Though it seems incredible, we’ve learned that there are some among us who have managed to skate by, oblivious to the numerous and systemic obstacles women face in their professional lives. This year is shaping up to be a reckoning. But broad discussions of the discrimination and barriers women face have been a consistent part of at least some of the media landscape over the past forty years; why are we only now starting to be heard? Many factors are certainly at play, but I wonder how much of our recent progress is due to women finally seeing ways to color outside the lines, to avoid having to play by someone else’s rules.
The Sufi mystic and poet Rumi wrote, “Everyone has been made for some particular work and the desire for that work has been put into every heart.” My path to finance has not been unusual; throughout my childhood, my parents ran an investment management and brokerage firm, so I quite literally grew up in the industry. Instead of taking this for granted, however, it helped me – as Rumi says – to find my particular work. Watching and admiring the dedication my parents put into their business and their careers showed me the value of entrepreneurship, independence, and of planting a garden, digging in, and tending it. I’m grateful for the lessons in responsibility, hard work, and drive that have been ingrained in me, and early on it became obvious to me that finance could – and should – be a tool for good. By the age of thirteen I was fascinated by the possibilities of angel investing; I am now the President of Saturna Capital, a socially responsible asset manager in Bellingham, Washington.
Some investors are surprised when they learn that Saturna, which will celebrate its 30th anniversary next summer, has had the opportunity to hone its specific approach to investing through a history of faith-based investing: Saturna’s largest client, the Amana Mutual Funds Trust, is built upon Islamic values and serves both Muslim and non-Muslim investors who seek robust investments with superior ethical standards. When Nick Kaiser, Saturna’s founder and Chairman – and also, my father – was approached in the 1980s to develop an investment vehicle that met the strict standards necessary for observant Muslims, he gladly took on the challenge.
Why have I embraced Islamic values in finance so fully? It’s easy: Islamic values parallel the firm beliefs I already held about the role of money and finance. A mutual fund, by design, is well-suited for Muslim investors: Islamic traditions prize partnership and insist upon shared risk. As we know, mutual fund investors share wholly in the results of a fund’s performance and returns are commensurate with what an investor puts in; no single investor receives a return unless all investors receive a return.
Though negative screening of the industries seen as socially harmful is a feature of Islamic finance, there are a number of other values-based principles involved. For example, Islamic values forbid speculation, which veers toward gambling. Gambling is forbidden (haram) in Islam, as it violates the principle that all money should be earned through work. Accepting interest as income is similarly forbidden. Instead, halal – or permissible – investing encourages a disciplined approach that promotes in-depth security research and a long-term focus. At Saturna, we realize this principle through low portfolio turnover. Infrequent trading means that our due diligence goes deep before making an investment, and that rather than jumping from one hot thing to the next, we prefer to see ourselves as long-term partners in the companies in which we invest.
Islamic values also require avoiding debt. For Muslims, business and financial relationships must maintain high ethical standards and must ensure all parties receive fair and just treatment. Central to this is the mandate that all risk is shared equally among parties. As investors, we know that companies loaded with debt not only stand on shakier ground than their more solvent peers, but they may also be prone to risky, quick fixes, or more likely to bend accounting rules. Not only is a stronger balance sheet linked to greater sustainability in the sense of business continuity, but we can assume that companies with less debt have a greater capacity to focus on bigger picture goals – namely those environmental, social, and governance issues we want to see companies address.
Despite the very practical, straightforward investing guidelines that Islamic principles provide, many mainstream financial advisers have been resistant to embrace any portfolio labeled Sharia-compliant. Promoting the funds certainly comes with its challenges, but does that stop us from continuing our work? Not at all. We not only believe it has been a tremendous advantage to observe Islamic investing guidelines, but we are proud to offer quality services that help people invest according to their values. By digging in and sticking to our core beliefs, we’ve been able to build products that address the issues we feel are most important.
Beyond the challenge of offering niche products, we also choose to operate from just about the furthest location from Wall Street in the contiguous US. Why do we keep our main headquarters in the extreme Northwest corner of Washington State? Because we like it here. It’s our home. We found our community, planted our garden, and we want to put all of our energy toward investing in and improving it.
I’m aware that growing up within the industry puts me in a much different position than the many women trying to break in from the outside, but I do believe that everyone has an opportunity to plant their own garden. Technology has made it possible for anyone to raise her voice, find support, and connect with those others out there who get it. Staying true to core beliefs, being unafraid to carve out a non-traditional niche, and tending carefully to the surrounding community have been huge factors to my, and to Saturna’s, success. I also believe that with every challenge comes the opportunity to find a creative solution. Instead of playing by someone else’s rules we now, more than ever, have the opportunity to strike out and lead outside of any traditional framework – and specifically seeking those opportunities should be a personal mandate for all. It will ultimately be the diversity of our experience, and of our expertise, that makes our industry richer overall.
Article by Jane Carten, MBA, President and Director, Saturna Capital (www.saturna.com) and Saturna Sustainable Equity Fund Portfolio Manager
Jane Carten joined Saturna Capital in June 1997. Ms. Carten graduated from Western Washington University with an MBA and undergraduate degree in Computer Science and Business. As President, Jane oversees Saturna’s daily operations and directs Saturna’s internal and external information systems, managing the technology and marketing activities. She also directs Saturna’s continuing education program and the philanthropic efforts of the firm. Ms. Carten is active in the Bellingham Bay Rotary and is a member of the Young Presidents’ Organization; she is a former member of the Whatcom Museum Children’s Advisory Board. She is a founder and former director of the nonprofit OpenAccess Internet Services and is a Bellingham Sister Cities member and contributor. She enjoys her family, snow-boarding, and wildlife, as well as international travel and fine and theatre arts.
Disclosures: Please consider an investment’s objectives, risks, charges, and expenses carefully before investing. To obtain this and other important information about the Amana Mutual Funds in a current prospectus or summary prospectus, please visit www.saturna.com or call toll free 1-800-728-8762. Please read the prospectus or summary prospectus carefully before investing.
The Amana Funds limit the securities they purchase to those consistent with Islamic principles. This limits opportunities and may affect performance.