Is It Permissible To Invest In Unethical, but Shari’a Compliant Companies?

Question: Assalamu ‘alaykum. The only Shari’a compliant ETFs available invest in some unethical companies, but there is not really other options available for passive investing. Is it halal to invest in these ETFs?

Answer:

Wa ‘alaykum assalam wa rahmatullah wa barakatuh.

I pray you are well.

Investing in any Shari’a compliant company will mean that the investment and profit are halal. However, unethical elements in a business would make it superior to avoid. The way of excellence is conduct with Allah and His creation (ihsan) would entail not being a part of something that harms others not something that robs or diminishes others of their rights.

Avoiding such matters with the intention to please Allah is something that would be rewarded. “Indeed, Allah loves those who excel in goodness.“ [Qur’an, 2:195] Look for other opportunities. Whatever you do for Allah will come back to you as some form of good, if not in this life, then certainly in the next.

May Allah grant you the best of both worlds.
[Shaykh] Abdul-Rahim Reasat

Checked and Approved by Shaykh Faraz Rabbani

Shaykh Abdul-Rahim Reasat began his studies in Arabic Grammar and Morphology in 2005. After graduating with a degree in English and History he moved to Damascus in 2007 where, for 18 months, he studied with many erudite scholars. In late 2008 he moved to Amman, Jordan, where he continued his studies for the next six years in Sacred Law (fiqh), legal theory (Usul al-fiqh), theology, hadith methodology, hadith commentary, and Logic. He was also given licenses of mastery in the science of Quranic recital and he was able to study an extensive curriculum of Quranic sciences, tafsir, Arabic grammar, and Arabic eloquence.