It's Time for Conventional Corporations to Consider Sukuk, Here's Why!

When companies require funding, the typical options are bank loans, bond issuances, or share offerings. Yet, there is another funding alternative in the capital market that remains underutilised by conventional companies: sukuk. Sukuk has often been regarded as an exclusive instrument for Sharia-compliant firms. However, this instrument can also be issued by conventionally operating companies, provided the issuance structure meets Sharia principles and applicable regulations. Amid increasingly diverse funding needs and evolving market dynamics, companies are required to be more proactive and adaptive in selecting their funding sources. In this context, sukuk deserves consideration as part of a company’s long-term funding strategy. In addition to bank loans and share issuances, the capital market provides a Sharia-based funding instrument with significant potential, namely sukuk. Generally, sukuk is a Sharia security issued based on Sharia principles in the capital market, using specific contracts in accordance with prevailing regulations. Unlike conventional bonds, which are debt-based and involve interest payments, sukuk utilises Sharia contracts including Ijarah, Istishna, Kafalah, Mudharabah, Musyarakah, Wakalah, and other contracts that do not conflict with Sharia principles in the capital market. The selection of the contract is tailored to the business characteristics, funding needs, and transaction structure of each issuer. Provisions regarding corporate sukuk issuance are regulated in POJK Number 18/POJK.04/2015 concerning Sukuk Issuance and Requirements. Additionally, the listing aspects of sukuk on the Exchange are regulated in PT Bursa Efek Indonesia (BEI) Regulation Number I-G of 2021. With the available regulatory framework and increasingly developed market infrastructure, sukuk issuance now has a clear foundation for companies wishing to access funding through this instrument. It is important to understand that a sukuk issuer does not have to be a company whose entire business activities are Sharia-based. Non-Sharia companies can still issue sukuk as long as they have underlying assets or business activities that comply with applicable regulations and meet Sharia principles in the issuance structure. Therefore, sukuk is not an exclusive instrument for a specific group of companies, but rather a funding alternative that can be utilised by various industrial sectors. The development of the corporate sukuk market in Indonesia shows an increasingly positive trend. Based on BEI data, the number of corporate sukuk issuers increased from 17 issuers with 28 emissions in 2024 to 33 issuers with 52 emissions in 2025. In line with this increase, the value of funds raised through corporate sukuk also experienced significant growth, from Rp19.95 trillion in 2024 to Rp53.69 trillion in 2025. As of 30 May 2026, there have been 19 sukuk emissions issued by 17 issuers, with a total emission value reaching Rp15.3 trillion. This development is also in line with the growth of Sharia investors in the Indonesian capital market. Based on data from Exchange Members providing the Sharia Online Trading System (SOTS), the number of Sharia investors has surged more than 425-fold, from 531 investors in 2012 to 226,457 investors as of April 2026. This growth indicates an expanding investor base with an interest in Sharia-compliant investment instruments, including sukuk. The increase in sukuk issuance activity in recent years shows that this instrument is gaining attention as a funding alternative in the capital market. At the same time, the growth in the number of Sharia investors reflects the broadening investor base that can be reached through sukuk issuance. Interestingly, sukuk issuers are not only from Sharia-based companies but also from various industrial sectors such as transportation and logistics, infrastructure, telecommunications, manufacturing, finance, and property. So, why should conventional companies start considering sukuk? First, sukuk can help companies broaden their investor base. Besides reaching conventional investors, sukuk also has the potential to attract investors who specifically focus on Sharia-based instruments. With the increasing interest in Sharia-compliant investments, sukuk can be an alternative for companies to obtain funding sources from a more diverse group of investors. Second, sukuk can be part of a company’s funding diversification strategy. Dependence on a single type of financing source can increase funding risk, especially amid dynamic economic conditions and interest rates. The presence of sukuk provides an additional alternative for companies to manage their funding structure more optimally. Third, sukuk issuance can also provide added value in terms of corporate reputation and governance. In its issuance process, sukuk prioritises aspects of transparency, accountability, and compliance with applicable regulations. The application of these principles can encourage companies to strengthen good corporate governance practices and improve the quality of information disclosure to investors. Furthermore, the existence of Sharia supervision in the sukuk structure can provide an additional level of assurance to investors regarding the governance and integrity of the issuance process. These three benefits indicate that sukuk issuance is not solely about meeting funding needs, but is also a strategic step in building credibility and competitiveness in the capital market.