Q&A: Shariah Compliant Finance

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A conversation with Fuwad Beg, managing director at Yasaar Human Capital, a Dubai-based executive search firm serving the Islamic finance sector on a global basis. It is a division of Yasaar Ltd., a Shariah advisory and compliance solutions company. Islamic or Shariah compliant finance involves financial products structured to satisfy the Quran's prohibition on paying or receiving interest, selling borrowed or notional assets, or profiting from forbidden goods (pork, alcoholic beverages) or activities (pornography, gambling).

What is the trend of demand for talent globally within Islamic finance?

The demand for Islamic finance jobs on a global basis is certainly on the rise. A year ago there was a sharp decline in jobs available simply because of market conditions - although this was more of a holding pattern of companies stopping employing, rather than organisations ceasing to exist.

With the brakes slowly being lifted we are seeing key senior positions being filled across the globe and the demand for people increasing. Although this is slow, it is certainly different from only a short while ago prior to Ramadan (the month that began Aug. 21 or 22 this year, depending on location). With the predicted increase of new Islamic finance companies from Thailand to Saudi the demand will certainly increase and will be global.

Skills in demand range from product development specialist to Shariah scholars which are always in demand all the way through to senior management.

Did the world financial crisis affect Islamic finance institutions and employment differently from how it affected conventional banks?

Clearly there is no insulation from the market turmoil, simply because in one way or another there is a link between Islamic and conventional finance. This link occurs because some conventional banks have Islamic windows and conventional banks invest in Islamically permissible companies which are also invested in by Islamic institutions. Therefore, if one common profit area or company is hit by the downturn, they all are.

In terms of how this reflects in the job opportunities and creation from an Islamic institutional perspective, that plays out on a company by company basis. A lot of the Islamic finance sector institutions have utilized the economic climate to trim the fat. However, no institution that I have heard of has collapsed as Lehman Brothers did. And there is certainly not the scale of 89 U.S. bank closures and 416 U.S. banks on the FDIC problem list since January 2009.

Is there any notable pickup in opportunities related to Sharia finance within North America?

I would suggest you read Paul McNamara's report, Islamic Finance in North America 2009. Paul McNamara is the managing director of Yasaar Media (another division of Yasaar Ltd.) and a colleague of mine.

What advice would you give someone looking to move from a conventional finance background into the Islamic finance sector?

IFQs (Islamic Finance Qualifications, a global certification exam) are great if you are starting out and they help build your knowledge about the industry and subject matter.

But it is who you know in this business, simply because in each country or region, people are always connected by either a Shariah scholar or regulator and people will know each other and use the conference scene to meet and re-acquaint. So you need to mix in this industry and know the players and network, or come to Yasaar Human Capital and we will try and help.

Still, not all moves from conventional to Islamic are done via networks - so a semi permeable membrane of skills do block entry. The most obvious one is to become a Shariah scholar (an expert on Muslim religious law who can issue authoritative rulings on whether a particular transaction complies with the Quran). I think that takes at least 11 to 13 years of training and then practice. But also, jobs such as product development require customization skills, knowledge and experience that is industry specific and will take time to learn if you are crossing over from conventional.

Are hard numbers or projections available for employment in Islamic finance?

Your guess is as good as mine. Currently no numbers exist, because nobody has started to collate them in real terms.