Dear Ali Sakti,
Philanthropy is a well-entrenched component of Islamic finance. This week’s 2nd World Congress of Muslim Philanthropists in Abu Dhabi brought together people who understand that collaboration across the lines of faith and race is a necessity and not merely a choice. It was expected that the major Muslim philanthropic organizations would be there, such as the Organization of the Islamic Conference, the Islamic Development Bank, Emirates Foundation, King Khalid Foundation and Al-Waleed bin Talal Foundation.
However, also present were renowned industry experts and senior representatives of the United Nations, World Bank, Malaria No More, Reach Out to Asia, Religions for Peace and the Tony Blair Faith Foundation. They discussed global challenges, accountability and partnership building. It was an excellent opportunity for bridge building between participants, and it was reported that a series of high-level negotiations took place that are likely to foster partnerships for effective development.
The reality that organizations need to work more closely together to address challenges was underlined. In examining the global economic slowdown’s effect on Muslim philanthropy, speakers underlined the harmful effect that economic troubles have on the poorest members of society, but pointed out the encouraging fact that as needs increase during a recession so does giving. As this amount of giving increases, it was stressed that the onus should be on spending more efficiently, creating strategic partnerships and reducing non-developmental spending.
The congress also launched the Academy of Philanthropy to provide donor education with an emphasis on how to give strategically and safely. The academy will also partner with the Human Development Foundation to establish a Human Development Institute that will enhance the capacity of service delivery at the grassroots level.
Philanthropy is one facet of Islamic finance that hardly makes the news, but is a thriving activity. At the basic level, every Muslim who can afford it pays zakat or tithe to the religious authorities to aid the poor and needy. It’s a basic requirement for Muslims, and this fact alone should propagate a more acceptable impression of Islamic finance.
Much has been said recently about now being the best time to drive Islamic finance forward. People are disgusted with the avarice and crookedness of financiers and are seeking a prudent and ethical financial system that offers good governance and promotes only the productive use of money.
But it appears that the main stumbling block will be the people to manage Islamic finance. The growth trend of the sector indicates that its global employment needs will jump from 91,995 in 2007 to almost two million in 2020. This is an average of 135,000 new employees a year. With investment and asset management firm JPMorgan expecting GCC economies and other emerging markets to outpace developed countries this year, this forecast seems realistic.
As Muslims make up a quarter of the world’s population, practitioners of Islamic finance already have a strong platform to make their business vibrant enough to break the glass ceiling of race and religion and make it more than just a niche alternative. But they need human resource. In other words, people need people, just as in philanthropy.