Does Your Portfolio Reflect Your Values? Musaffa’s ISRI Approach Explained

Written by Haider Saleem
Journalist and Political Analyst | LinkedIn / X

Musaffa’s Islamic Socially Responsible Investing (ISRI) tool empowers investors to move beyond basic Shariah compliance, enabling a meaningful assessment of corporate ethical behavior through a distinctly Islamic lens.

Why Go Beyond Shariah Compliance?

Shariah-compliant investing is now more accessible than ever. Yet, for many Muslim investors, simply avoiding haram sectors isn’t enough. The deeper challenge is this:

Does a company genuinely reflect Islamic values such as justice, dignity, accountability, and environmental stewardship in its operations?

Musaffa’s ISRI framework helps answer that question. By extending beyond conventional halal filters, ISRI evaluates how companies perform ethically, socially, and environmentally – using a framework firmly rooted in the higher objectives of Islamic law (Maqasid al-Shariah) and reinforced by internationally recognized ethical standards.

ISRI isn’t another halal screening tool – it’s a much more thorough, ethical lens for investors to use.

ISRI in a Nutshell

• Principled Foundation – built on Islamic ethical values aligned with the Maqasid al-Shariah.
• Holistic Evaluation  – assesses companies across five ethical pillars weighted by importance.
• Evidence-Based – uses 50 precise, binary, publicly-verifiable indicators.
• Transparent Scoring – scores range from 0 (poor) to 5 (excellent) ethical alignment.

Dual Ratings – combines expert analyst scores with community-generated ratings for balanced insights.

What Makes ISRI Unique?

Unlike traditional Shariah screens that focus mainly on financial ratios and sector exclusions, ISRI measures a company’s broader ethical footprint. It assesses real-world behavior across labor, community impact, governance, product purity, and environmental responsibility.

The framework draws on Islamic teachings and global standards including:

• The UN Sustainable Development Goals (SDGs)
• International Labour Organization (ILO) Core Labor Conventions
• AAOIFI Governance and Ethics Framework
• The UN Guiding Principles on Business and Human Rights (UNGP)

Key Islamic Concepts Behind ISRI

Maqasid al-Shariah: The higher goals of Islamic law – protecting faith, life, intellect, family, and wealth. In investing, this means supporting justice, dignity, and public welfare.Maslahah: A principle in Islamic ethics meaning public benefit. It encourages prioritising investments that serve society, not just comply technically.

The Five Pillars of ISRI

Each company is evaluated across five core ethical pillars, with a total of 50 evidence-based, publicly verifiable indicators distributed evenly across two subcategories per pillar:

Pillar	Weight	Main Subcategories	Ethical Principles
Community Impact & Social Controversies	35%	Community Investment & Social Upliftment Reputational Risks & Controversies	Justice, dignity, community upliftment, accountability
Labor Practices & Human Rights	25%	Fair Labor & Dignity Workplace Justice & Non-Discrimination	Respect for workers, equity, freedom from exploitation
Product & Sector Involvement	20%	Shariah Screening & Product Purity Maslahah Innovation & Social Benefit	Halal compliance, social good, avoiding harm
Ethical Governance	10%	Trust & Leadership Ethics Accountability & Governance	Transparency, integrity, moral leadership
Environmental Responsibility	10%	Environmental Stewardship Preservation & Compliance	Stewardship (Khalifah), sustainability, resource care

Red Line Rule: If a company breaches critical ethical red lines – e.g. engagement in forced labor, human rights abuses, or prohibited sectors – the corresponding subcategory is automatically scored zero, regardless of other strengths.

How the ISRI Score Is Calculated

• Each of the 50 indicators is scored as 1 if credible public evidence supports the practice or disclosure, or 0 if unmet or undisclosed.
• Scores for each subcategory and pillar are aggregated and weighted.
• The final ISRI score ranges from 0 to 5, summarizing overall ethical alignment.

ISRI vs. Traditional Halal Screening

Feature	ISRI Framework	Conventional Shariah Screening
Shariah Focus	✅ Built on AAOIFI and Islamic ethics	✅
Beyond Halal	✅ Includes justice, dignity, stewardship	❌ Primarily financial and sector filters
Transparency	✅ Fully evidence-based & score breakdown	❌ Limited transparency
Community Participation	✅ User-generated Community ISRI scores	❌ Absent
Continuous Monitoring	✅ Regular updates based on new data	Variable

The Dual Scoring Model: Analyst Meets Community

Musaffa’s ISRI combines two complementary perspectives:

1. Musaffa ISRI Score – where expert analysts provide a rigorous, research-based score using the ISRI methodology.
2. Community ISRI Score – crowd-sourced from users submitting ratings across the five pillars, promoting interactive engagement and transparency.

This dual approach encourages ethical reflection and allows users to compare personal values with expert assessments.

Why ISRI Matters for Investors

As Islamic finance expands globally, so does the desire for investment options truly reflecting Islamic ethical values. Beyond avoiding riba and haram businesses, many investors want to support companies that actively promote justice, dignity, and environmental care.

ISRI gives you the tools to ask:

• Does this halal-compliant company treat its workers fairly and uphold human rights?
• Is it committed to protecting the environment?
• Does its leadership demonstrate transparency and ethical governance?

Final Thoughts

While ISRI is currently in beta and continuously evolving, it represents a major step forward in values-based Islamic investing. It equips Muslim investors to ask not just “Is it halal?” but “Is it good for the world?”

Disclaimer: The content is for informational purposes only and does not constitute legal, investment or financial advice.
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