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In spite of the increasing number of Islamic banks offering Islamic investment products, there is, as yet, little academic research on this topic and the consumer acceptance of the products is not yet understood fully. To help in bridging this gap, this study aims to assess the determinants of choice behaviour of Islamic investment products in Malaysia.

Using the Theory of Consumption Value (TCV) as a baseline theory, data are obtained from 460 bank customers who intend to invest in the products.

The results of this study show that emotional value, epistemic value, conditional value, functional value and social value are significantly related to the choice behaviour of Islamic investment products.

Three concerns were found in this study. Firstly, the geographies of this study are narrowed down to bank customers who were resided in specific areas in East Malaysia. Secondly, the authors used the TCV on a particular focus of Islamic banking products. Future studies should address these issues accordingly for improved application and generalisation. Thirdly, some reliability issues were identified in composite reliability values and the related future studies are expected to strengthen the research design to extend the findings at best.

The results are helpful for practitioners to develop new business models of Islamic investment products in Malaysia.

This study provides meaningful insights for theory building of choice behaviour in the context of Islamic investment products, where the TCV comes into play.

The purpose of this paper is to examine the nature and structure of Islamic investment funds and evaluate their governance.

The methodology employed is the conceptual framework of Islamic economics.

It is found that Islamic investment funds have grown rapidly this decade: in Malaysia alone, the number of shari'a‐compliant funds has grown from 17 in 2000 to 149 in 2008, and at a global level there are 650 funds in operation. However, the industry has developed in a particular way, by focusing on negative screens, and removing from investments those activities deemed to be unacceptable to Islamic precepts, rather than pursuing as well the implementation of other aspects of the Islamic ethos.

The conclusion reached is that, if the Islamic investment fund industry is to provide more completely for the religious and financial aspirations of investors, it needs to go beyond the negatives and to also accentuate the positive and, drawing upon Islamic governance guidelines, actively seek out investments that have a positive impact on society and the environment and promote the welfare of the community. These issues hitherto have been largely unexplored.

There is a great deal of research that has been done to investigate the investment characteristics of conventional socially responsible investment portfolios compared to their broader conventional counterparts. However, the impact of incorporating sustainability criteria into the traditional Sharia screening process has not so far been investigated. Therefore, the study aims to give empirical evidence as to whether or not incorporating sustainability socially responsible criteria in the traditional Sharia screening process has a significant impact on the investment characteristics of the Islamic investment portfolio.

The paper examines the investment characteristics of four groups of investment portfolios mainly, Dow Jones Global Index, Dow Jones Sustainability World Index, Dow Jones Islamic Market World Index and Dow Jones Islamic Market Sustainability Index. To improve the robustness of the study, the analysis was carried out at different levels. First, absolute mean return and t‐test were used to examine whether the difference between the different groups of investments is statistically significant or not. Second, risk adjusted equilibrium models, both single‐index and Fama and French multi‐index, were employed. This is to control for different risk exposure and investment style bias associated with different investment portfolios examined.

The paper finds that neither the Sharia nor the sustainability screening process seems to have an adverse impact on the performance and systematic risk of the investment portfolios compared to their unrestricted conventional counterparts. Therefore, Muslim as well as socially responsible investors can choose investments that are consistent with their value systems and beliefs without being forced to sacrifice performance or expose to higher systematic risk.

The study contributes to the existing literature by giving new evidence on the impact of incorporating sustainability criteria into the traditional Sharia screening process that has not so far been investigated.

Muslim investors must comply with the ethical injunctions prescribed for them while making financial investments. As per Islamic principles, the use of Riba (interest), Maysir (gambling) and Gharar (uncertain or contingent payoff contracts) is prohibited. This chapter provides some recent post great financial crisis evidence on the comparative performance of Islamic and conventional market indices. Islamic indices outperformed conventional market indices in terms of annualized returns except for emerging markets. In the overall period of 2007-16, it is found that Islamic indices have a lower coefficient of variation and hence higher reward to variability ratio. This suggests that Islamic indices are superior to conventional market indices adjusting for variability in returns. In most comparable Islamic and conventional indices, a strong co-movement and long-term co-integrating relationship is found. The results also highlighted causality running from conventional indices to the Islamic indices in most of the market groups, except for the S&P Global.

The objective of this chapter is twofold. It first explores the complementarities of Islamic investment with Socially Responsible Investment. Secondly, it examines the financial price, for investors, of being both shariah-compliant and socially responsible.

Using a value-weighted approach, we experiment the construction of a set of sharia-compliant stock portfolios with different Environmental, Social, and Governance (ESG) performance. We use the KLD ratings of 238 companies listed in U.S. stock market from 2007 to 2011. We measure and compare their performance using the model developed by Fama and French (1993) and extended by Carhart (1997).

The results indicate no adverse effect on returns due to the application of a double screening, Islamic and SRI, and show a substantially higher performance for positive governance screen during 2008–2011 periods. This outperformance cannot be explained by differences in investment style. Though, we observe significant outperformance for some ‘irresponsible’ portfolios involved in community and human rights controversies.

The study only focuses on U.S. market. Future works should extend the experimentation to other markets.

This study provides a venue for Islamic funds managers to consider SRI screening as fully in line with shariah-compliance requirements, while preserving the performance of their portfolios.

Potentially, the reconciliation of Islamic investment with positive SRI practices may foster the implementation of CSR policies by firms’ manager willing to attract Islamic investors.

With reference to the many studies emphasising the compatibility between CSR criteria and Islamic principles, this experimental study is the first to investigate the integration of a positive screening process designed to select companies based on their ESG performance in addition to a traditional shariah-compliant screening.

Most conventional financial products currently on offer to Muslims in the Indian market are incompatible with Islamic religious principles; there is a recognized demand for alternatives within this niche community. India has the third largest Muslim population in the world – 155,477,386 in 2011. The purpose of this paper is to present the status of marketing activities of Shari'ah‐based investments and a comprehensive analysis of avenues for Islamic investments in India.

In India, Islamic investment is gathering pace as Muslims in the country are becoming more vocal in their demands for greater self expression. Hence, there is a great potential in India itself. Even if a small percentage of this population can be pressured to invest in the Islamic investments, the amount of money that can be brought into the system could be enormous.

The findings reveal the emergence of Islamic investment opportunities on Shari'ah‐based investments in India. This paper also provides suggestions for enhancement of Islamic investment opportunities in India.

With a sound economic base and with hundreds of companies complying with Shari'ah norms, India offers a huge opportunity for Islamic equity investment. If performance as a parameter is considered, it is observed that Shari'ah‐compliant investments, being low in debt and having sound fundamental principles, tend to perform better, hence large non‐Muslim investors should take the benefit of these socially responsible and above par performing Islamic investments.

The purpose of this paper is to investigate Shariah compliant real estate development financing and investment in the Gulf Cooperation Council (GCC).

In this paper, the authors employed desk research and survey to examine issues relating to Shariah compliant real estate development financing and investment. Following the desk research, 18 in‐depth interviews were conducted with senior executives of banks, real estate developers and consultants.

Equity Shariah instruments are found to be in high demand by real estate investors, however they are rarely offered by Islamic banks. In addition, the survey results confirm that Islamic financiers tend to partner real estate companies through land acquisition to post construction, contrary to how conventional financiers operate, therefore reducing moral hazard issues.

As Shariah compliant real estate research and knowledge is limited, the authors faced a challenge in getting respondents who are familiar and willing to participate in the interview. Nevertheless, the 18 respondents gave adequate inputs to enable the authors to write the research paper.

The paper includes challenges and implications for the future developments of Shariah compliant real estate development financing and investment.

This paper provides the Shariah compliant perspective of real estate development financing and investment, where the current knowledge is very limited.

This paper aims to explain and present a theoretical framework for providing people with savings to finance two sectors: profitable investment and Gharz-al-Hassane. To do this first, assumptions and presumptions of the theory and framework are expressed, and then the effect of belief on this behavior is explained. Subsequently, this theoretical framework is evaluated in an empirical research.

The theoretical framework is explained by mathematical and logical methods. The experimental study is carried out using real data of 500 households from Zahedan (Center of Sistan and Baluchestan Province of Iran). Data were collected using questionnaire and were analyzed using statistical and econometric methods.

The result indicates that demands of Iranian people are not met within the framework of official markets. This disparity in supply and demand has led to the actions of people outside the formal framework, and so, banks and financial institutions cannot exploit the supply of people’s savings. On this basis, key factors determining people supply in a variety of markets are religious belief, age, income, education level, religious experience and so on, which should be considered in designing the Islamic banking and financial tools.

Today, economics and marketing have shown that an enterprise needs to meet customer demand to succeed. In the field of Islamic banking and finance, financial firms and banks should know this too. However, there are not many research studies in this area.

This paper aims to provide an essential framework for establishing Shariah-compliant deposit insurance scheme, by reviewing the Shariah provisions concerning the available approaches for deposit guarantee, types of deposits in Islamic financial institutions and the permissible party to incur the cost of this guarantee.

This paper reviews the Fiqh rules and principles approved by the well-known Islamic Fiqh references, as well as the resolutions of International Islamic Fiqh Academy (IIFA) and Shariah standards issued by Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), and presents these resolutions and judgments in a modern applicable way.

This paper recommends that the Islamic scheme for deposit insurance should be established based on Takaful insurance principle, and this scheme must adopt fund segregation principle to comply with Shariah provisions for guarantee permissibility.

The paper bridges the gap between theory and practice by highlighting how the proposed model can be initiated in practice, thus, it can influence public policy in countries with Islamic banking system.

This paper represents a significant contribution toward the establishment of a consensual Shariah-compliant Islamic deposit insurance model.

The purpose of this study of this methodological abstraction is erected the nature of the well-being function as evaluative criterion. The well-being function (maslaha) evaluates the interrelationships between long-run investment (real sector), the corresponding financial instruments (financial sector) and the embedded socioeconomic variables and ethical values conveyed by extensive complementarities and participation in a systemic approach of unity of knowledge. Among the financing variables to be selected will be the transformation of debt-instruments into equity instruments. All financial instruments are to be transformed into a holistic participatory pooled portfolio.

The paper establishes the point that, the idea of long-run is appropriately that of a juncture of Islamic change during which the objective of well-being (maslaha) is evaluated (estimation leading to simulation) with long-run investment and Islamic financing instruments on the basis of the Islamic methodological worldview. This methodological worldview is premised on the ontological foundation of the episteme of organic unity of knowledge and the resulting world-system. The Qur’an refers to this foundation of knowledge as Tawhid. Tawhid is used in this paper to mean the Primal Ontological Law of Unity of Knowledge.

The most critical long-run investment program focused on is poverty alleviation and its equity-based financing instruments that reduce debt progressively to attain sustainable grassroots development with the ability to own, and the social capability to distribute resources and enable the grassroots. The corresponding interaction, integration and evolutionary dynamics of learning that emanate from the interrelationship of poverty alleviation as the focus of long-run investments and their attenuating financing instruments, along with the implications of inter-causal socioeconomic variables and the embedded episteme of unity of knowledge in the well-being function (maslaha). This paper is thus an abstracto-empirical contribution to the literature of Islamic finance, long-run investment and socioeconomic development with global significance.

The choice of long-run investment for poverty alleviation and the corresponding Islamic financing instruments are summarized by the following Tawhidi epistemic schema (an extractive picture). Upon this epistemic methodological worldview, the entire structure of well-being and sustainability of socioeconomic development lies.

The paper brings out many of the properties that ought to be the truly moral/ethical and thereby the conformable analytical nature of the model of financing and investment in a combination of short-, medium- and long-term mobilization of resources to attain levels of social well-being as the objective criterion. Empirical work is done to bring the objective criterion to an applied level and to critically examine the work in the same field being carried out by many other ones, including authors and institutions. The empirical work done here can be widely extended to the case of estimating of the maslaha function (well-being).

This paper carries an essentially moral and social perspective in its methodological orientation that is derived from the Islamic epistemological foundations of unity of knowledge (Tawhid) and applied to Islamic finance and investment theory with the well-being objective criterion.

This is an original paper that combines methodological abstraction with applied financing and investment perspectives. Such an abstracto-empirical approach has not been done in Islamic research writings.