MORN

What You Should Know

Morningstar is a US investment-research and financial-services company providing investment data, research, and ratings (Morningstar Direct, Morningstar Office, Morningstar Advisor Workstation), credit ratings (Morningstar DBRS), index licensing, sustainability and ESG ratings (Morningstar Sustainalytics), managed portfolios (Morningstar Investment Management), private-credit and structured-credit data (PitchBook), and retirement-plan advice. The information-services and research business is unambiguously permissible at the activity level — Morningstar sells data and analytics, not financial products. The Sharia consideration is the qualitative screen. Almost the entire customer base is conventional asset managers, broker-dealers, banks, and insurance companies; the DBRS credit-ratings business directly rates interest-bearing debt instruments and is a core enabler of conventional fixed-income markets; the managed-portfolio business builds and manages portfolios that include conventional fixed-income and interest-bearing instruments. Strict Sharia advisory boards classify credit-ratings agencies and conventional-asset-management enablers as failing the qualitative screen; more permissive boards classify the business as general-purpose financial-information services. The financial screen passes cleanly (low debt, strong free cash flow). Most major boards land on doubtful for Morningstar because of the credit-ratings business specifically.