamic Economics, Banking and Finance, 6(2), 25–40.
Edi, N., & Saad, N. M. (2012). Syariah REITs Vis-A-Vis Conventional REITs : An Analysis. International Journal of Academic Research in Business and Social Sciences, 2(7), 1–17.
Hassan, M. K., Aliyu, S., Saiti, B., & Abdul Halim, Z. (2020). A review of Islamic stock market, growth and real-estate finance literature. International Journal of Emerging Markets, 16(7), 1259–1290. https://doi.org/10.1108/IJOEM-11-2019-1001
Khan, T. (2021). Climate remediation and circular economy – Reframing Islamic finance architecture and infrastructures. 1–31.
Lombardi, S. M. (2010). Real Estate Investment Market. Nova Science Publishers.
Mohd Daud, M. A., Rosly, S. A., & Muhamad Sori, Z. (2021). Structuring fund for affordable housing investment in Malaysia: an exploratory research. International Journal of Housing Markets and Analysis, 14(2), 260–271. https://doi.org/10.1108/IJHMA-03-2020-0024
Ng, A. W. (2018). From sustainability accounting to a green financing system: Institutional legitimacy and market heterogeneity in a global financial centre. Journal of Cleaner Production, 195, 585–592. https://doi.org/10.1016/j.jclepro.2018.05.250
Nor Nazihah Chuweni, & Chris Eves. (2017). A review of efficiency measures for REITS and their specific application for Malaysian Islamic REITS. Journal of Islamic Accounting and Business Research, 8(1).
Olanrele, O. O., Adegunle, T. O., Jalaoso, B. A., & Said, R. Bin. (2019). Social Housing and REIT Funding for Affordable Housing in Africa Developing Nations. The Bartlett School of Construction and Project Management International Conference Bartlett Real Estate Institute, September.
Ong, T. S., Teh, B. H., Soh, C. H., & Yan, Y. L. (2012). Malaysian Real Estate Investment Trusts: A Performance and Comparative Analysis. International Journal of Economics and Finance, 4(5). https://doi.org/10.5539/ijef.v4n5p73
Osmadi, A., & Razali, M. N. (2014). Assessing the financial and management strength of Islamic Real Estate Investment Trusts (I-REITs) during the Global Financial Crisis (GFC). PERINTIS E Journal, 4(1), 48–69. http://ejournal.perintis.org.my/pdf/2014 - Article 3.pdf
Owen, G. (2013). Integrated Reporting: A Review of Developments and their Implications for the Accounting Curriculum. Accounting Education, 22(4), 340–356. https://doi.org/10.1080/09639284.2013.817798
Pagliari, J. L., Scherer, K. A., & Monopoli, R. T. (2005). Public versus private real estate equities: A more refined, long-term comparison. Real Estate Economics, 33(1), 147–187. https://doi.org/10.1111/j.1080-8620.2005.00115.x
Piao, X., Mei, B., & Zhang, W. (2017). Long-term event study of timber real estate investment trust conversions. Forest Policy and Economic, 78,1–9. https://doi.org/10.1016/j.forpol.2016.12.009
PricewaterhouseCoopers (PWC). (2014). The state of Integrated.
Thomson. (2015). “But does sustainability need capitalism or an integrated report” a commentary on “The International Integrated Reporting Council: A story of failure” by Flower, J. Critical Perspectives on Accounting, 27, 18–22. https://doi.org/10.1016/j.cpa.2014.07.003
Zhu, H. (2003). The importance of property markets for monetary policy and financial stability. In BIS Working Paper, 21.
How to Cite
Copyright (c) 2023 International Journal of Islamic Economics and Finance Research
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.