A Critique Of Creative Shari Ah Compliance In The Islamic Finance Industry

In A Critique of Creative Shari‘ah Compliance in the Islamic Finance Industry Ahmad Alkhamees provides a sustained analysis of the gap between the theory and practise of Islamic finance, and suggests a regulatory mechanism for regulators in Islamic and secular countries.

In A Critique of Creative Shari'ah Compliance in the Islamic Finance Industry Ahmad Alkhamees provides a sustained analysis of the gap between the theory and practise of Islamic finance, and suggests a regulatory mechanism for regulators in Islamic and secular countries.

A comprehensive guide to one of the key risk management issues in the expanding field of Islamic finance For Islamic financial institutions, Sharia non-compliance is a growing and key risk that must be carefully managed. This book offers a thorough look at non-compliance risk and explains the legal documentation necessary to ensure compliance for professionals in the Islamic finance industry. In addition, the book offers helpful guidance and understanding for the legal departments of Islamic financial institutions, as well as lawyers, legal firms, Shariah advisors, Shariah officers, and students studying Islamic finance. The book covers fundamental concepts, major risk elements, tools and techniques for identifying non-compliance, legal documentation, and the impact of non-compliance, among other vital topics. Offers comprehensive coverage of the growing field of non-compliance risk management in Islamic finance Includes in-depth coverage of legal documentation Written by an expert on the topic who teaches at INCEIF, The Global University for Islamic Finance and IIUM, International Islamic University of Malaysia in Malaysia

A practical guide for robust sharī'ah governance of the Islamic banking industry Debate in the market on the extent of sharī'ah compliance of Islamic banks, their products, and activities has piqued stakeholders' interest. In Foundations of Sharī'ah Governance of Islamic Banks, Karim Ginena and Azhar Hamid explore the depths of sharī'ah governance to unravel its mysterious dimensions, and equip academics and practitioners with a solid understanding of the subject, which has become a serious challenge and thus deserves dedicated attention. The authors make a strong case for the need to contain the sharī'ah risk that Islamic banks experience, and present a compelling argument for how this should be done. Ginena and Hamid propose a robust sharī'ah governance model that comprehensively tackles thisrisk, and helps improve the extent of sharī'ah compliance of market players. The authors detail the internal, external, and institutional arrangements needed to promote responsible sharī'ah governance, and critically analyze current laws, regulations, and industry practices on the topic. The chapters of the book do the following: Examine the roots, characteristics and objectives of sharī'ah and its relation to financial dealings; Probe the role of regulators in sharī'ah governance, explore the different approaches adopted by banking supervisors, and provide examples of relevant legal and regulatory measures; Explain to bank directors and management the fiduciary duty they assume with respect to sharī'ah compliance, and detail how they could discharge this responsibility in line with best practices; Elaborate on the purpose of the Sharī'ah Supervisory Board (SSB), its responsibilities, competence criteria, internal regulations, and key governance guidelines; additionally, they explore different SSB models; Describe the internal sharī'ah control system including its six components, and examine the internal sharī'ah audit function as well as different stages of conducting a sharī'ah audit; Clarify the role of a sharī'ah auditor, with guidance on reporting lines, scope of duties, authority, and practical ways on fulfilling tasks, such as a sample sharī'ah risk assessment grid and audit checklists; Discuss the newly emerging external sharī'ah advisory firms that are expected to play a key role in the coming years and the services they provide. Through an effective treatment of each of these elements, and the way that they interact with one another, the book offers a fresh take on how robust sharī'ah governance of Islamic banks can be successfully accomplished. It is a comprehensive resource for academics, regulators, directors, lawyers, auditors, consultants, employees, and customers of Islamic banks interested in learning more about these challenges. This essential reading persuasively extends the discourse on the subject and addresses critical sharī'ah issues that have policy implications for decision makers in jurisdictions aiming to attract the fast-growing Islamic finance industry or increase their market share.

In the present financial world, various niche markets play an increasingly important role. One of the fastest-growing niches is, without a doubt, Islamic finance. Indeed, sustainable finance needs constantly evolving innovations, and this book offers valuable insights into Islamic capital structure and Shari’ah equity screening enriching academic discourse. "In recent years, we have witnessed the emergence of a new generation of academics and professionals specializing in various aspects of Islamic finance as knowledge and practice. This has brought about a new dynamism and also further sophistication. This book is one of such contributions, as it develops knowledge which is then transformed into practice whereby practical impact is also achieved. Being an academic book, it provokes readers’ thoughts, offering a critique of the implications of the currently applied Shari’ah screenings methodologies. As a transformative practical piece, by developing an innovative screening ratio, in this book, Dr. Yildirim extends his focus on the risk-sharing based financing hierarchy, covers thoughts and the underlying philosophy, and proposes an Islamic version of a pecking order hierarchy. This framework can be considered the foundation for developing an Islamic capital structure theory. This book will benefit academics, professionals, investors, as well as policymakers working in the Islamic finance industry and would like to explore more." (Professor Dr. Mehmet Asutay, Durham University Business School, UK) "This book offers, for the first time after the inception of Shari’ah screening methodologies, a groundbreaking new stock screening solution that is comprehensible, practical, and foremost entirely derived from the primary sources of Islam (Qur’an and Sunnah). Congratulations to Dr. Ramazan for his outstanding contribution to Islamic finance and capital markets." (Associate Professor Dr. Ahcene Lahsasna) "This excellent book is a must-have for all corporate finance students/researchers interested in the theoretical aspect of capital structure and the religious discussion of Shari’ah equity screening. This book should become a companion to those involved in a quantitative research environment and aim to conduct a comparative analysis; an ideal resource for everyone, from Shari’ah scholars to Islamic finance practitioners and beginners to experts." (Professor Dr. M. Kabir Hassan, University of New Orleans, USA)

Islamic finance’s phenomenal growth owes to the Shariah compliant nature of its financial instruments. Shariah forbids the charging of interest (Riba) and instead promulgates risk-sharing and trade-based modes of financing. The Islamic financial industry has been subject to both critique and admiration. Critics argue that Islamic instruments (bearing debt-based structures) differ from their conventional counterparts only in legal lexicon and not in economic impact. The admirers argue that such instruments, irrespective of wider economic implications, rigorously comply with ‘juristically sound’ Islamic principles. This book aims to reconcile the above dispute. It argues that the financial impact of instruments is a consequence of the way they are priced and structured. The similarity in pricing and structures is an outcome not of the underlying Islamic financial modes but of the competitive environment in which Islamic instruments compete. Even risk-sharing and trade-based Islamic structures, if implemented in such an environment, would have a financial impact similar to that of conventional instruments. This book has a wider appeal for both academic and non-academic audiences. It can complement undergraduate and graduate courses as an additional reading on the intricacies of Islamic financial instruments and markets. For PhD students, it would help identify future research areas. To non-academics, it offers a deeper understanding regarding the working of the Islamic finance industry.

An in-depth and insightful study of Shari'ah governance from a theoretical and practical perspective. Shari'ah governance has a profound influence on the day-to-day practice of Islamic Financial Institutions (IFIs) and each jurisdiction has adopted a different approach to developing a governance framework. Hasan Zulkifli reviews these pluralistic approaches and identifies best practice. With examples, case studies and practical discussions based on IFIs in Malaysia, the GCC countries of Bahrain, UAE, Qatar, Kuwait and Saudi Arabia and the UK. Topics covered include; The theory behind corporate and Shari'ah governance; The regulatory framework for Shari'ah governance; Shari'ah governance approaches; The Shari'ah Board's role and how it retains its independence, transparency and competence; The operational procedures of Shari'ah governance; The effectiveness of the Shari'ah Board and how it could be improved

Written by a group of prominent shari'ah scholars, academics and practitioners in the field of Islamic finance, this book contains 17 in-depth case studies of shari'ah governance practices and experiences as well as critical analysis of these practices. It serves as a standalone comprehensive reference work on shari'ah governance, containing an overview of its Islamic legal foundations, its evolution and development over the years, current practices and debates on shari'ah governance standards and future prospects for shari'ah governance in the global Islamic finance market.