Investing in ethical companies
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Salaams all,
I've been a lurker a while but something has been bugging me a bit. I was trying to gain an understanding of investing in companies that are compliant with the principles of islam (not I did not say shariah!). I know there are all sorts of posts by all sorts of people who talk about "shariah compliance" of companies, but that is not really my question!
If we are all meant to be good decent beings, I would hope that translates to formation of enterprises/companies that also rule by some ethical standards. Ok, so the basic bits of not investing in alcohol, tobacco, weapons, pornography is fine, but let's look beyond that.
I think a company should not exploit it's workers.
It should not utilise direct supply chains that exploit workers. Secondary chains are hard to identify so I can't blame a company working in good faith for that!
It should have transparent accounting structures; no corrupt government run companies please!
It should have some kind of environmental impact policy since in the Quran we are told to look after the environment. I agree that no company is perfect in this regard, but at least an effort is better than nothing.The above are largely common sense, but I wonder if there is additional criteria in the Quran that I should be looking for? Oh I'm aware of regular western criteria of ensuring the company is financially viable. I'm not looking into that for this question.
Why am I doing this? I guess for research in a sense, so that inshala if I set up a company in the future I can have some level of social conscience that I'm doing my best to live by Allah's commands even in business.
Interesting points are welcome
Wa-salaam
Ronnie
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Peace and welcome, Ronnie,
The above are largely common sense, but I wonder if there is additional criteria in the Quran that I should be looking for?
For a company, or for our own development, I believe the criteria is the same. In running my contracting business, I apply the same standards that I would in any relationship. Treat others fairly, fulfill your promises and obligations, work with integrity and compassion. When I build a new kitchen or bathroom or home for a client, I do it with the same passion and attention to detail as I would for myself or for my own mother. I try my best to pay my employees on time and to help them out logistically when they need it - and to treat them like family members.
In working this way, we get better, more appreciative clientele. We get better employees. We always enjoy our work, and our business continues to grow, by God's grace.
Putting the qur'anic principles into your business plan is, imo, a surefire way to achieve success with a clear conscience. And doing your best to keep God in mind when making all your decisions tends to steer you in the right direction - and before you know it, opportunities just present themselves to you.
Peace,
Tay -
peace,
Investing in companies (or investing in anything!) is difficult if one is trying to make their investment as ethical as possible. Especially so if you mean stocks/shares because larger companies tend to be less ethical and/or harder to verify in terms of how they do business because its so spread out.
In my opinion, it is better to invest in a more ethical company than a company that is less ethical. Many investment companies offer ethical investment now (or at least they do in the UK) so they will do the leg work for you in terms of researching a company's ethical status.
If it's your own company, then that's a totally different matter because you will have greater control of what you do and how you go about it.
You might find this thread helpful
http//free-minds.org/forum/index.php?topic=13876.0
