SHARIAH COMPLIANT BUSINESSES, BENEFITS AND CERTIFICATIONS IFSC 2013 Singapore, 1st Oct 2013 Dr Cedomir Nestorovic Professor ESSEC Business School Director Executive MBA Asia Pacific Academic Co-director MBA Arabian Gulf University, Manama, Bahrain
What is a Shariah compliant business ? Shariah-based products Shariah-compliant products Real spirit of the Shariah Non contradicting Shariah ruling Observance of Shariah principles Observance of Shariah principles in in substance form Emphasis on the Holy Qur’an and Emphasis on jurisprudence Sunna 2
2 examples: Islamic Finance and Halal Food ● Islamic Finance ● Halal Food Musharaka Gelatine Shrikat Al-Aqd Slaughtering by Al-Kitab Shrikat Al-Milk Mechanical Slaughter Shrikat Mutanakisa Pre-slaughter Stunning In-house Certification Third-party certification 3
Halal Food Gelatine Raw materials from zabihah slaughter only Slaughtering by Al-Kitab Slaughter by a Muslim only Mechanical Slaughter No mechanical slaughter Pre-slaughter Stunning No pr-slaughter stunning 4
What is the benefit? ● Criteria: ● Spiritual benefits 1. Friendly attitude of bank’s staff 1. Individual benefit: Purification of income 2. Expertise of bank’s advisor 2. Social benefit: reducing 3. Good repute of the bank economic disparity 4. Variety of financing options 5. Shari’ah compliance 6. Low service charges Source: Criteria for selecting an Islamic bank in Pakistan JIMA, vol 2, n°1, 2011 5
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