“Booming Islamic bond market embroiled in a debate over religious compliance” this was the headline of World-Wide Religious News on January 11, 2008. Financial Times further reported that in 2007, Sheikh Muhammad Taqī ʿUsmānī, chairman of AAOIFI Sharīʿah board sent shockwaves through the Islamic financial world with a statement that threatened to bring the fast-growing sukuk market to a standstill. He estimated that 85 per cent of sukuk (based on mushārakah and mudhārabah) have been sold with repurchase agreements and believed that the promise to pay back the capital runs counter to Islamic law. This event exemplifies the critical and strategic role of Shari’a scholars in the Islamic finance industry.
In fact, the role of Shari’a advisors resembles the function of a thermostat in the sense that they regulate the overall ecosystem of Islamic finance with their acute Shari’a opinions and recommendations. Unlike a thermometer that quickly reacts to the temperature around it, the highly effective Shari’a advisors critically analyse an existing phenomenon and adjust it according to the future direction of the industry. Their guidance navigates the industry as a compass in a rapidly globalising, often polarising world facing regulatory, commercial and social challenges. For the sake of understanding the skills required for this type of leadership and Shari’a intelligence, the author interviewed famous Shari’a advisors including Sheikh Taqī ʿUsmanī and Dr. Nizām Yʿaqubī. To further substantiate the findings, a few leading practitioners comprising of Islamic bankers, regulators and standard setters were also interviewed. The findings indicate that there are three common skills of successful Shari’a advisors. For the purpose of this research, a skill is defined as “the ability acquired through rigorous training, diverse knowledge and deliberate experience to effectively and efficiently perform a complex activity or job function assigned to a Shari’a advisor/consultant”.
- Interdisciplinary Knowledge Islamic finance is a multifaceted field, which entails integration of insights from a number of disciplines. The interviewed experts unanimously agreed that a successful Shari’a advisor should be equipped with interdisciplinary knowledge and skills. This is due to the fact that the Shari’a advisory profession deals with problems requiring analysis and synthesis across Islamic studies, economics, finance, law, accounting, social and environmental spheres.
It is observed that the top-tier Shari’a minds who are well-trained in various disciplines are excellent in articulating Shari’a rules, critical thinking, conflict and cognitive bias management and creative solution. This is evidenced in their thoughtful Shari’a analysis of sophisticated financial transactions and their ability to immediately construct understanding of technical aspects embedded in a proposed product.
A research showed2 that a rigorous interdisciplinary understanding develops three cognitive attributes; (1) perspective-taking techniques (in case of Islamic finance, the capacity of a Shari’a Scholar to understand multiple viewpoints on a given topic in a board meeting), (2) structural knowledge (comprehending factual information of a financial product and procedural detail of its execution) and (3) integration of conflicting insights from relevant disciplines and skill. In this vein, Sheikh Taqī ‘Usmānī, chairman of AAOIFI Sharīʿah board particularly accentuated the importance of ‘discernment’ in critical analysis of a financial contract in the right context keeping in view the terms and conditions applied. This skill is developed by a specialisation in Islamic financial jurisprudence coupled with interdisciplinary learning from banking, finance, economics, law, corporate governance, management science and IT. Consequently, the combined knowledge will enable the scholars to understand the dynamics of the business model, the requirement of the client they are serving, and the operative legal and regulatory framework. The multi-layer lens will also allow them to timely recognise the social, economic and environmental implications of their fatwa and Shari’a resolutions. A Shari’a advisor who can think like an economist, analyse like a financial analyst and argue like a lawyer will certainly make an effective and efficient Shari’a decision.
- Business Communication Proficiency
According to a 2016 LinkedIn survey, oral and written communication proficiency consistently topped the most sought-after soft skills among employers3. In fact, high-powered business executives sometimes hire consultants to coach them in sharpening their communication skills. For that very reason, the skill of effective communication was also emphasised by the interviewed experts as the second most useful soft skill for a successful Shari’a advisor.
In the context of a Shari’a advisory business, an effective communication skill can be described as a two-fold process; first, comprehending the purpose and behaviour of a financial product/query as presented to a Shari’a advisor, and second, eloquently articulating the Shari’a principles and rulings pertaining to the enquired case in an engaging and deliberated way without jeopardising the sprite of Islamic law. In addition to the Arabic language as a tool for mastering the sources of Shari’a, a scholar is also required to be fluent in international business languages such as English, French etc. A Shari’a advisor who is skilled in intercultural communication will not only be able to work productively in the multi-cultural industry of Islamic finance, but can also appreciate differing values, beliefs, attitudes, and behaviours, to anticipate, act, and react in appropriate ways to produce the most effective results.
“A qualified jurist is not the one who memorised views of different scholars, rather he is the one who possesses skills of a cobbler. A cobbler is not a person who owns a large number of shoes neither the one who only makes a specific pair of shoes. Indeed, he is skilled enough to make shoes according to the size and choice of the customers (i.e. modified).”
A CEO of a global Islamic finance consultancy firm stated that the lack of effective communication and cultural gap, do not only impair the outcome of a Shari’a decision but creates a perception that undermines the credibility of the scholars. At the same time, Shari’a scholars shall also remain vigilant of the “eloquence bias” where the advisory seeker might misframe a case with his persuasive speaking or writing talent. Since a Shari’a opinion relies on the information presented, The Prophet (peace be upon him), categorically warned about the hazard of eloquence bias as he stated “maybe someone amongst you can present his case in a more eloquent and convincing manner than the other, and I give my judgment in his favour according to what I hear. Beware! If ever I give (by error) somebody something of his brother’s right, then he should not take it as I have only given him a piece of fire” (Mishkat Hadith No. 638. Vol. 3).
- Continuing Professional Development (CPD)
With the rise of fintech in the fourth industrial revolution; automation, blockchain, artificial intelligence and robot technology are disrupting demand and the nature of existing jobs and skills in the financial industry. According to the World Economic Forum Report (2018) on the future of jobs, various functions in the financial services sector are set to be significantly replaced by machine labour in the near future. To be relevant in the era of disruptive technologies, the scholars should lead with an agile and nimble mindset – a mentality that believes in adaptability to change, learning through failures, and encouraging feedback – to bring in consistent improvement, and coaching the young Shari’a scholars. An agile Shari’a advisor can easily combine velocity and adaptability with stability and efficiency.
Dr. Daud Baker, chairman of Sharīʿah Advisory Council of Bank Negara Malaysia stated “a scholar cannot work in self-imposed reality, which is different from what is happening on the ground….in real practice, a Shari’a scholar requires acute intelligence, sensitive antenna and nimbleness of footing”6. To develop this type of personality, Dr. Nizām Yʿaqubī and other experts suggested the habit of continuing professional development (CPD). As a career-long obligation for practicing professionals, CPD stands for an ongoing self-made process for professional skills development through formal training or informal learning at the job. It leads to increased public confidence in Shari’a scholars so they can deliver high-quality of Shari’a advisory services that safeguard the public interest (maṣlaḥah) and meet the expectations of their clients and the requirements of Islamic financial institutions.
It is narrated that the famous Ḥanafī jurist Imām Muhammad used to visit the markets in order to understand the current commercial trends. This reflects the fact that a Shari’a ruling given by a scholar in a certain case, might change when the presumed relevant conditions change with the passage time. As an established principle in Islamic jurisprudence, “evolution of Shari’a rulings (based upon a custom and ijtihad) due to changing time is not to be denied”. In this connection Ibn Al-Qayyim rightly stated “pronouncement on issues changes with time, place, conditions, and results. Ignorance of this causes an injustice to Shari’a, and has thus creates difficulties, hardships, and requirements to which there is no path”8. There are various cases in the Islamic finance industry where the Shari’a ruling has been changed from permissibility to prohibition and vice versa as a result of changes occurred in the subject matter. This is why successful Shari’a advisors are consistently involved in a self-designed CPD to make themselves relevant and abreast of the changing trends and directions in the industry.
Conclusion
Ibn Rushd, the famous Muslim jurist and Andalusian philosopher described a qualified scholar who is equipped with skills of a cobbler and not just by memorising views of different scholars. As much as a person cannot become a cobbler by owning a large number of shoes neither the one who only makes a specific pair of shoes. Rather, he is skilled enough to make shoes according to the size and choice of the customers. As a matter of fact, the leading Shari’a advisors are not heavily paid for the amount of knowledge they possess, but for the value they create from their knowledge and expertise for the benefit of the organisations, society and humanity as a whole. It is equally important for the young generation of Shari’a advisors to remain productive, agile, skilled and resourceful in the era of disruptive technologies by being mindful of the Qurānic principle “as for the foam (on the water), it passes away (as) scum, and as for what benefits mankind, remains in the
earth” (13:17).
Dr. Agha holds a Ph.D. in Islamic banking and finance from IIiBF, International Islamic University Malaysia. The opinions expressed in this article are solely of the author and do not express the views or opinions of his employer.
