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AGInvest offers Shariah-compliant investments

The Canadian farmland investment company has received temporary certification to offer Shariah products to Islamic investors.

AGInvest Properties Canada, the Ontario-based farmland investment company, now offers Shariah-compliant investments to its clients, a first in Canada.

The decision to launch the initiative was a result of both client requests and market trends, according to Jenessa Miglietta, director of investor relations at AGInvest Properties.

“We’ve had enquiries in the past about Shariah-compliant transactions, although [its absence] has never harmed investment demand from Islamic investors,” she told Agri Investor.

“In terms of market trend influence, the Shariah finance industry is growing in Canada and the US, so there’s a niche in the market for these transactions.”

The market is growing in Canada due to various reasons, continued Miglietta: “There are three main trends here. The first is Islamic investors seeking a stable place to invest ethically. Second is the concept of benefitting a community where agri investment provides an avenue to improve lands, yield and farming practices. Lastly, the trend and need for food security and entrepreneurial ventures.”

Implementing Shariah investment principles into the firm’s asset management capabilities will not change its investment methods because AGInvest Properties is accustomed to providing transactions that fit the Islamic finance rules of lease, partnership and profit sharing, according to Miglietta.

“Our transactions are Shariah-compliant by nature [prior to seeking certification],” she said. “However, to be officially compliant, our transactions have to provide a Shariah board and an annual audit.”

AGInvest has no plans to open an office in the Middle East to better services clients just yet, although Miglietta did not rule it out over the longer term.

The company is now awaiting full Shariah certification from the Shariyah Review Bureau, but has a temporary certification to start business straight away.