Islamic Finance For Dummies

Chapter 16

Supervising Operations: The Sharia Board

In This Chapter

Tracing the evolution of the sharia board since the 1970s

Seeing how a sharia board is structured

Determining who sits on a sharia board

Appreciating the work of a sharia board

Touring various models of real-world sharia governance

As I emphasize throughout this book, the Islamic finance industry is based on sharia principles. Sharia is Islamic law, a code of conduct that Muslims follow because they believe it’s God’s law (see Chapter 1). Sharia governs a broad spectrum of activities — from the way the justice system works in a Muslim country to how a Muslim family handles its everyday life. And, of course, within the Islamic finance system, sharia governs the way that banks, fund management companies, insurance fund operators, and other financial professionals conduct their business.

Even people who know nothing about Islamic finance have likely heard of sharia law, and opinions about sharia among non-Muslims are ...