Islamic body goes global to fill void in speciality skillszulkiflihasan
Islamic body goes global to fill void in speciality skills
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A Malaysian institute set up seven years ago to improve education standards for Islamic finance professionals is going global as it seeks to fill a void of experts with specialities such as insurance and law.
The Chartered Institute of Islamic Finance Professionals in Kuala Lumpur aims to increase membership of qualified practitioners to 3,000 in three years, from 400 now, Badlisyah Abdul Ghani, its president and former chief executive officer of CIMB Islamic Bank Bhd, said in an interview. The CIIF, which changed its name and geographical focus in 2015, is in talks with associations and regulators stretching from the Middle East to Indonesia as part of that campaign, he said.
The $2tn industry has long been plagued by a shortage of individuals who have studied beyond the prerequisite skill base and CIIF plans to start offering specialised courses next year to address the problem, which is hindering development, Badlisyah said.
The Kuala Lumpur-based Finance Accreditation Agency estimates 56,000 more qualified experts will be needed to fill positions in the next five years as growth accelerates.
“There is a lack of accepted global standards for professional qualifications – similar to accounting – the absence of which has created differences in talent skills requirements across jurisdictions,” said Daud Vicary Abdullah, CEO of the International Centre for Education in Islamic Finance in Kuala Lumpur. “The industry is still at a nascent stage where talent development and planning are concerned.”
CIIF was formerly the Association of Chartered Islamic Finance Professionals, which was established in 2008 and whose intake was mainly graduates from Malaysia’s INCEIF. The newly formed institute will help promote members globally and aims to provide a common standard of education acceptable in the various countries offering Shariah-compliant products, Badlisyah said.
The standards and codes of conduct issued by CIIF will be recognised and adopted under the Islamic Finance Profession Charter, which was signed by key Shariah-compliant associations in Malaysia, Badlisyah said. The guidelines will extend to other qualified leading organisations such as the Bahrain-based General Council for Islamic Banks and Financial Institutions and the Indonesian Syariah Banking Association if they sign up, he said, adding that they could eventually be made a requirement across the board.
Asset growth in an industry where interest payments are forbidden showcases the need for trained professionals, with the Kuala Lumpur-based International Shariah Research Academy forecasting a $3tn market by 2018.
Sales of Islamic bonds known as sukuk, which scholars need to vet for conformity with religious laws, have climbed to above $45bn in the past three years, compared with less than $10bn a decade ago, data compiled by Bloomberg show. Takaful contributions, the equivalent of conventional insurance, are expected to reach $20bn by 2017 from $14bn in 2014, according to Ernst & Young.
There’s still a gap in the market for trained experts even as the range and selection of courses expands around the world. There are essentially two types of Shariah professionals, said Abdul Rahman Mohd Yusoff, head of the Shariah department at OCBC Al-Amin Bank Bhd and also a CIIF member. There are those with a degree in pure Shariah law or Fiqh, or those with an equivalent degree in commercial and business aspects known as Muamalat, he said.
On the other hand, there also graduates with Bachelor’s degrees in non-Islamic disciplines who supplement them with qualifications in Shariah-compliant finance such as Ph D’s or certificates from other accredited organisations, Abdul Rahman said.
“This makes the degree in Islamic finance an add-on rather than the primary one that will govern their future, lessening the pressure on them to go the extra mile to achieve the qualification,” said Abdul Rahman at the Islamic unit of Oversea-Chinese Banking Corp, Southeast Asia’s second-biggest lender. “To address the shortage, it might be useful to make it mandatory for all staff handling Islamic finance products to sit for at least the certification courses.”