Tadawul, Saudi Arabia’s stock exchange, will set up a Shariah Advisory Committee to expand its offering to cover new Shariah-compliant investment tools and products.
The committee consists of representatives from the Kingdom’s largest financial institutions, who will work towards a unified Shariah-compliant rulebook that will be approved by the members’ respective Shariah boards.
The committee will also undertake the responsibility of overseeing and approving the list of Shariah-compliant listed companies on a periodic basis.
The exchange, also known as Tadawul, will oversee the Shariah Advisory Committee, without actively taking part in the company screening and selection process, to ensure independence and transparency in decision making, it said in a statement.
It will also consult the committee when needed regarding some of its products and services.
Members of big financial institutions which are part of the committee, include Bader Al Omar, head of Jadwa Investment; Abdulrahman Al Ghusn, associate in Alinma Investment; and Abdullah Al Barrak, senior Shariah advisor at Al Rajhi Capital.
Tadawul will also collaborate with IdealRatings, a global Islamic Finance Solutions Provider, to provide Shariah screening services of listed companies within the Saudi capital market.
The list will be reviewed and approved by the Shariah Advisory Committee.