Islamic finance and sustainable finance share common features and both markets are expanding, with sustainable sukuk comprising a nonnegligible proportion of annual sukuk issuance. Islamic finance is typically concentrated in economies reliant on hydrocarbons that have greater exposure to energy transition risks, which potentially creates higher demand for sustainable sukuk to execute the transition of these countries, in our view. We see progress in Southeast Asia and the GCC to create local definitions of what constitutes sustainable Islamic finance.