Saturna Sdn Bhd follows Islamic principles as well as ESG investing principles among its equity funds.
Islamic principles require investors to share in profit and loss, to exclude investments in prohibited activities, and to avoid speculation in favor of long-term investment.
Business sector and ESG screens eliminate companies primarily involved in certain activities including:
• Fossil fuel extraction
Financial screens eliminate companies with:
- Greater than 5% of their revenue coming from haram, or unacceptable, sources (such as those listed above)
- Greater than 33% total debt as compared to their market capitalization (trailing 12 month average)
- Greater than 45% accounts receivable as compared to their total assets (trailing 12 month average)
The guidelines help ensure that investments meet the requirements of the Islamic faith and were established by Saturna Capital in collaboration with the Fiqh Council of North America (FCNA), a non-profit organization serving the Muslim community. To ensure that investments continue to meet the requirements of the Islamic faith, Saturna engages Amanie Advisors Sdn Bhd, a leading consultant specializing in Islamic finance.
Saturna's equity funds also support the fossil fuel divestment campaign by excluding energy extraction and refining companies.