In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
In this fatwa:
Muslims who wish to invest should seek those businesses that do not deal in haram products or practices. This is actually necessary so as to avoid investing in the shares of companies that deal with haram products.
In responding to your question, Sheikh Ahmad Kutty, a senior lecturer and an Islamic scholar at the Islamic Institute of Toronto, Ontario, Canada, states,
Investing in company shares that deal with haram products
Investing in company shares that deal with haram products (whether pork, alcohol, and so on) is not permissible in Islam. If something is declared haram, a Muslim must abstain, not only from involving himself in it, but also from promoting it.
By buying shares in such companies, one is committing the offence of promoting what is haram. Therefore, no Muslim should even contemplate doing such a thing.
Therefore, Muslims who wish to invest to look for those businesses that do not deal in haram products or practices.
Buying shares in companies that deal solely in high-tech products, dairy products, and so on, might fall under this category.
Sometimes, an individual Muslim may find it hard to keep track of the policies and business practices of such companies so as to ensure that they are entirely free of involvement in haram. If that is the case, then a person is best advised to entrust this decision to those agencies which specialize in monitoring companies for their halal practices.
It is fortunate that there are no shortages of halal investment opportunities that are strictly based on clear principles of halal and haram. It is recommended to get in touch with them.”
Almighty Allah knows best.
Editor’s note: This fatwa is from Ask the Scholar’s archive and was originally published at an earlier date.