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This study explores the practical application of the Shariah screening process and how it could be enhanced by converging the same with the ethical screening of stocks.

This study adopts a qualitative research methodology by combining the qualitative descriptive approach and content analysis.

The findings of this research suggest that there is scope to converge ethical screening of stocks with Shariah Screening as the lex loci applicable to Shariah screening is derived from Shariah, which considers ethics as part of determining its rules.

The data from this study reveal several practical applications, the ultimate goal of which is to help the policymakers and stakeholders understand the relevance of the Shariah screening of stocks and get a streamlined screening process, paving the way to enhance the same using ethical screening criteria to develop its function to become much more relevant irrespective of the denomination of faiths.

This is original research, which is expected to contribute to understanding the extent to which Shariah screening can be enhanced by integrating the ethical stock screening dimension to it.

The purpose of this study is to highlight key issues pertaining to making use of Islamic equity indices and proposing possible solutions to address the problems faced in advancement of the concept of Shariah investing (SI) with the aim to advance the discourse on the subject.

Online focus group discussion (FGD) was carried out in which ten Islamic finance researchers and analysts belonging to institutions considered as authority on the subject matter participated to share their viewpoints on Islamic equity indices. Content analysis on the collected data of FGD was carried out which has revealed six key themes.

Six broader themes were identified based on the analysis of FGD, which includes criteria for constructing Islamic equity indices, utilization of Islamic equity indices for comparison with conventional stock indices, stock market efficiency perspectives, reason for integration of different equity markets, investors’ awareness of SI and future directions of Islamic equity indices. Results of the study indicate that Islamic finance researchers and analysts opined that there is a need for revising the criteria for construction of Islamic equity indices. There are conflicting viewpoints regarding performance and efficiency of Islamic indices in comparison with conventional indices and main reasons for stock market integration are trade liberalization, globalization and other factors. Moreover, there is a need for making investors and other market players aware about the attractiveness of Islamic indices from investing point of view.

Based on this extensive literature review and as highlighted by Masih et al. (2018) in their recap of literature on Islamic equity indices indicating that there are bulk of empirical studies carried in the past in the domain, however, there is a dearth of theoretical and qualitative studies. Hence, this preliminary qualitative study not only makes theoretical contribution but also deploys FGD, which is rarely used in the similar context, and offers candid views of the participants on key issues pertaining to Islamic equity indices. This lends novelty to this study.

The purpose of this paper is to investigate the impact of the Indonesia Shariah-compliant Stock Index (ISSI) on the performance of included shares. In essence, the authors ask whether the establishment of the ISSI provides abnormal returns for the firms that are not included in the Jakarta Index.

The authors use an event study methodology to estimate cumulative abnormal returns in the days surrounding the event to examine the relationship between Shariah-compliant investments and stock returns. The estimation window of 90 trading days prior to the event (−30) to day 60 after (+60) is adopted. They also use a range of investment performance measures to provide new evidence on whether faith-based ethical investments generate superior performance compared to their unscreened benchmarks.

Using daily returns, the Indonesia ISSI and panel data model, the findings show that the inclusion of the ISSI has a positive impact on the financial performance of the included shares during the 41-day event window. The evidence also suggests that the ethical investment has a significant influence on the performance of stock market returns.

This study offers insights to policymakers, investors and fund managers interested in the indices’ performance. A key conclusion that could be derived by bodies that regulate Islamic products and services is that investors are not only concerned about what is profitable but also what makes their investments ethical.

Although the global growth of the Islamic capital market products and services has been tremendous in recent years, very few studies focus on the Indonesian market and indeed, none of them devote sufficient attention to Shariah-compliant investments and stock returns.

This study aims to identify enablers of belief and ethics-based marketing practices, establish relationships among the factors and present them in a hierarchical model to derive critical insights. This paper emphasizes interpretations of the in-depth interviews to decipher the market pervasiveness of the evolved model.

In-depth interviews were conducted with individuals and small groups of informed and elite respondents pursuing marketing guided explicitly by ethics and led by belief. The interview data further corroborated with the related literature contributed to specific factors. Finally, interpretive structural modeling has been implemented step by step to develop a systematic model for enablers.

This paper contributes a structural relationship of morality and ethics, strengthening faith and belief through philosophical understanding, which traverses into the actions related to societal benefits with the support of market opportunity development while bringing in value, enhancing the demand in return and establishing market pervasiveness. The crux of this paper is that the foundation of belief will reduce the hierarchy of other related factors while strengthening their interdependencies with equity to contribute to the development of the pervasiveness of the market for such organizations.

To the best of the authors’ knowledge, this is the first study exploring and examining the enablers contributing to belief and ethics-based organizations’ pervasiveness along with their interrelationships. The initial intrigue that led to the inquiry was evidence of the market pervasiveness of such organizations’ products and services across various streams.

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.

The purpose of this paper is to initially contribute the literature linking the global financial crisis and the Islamic finance model which is competent of playing down the severity and frequency of financial crises, by introducing the financial system based on sharing in the risk. It links credit expansion to the growth of the real economy by allowing credit primarily for the purchase of real goods and services which the seller owns and possesses, and the buyer wishes to take delivery. It also requires the creditor to bear the risk of default by prohibiting the sale of debt, thereby ensuring that he evaluates the risk more carefully. It is important for everyone's future that we study the current crisis in order to develop sustainable financial practices and in quest of a new business model based on sharing the profit and loss.

The divergence approach is used for exploring possibilities and constraints of inherited situations by applying critical thinking and analysis through the published literature in Islamic finance. This is to create new understandings of international finance and using new banking business model towards better design solutions for the current global financial crisis and preventing more collapse in the future.

A new business model for the banking system based on non‐interest‐based transactions but profit and loss sharing should be in practice at the financial system. The financial institutions should encourage business and trade activities that generate fair and legitimate profit. In Islamic finance, there is always a close link between financial flow and productivity. This intrinsic property of Islamic finance contributes towards insulating it from the potential risks resulting from excess leverage and speculative financial activities which are part of the root causes of the current financial crisis.

This paper is based on published research papers but does not include empirical investigation.

The new business model based on Islamic finance principles will help in financing businesses by using alternative methods to the banking systems or as a different way to run our banking system. The Islamic finance system with proper checks and controls introduces greater discipline into the economy and links credit expansion to the growth of the real economy.

The paper sheds new light on the relationship between the Islamic finance model and a new business model for the financial institutions to be used in order to think through how to prevent future financial collapses and make capital markets work more effectively.

The purpose of this paper is to elaborate and elucidate the experience of Malaysia in developing the Islamic financial system by explaining the different developments and methods that has been deployed since its inception in 1963 until now and how best these experience can be used in developing Islamic financial industry.

The objectives are achieved by analyzing the different materials gathered through library research. The sources of the materials includes books, statistics, reports, presentations and conference papers. The scope of the study is limited to the Malaysian financial industry development.

The paper found that Malaysia has a very encouraging history of Islamic banking and has big potential to succeed in this area. However, some areas need to be improved, as suggested in the paper. It also found that the Malaysian model in developing Islamic financial industry can be taken as a benchmark in the development of such industry in other countries.

The originality of the paper lies in the in‐depth analysis of the different steps of development that Malaysia has gone through in the development of Islamic financial market, including banking, capital market and Takaful.

The purpose of this paper is to review the history of Islamic banking in Malaysia from 1963 until 2010.

To review the history of Islamic banking in Malaysia, data have been gathered from different articles, books and reports about the Islamic banking system in Malaysia.

The paper found that Malaysia as an Islamic country has an outstanding infrastructure to support the establishment of an Islamic banking hub in the Islamic region.

The paper shows that Malaysia was of the first countries to take a systematic planning approach to develop the Islamic finance system in the region. Islamic banking systems in Malaysia are growing rapidly and progressively, in spite of some other countries wishing to be ahead of Malaysia, such as Singapore and the UK.

This paper aims to compare and analyse the aspects of Shariah screening methodologies within the selected Gulf Cooperation Council (GCC) countries as well as comparing the methodologies with the USA, and to examine how Shariah screening methodologies affect financing and investing activities of a firm.

Shariah screening methodologies within the selected GCC countries and between the GCC countries and the USA are compared on the basis of the data collected from secondary sources.

Design, qualification and Shariah governance set the Shariah screening methodologies within the GCC countries apart. Feasibility, duration, economic viability and funds required differentiate these Shariah screening methodologies between the GCC countries and the USA. Shariah screening methodologies implied in the USA is more stringent than in the GCC countries.

The suggestions in this study include using a longer research timeline, examining many more number of countries’ Shariah screening methodologies and exploring other types of Shariah screening methodologies.

The possibility of generalising the implementation of strict and uniform Shariah screening methodologies across all the country-specific Shariah indices amongst Muslim nations, globally, is likely to benefit all the Muslim countries, by strengthening the understanding, interaction and economic co-operation amongst these countries.

People’s needs can be tended to if Maqasid Al-Shariah (objectives of Shariah) is achieved through flexibility, dynamism and creativity within the social policy.

Aspects of Shariah screening methodologies are compared and contrasted within the selected GCC countries as well as between the GCC countries and the United States and the role of Shariah screening methodologies is examined in order to determine the extent of what is Shariah-Compliant and what is Non-Shariah Compliant for a firm.

The purpose of this paper is to trace the history and legacy of Islamic finance (IF) in Sri Lanka in the context of the emergence of life finance. It tracks the social life of finance through a genealogy of trust and capital.

The methodology used is qualitative. It is an extended case study using conversations, company documents and newspaper archival research.

Trust, transparency and ethics must be understood locally to have salience. The implicit effect of locally understood ideas of trust that have been built into the movement of capital (via ethical branding and transparency in IF, education and social awareness) can reconfigure relationships between communities in a country that has been ravaged by war.

There have been few studies on IF in Sri Lanka; this study will enrich those offerings. However, they must be understood in relation to the emergence of life finance.

This study presents a new viewpoint on the relationship between finance and social well-being and new categories through which to understand finance.

The implicit effect of locally understood ideas of trust which have been built into movements of capital (via ethical branding and transparency in IF, education, socially aware) can reconfigure relationships between communities in a country that has been ravaged by war.

There have been few studies on Islamic Finance in Sri Lanka; this study will enrich those offerings. But they must be understood in relation to the emergence of life-finance in South Asia.