The last in our annual awards series, IFN is pleased and proud to announce the winners of the 2015 IFN Islamic Investor Awards. A streamlined selection this year, the winners bring a mix of experience and innovation, tradition and transition to demonstrate the continued progress of the Shariah compliant asset management industry. 

Previously the IFN Asset Management Poll, in 2014 IFN re-evaluated its Islamic investor approach to change from an online poll to a nomination-based selection by an anonymous and independent panel of judges: in order to recognize the achievements of the major players while also rewarding the smaller and newer entrants to the market. 

A constant work in progress, this year saw another positive response as IFN works with the Islamic asset management industry itself – not just to acknowledge its successes but to raise awareness, increase understanding and encourage evolution. 

Table 1: Islamic Investor Awards winners 2015
Category	2015 winners	2014 winners
Best Overall	Franklin Templeton	Franklin Templeton
Best in Asia	AIIMAN	Franklin Templeton
Best in the Middle East	Sidra Capital	Al Rayan
Best in Africa	Oasis Crescent Capital	Oasis Crecent Capital
Most Innovative	First Guardian	Arabesque Asset Management
Best Institutional Solutions Provider	EPF	EPF
Best Regional Fund Performance	Al Rayan GCC Fund	Al Meezan
Best Thematic Fund Performance	AmInvest AmDynamic Sukuk Fund A	Asiya Investments
Best Sector Fund Performance	Oasis Crescent Capital	Azimut

This year the awards have been streamlined into just 10 key categories, to reflect the consolidation and confluence of activity within the industry. Notably, while some key winners repeat their success and others are the undeniable standouts in their field or market, others emerge to demonstrate new centers of excellence and new pockets of innovation. 

Please note that winners in each category are selected only from the nominated asset management firms, and do not reflect the global Islamic asset management universe as a whole. 

Leader of the pack
It comes as no surprise that last year’s winner once again takes the prize for Best Overall Islamic Asset Management Company. A global leader in asset management with offices in over 150 countries worldwide and a track record spanning over 65 years, Franklin Templeton Investments is one of the biggest names in the game: standing out for its comprehensive product suite, dedication to Islamic excellence and the rigor of its Shariah compliance, along with its constant commitment to innovation and progress. 

The group has 14 dedicated Shariah compliant investment professionals globally, including three Sukuk and four equity lead portfolio managers. With US$770.9 billion total assets under management (AUM), Franklin Templeton Investments manages US$1.4 billion in Shariah compliant assets through four funds and 13 Shariah mandates from a diverse mix of clients including pension funds, central banks, government agencies, Takaful companies and family offices across multiple strategies including global and country-specific Sukuk as well as global, Asian and emerging markets Shariah equities. With its global reach and extensive experience, Franklin Templeton has managed to ride out a rocky year with aplomb – growing its AUM from US$1.2 billion in January 2015 to add US$260 million by the end of September. 

Over the past year, the group has demonstrated its ongoing commitment to progress with a number of landmark achievements: including the launch of its first Shariah compliant emerging markets equity mandate and the structuring of an Islamic Derivatives Master Agreement with CIMB to enable foreign hedging. The group also received approval for its Franklin Malaysia Sukuk Fund, to be launched by the end of 2015 – the first Shariah retail fund to be offered to the Malaysian public by Franklin Templeton Investments. 

“We are delighted to receive [this] award by IFN for the second year running. It is a great recognition of our efforts and success in leading Shariah investments globally. It is heartening for Franklin Templeton Investments to be conferred an award in Islamic finance, especially in light of the challenges of a volatile market condition in emerging markets in 2014 and this year. This highlights the collaborative strengths of our global teams from investment, business development, [and] marketing to support teams, and the diversity of our Shariah product range and strategies in helping us to navigate this challenging phase in the asset management industry,” said Sandeep Singh, the country head for Malaysia and head of Islamic business for Franklin Templeton Investments. “We will continue with our commitments in growing the Shariah investment industry as a global asset manager in the coming years. In [the] immediate horizon, we are working toward diversifying our client base, expanding our distribution network and tapping new market segments to extend the scale of our Shariah platform.”

Asian dragon
Moving east, and the award for Best Islamic Asset Management Company in Asia this year goes to Malaysia’s Asian Islamic Investment Management (AIIMAN) for a sterling performance that saw AUM increase by 44% over the last year. The firm has grown exponentially over the last 12 months, expanding its remit from nine funds and 18 mandates in September 2014 to 18 funds and 31 mandates as of the 31st August 2015. Total AUM now total RM8.5 billion (US$1.93 billion) – up from just RM691 million (US$157.22 million) in 2009. Its flagship AIIMAN Growth Fund has returned 362% since inception in 2002 and 9% over the last three years, while the group has also launched two new retail funds over the last year to expand its reach. 

“Over its relatively short history, [we have] achieved a number of notable achievements in the industry, leading to a reputation of product innovation and strong, consistent performance,” commented Akmal Hassan, the managing director of AIIMAN. “Since its establishment in 2008, AIIMAN has brought more than 20 funds to the Malaysian market. Over the past seven years, AIIMAN [has] continuously gained clients’ trust and confidence and enjoyed consistent AUM growth across various investors. Our investment team is one of the bigger and dedicated teams in the Islamic asset management industry [and] we continue to build this team.”

“We plan to launch two new funds in 2016 despite the challenging global macro conditions. We’ve had a good track record in managing two institutional portfolios and thought it would be an opportune time to launch a similar version for retail investors. This reflects our commitment to the Malaysia International Islamic Financial Center. We think that investors’ appetite for Shariah compliant investments will grow.” 

Arabian promise
On the Gulf side, this year’s accolade of Best Islamic Asset Management Company in the Middle East was awarded to SIDRA Capital for its standout performance in terms of innovation, dedication and commitment to growing its franchise. The firm might be one of the smaller players in the current market with US$562 million in total Shariah compliant AUM as of the 18th October 2015, but it punches above its weight in terms of sector strength and strategic ambition. The firm has seen AUM grow by 15% in the last year, with five new mandates launched in the last 12 months. Its Global Structured Trade Investment Fund has become the world’s largest Islamic structured trade investment fund since its launch in February 2015, bringing investors exceptional returns on a truly Shariah compliant basis and in an area often overlooked. 

“Our current activities continue to be strongly guided by investors’ preference vis-à-vis outlook of the market in determining the suitability of the chosen asset class. However, Sidra Capital is maturing to focus on a handful of alternative asset strategies, mainly real estate and structured trade finance. There are many indicators to suggest a prolonged low growth environment globally which correspondingly increases the degree of risk aversion among investors. This has resulted, to some extent, unscheduled reallocation of investment assets. We are happy to see real estate as an asset class continue to gain interest from our investors albeit with slightly higher expectations,” explained Naim Azad Din, the head of the asset management division at Sidra Capital, speaking to IFN on his outlook for next year. 

“We are also, as confirmed by the previous IFN research on how SMEs are being sidelined, continuing to push to the front of the structured trade finance strategy to help relevant SMEs to flourish. We are planning to launch a Saudi domicile fund undertaking this strategy globally in 2016 while continuing to grow our Luxembourg platform. Given some uncertainty in the local real estate sector, our strategy to grow our AUM from the local sector will face challenges at least in the short term but there are opportunities for us to consider offering to the market. This will be our tertiary focus in 2016.

“Our success thus far can be attributed to various factors including strong focus/emphasis by the management to find [a] niche strategy and grow, a number of success stories of exited investments and [a] growing international network of asset managers. We are appreciative of the support provided by stakeholders and we hope 2016 will bring more opportunities.”

African skies
The Best Islamic Asset Management Firm in Africa once again goes to South Africa’s Oasis Crescent Capital, which continues to carve a path at the forefront of the African asset management industry. The firm holds US$2.7 billion in AUM, and has increased its AUM by 2% this year on a constant currency basis. It currently holds 25 Shariah compliant funds under management, and 2015 has been a busy year with the launch of the Oasis Crescent Variable Balanced Fund (a GBP-based balanced fund targeting inflation-beating returns over the long term) and the Oasis Crescent Global Short Term Income fund (a Shariah compliant income fund focused on providing a stable short-term saving/income solution) as well as a range of tax-free investment savings options in response to the regulatory amendments in the savings market. 

Over the past year, Oasis has also continued to strengthen and broaden its distribution infrastructure. It has deepened its local distribution in the UK, its regional distribution in Europe (including Belgium and Switzerland) and into the Middle East – particularly in the UAE, Bahrain, Kuwait and Qatar. 

Oasis Crescent Capital also this year took the award for Best Sector Fund Performance for its Oasis Crescent Global Property Equity Fund, launched in September 2006. Over the last nine years, the fund has provided consistent returns and is a leading regional property fund in terms of its performance and downside protection. The total cumulative return since inception has been 47.2% relative to the benchmark of 18.7% – equating to an annualized US dollar return of 4.3% relative to 1.9% for the benchmark.

“Oasis is a global wealth management firm that is committed to creating real wealth for our clients in every jurisdiction we operate in. Key to Oasis’s growth has been our focus on service excellence, having sound and robust systems and administration, clearly defined processes and well-trained and supported staff. These fundamentals make the organization agile and quick to respond to any changes in market or economic conditions to ensure our clients’ wealth is protected through cycle,” said chief investment officer Adam Ebrahim, speaking to IFN. 

“Oasis offers investors access to its products through its direct advisory force in certain markets and also ensures a deep and widespread omni-channel distribution through private banks, wealth management companies, leading global platform providers and the local investment providers within each region. The group operates in some of the most widely-recognized regulatory environments with funds being registered for distribution with regulatory bodies that include FCA (UK), CBI (Ireland), FINMA (Switzerland), MSA (Singapore) and FSB (South Africa); meeting every standard and operating requirement. The relationships we have established on a business-to-business and business-to-consumer basis have ensured a broad and wide distribution to ethically-minded investors who seek to protect and grow their wealth in a sustainable manner.” 

“Our focus in 2016 is to entrench our brand further into our markets of operation, strengthen our relationships, extend and deepen our footprint into Europe and the Middle East. Importantly, we will continue to focus on delivering significant value to our clients, stakeholders and the communities we serve.”

New horizons
Coming to the award for Most Innovative Islamic Asset Management Firm, IFN is delighted to welcome a new entrant to the stable of winners, demonstrating once again the vital importance of awareness, education and expansion to develop the industry in new markets and sectors. This year’s winner, Australia’s First Guardian Capital, has done exactly that – bringing Shariah compliant fund management to Australia and pushing it into the mainstream asset management market. The firm currently holds AU$68 million (US$48.32 million) in Shariah compliant assets, and has seen an exceptional annual growth of 620% between 30th June 2014-15 with three new fund launches: the First Guardian Super Ethical Defensive Portfolio, Balanced Portfolio and Growth Portfolio. 

Managed by Simon Selimaj, an experienced portfolio manager with over 31 years in Shariah compliant investing, the three funds exist as investment options under First Guardian Super – a new Australian superannuation fund specifically developed for Australia’s Muslim community. Launched in late 2014, the fund has been instrumental in providing a much-needed alternative not only for Australia’s Muslims but for any investor seeking ethical and socially responsible retirement income investment. 

The firm has also taken a proactive and innovative approach to grassroots marketing, affiliating itself with leading Muslim bodies such as the Australian National Council of Imams, The Islamic Council of Victoria and The Grand Mufti of Australia; and working directly with clients at community centers, sponsored events and education seminars. 

“The objective of First Guardian Super is to invest according to the tenets of Islam, for the betterment of Australia’s large and flourishing Muslim community.

It is designed and managed for ethically conscious investors, with [a] particular reference to the Muslim community to assist in their financial journey to retirement,” explained Dr Bekim Hasani, the director of First Guardian Capital. “First Guardian Super is a forerunner to more Islamic financial services we have to offer in the near future. We aim to become a leading provider of financial services to all Australians who have an ethical focus. We remain active in the community in terms of providing ongoing education on matters relating to Islamic finance and wealth creation.”

Institutional focus
In a result that should come as no surprise, the award for Best Institutional Solutions Provider once more goes to Malaysia’s Employees Provident Fund (EPF), a giant among global institutional players and a pioneer for Islamic solutions that encourages and drives forward Shariah compliant opportunity and participation. EPF has total AUM of RM636.53 billion (US$144.83 billion), of which an impressive 40% are Shariah compliant. In October this year, Malaysia’s deputy finance minister Johari Abdul Ghani announced that when the Employees Provident Fund Act (Amendment) 2015 is passed, contributors may choose to have a KWSP-I account managed and invested under Shariah principles. “The biggest investor in Islamic assets in Malaysia, by 2017 EPF will be the first government pension fund in the world to offer Shariah compliant solutions to its members,” said general manager Ja’afar Rihan. 

Regional themes
And finally, we come to the top players by region and theme, selected from the nominations received by IFN in this year’s Islamic Investor Awards submissions. 

In top spot for Best Regional Fund Performance, the Al Rayan GCC Fund wins for its size and regional strength. With total AUM as at the end of September 2015 of US$915 million, Al Rayan has seen year-on-year AUM growth of 2.5% and an impressive year-to-date growth of 9.5%. The Al Rayan GCC Fund is the largest mutual fund based in Qatar, and over the last 24 months has seen a return of 12.8%, compared to -13.8% for its benchmark, the S&P GCC Shariah Index. 

Rigorous risk management combined with a disciplined investment process has helped the firm to reduce fund volatility. At end-September 2015, the fund’s 24-month rolling Sharpe ratio was +0.19 despite difficult market conditions. The fund’s ‘market participation’ in months where the market rallied is 101% on average, while downside participation in down months is 48% on average. “Backed by in-house research, the fund invests only in high-conviction ideas, applying a two-year investment horizon. This drives the significant difference in performance versus an index like S&P GCC Shariah,” explained Akber Khan, the senior director for asset management. “The fund manager is incentivized to invest thoughtfully as churn is kept low and fund holdings are limited to around 25. Security selection is therefore key to alpha generation, in both up and down markets.”

For Best Thematic Fund Performance the award goes to the AmInvest AmDynamic Sukuk Fund A, which has seen a strong year with a 3.05% annual growth rate compared to -0.25% for its benchmark, the BPAM Corporate Sukuk Index. Over the past three years, the fund has demonstrated steady growth and consistent performance with an 11.04% growth compared to just 3.43% for its benchmark. 

Commenting on the win, Maznah Mahbob, CEO of AmInvest, said, “We are very focused on offering global investment solutions to global investors and it is recognition such as this which shows that we are on course to achieving this. In the Islamic asset management industry, we are positioning ourselves as a complete Shariah compliant solutions provider which has a full range of fund offerings that cut across asset classes, strategies, currencies as well as geographical exposure. In terms of investment performance, we have and will continue to put in effort to ensure that our Shariah compliant investment solutions are competitive with the best conventional offerings in the marketplace in terms of risk and return.”

Congratulations
IFN would like to once again extend its most sincere congratulations to all the winners of the 2015 IFN Islamic Investor Awards. This is a small but growing industry, and as we evolve and develop together we hope to develop an even closer relationship with the asset management universe to ensure the widest and most complete coverage and encourage the best performance possible across all fields of progress. Onwards and upwards!