Green Sharia Compliant Investments/Pensions?

Everyday Islamic Finance Islamic Finance Companies/Products
#1

The evidence that fossil fuels are causing damage to our environment and people, particularly Muslims is now uncontravertible. Therefore it is my personal belief that investing in fossil fuel companies like Shell, BP or even Bitcoin which uses as much energy as a small country for little benefit cannot be something a good Muslim should be involved in. Is there any guidance from scholars on this point? (cc @Mufti_Faraz_Adam @Mufti_Billal).

I have a Sharia compliant pension with HSBC. However, I note that they are investing in oil companies which I detest. I am considering switching to an ethical green pension fund. I’m not aware of a Green Sharia compliant fund (Surely all Sharia compliant funds should be green by default?). I’m also not sure whether the ethical green pension funds can be considered Sharia compliant. In the past I have picked a fund investing in property as there was no Sharia compliant fund available and I’m considering doing that again. What can I do?

Thank you in advance.

1 Like
#2

thanks for posting this Rehan.
we should seriously consider how we spend our money.
hope we get an answer about this soon.

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#3

Wasalam

May Allah bless you.
There is no official shariah screening criteria in regards to these sort of companies, so to answer your question: shariah compliant funds are not necessary green by default.
Eventually, in the near future, ESG integration in the Islamic finance industry will hopefully be adopted on a wider scale.
As for the ethical green pension funds, there might not be shariah compliant if they invest in haram elements such as interest bearing debts etc.

Kind regards

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#4

Thank you @Mufti_Billal!

Is there anything I can do to get a Sharia compliant green pension fund? I am with the HSBC Amanah pension fund. Can I complain to them somehow? I have heard about self-invested personal pensions (Sipps) but that seems a bit daunting.