01Jun10 -FEATURE-
* New scholars have more finance, language skills
* International programmes offer Islamic finance training
By Shaheen Pasha
DUBAI, June 1 (Reuters) - Fifteen years ago, New York native Taha
Abdul-Basser had a set plan for his future. The Harvard student was
double majoring in pre-med and comparative religions with the
expectation that he would serve society as a doctor.
But his life took a different turn as Abdul-Basser, already a student
of traditional Islamic disciplines, became involved with Harvard
University's Islamic Finance Project as a researcher and found his new
calling: sharia.
"I always had an interest in traditional Islamic religious sciences
with my early education coming from my father," said Abdul-Basser. "But
I really stumbled across the opportunity to apply Islamic ethics to
contemporary life."
At 35, Abdul-Basser is now a respected and in-demand sharia advisor
in the global Islamic finance industry and positioned to benefit from an
acute shortage of qualified professionals in the sector.
With Islamic finance a $1 trillion industry globally and expected by
ratings agency Moody's to reach $5 trillion in time, students of sharia
have more opportunities than before to take their skills beyond the
mosque doors and into the boardroom.
Reflecting the change in times, many current scholars, including
Abdul-Basser, now prefer to call themselves sharia advisors or
technicians to suggest that their duties are more professional rather
than simply clerical.
Professionally, it can be a lucrative endeavour. Scholars working on
Islamic finance deals are paid consulting fees, depending not only on
the services provided but also the seniority and fame of the scholar.
There's no shortage of positions, with every Islamic finance company
having a sharia board that monitors compliance, and ad hoc boards often
set up for individual deals.
While there is no benchmark for fees, a renowned chairman of a sharia
board, for instance, could earn $50,000 to $100,000 per board as a
result of retainer fees, fees for issuing edicts, audit fees and
documentation fees. Junior scholars make significantly less.
Abdul-Basser, who works full-time as Harvard's Muslim chaplain, sits
on five international sharia boards and served on six others that are no
longer active. Juniors such as Abdul-Basser undergo an informal
apprenticeship with senior scholars and move up the ranks as their
expertise grows.
"It's a process that never really ends," he said. "The primary
difference between the first and next generation of scholars is that
institutions exist now, so the upcoming experts can be more focused on
applying their expertise in sharia to financial techniques, rather than
institution building."
TOP SCHOLARS DOMINATE
There is currently no standard global training process or
certification for a student of sharia to become a scholar. Sharia
scholars can come from a small village madrassa in south Asia or have an
advanced degree in religion from Cairo's venerated Al Azhar University.
And well-rounded sharia advisors are scarce. Islamic finance experts
say that the first generation of scholars may have laid down the
foundation to help establish the business, but many still lack the
business acumen, technology and language skills necessary to help the
industry evolve.
"Many of them are too set in their ways to take the steps needed to
help the industry move forward," said one Gulf-based Islamic banker, who
asked to remain anonymous. "And the ones that have the skills are
stretched way too thin. It's up to the next generation to help Islamic
finance reach its potential."
The same scholars are repeatedly seen at the helm of sharia boards.
"There are about 15 highly qualified internationally recognized
scholars who are financially savvy and who understand modern finance,"
said Harris Irfan, head of Islamic products at Barclays Capital. "It's
very difficult to get time with those 15 as they sit on dozens of boards
and are very much in demand."
Out of the 132 scholars active within the Gulf Cooperation Council,
the same top ten scholars make up almost half of all sharia board
positions, said consulting firm Funds at Work.
MORE FINANCIAL TRAINING OPTIONS AVAILABLE
But that could change as more global programmes are created to help
foster the Islamic finance industry by training upcoming sharia scholars
in the ways of business.
Bahrain, for instance, has a certified sharia advisor and auditor
programme in place to train scholars.
In Malaysia, the central bank established International Shari'ah
Research Academy for Islamic Finance (ISRA), to help develop talent
among industry practitioners and sharia scholars.
The programme offers scholarships to provide an incentive for a
sharia student or scholar to pursue an advanced degree in Islamic
finance and also offers mentoring for aspiring sharia practitioners to
learn from established scholars.
"We now have around 120 advisors that we have developed sitting on
different sharia boards," said Mohamad Akram Laldin, prominent sharia
scholar and executive director of ISRA.
Scholars must think internationally, by improving their English
skills and knowledge of Western business practices in order to be
successful, experts said.
To that end, the Islamic Finance Council in the UK has developed the
Scholar Professional Development Programme to train sharia scholars in
Islamic finance tenets, said Omar Shaikh, executive board member of the
council.
"It's extremely unrealistic for sharia scholars to give opinions on
such a diverse space in finance without being up to speed with
understanding the language of the finance professional," he said.
While not offering a master's degree or specific certification, the
programme provides 21 hours or roughly three days of workshops designed
to teach financial basics for mid-level and new scholars that may not be
as familiar with Islamic finance. The programme has already conducted
training in the UK, Malaysia and Bahrain.
Shaikh and Laldin said that the next generation of scholars will be
asked to do more than simply approve deals and financial structures.
"The gap between sharia knowledge and market practice will be
narrower," Laldin said. "There will be more demand for scholars to help
with coming up with better solutions and better products."
But Abdul-Basser said it was important for upcoming scholars to hold
on to their roots and the teaching of their mentors even as the industry
evolves.
"There is a fairly large set of up-and-coming experts who are
well-positioned to take positions on sharia boards," he said. "We have
received the torch, so to speak, and have a responsibility to move
things forward."
(Reporting by Shaheen Pasha; Additional reporting by
Cecilia Valente; Editing by Sitaraman Shankar)
