Recent developments in the Islamic finance market prompted the industry to rethink the role of Shari'ah scholars. Most Islamic financial institutions appoint a supervisory board or committee of religious scholars who are tasked with reviewing their transactions in order to ensure that they comply with the principles of Islamic Shari'ah in their business and financial dealings. A Shari'ah supervisory board or committee approves or rejects a transaction through the issuance of a fatwa (an opinion or proclamation about the Shari'ah compliance of such a transaction).
The question of the day in the Islamic finance industry is whether Shari'ah scholars should be subject to some sort of supervision themselves. In our opinion, the answer to this question depends on what is meant by 'supervision'. Industry practitioners should oppose supervision if it means that Shari'ah scholars would have to adhere to strict criteria or methodology before issuing a fatwa. Such supervision will in our opinion curtail innovation and transform the industry, prematurely, to a commoditized industry, since Shari'ah scholars would in their attempt to check all the boxes and stay within the accepted norms, refrain from covering new ground and developing new structures that would allow new transactions and thus the development of the industry.
The industry should not lose sight of the fact that Shari'ah scholars are our current day mujtahid (Jurist). Throughout the history of Islamic jurisprudence, the use of human reasoning (ra'y) has played an important part in the development of Islamic Shari'ah. When issuing fatawa, Shari'ah scholars are practising ijtihad and they should enjoy complete freedom in their practice of ijtihad; their guidance and limitations should only come from the five sources of Islamic Shari'ah being:
However, we would support supervision of Shari'ah scholars such as the new proposed rules of the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) to reduce the risks of conflicts of interest or improper disclosure. This type of supervision may lead to more transparency and benefit the authenticity and credibility of both the industry and the Shari'ah scholars.
Another form of welcomed supervision is training and accreditation at an early stage and before a student of Islamic Shari'ah becomes a self-proclaimed Shari'ah scholar. Organizations such as AAOIFI should run training and continuing education programs for would be Shari'ah scholars. Such programs should aim to provide Shari'ah scholars with an understanding of various financial and business transactions and the legal framework in which such transactions are being consummated. Most importantly, these training and continuing education courses should train Shari'ah scholars to be inquisitorial of the intention (niyya') behind the transaction.
We should not exaggerate the required finance and business expertise of Shari'ah scholars. After all we do not want them to be bankers or lawyers. Therefore being inquisitorial should be the most important part of their training: they should ask critical questions in order to reach the true niyya' of the parties involved (as judges would try to search for the factual truth in a legal proceeding).
Jawad I. Ali, Omar Salah
source : Zawya