Although it now seems to have dropped off the radar, there was once a time when books on Shariah law, the Islamic legal system, were being published one after another in the context of rising crude oil prices. Lately in Asia and the Middle East, there have been continuous efforts to establish Shariah-based REITs.
What exactly is a Shariah-based firm? Since 2007, Standard & Poor’s and the Tokyo Stock Exchange have been providing the S&P/TOPIX 150 Shariah Index, which comprises only of Shariah-compliant firms targeting investors in Islamic countries. According to materials on the Index, the types of businesses that are in conflict with Shariah are those related to advertising, media, alcohol, finance, gambling, pork, pornography, tobacco and the exchange of gold and silver.
Hence Nikkei BP, which is a publishing media, would not be able to move into properties owned by the above-mentioned REITs. Although this is by no means an impediment, I am curious as to why our business is not considered to be compatible with Islamic law.
(Kazuhiro Mikami)