American Muslim investors to donate $5.6 million to charity in Ramadan
In a statement, Azzad said:
“We are once again proud to help our clients fulfill their religious obligations and are gratified to facilitate the donation of more than $5.6 million to those in need. Charity is essential to the proper practice of Islamic investing, and we hold ourselves to the highest standard when it comes to calculating accurate zakah and purification amounts for our clients.”
The third pillar of Islam, zakah–sometimes spelled zakat–is an obligation that practicing Muslims pay on assets they have owned for at least one full lunar year.
The company calculates that its clients will give approximately $4.7 million in zakah and an additional $900,000 in purification dues, bringing the total to $5.6 million.
Azzad reports the amounts to its Muslim clients in annual statements issued during the month of Ramadan. Many Muslims choose to pay zakah during Ramadan–a month of fasting, worship, and giving–which began this year on May 15. The firm regularly educates the American Muslim community on the sometimes complex issues of Islamic investing, including zakah and purification.
See: Calculating Zakah on Modern Financial Assets (Azzad Funds website)
Islam mandates paying zakah on accumulated wealth in order to help those in need and to avoid a concentration of resources among the very few. Zakah is not a tax on income, but on wealth and savings. In addition to the obligatory zakah, Muslims are strongly encouraged to give additional charity, if they are able.
Azzad follows best practices and guidelines issued by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI). AAOIFI is a consortium of Muslim scholars who convene to issue guidelines on halal investing and other financial matters. AAOIFI Standard Number 35, which outlines specific guidance on zakah and purification calculation, is considered the authority for Islamic financial services firms.
About Azzad Asset Management
Since 1997, Azzad Asset Management has provided investment services designed to help clients enjoy optimum performance without compromising their values. Azzad is a member of the Forum for Sustainable and Responsible Investment and the Interfaith Center on Corporate Responsibility. The firm is a registered investment advisor based in Falls Church, Virginia.