ELI5 -- if a company's stock is considered non-compliant with shariah, is the income from working at that company also not compliant, i.e. not halal?

mrsstylz

New member
This seems pretty straightforward to me, but some comments here got me thinking I might be missing something...thoughts? opinions? valid sources?
 
@mrsstylz If it is a permissible business you may work in it regardless of the capital structure and as long as your role does not entail haram activities (e.g. entering into loan agreements).

In principle, you are testing to see if the business activity is halal, and if it is, then is the work you are doing within the business halal.
 
@romans1013 Thanks!

The sin of riba is borne by the company and those who directly deal with riba or help with it, or approve of it

Although, if that's the reason the income would be okay, why couldn't that same rationale be used to justify purchasing stocks of other companies that deal in halal business, but have non-compliant financing?
 
@mrsstylz The issue really seems to stem from the nature of your contribution. As an employee, you are being compensated for your specific role and the work you do. If that work is halal, then you can consider your income coming from the halal business of the firm.

But as a shareholder, you are taking responsibility for and participating in all activities of the firm. And remember, either being a creditor or a debtor in non-compliant financing is not allowed.

As an equity holder you are responsible for the debts of the firm. So when you buy shares in a highly leveraged firm, you are mostly taking on high levels of debt relative to equity (which is a claim on profits and capital of the firm).
 

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