With trust, we can have complex and farflung relationships and conduct such transactions in full confidence that these would be honoured and all liabilities or debts will be met. Without such trust, we need legal contracts and enforcement. We need money that provides finality to a transaction so parties can walk away afterwards. Unsurprisingly, money and even barter are mechanisms that allow us to do away with the need to trust. Though this can be expedient, it is not without a loss. What could have been an ongoing mutually beneficial business relationship is instead a series of individual and potentially costly transactions. Which is better? In a world without trust, we need the mechanisms to cope. In Islamic finance, with ethics as its core, such trust can be nurtured and sustained. We can thus rely less on the coping mechanisms which would merely serve as safeguards while focusing more on the business and activities that generate productive and impactful outcomes. Acting ethically should also involve embracing professionalism. Having qualified Islamic finance professionals will be a key differentiator. Professional credentials can be instrumental in strengthening the trust between financiers and customers. These qualities will anchor businesses and financial institutions towards sound and fair practices even in an environment that is rapidly changing and uncertain. In addition, continuing professional development, or CPD, will be crucial to ensure talents keep their knowledge and skills fresh, enabling them to respond to changing circumstances with agility and precision.
2 We know that financial intermediation as a whole accounted for about 8.5% of UK Gross Value Added in 2005. And a recent estimate 3 of the professional services supporting financial services accounted for a further 3.6% of economic activity in 2005, giving a total of some 12%. That compares with around 14% of GDP for the UK manufacturing sector and the jobs in financial and business services taken together have increasingly outnumbered those in manufacturing. 1  “Sustaining New York’s and the US’ Global Financial Services Leadership”. Report by McKinsey & Company to Mayor Michael Bloomberg of New York and Senator Charles Schumer (pages 14 and 54). 2  Indeed the ONS has announced that it will be revising its estimates of the level and composition of GDP to incorporate changes to the measurement and treatment of value added for banks and to take better account of in-house software development. 3  International Financial Services, London. “International Financial Services in the UK”, November 2006. BIS Review 29/2007  1  And since 1999 financial services and insurance taken together have accounted for over 20% of the UK’s exports of services. So it is clear that the financial sector is an important industry for the UK. But financial intermediation covers a great deal more than the City. Retail banking and insurance, like other retail services from restaurants to hairdressing, is widely dispersed across the country. In general one would expect this part of the industry to reflect the size of the population and their wealth.