Endowment ESG & Sharīʿah screening review annually
Assesses whether the organization conducts an annual, look‑through review of all endowment holdings against defined Sharīʿah and ESG screening criteria, with quarterly monitoring for breaches. The goal is zero high‑risk assets held at the reporting date, or a managed remediation plan for illiquid exceptions. High‑risk means holdings that (a) breach Sharīʿah sector/ratio screens (e.g., AAOIFI SS 21) or (b) meet the charity’s excluded ESG sectors or severe controversy thresholds.
| Metric | Endowment Compliance Scorecard |
|---|---|
| Target | 0% Red / >95% Look-through / <90 Days Remediation |
| Frequency | Annual (with Quarterly monitoring) |
| Method | Composite: % Red Assets + Look-through % + Remediation Days + Purification Status |
| Unit | Composite |
Level 1: Initial/Ad-hoc
No formal or consistent process exists for screening endowment investments against Sharīʿah or ESG criteria. Investment decisions are ad-hoc.
Level 2: Developing
An informal screening process is in place, but it is conducted inconsistently. Criteria are not formally documented, and reviews are sporadic rather than annual.
Level 3: Established
A formal, documented policy for an annual review of endowment investments against defined Sharīʿah and ESG criteria is established and approved by the governing body.
Level 4: Advanced
Annual review conducted with ≥90% look-through. Breaches register is active, and purification is executed within defined timeframes. Red assets are remediated or under approved exception plans.
Level 5: Optimizing
Screening is fully integrated with quarterly monitoring and stewardship (voting/engagement). External assurance (e.g., ISAE 3000) or internal Sharīʿah audit is completed. Performance is benchmarked against leading Islamic/ethical peers.
Organisation Types
By Organisation Size
| Size | Applicability | Notes |
|---|---|---|
| Micro | exempt | Micro charities do not hold endowments or complex investments requiring listed equity screening. |
| Small | exempt | Small charities typically hold simple cash reserves rather than pooled funds or listed equities. |
| Medium | optional | Disproportionate unless the charity holds a specific, sizable endowment; a simpler ethical investment policy usually suffices. |
| Large | partial | Requires an ESG/Shariah screening policy and annual review, but complex RAG taxonomies and multiple data sources can be scaled down to relying on a single fund manager's reporting. |
| Major | full |
Applicable When
- The organization has an endowment or manages investments.
- The organization aims to operate according to Islamic principles.
Not Applicable When
- The organization has no endowments or investments.
- The organization has explicit policies against Shariah compliance.
Discussion (1)
📋 **Version updated: 1.0.0 → 2.9.7** **Changes:** Updated islamic_references from mizan-297.json
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