Window dressing, scholar wannabes

Window dressing, scholar wannabes

Dr Zulkifli Hasan Available at: http://themalaysianreserve.com/main/sectorial/islamic-finance/3118-window-dressing-scholar-wannabes

Shariah scholars in Islamic finance are frequently put in a dilemma position. They have been accused upside down with numerous allegations even without any basis. During early implementation of Islamic finance, Shariah scholars were alleged to have formed an alliance with Islamic capitalists to create a new market for Islamic finance sector.

In this instance, the Islamic banks were guided by those well-paid clerics and always issued rulings according to their needs. In fact, since 1980s, many of the scholars have been accused of being bankers’ window dressing and of overstretching the rules of Shariah to provide easy fatwas to Islamic financial institutions.

Lately, it is quite surprising that the scholars have been criticised even by Islamic bankers. The myth of alliance between Islamic bankers and Shariah scholars seems to be no longer relevant. One of the critics refers to an allegation where the Islamic financial market globally has been invaded by Shariah scholar wannabes, a new term introduced to refer to the so-called unqualified Shariah scholars.

Infiltration of Islamic Banks

These Shariah scholar wannabes have infiltrated Islamic banks, regulatory authorities and Shariah governing bodies without due consideration to stakeholders value. Much more serious is where the criticism includes allegations of changing the meaning of Quranic verses and Hadith by those Shariah scholar wannabes.

Caution and criticism are mostly welcomed and in fact warranted but not baseless allegations and wrongful accusations. Constructive criticisms particularly on the governance issue in Islamic financial institutions will surely contribute to the development of Islamic finance industry. The unqualified criticisms will lead the industry nowhere and in fact hinder its development and negate the public confidence.

Considering the significance of this issue, this article attempts to address several misconceptions about Islamic finance even by the so-called truly Islamic finance practitioners with the aim of providing a basic understanding and removing any inaccurate or unfounded prejudice.

1. Islamic finance is purely a commercial transaction: Islamic finance concept is grounded in ethics, values and norms. As Islamic finance is not pure commercial transaction and not only confined to nominate contracts, Islamic financial institutions therefore should be commercially and morally oriented entities.

Islamic finance assumes a moral based value proposition which offers solutions for the economic and financial problems. These moral and ethical value systems require that the decision-making process in Islamic finance must not be solely based on efficiency and equity but must have social and ethical dimensions.

2. Stakeholders value confines to shareholders interest: The stakeholder value orientation is not only concern for shareholders but also to protect all the stakeholders’ interests and rights. The stakeholders value, conceptually, requires Islamic financial institutions to balance the corporate goal of maximising the profit with the duty to uphold the principle of social justice and maqasid Shariah and this entails the notion of protecting the interests and rights of all stakeholders within the Shariah rules.

Even the Basel Committee for Banking Supervision on “Enhancing Corporate Governance for Banking Organisations”, expands the term “stakeholders” to include employees, customers, depositors, suppliers, supervisors, government and the community.

Not only that, the Organisation for Economic Cooperation and Development further classifies the stakeholders into shareholders, internal stakeholders (employees and labour unions), operational partners (customers, suppliers, creditors and contractors), and the social community (state authorities, trade union, non-governmental organisations and civil society).

3. The true meaning of Bay is sale and it has no element of risk: Islamic finance is gharar-free, maysir-free and riba-free, but not risk-free. Since Islamic financial products and services are designed based on different nominate contracts, it is erroneous and would be a sheer misconception to say that Islamic finance is risk-free or less risky.

Moral and Ethical Dimensions

Furthermore, Islamic financial products and services should have moral and ethical dimensions and therefore any transaction should be embedded in real economy which offers an alternative financing paradigm. At this point, the conceptual framework of Islamic finance suggests that it should be more than financialisation of the nominate contracts.

Islamic financial institutions should take necessary risks equitably and not simply shifting the liability unfairly to the customer. In other words, Islamic finance should represent a holistic approach to financing not only bankable customers but also to allocate certain funds for non-bankable and underprivileged people as part of its social responsibility to the society and ummah.

4. Islamic financial institutions are purely profit-oriented entities: Based on its epistemological dimension, Islamic finance is actually a society oriented financing proposition as it aims to serve the community, ummah and not solely to the markets. Islamic finance must not be confined within profit-driven orientation but it should also address issues on economic and sustainable development, social justice and social investing oriented principles.

With reference to several empirical studies, the current Islamic finance practices on the other hand do not indicate positive correlation with human development index scores. Surprisingly, the corporate social responsibility performance of Islamic financial institutions also has been rather weak and poor as compared to its conventional counterpart. This position demands Islamic financial institutions to seriously re-evaluate and review their current practices and future direction.

5. Shariah scholar wannabes infiltrated the industry’s wellbeing: The critics on the roles of Shariah scholars are always blown out of proportion and over-exaggerated.

Undeniably, Shariah scholars, either senior or young scholars or conservative or pragmatic scholars have their own unique contribution to the industry’s wellbeing but their approaches may be different. This should not be the reason of denying their significant contribution.

The “conservative” scholars may view the legitimacy of Islamic financial products and services to be based on the legal and mechanistic aspects of Shariah. The products and services are classified as lawful and Shariah-compliant or Shariah-based if they meet the conditions of a valid muamalat transaction after going through the ordinary process of usulal fiqh.

On the other hand, the “pragmatic” scholars admit that Islamic finance should not confine their function by solely emphasising the fiqh aspect. The “pragmatic” scholars acknowledged that Islamic financial products and services should not only be valid and lawful, must fulfill the spirit of maqasid Shariah but must also be ethical and uphold the Islamic values.

Allegations Misleading

The critics upon Shariah scholars of either being banker’s window dressing or invasion of the scholar wannabes are actually misleading. These allegations to a certain extent will negatively influence the Islamic finance industry as they are not supported with any empirical evidence. Rather than discussing these unnecessary issues, the Islamic finance discourse should actually be focusing on its fundamental principles and how to ensure its sustainability. It is important to critically evaluate the performance of Islamic financial institutions against their foundational base and at the same time to maintain its positive development.

The existing practices of Islamic finance so far have failed to establish a distinct identity or to draw a clear demarcation line with conventional banks. In fact, with several corporate failures of Islamic financial institutions, such as the closures of Ihlas Finance House in Turkey, the Islamic Bank of South Africa and the Islamic Investment Co of Egypt, and corporate difficulties, as in the case of the Dubai Islamic Bank, and Bank Islam Malaysia Bhd, Islamic finance is clearly not immune from the crisis.

Islamic finance must learn from the history and take lesson from previous financial crisis. We do not want to hear that the only lesson that Islamic financial institutions have learned is that they never learn.

Dr Zulkifli Hasan is a senior lecturer at Shariah and Law faculty of Islamic Science University of Malaysia. He is a Shariah committee member of Affin Islamic Bank Bhd and also sits in the committee member for the Association of Shariah Advisors. Opinions expressed in this article are his personal views.

Muscat, Oman

Infaq or Giving in the Way of Allah

Mengimarahkan Budaya Infaq

Zulkifli Hasan

Sidang Jumaat yang Dirahmati Allah,

Pada hari yang mulia ini, saya memperingatkan diri saya dan sidang jemaah yang dimuliakan sekalian, marilah kita sama-sama bertakwa kepada Allah subhanahu wataala dengan sebenar-benar takwa, dengan mengerjakan segala suruhannya dan meninggalkan segala larangannya mudah-mudahan dengan jalan ini kita akan selamat di dunia dan di akhirat. Ini amat bertepatan dengan firman Allah:

ـٰٓأَيُّہَا ٱلنَّاسُ إِنَّا خَلَقۡنَـٰكُم مِّن ذَكَرٍ۬ وَأُنثَىٰ وَجَعَلۡنَـٰكُمۡ شُعُوبً۬ا وَقَبَآٮِٕلَ لِتَعَارَفُوٓاْ‌ۚ إِنَّ أَڪۡرَمَكُمۡ عِندَ ٱللَّهِ أَتۡقَٮٰكُمۡ‌ۚ إِنَّ ٱللَّهَ عَلِيمٌ خَبِيرٌ۬
Maksudnya: Wahai umat manusia! Sesungguhnya Kami telah menciptakan kamu dari lelaki dan perempuan dan Kami telah menjadikan kamu berbagai bangsa dan bersuku puak, supaya kamu berkenal-kenalan (dan beramah mesra antara satu dengan yang lain). Sesungguhnya semulia-mulia kamu di sisi Allah ialah orang yang lebih takwanya di antara kamu, (bukan yang lebih keturunan atau bangsanya). Sesungguhnya Allah Maha Mengetahui, lagi Maha Mendalam PengetahuanNya (akan keadaan dan amalan kamu). (al-Hujurat: 13).

Sidang Jumaat yang Dirahmati Allah sekalian,

Mimbar hari ini ingin mengambil peluang membicarakan secara ringkas khutbah yang bertajuk ”Mengimarahkan Budaya Infaq”. Bersesuaian dengan situasi dan isu yang melanda umat Islam terutamanya dari aspek sosio-ekonomi dan kemanusiaan, budaya infaq dan bersedekah merupakan satu perkara yang amat dituntut oleh Islam. Budaya infaq ini juga akan dapat memastikan budaya kebergantungan kepada kerajaan dan pemerintah dapat dikurangkan dan seterusnya menjadikan sesebuah masyarakat itu bebas dan berdikari. Sebelum mimbar membicarakan konsep infaq ini, adalah amat bermanfaat untuk kita melihat secara ringkas kedudukan dan amalan infaq ini dalam konteks umat Islam di Malaysia. Mungkin ia bermanfaat untuk kita koreksi dan muhasabah tentang sejauh mana umat Islam menghayati tuntutan infaq atau bersedekah ini dalam Islam.

Dari sudut infaq wajib iaitu zakat. Dilaporkan hanya 10% umat Islam di Malaysia yang membayar zakat iaitu mewakili 1.74 juta sahaja daripada 17.35 juta umat. Agak mendukacitakan juga apabila dianggarkan hanya sejumlah 4.2% golongan profesional di Malaysia yang melaksanakan pembayaran zakat pendapatan dan lebih 80% syarikat orang Islam tidak membayar zakat. Daripada jumlah yang membayar zakat ini termasuk zakat syarikat sebanyak lebih RM1.6 bilion dapat dikutip oleh pusat zakat pada 2012. Ini membuktikan bahawa potensi infaq bagi umat Islam di Malaysia adalah sangat besar dan perkara ini perlu diberikan perhatian oleh semua umat Islam. Begitu juga dengan sedekah yang masih belum sampai ke tahap ia dibudayakan. Kita sering kali mendengar dan menyaksikan kedhaifan sesetengah umat Islam yang memerlukan bantuan di media massa dan masalah tidak cukup dana pertubuhan kebajikan Islam yang ingin memberi bantuan.

Bersesuaian dengan perkembangan yang berlaku di dunia Islam termasuk tanahair kita mengenai keperluan memupuk budaya infaq ini dari segenap lapisan, khutbah pada hari ini akan cuba membicarakan secara ringkas Infaq atau sedekah dan kedudukannya dalam Islam.

Sidang Jumaat yang Dirahmati Allah,

Bagi membicarakan konsep infaq ini, adalah amat penting untuk kita umat Islam memahami konsep dan epistimologinya. Sedekah adalah suatu sunnah dan amalan para sahabat yang sangat mulia. Dalam tradisi Islam ia merujuk kepada zakat, sedekah, derma, hadiah, hibah dan lain-lain. Zakat adalah amalan wajib ditunaikan oleh umat Islam yang berkemampuan manakala sedekah adalah amalan sunat yang sangat dituntut. Ia merupakan pemberian sesuatu kepada orang yang memerlukan dengan tujuan mahu mendekatkan diri kepada Allah SWT dan merupakan amalan yang mulia serta mencakupi perkara yang mendatangkan kebaikan dari sekecil-kecil sehinggalah sebesar-besarnya.

Tuntutan bersedekah ini perlu disandarkan pada niat yang ikhlas kerana Allah SWT demi untuk kebajikan pihak yang memerlukan dan tidak mengharapkan pujian atau balasan, bahkan semata-mata untuk mencari keredhaan Allah SWT dan menjunjung ketaatan kepada-Nya serta memupuk kasih sayang kepada manusia dan masyarakat seluruhnya. Keutamaan bersedekah ini amat digalakkan oleh Islam dan telah dijelaskan oleh Allah SWT di dalam surah al-Baqarah ayat 261:

Bermaksud: “Bandingan (derma) orang-orang yang membelanjakan hartanya pada jalan Allah, ialah sama seperti sebiji benih yang tumbuh menerbitkan tujuh tangkai, tiap-tiap tangkai itu pula mengandungi seratus biji. Dan (ingatlah), Allah akan melipatgandakan pahala bagi sesiapa yang dikehendakiNya, dan Allah Maha Luas (rahmat) kurniaNya, lagi meliputi ilmu pengetahuanNya”.

Berdasarkan ayat ini Allah memberi jaminan bahawa bersifat pemurah dan dermawan tidak akan mengurangkan harta malah punca pendapatannya akan ditambah selain mendapat saham pahala akhirat yang berterusan. Malah dalam beberapa hadith Sahih riwayat al-Bukhari menyebutkan bahawa para malaikat turut berdoa agar rezeki orang yang menderma bertambah. Sabda Rasulullah SAW:

Maksudnya: ” Tidak ada satu hari hamba Allah berpagi pada hari itu, selain ia dihadiri dua malaikat; kemudian salah seorang daripada keduanya mendoakan: “Wahai Tuhan, berilah si dermawan itu ganti; dan salah satu malaikat lagi mendoakan : Wahai Tuhan, berilah orang yang bakhil itu kehancuran ” .

Bukan itu sahaja, mereka yang diberkati sedekahnya akan mendapat penghormatan yang tinggi daripada Allah SWT dan malaikat sentiasa mendoakan kebaikan kepadanya. Oleh itu, tidak hairanlah bagaimana para sahabat yang begitu mengambil berat soal membudayakan infaq ini dalam kehidupan harian. Umpamanya, Saidina Abu Bakar yang telah mendermakan seluruh hartanya untuk Islam dan ummah tiada bandingannya. Ketika Rasulullah SAW bertanya Saidina Abu Bakar, apakah yang beliau tinggalkan untuk keluarganya, beliau menjawab, tiada apa-apa melainkan Allah dan Rasul-Nya sahaja. Demikianlah tingginya tahap pengorbanan dan kasih sayang yang dihayati oleh umat Islam terdahulu.

Sidang Jumaat yang Dirahmati Allah,

Mimbar ingin menekankan bahawa sebenarnya sedekah bukan saja berbentuk kebendaan. Berinfaq lah mengikut kemampuan individu masing-masing. Bagi yang tidak mampu atau tiada harta, mereka boleh menyumbangkan usaha dan doa. Di sini mimbar ingin mengajak sidang jumaat yang dirahmati Allah untuk melakukan inovasi dalam melaksanakan amalan infaq atau sedekah ini. Inovasi dan kreativiti bukan sahaja diperlukan dalam pembelajaran, pengajaran, penyelidikan tetapi ia juga diperlukan dalam tuntutan untuk berinfaq ini. Hal ini disebut dalam hadith Rasulullah SAW:-

Daripada Abu Zarr R.A. juga, (beliau meriwayatkan): Bahawa sebahagian sahabat Rasulullah SAW berkata kepada Nabi SAW: Wahai Rasulullah! Orang-orang kaya telah mendapat banyak pahala. Mereka sembahyang sebagaimana kami sembahyang, mereka berpuasa sebagaimana kami berpuasa dan mereka bersedekah dengan lebihan harta mereka. Baginda bersabda: Bukankah Allah telah menjadikan bagi kamu sesuatu yang kamu boleh bersedekah dengannya? Sesungguhnya dengan setiap kali tasbih itu adalah sedekah, setiap kali takbir itu adalah sedekah, setiap kali tahmid itu adalah sedekah, setiap kali tahlil itu adalah sedekah, menyuruh amar ma’aruf itu sedekah, menegah mungkar itu sedekah dan pada kemaluan seseorang kamupun adalah sedekah. Mereka bertanya: Ya Rasulullah! Adakah apabila salah seorang kami melepaskan syahwatnyapun dia beroleh pahala? Baginda bersabda: Bagaimana pandangan kamu kalau dia melepaskan syahwatnya pada tempat haram, adakah dia berdosa? Maka demikian jugalah apabila dia melepaskannya pada tempat yang halal, dia beroleh pahala. Hadis riwayat al-lmam Muslim

Menyentuh aspek infaq dalam konteks yang lebih luas, inovasi dan kreativiti mampu membuka dimensi yang lebih segar dan baru. Di USIM, pensyarah misalnya bukan sahaja boleh bersedekah wang ringgit tetapi boleh sahaja menginfakkan masanya untuk mendidik pelajar di luar waktu pekerjaan termasuk mengadakan kelas tambahan atau aktiviti yang dapat meningkatkan pengetahuan dan kemahiran pelajar. Seorang doktor boleh sahaja menginfakkan sebanyak 5 pembedahan secara percuma bagi tempoh setahun sebagai infaq beliau. Seorang peguam boleh memperuntukkan sebanyak 5 kes setahun bagi mengendalikan kes secara percuma bagi mereka yang memerlukan. Begitu juga bagi pelajar, dengan masa yang begitu berharga, mungkin pelajar boleh menginfakkan masa untuk kerja-kerja amal dan kerja sosial untuk masyarakat terutamanya semasa cuti semester. Dalam hal ini kerja-kerja kesukarelawanan adalah amat bermanfaat. Selalu kedengaran, pertubuhan kebajikan dan amal yang bukan sahaja tidak punyai cukup dana tetapi kekurangan sukarelawan untuk membantu mereka melaksanakan kerja-kerja amal.

Sidang Jumaat yang Dirahmati Allah sekalian,

Umat Islam diseluruh dunia adalah bersaudara kerana Islam adalah agama persaudaraan. Tali persaudaraannya diikat kuat oleh persamaan akidah. Dengan demikian apabila umat Islam di negara atau kawasan tertentu ditimpa malapetaka atau dizalimi, maka akan timbul perasaan atau keinginan untuk membantu meringankan penderitaan mereka. Ini bertepatan dengan firman Allah SWT dalam surah al-Hujurat ayat 10:

Maksudnya: ” Sebenarnya orang yang beriman itu bersaudara maka damaikanlah di antara dua saudara kamu itu; dan bertakwalah kepada Allah agar kamu beroleh rahmat.”.

Bertepatan dengan tajuk khutbah pada hari ini mengenai Budaya Infaq, di kesempatan ini mimbar ingin mengajak sidang Jumaat sekalian untuk bersama-sama berinfaq untuk saudara kita yang kini sedang menghadapi ujian yang amat berat khususnya di Gaza, Arakan, Myanmar dan Syria. Marilah kita sama-sama mendoakan keselamatan saudara-saudara kita ini yang kini dikhabarkan dalam keadaan tegang dan getir.

Berpeluang berada di Gaza baru-baru ini begitu menginsafkan.Saudara kita di Palestin benar-benar memerlukan pembelaan. Mereka kehilangan keluarga, rumahtangga, kemusnahan hartabenda, sekolah, hospital dan sebagainya. Gaza memerlukan bantuan kita untuk dibangunkan semula. Begitu juga di Arakan Myanmar, dilaporkan bahawa keadaan umat Islam yang diletakkan di dalam penempatan khas pihak berkuasa Myanmar kini berada dalam keadaan dhaif dan kesengsaraan. Mereka kini sangat-sangat memerlukan bantuan saudara seIslam untuk meneruskan kehidupan.

Dan yang paling kritikal ialah saudara kita di Syria. Konflik di Syria yang telah selama 20 bulan ini telah mengorbankan 27,600 nyawa, dan mengakibatkan 200,000 orang menjadi pelarian di sempadan Turki, Jordan dan Lubnan. Ribuan rakyat yang tercedera, ratusan mati kerana kekurangan peralatan dan bekalan ubat, bayi mati kekurangan susu, dan kebanyakan rakyat di seluruh negara Syria kekurangan keperluan asas termasuk tempat tinggal dan makanan. Pertubuhan Bangsa-Bangsa Bersatu (PBB) menyatakan bahawa Syria memerlukan bantuan kemanusiaan bernilai hampir 700 juta USD dan keadaan di Syria menjadi semakin kritikal daripada masa ke semasa.

Sebagai saudara seakidah dan atas sifat peri kemanusiaan, maka kita berkewajiban terus menerus membantu mereka. Persaudaraan sesama Islam akan terbukti apabila kita turut merasa susah, sedih dan bersedia membantu, bilamana saudara kita sakit, susah dan menderita. Imam Muslim dan Ahmad telah meriwayatkan bahawa Rasulullah SAW bersabda:

Mafhumnya: “Gambaran kehidupan orang yang beriman dari segi kasih sayang, saling bersimpati dan saling cinta mencintai samalah seperti anggota tubuh yang jika salah satu daripadanya mengadu kesakitan, ia melibatkan seluruh anggota lain yang tidak tidur malam dan demam”.

Sidang Jumaat yang Dirahmati Allah sekalian,

Mengakhiri khutbah pada minggu ini, mimbar menyeru marilah sama-sama kita mendekatkan diri kepada Allah SWT dengan mengamalkan amalan yang mulia ini dengan membantu sesama kita. Dengan kita bersedekah dan berinfaq mudah-mudahan hidup kita sentiasa diberkati oleh Allah SWT.

Justeru itu, pada hari yang penuh berkat ini, mimbar menyeru umat Islam memperbanyakkan amalan bersedekah dan infaq kerana (i) Bersedekah adalah antara tanda keimanan seseorang; (ii) bersedekah merapatkan tali persaudaraan dan menggembirakan ummah; (iii) Bersedekah menghapuskan dosa; (iv) bersedekah idak memiskinkan seseorang malah menambahkan rezeki; dan (v) bersedekah adalah amalan para Rasul, Nabi dan orang-orang soleh.

بَارَكَ اللهُ لِيْ وَلَكُمْ فِي الْقُرْآنِ الْعَظِيْمِ وَنَفَعَنِيْ وَإِيَّاكُمْ بِمَا فِيْهِ مِنَ اْلآيَاتِ وَالذِّكْرِ الْحَكِيْمِ. أَقُوْلُ قَوْلِيْ هَذَا وَأَسْتَغْفِرُ اللهَ لِيْ وَلَكُمْ وَلِسَائِرِ الْمُسْلِمِيْنَ مِنْ كُلِّ ذَنْبٍ فَاسْتَغْفِرُوْهُ إِنَّهُ هُوَ الْغَفُوْرُ الرَّحِيْمُ

Khutbah Kedua

إِنّ الْحَمْدَ ِللهِ رَبِّ الْعَالَمِينَ وَأَشْهَدُ أَنْ لاَ إِلهَ إِلاّ اللهُ وَلِيُّ الصَّالِحِينَ وَأَشْهَدُ أَنّ مُحَمّدًا خَاتَمُ الأَنْْْبِيَاءِ وَالْمُرْسَلِينَ اَللَّهُمَّ صَلِّ عَلَى مُحَمَّدٍ وَعَلَى آلِ مُحَمَّدٍ كَمَا صَلَّيْتَ عَلَى إِبْرَاهِيْمَ وَعَلَى آلِ إِبْرَاهِيْمَ، إِنَّكَ حَمِيْدٌ مَجِيْدٌ. وَبَارِكْ عَلَى مُحَمَّدٍ وَعَلَى آلِ مُحَمَّدٍ كَمَا بَارَكْتَ عَلَى إِبْرَاهِيْمَ وَعَلَى آلِ إِبْرَاهِيْمَ، إِنَّكَ حَمِيْدٌ مَجِيْدٌ., أَمَّابعد

My Dear beloved Jemaah,

On this blessed Friday, let us pray that Allah subhanahu wataala continues to protect our taqwa and our faith. Let us consistently strive to perform all of His commandments and avoid all of His prohibitions. Hopefully, we will be in an excellent condition during our meeting with Allah subhanahu wataala. and Rasulullah sallallahualaihiwasallam in the hereafter. The topic for today’s khutbah is ‘The Importance of Infaq or Giving in the Way of Allah’.

My Dear Beloved Brothers,

Infaq has a very broad meaning. It constitutes all kind of expenditures given without any expectation of reward or return and just for the sake of Allah. Infaq can be for family, siblings and also it can be for the poor and the needy. There are many indications in Holy Quran that infaq is both an order and a strong recommendation. For instance in surah al baqarah verse 261, Allah says:- The parable of those who spend their substance in the way of Allah is that of a grain of corn: it groweth seven ears, and each ear Hath a hundred grains. Allah giveth manifold increase to whom He pleaseth: And Allah careth for all and He knoweth all things.

If a person spends his better parts of his goods, and the goods that he is personally fond of, and he does this under the name of infaq and only for the sake of Allah, he will reach the level of righteousness. This is affirmed by Allah SWT in surah al Baqarah verse 274, Allah says:- Those who (in charity) spend of their goods by night and by day, in secret and in public, have their reward with their Lord: on them shall be no fear, nor shall they grieve.

My Dear Beloved Jemaah,

The Infaq is a way to purify one’s heart and mind. It is an unselfish act of worship. Infaq can bring numerous benefits in this world and hereafter. (i) Allah the Almighty will increase and guarantee your wealth. Through Infaq, the giver does not lose his or her income and wealth, because God guarantees that at least the same amount will be returned, if not more. (ii) Allah the Almighty will give you reward so you will not be fear or stressed. (iii) Infaq will strengthen family relation and enlarge social networking. (iv) Infaq can strengthen the spirit of brotherhood and solidarity. (v) Infaq can contribute to ummah development.

اَللّهُمَّ اغْفِرْ لِلْمُسْلِمِيْنَ وَالْمُسْلِمَاتِ وَالْمُؤْمِنِيْنَ وَالْمُؤْمِنَاتِ، الأَحْيَاءِ مِنْهُمْ وَالأَمْوَاتِ. إِنَّكَ سَمِيْعٌ قَرِيْبٌ مُجِيْبُ الدَّعْوَاتِ وَقَاضِىَ الْحَاجَاتِ.

اللّهُمَّ انْصُر مَلِكَنَا، يَغ دِفرتوأن بسر نضري سمبيان دار الخصوص، توأنكو مُخرِز ابن المرحوم توأنكو مُنوِّر وأَيِّدهُ وَوَفِّقْهُ لِماَ تُحِبُّهُ وَتَرضَاهُ، وأَبِد بِوُجُودِهِ مَكَايِدَ أَهلِ الظُّلمِ وَالكُفرِ وَالخِذلاَنِ،

اللّهُمَّ ارْزُقِ العَوْنَ والتَوفِيق، داتوء كلانا فِترا، داتوء حاج مبارك ابن ضحاك المَعرُوف بأُندَغ لُوأَق سُوغَاي أُوجُوغ، وأَيِّدهُ وَوَفِّقْهُ لِماَ تُحِبُّهُ وَتَرضَاهُ، بِحُرمَةِ مَن أَرسَلْتَهُ لِلْعَالَمِينَ رَحمَةً وَبُشْرَى، وَدَاعِياً إِلَى الله بإِذْنِهِ وَسِرَاجاً مُنِيراً.

Ya Allah, Engkau berkatilah Universiti Sains Islam Malaysia serta warganya. Jadikanlah kami dalam kalangan hamba-hamba-Mu yang sentiasa mendapat hidayah, rahmah kesihatan dan kelapangan, serta jauhkanlah kami daripada bala-bencana dan ancaman wabak mudarat serta penyakit al-wahn. Sesungguhnya Engkaulah tempat kami memohon dan mengharapkan pertolongan.
أقيموا الصلاة…

Regards
Zulkifli Hasan

Masjid al Nabawi, Madinah al Munawwarah

BETWEEN BANKER’S WINDOW DRESSING AND INVASION OF SCHOLAR WANNABES

BETWEEN BANKER’S WINDOW DRESSING AND INVASION OF SCHOLAR WANNABES

Zulkifli Hasan

Shari’ah scholars in Islamic finance are frequently put in a dilemma position. They have been accused upside down with numerous allegations even without any basis. During early implementation of Islamic finance, Shari’ah scholars have been alleged as forming an alliance with Islamic capitalist to create a new market for Islamic finance sector. In this instance, the Islamic banks are guided by those well-paid clerics and always issue rulings according to their needs. In fact, since 1980s, many of the scholars have been accused of being bankers’ window dressing and of over-stretching the rules of Shari’ah to provide easy fatwas to Islamic financial institutions.

Lately, it is quite surprising that the scholars have been criticized even by Islamic bankers. The myth of alliance between Islamic bankers and Shari’ah scholars seems to be no longer relevant. One of the critics refers to allegation where the Islamic financial market globally has been invaded by Shari’ah scholar wannabes, a new term introduced to refer to the so called unqualified Shari’ah scholars. This Shari’ah scholar wannabes have infiltrated Islamic banks, regulatory authorities and Shari’ah governing bodies without due consideration to stakeholders value. Much more serious is where the criticism includes allegation of changing the meaning of Quranic verses and Hadith by those Shari’ah scholar wannabes.

Caution and criticism are mostly welcomed and in fact warranted but not to baseless allegation and wrongful accusation. Constructive criticisms particularly on the governance issue in Islamic financial institutions will surely contribute to the development of Islamic finance industry. The unethical criticisms will lead the industry nowhere and in fact will infiltrate its development and negate the public confidence. Considering the significance of this issue, this article attempts to address several misconceptions on Islamic finance even by the so called truly Islamic finance practitioners with the aim of providing a basic understanding and removing any inaccurate or unfounded prejudice.

1. Islamic finance is a pure commercial transaction: Islamic finance concept is grounded in ethics, values and norms. As Islamic finance is not pure commercial transaction and not only confine to nominate contracts, Islamic financial institutions therefore should be commercially and morally oriented entities. Islamic finance assumes a moral based value preposition which offers solution for the economic and financial problems. These moral and ethical value systems require that the decision-making process in Islamic finance must not solely based on efficiency and equity but must have social and ethical dimensions.

2. Stakeholders value confines to shareholders interest: The stakeholder value orientation is not only concern on shareholders but also to protect all the stakeholders’ interest and rights. The stakeholders value, conceptually, require Islamic financial institutions to balance the corporate goal of maximizing the profit with the duty to uphold the principle of social justice and maqasid Shari’ah and this entails the notion of protecting the interests and rights of all stakeholders within the Shari’ah rules. Even the Basel Committee for Banking Supervision on ‘Enhancing Corporate Governance for Banking Organizations’, expands the term ‘stakeholders’ to include employees, customers, depositors, suppliers, supervisors, government and the community. Not only that the OECD further classifies the stakeholders into shareholders, internal stakeholders (employees and labour unions), operational partners (customers, suppliers, creditors and contractors), and the social community (state authorities, trade union, non-governmental organizations and civil society).

3. The true meaning of Bay is sale and it has no element of risk: Islamic finance is gharar-free, maysir-free and riba-free, but not risk-free. Since Islamic financial products and services are designed based on different nominate contracts, it is erroneous and would be a sheer misconception to say that Islamic finance is risk-free or less risky. Furthermore, Islamic financial products and services should have moral and ethical dimensions and therefore any transactions should be embedded in real economy which offers an alternative financing paradigm. At this point, the conceptual framework of Islamic finance suggests that it should be more than financialisation of the nominate contracts. Islamic financial institutions should take necessary risks equitably and not simply shifting the liability unfairly to the customer. In other words, Islamic finance should represent a holistic approach to financing not only bankable customer but also to allocate certain fund for non-bankable and underprivileged people as part of its social responsibility to the society and ummah.

4. Islamic financial institutions are purely profit-oriented entities: Based on its epistemological dimension, Islamic finance is actually a society oriented financing proposition as it aims to serve the community, ummah and not solely to the markets. Islamic finance must not only confine within profit-driven orientation but it should also address issues on economic and sustainable development, social justice and social investing oriented principles. With reference to several empirical studies, the current Islamic finance practices on the other hand do not indicate positive correlation with human development index scores. Surprisingly, the corporate social responsibility performance of Islamic financial institutions also has been rather weak and poor as compared to its conventional counterpart. This position demands Islamic financial institutions to seriously reevaluate and review their current practices and future direction.

5. Shari’ah scholar wannabes infiltrated the industry’s well being: The critics on the roles of Shari’ah scholars are always blown out of proportion and over-exaggerated. Undeniably, Shari’ah scholars, either senior or young scholars or conservative or pragmatic scholars have their own unique contribution to the industry’s well being but their approaches may be different. This should not be the reason of denying their significant contribution. The ‘Conservative’ scholars may view the legitimacy of Islamic financial products and services to be based on the legal and mechanistic aspects of Shari’ah. The products and services are classified as lawful and Shari’ah-compliant or Shariʿah-based if they meet the conditions of a valid muamalat transaction after going through the ordinary process of usul al fiqh. On the other hand, the ‘Pragmatic’ scholars admit that Islamic finance should not confine their function by solely emphasizing the fiqh aspect. The ‘Pragmatic’ scholars acknowledged that Islamic financial products and services should not only be valid and lawful, must fulfil the spirit of maqasid Shariʿah but must also be ethical and uphold the Islamic values.

The critics upon Shari’ah scholars of either being banker’s window dressing or invasion of the scholar wannabes are actually misleading. These allegations to certain extent will negatively influence the Islamic finance industry as they are not supported with any empirical evidence. Rather than discussing these unnecessary issues, the Islamic finance discourse should actually be focusing on its fundamental principles and how to ensure its sustainability. It is important to critically evaluate the performance of Islamic financial institutions against their foundational base and at the same time to maintain its positive development. The existing practices of Islamic finance so far have failed to establish a distinct identity or to draw a clear demarcation line with conventional banks. In fact, with several corporate failures of Islamic financial institutions, such as the closures of Ihlas Finance House in Turkey, the Islamic Bank of South Africa and the Islamic Investment Companies of Egypt, and corporate difficulties, as in the case of the Dubai Islamic Bank, and Bank Islam Malaysia Berhad, Islamic finance is clearly not immune from the crisis. Islamic finance must learn from the history and take lesson from previous financial crisis. We do not want to hear that the only lesson that Islamic financial institutions have learned is that they never learn.

Disclaimer: This is the personal opinion of the author.

Regards

Zulkifli Hasan

Grand Mosque of Cordova