Sharia compliant schemes for businesses

Sharia complaint investment- Ash EnokaAsh Enoka

Amanah Ethical is an investment management company based in Auckland specialising in Islamic Finance solutions.

The Company has been working with the Muslim community for over two years, introducing ‘Amanah KiwiSaver Plan,’ and an investment vehicle called the ‘Amanah New Zealand Unit Trust.’

Both products are strictly Sharia compliant and their investments are monitored by an Islamic Advisory Board consisting of local and international academics and scholars.

Strong partnership

Amanah Ethical’s association with the Muslim community has been further strengthened by a partnership with the Federation of Islamic Associations of New Zealand Inc. (FIANZ) to bring Amanah KiwiSaver Plan to the New Zealand Muslim population.

The foundations for Amanah Ethical were built from investigations of the Middle East investment market by Managing Director Brian Henry.

The prohibition on Riba (interest) appealed to Mr Henry’s own ethos.

As a barrister, Mr Henry had experienced the consequences for investors of failed financial products and questionable investment advice.

Islamic values

After discussions with members of the New Zealand Muslim community, Amanah New Zealand Unit Trust was developed ensuring that it was able to uphold the necessary standards of Sharia compliance for its investments.

During the development of the Unit Trust, further market research showed that there was no offering in the retirement savings sector for the Muslim community.

From this came Amanah KiwiSaver Plan, a Sharia compliant registered KiwiSaver scheme, which currently invests in Amanah New Zealand Unit Trust.

The Company is planning to extend its investment mandate to debt-free agricultural real estate in the future.

Prohibited investments

Amanah Ethical markets their two interest-free products to both the Muslim community and the public interested in ethical investment.

The investment mandate of Amanah New Zealand Unit Trust prohibits investment in all activities that are contrary to Sharia law, such as alcohol, interest products, gambling, tobacco, and weapons of war.

In addition, the Unit Trust applies a series of financial restraints that prohibit the use of complex financial arrangements such as derivatives, interest products and leverage. These restraints also require all investments to have low levels of debt.

The potential appeal to the ethical market is this added layer of financial restrictions.

While some other ethical investment products in New Zealand prohibit investment in activities similar to those excluded by Sharia, they have the same constraints on interest producing products, leverage (borrowing against investor funds) or complex financial instruments.

Opaque Schemes

Mr Henry believes that many of the complex investment arrangements currently offered in the industry are as akin to gambling as placing bets at the casino as their structures lack transparency and are difficult for non-professional investors to understand.

Amanah Ethical launched its Amanah KiwiSaver Plan on January 31, 2015. Since then, the Company has experienced an increasing interest in its products from both Muslim and Non-Muslim communities.

The business has large aspirations for the future, hoping to expand its offerings to include ‘Takaful’ (insurance policy) and Sharia compliant home loans. For now, Amanah Ethical is focusing on the promotion of Amanah KiwiSaver Plan, with a number of presentations planned around New Zealand.

The Company’s next presentation is at the Al Mustafa Jamia Masjid in Otahuhu at 10 am on April 26, 2015. The meeting is open to all. For more information about Amanah KiwiSaver Plan, Amanah New Zealand Unit Trust, please call 0508-262624. Email: info@amanahnz.com

Ash Enoka is the Operations Manager for Amanah Ethical.

The picture here shows dignitaries at the ‘Amanah KiwiSaver’ launch (from left) Brian Henry, Islamic Advisory Board Member Sheikh Mohammed Amir, NZ First Leader and Member of Parliament Winston Peters, former Governor General Sir Anand Satyanand, Amanah KiwiSaver Chairman Gregory Fortuin, Federation of Islamic Associations in New Zealand President Dr Anwar Ghani and Ethnic Communities Minister Peseta Sam Lotu-liga.

 

 

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