global islamic finance education 2013

8/14/2019 Global Islamic Finance Education 2013

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CONTENT OVERVIEW

INTRODUCTION FINDINGS

BONUS SECTIONCHALLENGES &

RECOMMENDATIONS

1 2

34

o Report Summary

o Definition

o Methodology

o Classification

o Geographic Distribution

o Distribution by Metrics

o Rankings by Number

o Comparative Analysis

o Key Challenges

o Envisioning the Future

o Recommendations

o Intellectual Contributions

by Industry Practitioners,

Thought Leaders, and

Academic Scholars


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WHAT ARE IFEKSP (ISLAMIC FINANCE EDUCATION & KNOWLEDGE

SERVICES PROVIDERS)?

Global Islamic Finance Education 2013 5

For the purpose of this research, we defined IFEKSP (Islamic Finance Education and Knowledge Services

Providers) as organizations that provide any one or more of the following in the subjects of Islamic Economicsand/or Islamic Finance:

Dedicated degree programs ( Bachelors, Masters, PhD)

Courses within a degree program (Electives, Major courses)

Independent short courses (Non-degree)

Diploma (Postgraduate / Higher, Regular)

Certification

Training Courses ( Individual, Corporate )

Seminar, Workshop, Awareness programs

Research (Primarily academic)


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Asia43%

Europe22%

Middle East &

North Africa19%

North America8%

Sub-Saharan Africa6%

Oceania2%

DISTRIBUTION OF ISLAMIC FINANCE EDUCATION & KNOWLEDGE

SERVICE PROVIDERS BY WORLD REGION


Asia, home of the largest

Muslim population hosts

43%of global IFEKSP

1

2

3

45 6

742 IFEKSP


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TOP 10 COUNTRIES BY NUMBER OF ISLAMIC FINANCE

EDUCATION AND KNOWLEDGE SERVICES PROVIDERS


Pakistan tops the chart with 88 institutions

that offer education and knowledge services

in Islamic Finance in the country. 74 of these

are academic and 14 are non-academic

Institutions.

Malaysia and United Kingdom come second

with 86 institutions offering Islamic Finance

education and knowledge services.

United States and United Arab Emirates take

fourth and fifth position with 44 and 43

institutions respectively. In case of

United States 41 are universities and higher

learning institutions.

Pakistan

Malaysia

United Kingdom

United States

United Arab Emirates

Indonesia

India

Bangladesh

Bahrain

Turkey

88

86

86

44

43

31

28

22

20

12


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DISTRIBUTION OF ACADEMIC VS. NON ACADEMIC

INSTITUTIONS IN TOP 10 COUNTRIES


Academic & Higher Learning(Universities & Colleges)

NonAcademic(Training, Awareness and Other)

74

49

48

41

28

24

14

13

7

7

Pakistan

United Kingdom

Malaysia

United States


Indonesia

India

Bangladesh

Turkey

Bahrain

38

37

15

14

14

13

9

7

5

3

Malaysia

United Kingdom


Pakistan

India

Bahrain

Bangladesh

Indonesia

Turkey

United States


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INTELLECTUAL VS. SKILL BASED PROGRAMS


15%

85%

Intellectual Skill Based

Intellectual

(PhD, Dedicated Degree

Programs, Research)

Skill Based

(Certifications, Workshops,Training, Diploma, Seminars

Short Courses etc.)

How will research

and development

be facilitated for

future growth &

sustainability?


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DISTRIBUTION OF IFEKSP IN EUROPE


United Kingdom leads IslamicFinance Education Services in

Europ e with 53% of th e total

IFEKSP in the regio n

Country InstitutionsBelgium 2

Bosnia & Herzegovina 3

Cyprus 1

Denmark 3

Finland 1

France 12Germany 7

Hungary 2

Ireland 8

Italy 5

Luxembourg 5

Spain 5Sweden 3

Switzerland 6

The Netherlands 2

Turkey 12

United Kingdom 86 1

2

2


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DISTRIBUTION OF IFEKSP IN THE MIDDLE EAST AND

NORTH AFRICA


Algeria 1

Bahrain 20

Egypt 9

Iran 2

Iraq 1

Jordan 6Kuwait 7

Lebanon 9

Libya 3

Morocco 3

Oman 7

Qatar 4

Saudi Arabia 19

Tunisia 4

United Arab Emirates 43

Yemen 3

1

2

3

United Arab Emirates leads in MENA with

43institutions which is 30% of the totalIFEKSP in the region


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RECENT TREND IN DEMAND BY PROGRAM TYPES


Sample Size

2,910

Demographics (Region)

Asia, Europe, Africa, Americas,

Oceania, Middle EastSource: Yurizk Poll, Yurizk Web Queries (20122013)

Detail available in Full Report


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CHALLENGES FACING ISLAMIC FINANCE EDUCATION


HumanCapital

Research &

Innovation

Curriculum&

Textbooks

Funding

Insufficient quality human resource is claimed as

critical challenge for Islamic Finance industry although

85%of the educational initiatives are towards

professional development. Where is the gap?

Only 15%of the global IF

educational initiatives are potential

contributors of R&D. What should be

the way forward?

Who will design a comprehensive

curriculum that addresses all the

challenges to produce nextgeneration human capital?

How will the initiatives be funded?

Will there be conflict of interests?


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DEVELOPING NEXT GENERATION HUMAN CAPITAL


SHARIAH SCHOLARS

ACADEMICIANS

RESEARCH SCHOLARS

SKILLED EMPLOYEES

1

2

3

4

How do we visualize the next

generation Shariah Scholars?

How do we visualize the nextgeneration Academicians?

What will be the role of next

generation Research Scholars?

What will be expected from next

generation skilled employees?


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BONUS SECTION


Industry Thought Leaders, Practitioners, Academic Scholars shared their

views on various issues of Islamic Finance Education


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WHY ISLAMIC FINANCE TRAINING NEEDS TO CONFORM

TO AAOIFI STANDARDS


Ethica I nstitute of I slamic F inance

Without standardized training and certification, the Islamic financeindustry will continue to calcify in its old ways: no serious innovation

into equity-based Musharakah and Mudarabah products; no practical

alternative to a fractional debt-reserve banking system; no global

gold-based currency; and no move away from debt-based mainstays.

Instead, what we need in order to rebuild Islamic finance is a strong

foundation of capable, trained individuals competent enough to

innovate products away from debt-based, fiat-based, cosmetically-enhanced conventional products for the rich and upper middle class to

equity-based, asset-based, genuine products for all.

Yet, we continue to sing the praises of Islamic bankers at awards

ceremonies, hymn the growthmantra of conventional economics,

and hope for the best. Somehow, someone, we believe, will one day

make it all right. After all, Islamic finance is just starting out and it

only needs a little more time to work out the details, no?

Wrong. Where we are presently headed is an unabashed embrace of

conventional banking served up with a milquetoast nod to the Shariah.

If we go on without standardized training, nothing changes and we

continue as before. We lend further credence to detractors who

believe that Islamic finance is not working and what is needed is a

complete revamp.

But because these same detractors leave much to be desired in the

way of a practical, scholar-approved blueprint for us to follow, what

the absence of a workable alternative will more likely lead to is

countless millions with a worse option (interest-based products) rather

than a merely bad one (poorly implemented Islamic finance).

What we need is a move away from the current state of anything

goes Islamic finance training and certification. What we need is

standardized training and certification based on AAOIFI ShariahStandards. AAOIFI, (pronounced a-yo-fee),is the Accounting and

Auditing Organization for Islamic Financial Institutions and the de

facto in over 90% of the worlds Islamic finance jurisdictions.

AAOIFI already brings together scholars from all over the world who

agree on Shariah standards and have put behind us the painstaking

task of harmonizing global standards.

According to the Institute of Management Accountants, AAOIFI

standards are now mandatory in Bahrain, the Dubai International

Financial Centre, Jordan, Qatar, Qatar Financial Centre, Sudan, South

Africa, Syria, and the Islamic Development Bank. AAOIFI standards

also form the basis for national standards in Bangladesh, Brunei,

France, Indonesia, Kuwait, Lebanon, Malaysia, Pakistan, Russian and

Central States, Saudi Arabia, the United Arab Emirates, and the

United Kingdom.


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AAOIFIs regularly updated texts have become the definitive

reference work for those seeking a comprehensive rule book about

Islamic financial products and practices. Its 85 standards cover

everything from accounting and auditing to governance and product-

specific Shariah standards. The 16 to 20 scholars the number

depending on the year who sit on AAOIFIs Shariah Board areleading Islamic finance scholars who come from the Gulf, South Asia,

South East Asia, Africa, and North America; each of them legally

qualified to issue a fatwa and adjudicate on matters Islamic finance.

If we are going to be serious about Islamic finance, we need to be

serious about Islamic finance training. And being serious about

training means being careful about what is being said. A scholar once

advised his student, Find the best teacher and become the best

student.The best teacherthe Islamic finance industry presently has

is AAOIFI. Are we as studentsequal to the task?

Ethica 2013-18 |

Winner of "Best Islamic Finance Qualification" at the Global

Islamic Finance Awards, Ethica (www.EthicaInstitute.com) is

trusted by more professionals for Islamic finance certification.

Training and certifying professionals in over 100 financial

institutions in 56 countries, Ethica's 4-month Certified Islamic

FinanceExecutive (CIFE) is a globally recognized certificateaccredited by scholars to fully comply with AAOIFI, the world's

leading Islamic finance standard. Ethica's award-winning CIFE

is delivered 100% online or live at the bank. The Dubai-based

institute is now supported by Licensed Ethica Resellers in 11

countries. For more information about this article, or to schedule an

interview with Ethica Institute of Islamic Finance, please call +971-

4-455-8690 or e-mail at [email protected].

What we need is a move away from the current state of anything goes

Islamic finance training and certification. What we need is standardized

training and certification based on AAOIFI Shariah Standards.

www.ethicainstitute.com


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CHALLENGES AND RESOLVES FOR ISLAMIC FINANCE

EDUCATION: A PRACTITIONERS PERSPECTIVE


Muhammed I kram Thowfeek,President, First Global Academy

Till today, since 2008, given the global financial crisis after crisis,millions of people all over the world are suffering directly and/or

indirectly, whilst looking for alternatives to the conventional modes

of banking, financing and investments that can portray ethics and

fair dealings. These millions of people who are looking for an

alternative system of banking and finance are yet to explore the

benefits, opportunities and the growth potentials of the Islamic

banking and finance industry.

Unlike the conventional banking and finance that looks at any

financing and/or investment activity mostly from an economic and

financial benefits, whereas Islamic Finance (IF) goes beyond

economic and financial benefits, and looks at moral, ethical, social,

and religious aspects of it, which are unique propositions that can

provide solutions to millions of people (both Muslim and non-

Muslims) all over the world through equity participation, risk

sharing & fair dealing.

The challenging question to ask is that, if the IF industry canprovide solutions to those individuals, corporate entities and the

governments at large that are affected directly and/or indirectly by

the global financial crisis after crisis? Then, what is stopping the

industry of becoming the main stream banking & finance system

appealing to the global market to serve both the Muslims as well as

the non-Muslims? Is it Awareness,Educationand/or the

Islamic Finance Institutions (IFIs) within the industry are the

bottlenecks to sustain the growth of the IF industry and become the

main stream global finance system.

The simple answer to this challenging question is, bring

Awareness globally, from laymen to intellectuals, coupled with

Educationfrom 16+ years to the PhDs. All those who are Aware

and also equipped with education on the subject matter will

definitely can make a difference in the public domain and morespecifically at the institution level too, to raise the standards in every

facets of the organization to compete and to go beyond their

conventional counterparts, whilst sustaining the growth of the IF

industry and making it appealing to the global market.

Lets look at Awareness - what are the challenges and resolves

available to take this message of IFglobally to the laymen as well

as the intellectuals and to those in between, so that everyone

benefits.

Three decades plus, from the birth of the modern experiments with

IF in 1975, till to date, only 20% of the market opportunities and

growth potentials of IFindustry is tapped. Its,just like the tip of

the iceberg, 80% is largely untapped mainly due to lack of

understanding and awareness as to what Islamic Finance is all

about?


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only 20% of the market opportunities and growth potentials of IF industry is

tapped, just l ike the tip of the iceberg, and 80% is largely untapped main ly due

to lack of understanding and awareness as to what Islamic finance is all

about?


In most of the countries where there is an Islamic bank, two or more,

the target market is confined to the Muslim community only? As if

IFis only confined to the Muslims and not for the non-Muslims,

who are indeed looking for alternatives to the conventional modes of

banking & finance.

Why this focus? Again due to lack of understanding, awareness and

education on the subject of IFand its enormous benefits that couldaccrue to all mankind, irrespective of what color, sects, race, religion

or ethnic group they belongs to.

The primary challenge of some of the existing Islamic Financial

Institutions (IFIs) is not attracting new Muslim customers to the

Islamic finance fold, but how to retain those who are already

patronizing, while some of those although not satisfied with the

level of services and offerings compared with that of their

conventional counterparts but still stay put, with all the bickering,mainly due to the Shariahlayer or comfort. However, majority of

them move back to conventional banking or to any new IFI that has

open doors, seeking better customer services, wide range of product

offerings coupled with excellent distribution channels the pricing

and returns become secondary and then comes Shariahcompliance

for them.

Today, the mandates of bringing awareness to the masses is

confined to those Islamic Finance Infrastructure Institutions (IFIIs)

like, IFSB, AAOIFI, CIBAFI, IIFM, IRTI, IIRA, etc., through their

annual forums, conferences and symposiums held once or twice a

year. This has to change from annual events to a day to day affair

bringing awareness to the general public is onus on all the

stakeholders of the Islamic finance industry, mainly the institutional

players, practitioners, Shariah scholars etc., who should haveplanned awareness and educational events to reach out to the public

every nook and corner of the country through various channels

news media, TV, satellites, social media, Q&A forums, live, online,

virtual chats etc.

This needs a budget allocation by all the IFIs for planned events

mainly to bring public awareness and educating the masses (not only

the Muslim community but the entire humanity at large), which will

definitely add value to the bottom lines of the IFIs.

More the general public, from all walks of life, understand what the

IFis all about and experiences proper conduct of IFIs, not only the

Muslims are going to rally around and patronize IFIs the non-

Muslims too will join the bandwagon not mainly due to Shariah

compliance but due to excellent customer services and the ethical

values portrayed in every transaction and activity undertaken by the

IFIs.


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Thats on Awareness, lets come back to the Educational

Programsin building professionals in the field of Islamic Finance

who could take this industry to yet another paradigm given the

appetite and the global attractions to the Industry aftermath of the

global financial crisis after crisis.

With all due respect, most of the educational institutions that areoffering a certificate, diploma, a degree or a PhD level program in

Islamic finance drumbeats that they are sharing practice (not theory)

with students and making them ready to take up positions in the

Islamic banking and finance industry.

The other day, a dear friend of mine, asked me a question, soliciting

my views as a seasoned professional in the Islamic Finance (IF)

industry, trying to see what I thought the prospects were for those

young people looking to enter the Islamic Finance industry and

'make a difference'.

He said, The story these young graduates keep telling me is that

there are simply no jobs on offer which seems to be at odds with

the headlines that we keep seeing proclaiming that the IFindustry

is 'growing at 20% per year.

My response was Thoseseeking greener pastures or opportunities

in the IF industry are unfortunately knocking at the wrong doors or

are ill equipped - the regional and global markets are opening up for

Islamic financeso be ready.

Further, I mentioned that, beingin the IF industry over the last two

decades, I strongly believe that the bigger the global financial crisis

is the greater the opportunities are to all the stakeholders in the

Islamic finance industry, which can provide solutions to millions of

people (both Muslims and non-Muslims) all over the world to

improve their lives, financial and investment choices - through

equity participation, risk sharing and fair dealings.

To get these graduates and students who are looking for a career and

to fill one of those million jobs needed up to 2020, as per the

researchers, need to pursue on programs that really make them

professionally qualified as an iBanker (Islamic Banker) whilst

retaining their specialization or their field of choice namely, ICT,

human resources, Shariah,product development, sales, marketing,

legal, financing, accounting, management etc.

Keeping in mind, these current demands for professional Islamic

Bankers who can raisethe barof the IFIs, in particular, and the IF

industry, in general, the First Global Academy (FGA) have rolled

out the iBanker Certificate, Diploma and Executive Diploma

programs to the global market (both in campus and online), for those

who would like to enter at different levels from 16+ years onwards.

Becoming an iBanker, in a chosen field, by following these FGA

programs not only groom students to take up any entry level or a

higher position in any IFI but also makes them to look at banking&

financefrom yet another perspective. That is, as Entrepreneurs.

Islamicbankers are not mere bankers from a conventional sense,

where accepting deposits and lending are the core competencies of

conventional bankers to have the maximum spread between the two.

Whereas the Islamic bankers and finance specialists focus on

profit/loss sharing by using the funds on economic generating

investing and trading activities to make a profit and share that profit

with all the depositors and shareholders, whilst protecting the fabric

of our society without engaging in activities prohibited and harmful

to the society.


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With the mindset of grooming an iBanker to be an iEntrepreneur

(Islamic Entrepreneur) too, we will be sharing only Practice,

Practice & Practice of Islamic finance and our lecturers panel are

geared up to do so and equipped with practical knowledge and

exposure in setting up IFIs in the Middle East (ME) region fromscratch. They know and very well aware whatshappening in the

kitchen of those institutions and the expectations of the customers.

Indeed, there is a wide gap persist between the expectations of the

customers and the reality; we have to narrow down this gap to reach

out to as many people as we can with Islamic finance offerings

bringing benefits to all (both Muslims and non-Muslims alike) to

improve their lives, financial and investment choices - through

equity participation, risk sharing and fair dealings.

I strongly believe that bigger the

global f inancial cr isis is the greater

the opportun ities are to all the

stakeholders in the I F industry,which can provide solutions to

mill ions of people (both M uslims

and non-Muslims) all over the

world to improve their l ives,

f inancial and investment choices

through equity parti cipation, risk

sharing and fair dealings

Muhammed I kram Thowfeek (M IT) is currently the Founder of

First Global Group and Group CFO of QAF Holdings Group. He is

a Chartered Accountant by profession and an Islamic Banker by

practice. To date, he has gained a wealth of knowledge and

experience in auditing, management consultancy, financial control,

strategic planning & budgeting, Islamic banking & finance, retail,

commercial and investment banking, Islamic capital and globalSukuk (Islamic Bonds) market, training and career development

etc., through his diverse positions held in various organizations

(Ernst & Young, Kuwait Finance House, First Islamic Investment

Bank, International Islamic Financial Market, Commercial Bank of

Qatar, Barwa Bank, QAF Holdings Group, First Global Group).

Mr. Thowfeek is a startup specialist and has set up number of

Islamic Banks (IBs) and Islamic Financial Institutions (IFIs) in the

ME region, both fully fledged Islamic Banks and independent IB

branches of conventional banks, from scratch.

He is an Associate Member of the Institute of Chartered

Accountants (ACA) of Sri Lanka, a Fellow of the Chartered Institute

of Management Accountants (FCMA), Chartered Global

Management Accountant (CGMA) of the UK, a Member of the

Institute of Financial Consultants (MIFC) of the USA, a Member of

the Chartered Institute of Securities and Investments (MCSI) of the

UK and a Certified Islamic Banker.


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PHILOSOPHY OF EDUCATION IN ISLAMIC FINANCE


Prof essor D r. Syed Othman Alhabshi , Chief Academic Officer, INCEIF

The best practice especially in the banking industry is to recruitstaff from various backgrounds. There are occasions where the staff

is not from the disciplines related to economics and finance. They

can be engineers, medical doctors, quantity surveyors, lawyers, etc.

The main reason is that most of the tasks involved in banking can be

easily learnt by those from different background. I know a

statistician who was given a chance to work in an Islamic bank.

Eventually he became one of the most efficient senior staff of the

bank. We also know of engineers and lawyers who do extremely

well in the banking industry. Learning from such experience, it

would be a proper practice for students of Islamic finance to come

from various academic backgrounds. This will certainly enrich the

discussions in class because the body of students would have

differing views from various perspectives, skewed to their

background.

I for one strongly believed that the students would do extremely well

if the professor shows tremendous patience in nurturing them inside

and outside classroom. I read of a story of a sociology professor whowanted to know whether the young children of about 10 years old,

in a particular slum area in US would make it in life or not. He sent

two hundred of his MBA students to the slum area and selected two

hundred children to find out if they would make it in life. Based on

the environment, the way they dressed, the materials they wear, etc.

the two hundred MBA students had only one answer. They all

agreed that these children will never make it in life

Twenty-five years later, another sociology professor who happened

to read the report sent two hundred of his Masters students to the

same slum area to find out from the same two hundred children who

were the subject of that study twenty-five years earlier. They found

that out of two hundred children, only one hundred eighty three

were around. The other seventeen have either moved out of the area

or have passed away. The Masters students found that all the one

hundred and eighty-seven children who are now about 35 years old

have actually succeeded in life. Some are engineers, others are

lawyers, doctors, teachers, corporate executives, etc. They then

asked how come they were so successful. The answer was, there

was a teacher. The two hundred Masters students asked around to

find the teacher who happened to be an old lady of about seventy

years old. When she was asked how come those children who were

considered to have no chance to make it in life have now achieved

tremendous success, she answered with a broad smile on her face, I

LOVE THEM ALL.

I strongly believe that the approach to be adopted in nurturingstudents whoever they are is to show them the respect, the

confidence we have in them, the dedication and commitment we

give them to really make them successful in life. It is not just the

quality of students that we have but more importantly what our real

intention is when teaching them.


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Having a very comprehensive programme with high quality

curriculum and content is very essential to produce the talents we

need in any field. Of course we also need quality students with the

positive attitude to learn. Above all, we need the right approach to

coach, train and educate the students in the most effective way.

One of the major challenges in producing the right type of talent in

Islamic finance is to provide them with the right input so that they

would be able to manage and handle all situations that they face in

the industry. This is a major challenge because Islamic finance as a

subject or discipline of study is still very new. We do not have

standard texts for all the subjects that we teach. Most of the time, weuse texts that are not complete and hence have either to use many

texts or to be added with our own materials. This poses a problem of

standardization or harmonization, especially with regards to Shariah,

principles or concepts and products. We know that there are

conflicting views on Shariah matters between jurisdictions. Hence

we do get products that are acceptable in one market but rejected in

other markets. Even these differences are not considered as major

issues. This is because those conflicting views can be explained and

such conflicts do get mitigated.

There is yet a bigger challenge where some scholars simply feel that

the current practice of Islamic banking and finance are not Shariah

compliant because the beneficiaries do not include the poor and the

have-nots. They prefer to take the view that the benefits of Islamic

banks today which directly benefit the rich and the bankable only

have ignored one of the objectives of Maqasid Shariah that is meant

to bring about benefits to all and sundry and not confined only to the

rich and bankable.

Such a view simply denies the benefits that Islamic finance as

practiced today has brought about to society. Those who adopted

this view do not have the alternative system that could resolve theproblem of those poor and not bankable. The challenge then is how

to ensure that there is financial inclusion. One possible answer is

Islamic microfinance.

Although Islamic finance is growing at a faster rate than

conventional finance, which under present circumstances is

unstoppable, the biggest challenge is acute shortage of human

talents who have very high technical knowledge and at the same

time have excellent Shariah knowledge. We have also observedmany qualifications in Islamic finance that have been introduced to

the market that do not provide the right level, quality and scope of

the subject. We need to find ways of attracting students to the right

programmes so that the objective of bringing Islamic finance to the

next level can be effectively achieved.

Professor Dr . Syed Othman Alhabshi is the Chief Academic Officer

at INCEIF. Since November 1969, Prof Syed Othman has served in

various academic capacities in five leading universities in thecountry. He has also served in various capacities on the boards of a

number of organizations including takaful and investment

companies in Malaysia and Pakistan. He has written and published

more than 200 articles and books.

..the biggest chal lenge is acute shor tage of human talents who have very high

technical knowledge and at the same time have excellent Shar iah knowledge


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ISLAMIC MICROFINANCE EDUCATION: THE CRITICAL NEED,

OPPORTUNITY & WAY FORWARD


Islamic Microfinance means micro financing through interest freemodes to the financially deprived and poor people to generate

economic activities and making them self employed for the ultimate

economic prosperity. As per the latest research of Centre of

Excellence in Islamic Microfinance of AlHuda CIBE, the global

Islamic Microfinance volume has reached at US $1 billion with

persistent growth and serving about 1.3 million beneficiaries but the

share of Islamic Microfinance by less than 1% of overall volume of

Islamic Finance (US $1.3 trillion), unveils its misfortune. As per the

expert view it is stated that the Islamic Microfinance education is theultimate way to make Islamic Microfinance practicing and let the

people aware of the Islamic Microfinance on global canvas for its

acceptability. The main hindrance to the Islamic microfinance

behind successful execution is instant acceptability caused by lack

of awareness. The concept of Islamic microfinance is recently

developed dimension for micro financing to operate on Islamic

modes and started in early 1960 from Latin America and South East

Asia but Bangladesh has significant contribution to originate and

approach the concept of Islamic Micro financing. The Islamic micro

financing is being done through different models such as: Gramin

Model, Credit Union and Self Help Group in particulars but the

microfinance sector is looking forward a compatible brain well

trained and equipped to practice Islamic Microfinance using these

models prudently. It is observed there are no specialized institutions

for the education of Islamic Microfinance in particular.

Absence of specialized education in Islamic Microfinance,

particularly, is the crucial fact in Islamic Microfinance Industry,

which is one of the hurdles for the promotion of the industry as well.

There is an immediate need to initiate comprehensive degree

programs on Islamic Microfinance globally. If we look into the main

challenges of Islamic microfinance, the lack of awareness and

education fall on the top. Islamic Microfinance Industry is facing lot

of criticism in different aspects e.g. acceptability of Islamic Finance

because of lack of awareness, education and religious consciousness

are the main challenges to Islamic Microfinance Industry.

The expensive education of Islamic microfinance is also a

discouraging factor for the Islamic Microfinance learners which

should be subsidized and funded by Donor agencies e.g. IFC, World

Bank and IDB etc. The 46% of whole world poverty exists in

Muslim World while Muslim population in the world is 26%, so

Islamic Microfinance can potentially be used for poverty alleviation

by social awareness programs through proper channels and

educationists of Islamic Micro Finance realizing its importance and

optimal results.

Muhammad Zubair Mughal is the Chief Executive Officer of

AlHuda Centre of Islamic Banking and Economics (CIBE). He has

been working consistently for last nine years for poverty alleviation

through Islamic Microfinance concept; he can be reached at

[email protected]

Muhammad Zubair M ughal, Chief Executive Officer, AlHuda CIBE


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TALENT DEVELOPMENT IN THE ISLAMIC FINANCE INDUSTRY:

NEEDED OR NOT?


More and more educational institutions, around the world, areoffering degree programs and diplomas in Islamic Finance and

banking. This is a good sign as it indicates that the growing global

Islamic finance industry has a rising demand for competent and

trained talent.

Given that the industry is in growth mode why cant those

undertaking industry qualifications get jobs?

57,000 new Islamic Finance jobs? How not to get one! This wasa headline from a leading online news provider about eight months

ago.

Whilst industry news reports spout various numbers, by countries, of

the qualified talent requirement, the scenario on ground belies the

fact that the industry organizations are doing anything concrete

towards talent development. Studying the industry shows two clear

trends:

1. Most Islamic finance operations started as windows. The

conventional products were wrapped in an Islamic cover and

offered out. Inadvertently such a practice impacted the talent

recruitment practice of an organization wherein the preference

was for regular conventional finance qualifications.

2. Factor in the lack of industry and academia collaboration

resulting in slow development of professional standards and the

required practical educational content.

These two trends, amidst the backdrop of the global financial crises

that forced organizations to make do with available talent resources,

gives us the background of where talent development in the Islamic

finance industry is at presently.

Whilst respective international financial centers are attempting

certain actions towards a formal talent development policy, on its

own initiative, the global industry is yet to take up this issue as a

critical one.

Talent is the most crucial element in the success of an organization.

Recruiting, engaging and managing the talent, career planning and

developing the talent to be an organizational leader, all of these

ensure sustainable growth and success of an organization. For the

Islamic finance industry lining up the ducks that result in excellent

talent will only be beneficial in all ways.

A key first step is to define what talent is. A common definition,

across the industry, would help in establishing parameters that

would aid in developing a talent development policy, at an industry

level, and aid in developing their independent talent management

strategy.

Some key parameters to put in place would be:

i. Clear set of competencies and a grid to score on, identifying areas

of development.

ii. Identifying talent based on these competencies.

Joy Abdull ah,Head of Marketing & Communication, INCEIF


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iii. Ensure the organization has an environment that speaks to

personal growth people must not only want to get better but must

be allowed to, as well.

iv. Lastly ensure identified talent has progressively meaningful

work and gaining influence. These are two critical success factors

for talented staff in terms of retention and productivity.

The second step would be the route of collaborations between

industry organizations and academia and actively investing in the

collaboration to obtain the desired quality talent. As talent is a

primary requirement of the organizations in keeping their business

running, the lead on this has to come from the organizations

themselves. The way forward could be to collaborate with the

academic institutions for research requirements that the

organizations need to grow their business.

Thirdly, use the output of the research to develop case studies that

can then become part of academic programme content in order to

provide a more experiential knowledge base for incoming talents.

Lastly, a globally accepted set of competency standards needs to be

in place as the guideposts to what is expected from the talents in

terms of educational qualifications.

There are dual benefits of having in place an industry focused talent

development policy.

I. Locally the organizations would be seeding in the

competencies they seek in a talent, through the collaborations

with academia.

II. The talent gains both knowledge and competencies that the

industry organizations require to keep their business growing.

At a country level, this would act as a stimulus for the financial

services and the education sector. As the collaborations are actioned,

the talents recruited directly by the organizations will create a

word-of-mouth scenario through social media by talking about

their jobs. This in turn will lead to potential talents looking at the

industry and evaluating career benefits. From there itsa short step

to obtain required qualifications. So the academic institutions start

benefiting as demand for their programme rises. Net result theindustry gains by having a continuous pool of planned for talent that

has the competencies the industry wants.

At an international level centralized collaborations, between industry

bodies in different financial centers, will bring together

organizations and academia to work on enhancing specific areas of

the existing academic content. This, in turn, will facilitate generation

of cross-border academic content. Which benefits talents all round

by providing them the cross-jurisdiction knowledge they need.

For a talent this provides a huge benefit as he or she becomes a true

knowledge worker and is able to value-add to an organization

irrespective of the geographical market.

A common grouse of the industry CEOs is on the issue of howcan

the sharia specialists understand the bottom-line business pressures

and how can the commercial specialists understand there are strict

ethical principles to adhere to. This constant mode of internal

challenge actually inhibits progress.

So what can the global industry do in aiding the organizations in

resolving this issue, as a start towards having effective talent

development strategies?


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1. Co-create short training content that provides an overview for the

respective teams i.e. the sharia specialists get a business overview

and how their decision impact a businesss bottom line & the

commercial specialists get an overview of what are the key

guidelines to know in ensuring they can deliver a sharia compliant

product.

Taking it one level down, at an organizational level, the team i.e. of

commercial and sharia specialists could perhaps be given joint

business targets for achievement and joint rewards for achievement.

This would bring about joint talent development in the organizations

and allow them to maximize the knowledge and competency of their

talents for the benefit of the organization.

2. Accept and Implement a common global standard for

qualifications like other professional qualifications develop and

implement a global standard for qualifications, including short term

courses, which all educational institutions and educational service

providers have to adhere to.

This will bring about a rise in the quality of the talent as well as

enable the industry organizations to have a standard on which they

can base their recruitment policies.

The advantage the Islamic finance industry organizations have, vis-

-vis other industries, is that there are vast amounts of expertise

from their conventional counterparts already available for use rolling

out effective talent development plans.

But talent development will remain on the backbench, unless and

until, organizations take it upon themselves to align their business

goal, organizational values and talent competencies and approach

the academia with what they need.

Joy Abdull ah is the head of marketing & communication at INCEIF

The Global University of Islamic Finance

The opinions expressed is a personal point of view of the author and

is not an opinion from or on behalf of INCEIF.

..talent development wi l l remain on

the backbench, unless and unti l ,

organizations take it upon themselves

to ali gn their business goal,

organizational values and talent

competencies and approach the

academia with what they need.


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We would like to thank

We would like to thank the following individuals and organizations for their moral support, assistance, and intellectual

contributions in this report.

Sameer Hasan, Business Director, Ethica Institute of Islamic Finance

Muhammed Ikram Tho wfeek, Chairman & Founder, First Global Group

Muath Mubarak, Lecturer of Islamic Banking and Finance, First Global Academy

Dr. Syed Othman Alhabshi, Professor & Chief Academic Officer, INCEIF

Joy Abdu l lah, Head of Marketing & Communication, INCEIF

Muhammad Zub ai r Mughal, Chief Executive Officer, AlHuda CIBE

Almir Colan, Director, Australian Centre for Islamic Finance


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CommitmentIslamic EconomicsFinance FocusEducation

StrengthResearch and MarketingSecond NatureCreativity


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Appendix: List of Institutions (Academic)


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Appendix: List of Institutions (Non-Academic)

global islamic finance education 2013

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