THE question as to whether it is Islamically permissible to invest in Amanah Saham Bumiputera (ASB)/Amanah Saham Nasional (ASN) continues to receive polarised responses in Malaysia.
It came up again recently at the Selangor Fatwa Committee meeting (April 27), when a fatwa was issued declaring ASB/ASN investments to be permissible for Muslims.
This ruling, however, introduced another set of questions, especially when the same committee had previously prohibited ASB/ASN investments due to the presence of riba (interest or usury) transactions therein, which arguably rendered it non-syariah compliant.
The reverse decision by the Selangor Fatwa Committee seemed to echo the position taken by the National Muzakarah Fatwa Committee for Religious Affairs (Feb 3, 2008) and 13 other states, including the Federal Territories of Kuala Lumpur, Labuan and Putrajaya.
These states have maintained that investing in ASB/ASN is permissible mainly due to its significant economic impact and potential with regards to Malay Muslims (the majority of Muslims in Malaysia).
Such considerations are particularly important in view of the worrisome socio-economic realities of Malay Muslims. ASB/ASN remains the only institution that has a positive track record in yielding consistent and considerable returns to its majority Malay Muslim investors.
Another point brought up is that if Permodalan Nasional Bhd (PNB), which is the investment agent for ASB/ASN, pulls out its share from Maybank due to its non-syariah compliant portfolios, it would have a major negative economic impact on Malay Muslims.
Moreover, due to the position of Maybank as the largest bank in the Asia-Pacific region, such actions could potentially harm the overall Malaysian economy.
It is also important to note that PNB investments have already steered clear of investment in haram industries, such as gambling and liquor.
Currently, 70 per cent of its investment is already syariah compliant. The remaining 30 per cent comprise the aforementioned Maybank shares. But, even then, they are strictly monitored by syariah advisers appointed by PNB under the special project.
The National Muzakarah Fatwa Committee for Religious Affairs also pointed out the fiqh (Islamic jurisprudence) agreement across Hanafi, Maliki, Shafi’i and Hanbali juristic schools that permit investing in companies that involve halal and haram activities under certain circumstances, such as considering the wider public interest (maslahah ammah) and the avoidance of harm (mafsadah).
Prioritising public interest (maslahah ammah) and avoiding harm (mafsadah) are part of the higher goals of syariah, also known as Maqasid Al-Syariah.
This position is in line with the majority opinions of Muslim scholars, rooted in the Quranic verses: “And We have not sent you, [O Muhammad], except as a mercy to the worlds”, (Quran, Al-Anbiya’ 21:107) and “O mankind, there has to come to you instruction from your Lord and healing for what is in the breasts and guidance and mercy for the believers” (Quran, Yunus 10:57).
The higher objectives of syariah are categorised and prioritised in various ways. The traditional method classified the Maqasid Al-Syariah based on levels of necessity, namely the essentials (dharuriyyah), complimentary (hajiyyah) and embellishment (tahsiniyyah).
The category of essentials (dharuriyyah) covers basic human necessities in both mundane and religious matters that, if unfulfilled, will lead to extreme hardship or grievous loss. Islamic scholars have expanded the scope of such “essentials” to include the preservation of religion, life, intellect, lineage, dignity and property.
In the case of ASB/ASN investment, taking into account the worrisome low participation of Malay Muslims in financial investment and the ensuing economic predicament, if PNB, a majority shareholder in Maybank, was to pull out its shares, the issue of partial or relatively minor non-compliance in its investment portfolio would be of secondary importance.
Thus, keeping the Maybank shares in the hands of PNB can
be regarded as an essential (dharuriyyah), and therefore in line with the goals of syariah to serve the maslahah ammah.
At the second level of necessity, the category of needs (hajiyyah) also plays an important role when arriving at a fiqh ruling.
Despite it not being essential (dharuriyyah), neglecting fiqh dimensions that fulfil our “needs” will cause difficulty.
This is contrary to the Islamic ideals of alleviating as much hardship and difficulty as possible, as illustrated in the manifold rulings that appeal to rukhsah (removal of hardship), despite it is not being a pressing concern (e.g. dry ablution in the absence of water, shortening and combining of prayers during travels, and so forth).
The ruling on the permissibility of ASB/ASN investments coincides with the goals of syariah to offer opportunities to Malaysian Muslims wanting (hajiyyah) to enhance their financial stability, increase quality of life and discover their potential, among others.
There is no compulsion or restriction if one wishes to invest elsewhere in other Islamic institutions or, indeed, to not invest at all. Therefore, the principles of needs (hajiyyah) provide a certain flexibility and freedom (although not absolute) for the individual to choose.
In conclusion, the permissibility of ASB/ASN is a prime example on how fiqh rulings incorporate the perspective of public benefit (maslahah ammah) and the avoidance of harm (mafsadah) in decision-making.
Among the crucial factors warranting serious attention are the dire socio-economic realities of Malay Muslims, the high level of syariah compliance in the current ASB/ASN portfolio, as well as the latter’s efforts towards full compliance and the huge potential benefit that offers to the Muslim community.
Dr Mohamed Azam Mohamed Adil is the deputy chief executive officer of International Institute of Advanced Islamic Studies (IAIS) Malaysia. He can be reached via mazamadil@iais.org.my