Is Shariah-Compliant Investment Universally Sustainable? A Comparative Study

The current paper reports the outcome of investigating the sustainability and efficiency of Shariah–compliant investment from the global and cross-country perspectives. Our findings, thus far, suggest that global Shariah compliant sustainable shares performed slightly better than global sustainable shares in general, during 2006-2011, and Shariah compliant shares performed substantially better than global market during the same period. The superior performances of Islamic market indexes suggest that Shariah compliant investment is more resilient and sustainable compared to their counterparts in the long term. Further evidence from our cross country study suggests that, Shariah compliant investments perform better than the market on whole in Muslim countries, and worse than the market in predominately non Muslim countries. These findings have important implications for investors, regulators, customers, and Islamic financial institutions. © Author