Many faithful Muslims observe Sharia law which prohibits the investment in companies that market or sell alcohol, pornography and other vices. For many that would not be a problem, but what if you wanted to save for retirement? How could you be sure that all investments were free of these types of businesses? This is the dilemma for a thousand Muslim workers who work for Microsoft.
Thom Polson who has studied Islamic banking and finance, and is CEO of Falah Capital LLC., says a large percentage of Muslim employees are not using their 401(k) plans because they’re not Sharia-compliant. “You have people who aren’t getting the full benefits of their employer’s offering,” says Polson.
Last fall, Mr. Polson and a group of partners set up the Islamic exchange traded fund (ETF) which is now listed on the New York Stock Exchange, and is the first of its kind.