From left: Datuk Mohammad Faiz Azmi, chairman of the Securities Commission; Sultan Nazrin Muizzuddin Shah, the Sultan of Perak and Royal Patron of Malaysia’s Islamic Finance Initiative; and Dr Farhan Nizami, founding director of OCIS
KUALA LUMPUR: There is an urgent need for companies to apply the principles of "humanity" in finance, given how there is an excessive focus on profit maximisation to the detriment of stakeholders and the planet, said Securities Commission chairman Datuk Mohammad Faiz Azmi.
In his opening remarks at the 15th SC-OCIS Roundtable held at the Oxford Centre for Islamic Studies (OCIS), UK, Mohammad Faiz urged for issues of climate change and environmental social and governance (ESG) standards to be factored into the way companies operate.
He said there were some critics who doubted whether Islamic institutions had developed a higher moral standing than conventional institutions, and noted a need to clarify the position of Shariah Law with regards to the climate emergency and the encouragement of ESG practices.
"The difficulty I feel is sometime in the pursuit of profit, compassion, empathy and basic humanity seems to be forgotten," he said.
"One outcome of this roundtable we hope, is to see is how these universal values, encapsulated in the Maqasid Al Shariah can best be applied throughout the value chain of a company, from the funding, to delivery of products and services and how they meet stakeholder expectations.
"It will serve to also make Islamic Finance products and services more relevant to the issues at hand."
According to Mohammad Faiz, "humanity in finance" , the theme of this year's roundtable, is one of the six aspirations of the Maqasid Al Shariah - a doctrine about the "true intentions" of Shariah Law and their wider considerations.
He noted that the SC had issued in November 2023 the Maqasid Al Shariah Guidance for the Islamic Capital Market in Malaysia, which tries to apply these aspirations and principles in the context of the capital markets.
"The guidance itself talks about six aspirations and 15 principles and we are now embarking on a journey to see how these principles can be applied on top of Shariah compliance," he said.
