MANAMA: BIBF is collaborating with Thomson Reuters to study the knowledge dimension of the Islamic finance industry through the ICD Thomson Reuters Islamic Finance Development Indicator (IFDI) 2014.
Islamic finance industry development worldwide is usually measured by growth of profits and assets.
This indicates the quantitative health of the industry but does not depict the full picture of how Islamic finance is developing, especially considering the socio-economic mandate of Sharia.
Significantly, the development of Islamic finance is a function of the required human capital resources that can supply the knowledge and skills to sustain and enhance the industry.
As per the IFDI, Bahrain, an established global Islamic finance hub, topped the education sub-indicator.
Yet, after adjusting for population and economy size, Bahrain is second on the knowledge indicator, leading on education and coming fourth on research.
The IFDI measures five key components that combine to give the bigger picture of the state of Islamic finance in 92 countries: knowledge, quantitative development, governance, social responsibility and awareness.
This year, the IFDI was officially released at the Global Islamic Finance Forum in Malaysia in the presence of key market leaders.
The knowledge indicator of the IFDI is measured through two sub-indicators - education and research - which are key pillars in any industry expansion.
These are significant building blocks of specialist human capital in Islamic finance that is required to ensure sustainability driven by innovation.
Education measures the number of institutions that provide formal teaching and training programmes through degrees and courses while research measures the study and in-depth investigation of the industry through published papers and peer-reviewed journals.
"Islamic finance has reached an interesting stage of development, with critical mass achieved and awareness now reaching global proportions," BIBF's Islamic finance centre head Hani Redha said.
"The significant shortage in skilled professionals will remain the key impediment to this growth, and will determine the success of the industry in the intermediate and long term.
"At BIBF, we follow a dual track training philosophy which dictates that our training programmes are aligned with the syllabi of global professional qualifications.
"This ensures that whilst transferring knowledge and skills, our trainees are also prepared, in parallel, to sit the exams of global professional bodies and thereby acquire highly valuable qualifications at the end of the training programme.
"The benefits of this approach are clear. Trainees enhance their CVs and employers benefit from a tangibly more qualified workforce."
In addition to quantitatively analysing the existing knowledge infrastructure in different countries, the IFDI Report also addresses the knowledge-related challenges facing the industry, which will require an additional 50,000 Islamic finance professionals in the next decade.
It assess the balance required between academic study, professional qualifications and on-the-job training, and identifies strategies to adopt a 'dual track' training philosophy and leveraging online training platforms and executive trainee and graduate development programmes, to meet these challenges.
(Gulf Daily News / 02 October 2014)---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com