How much of Johnson & Johnson revenue comes from haram?

Johnson & Johnson earns its revenue from the following revenue sources:

  • Consumer Health:

Includes skin health, beauty, baby care, oral care, women’s health, and wound care products and over-the-counter medicines.

  • Pharmaceutical:

Includes products used in various therapeutic areas, including immunology, infectious diseases, neuroscience, oncology, pulmonary hypertension, and cardiovascular and metabolic diseases.

  • Medical Devices:

Includes a broad range of products used in the Interventional Solutions, Orthopaedics, Surgery, and Vision fields.

The contributions from each of Johnson & Johnson’s revenue segments in their 2021 annual report were as follows:

Practical Islamic Finance concludes:

None of Johnson & Johnson’s revenue comes from anything inherently haram.

Does Johnson & Johnson rely on interest to operate?

Year-to-Date
for period ended
7/4/2021
Fiscal year
ended
1/3/2021
Fiscal year
ended
12/29/2019
Interest Income $27,000$111,000$357,000
Total Revenue$45,633,000$82,584,000$82,059,000
Interest Expense $103,000$201,000$318,000
Total Expenses$32,727,000$62,670,000$61,089,000
Interest Income / Revenue0.06%0.13%0.44%
Interest Expense / Total Expense0.31%0.32%0.52%
*Numbers in thousands, U.S. dollars

Practical Islamic Finance concludes:

Riba is used but not relied upon in Johnson & Johnson’s operations.

What is Johnson & Johnson Environmental, Social, and Governance (ESG) impact?

Environment

According to Johnson & Johnson, 54% of its electricity usage is generated from renewable energy sources.

In addition, Johnson & Johnson has reduced its CO2 emissions by 45% from 2010 to 2020.

Social

Johnson & Johnson made several charitable initiatives in 2020, including contributing $50 million in funds to support frontline health workers battling COVID-19, donated 200 million doses of its VERMOX drug (1.8b doses donated since 2006), and committed $100 million to help eliminate health inequities in the United States.

In 2019, Johnson & Johnson’s recall rates for its pharmaceutical, medical devices, and consumer health segments were  0.002%, 0.041%, and 0.091%, respectively.

In 2020, the aforementioned segments experienced 0%, 0.034%, and 0%, respectively.

In addition, Johnson & Johnson has an impressively high Glassdoor rating of 4.2 out of 5 from over 10,000 current and previous employees compared to a 3.3 average for all other Glassdoor rated companies. 

Governance

As a pharmaceutical giant, it is no surprise that Johnson & Johnson has had its fair share of controversies, including allegations of bribery, contributing to the opioid epidemic, and falsely reporting the injury and safety risks associated with its products. 

These allegations are very serious and have since been settled.

Given Johnson & Johnson’s fundamentally beneficial lines of products and therapeutics, Practical Islamic Finance is willing to give Johnson & Johnson the benefit of the doubt moving forward so long as systemic causes for unethical behavior have not been identified in Johnson & Johnson.

Practical Islamic Finance concludes:

Johnson & Johnson has a net positive ESG impact.

Comfort Rating

From Johnson & Johnson’s business, financial, and ESG reviews, Practical Islamic Finance rates Johnson & Johnson stock as: 

Comfortable to invest in from a halal perspective.

Sources

JNJ 2020 Environmental, Social and Governance (ESG) Summary 

JOHNSON & JOHNSON 2020 10-K 

JOHNSON & JOHNSON 2021 Q2 10-Q 

Johnson & Johnson Wiki 

Johnson & Johnson Reviews