Is BHP (BHP Group Limited) Halal or Haram?

Based on our AAOIFI-standard shariah screening, BHP is Halal and considered permissible for Muslim investors. It passed all 4 of 4 compliance screens including business activity review, debt-to-market-cap ratio (12.04% vs ≤33% threshold), interest income ratio (1.29% vs ≤5% threshold), and cash & securities ratio (5.98% vs ≤33% threshold).

BHP Group Limited is one of the world's largest diversified resource companies, primarily focused on extracting and processing minerals essential for global infrastructure and energy transition. Their operations span massive iron ore mines in Western Australia, significant copper assets in South America, and metallurgical coal production for steelmaking. Recently, the company has pivoted towards future-facing commodities like nickel and potash, while divesting from petroleum assets to align with lower-carbon trends. For Muslim investors, BHP represents a compliant 'Halal' investment opportunity under AAOIFI standards, having passed all four mandatory financial screens. The company's business activities are inherently permissible, as extracting natural resources is considered halal, provided the financing structure remains clean. This clean pass means investors can include this blue-chip mining giant in their portfolios without the need for purification of dividends, assuming the non-compliant income remains minimal. Fin ancially, BHP maintains a robust balance sheet that appeals to conservative Islamic investment strategies. Their interest-bearing debt is low at 12.0% of market cap, well below the 33% limit, and their cash and short-term securities sit at a healthy 6.0%. Furthermore, the company generates very little haram income from interest , with such revenue accounting for only 1.29% of their total intake, showcasing a focus on operational earnings rather than financial engineering. While BHP is currently compliant, investors should continue to monitor the company's 'finance' and 'trading ' divisions mentioned in their operational scope. Although currently minor, any significant shift towards speculative commodity trading or interest-based financing services for third parties could impact future compliance ratios. For now, however, the stock remains a solid option for those seeking exposure to the basic materials sector. BHP Group Limited operates in the Basic Materials sector under the Industrial Materials industry and is headquartered in Melbourne, VIC, AU. The company is led by CEO Mike Henry and employs approximately 38,962 people.

BHP was screened using AAOIFI-based shariah compliance criteria. Four tests are applied: (1) Business Activity — the company's core business must not derive primary income from haram (prohibited) activities such as alcohol, gambling, tobacco, or interest-based finance. (2) Debt-to-Market-Cap — total debt must not exceed 33% of market capitalization. (3) Interest Income — interest income must not exceed 5% of total revenue. (4) Cash & Securities — cash and interest-bearing securities must not exceed 33% of market cap. BHP passed 4 of these 4 screens.

Although BHP passes all shariah screens, it does earn $658.9M in interest income (1.29% of revenue). Many scholars recommend purifying this portion by donating the equivalent percentage of any dividends received to charity. For example, if you receive $100 in dividends, you would donate approximately $1.29 to purify the income.

BHP was last screened on 2026-02-24. Shariah compliance status can change as companies report new financial data, acquire new businesses, or shift revenue streams. We recommend checking back periodically for the most up-to-date screening results.