Improving governance, risk management, and human talent high priorities for Islamic Finance leaders

Implementing change strategies to reinvent the value proposition of the Islamic financial services industry is high on the agenda of industry leaders, according to Deloitte’s new whitepaper entitled “The catalysts for change: Strategic priorities in governance and regulation in Islamic Finance practice.” This necessity is fueled by recent global economic downturn coupled with geopolitical risks that have put more pressure on industry strategists and policymakers.

The whitepaper was issued jointly by Deloitte’s Islamic Finance Knowledge Center (IFKC) in the Middle East and the Islamic Research & Training Institute (IRTI). It is the first publication of the Deloitte IFKC’s new Islamic Finance insights series “Leading by Engaging;” a series of whitepapers and policy documents aiming to address industry issues and present practical analyses and policy briefings to practitioners.

“The primary goal of Deloitte Islamic Finance insights series is to provide a forum through which best practice, knowledge and Islamic finance research can be shared with industry stakeholders,” said Joe El Fadl, Partner and Financial Services Industry leader at Deloitte Middle East.

The whitepaper explains the practice areas debated in the joint IRTI-Deloitte executive program and other related industry thought leadership programs, with a particular emphasis on the industry’s pain points. It also sheds light on the progress made in developing good practices in areas such as governance, regulatory compliance, risk, sustainable business models, financial reporting, transparency and leadership.

“Today, industry leaders and executives need to make significant investments in planning and executing a change strategy. Embracing the issues and challenges discussed in this whitepaper will arguably help IIFSs sustain business continuity,” said Dr. Hatim El Tahir, Director of the Deloitte IFKC. “The whitepaper brings together a consensus analysis of focus group responses on key industry issues and presents practical insights on prioritizing strategies to improve governance and practices.”

“Considering global growing significance of Islamic financial services and products, and given that Islamic banking and Islamic capital market are gaining ground in many jurisdictions, several key issues deserve the attention of policy makers to strengthen the Islamic finance sector in their economies and to integrate it better with global financial system,” said Professor Mohamed Azmi Omar, Director General, the Islamic Research & Training Institute (IRTI).

“Therefore, combined efforts are needed by all the stakeholders to effectively address the strategic challenges of Islamic finance such as: harnessing governance and regulatory framework, improving risk management and internal controls and developing the human talent. IRTI and Deloitte’s whitepaper intends to spotlight these issues and reach pertinent solutions.”