We already have the essential ingredients – the presence of the world’s largest global players in our takaful market, deep Shariah knowledge within our domestic takaful and retakaful companies, and an entire Islamic finance ecosystem that can be tapped into to really push the frontiers in 2/6  BIS central bankers' speeches  building retakaful capacity. We just need companies that are willing to lead the way. Building this will take time, resources and a long term perspective, but this may be a small price to pay to build scale, generate critical mass and position takaful as a credible solution for large and specialised risks. There is also a big opportunity in halal trade facilitation, especially in serving SMEs. The global halal industry is valued at around USD2 trillion. The takaful industry however, has to be more committed and visible in serving local and international halal businesses. After all, takaful has its roots in the Nusantara, when Muslim merchants who plied their trade in the Far East centuries ago were protected by early forms of takaful. This is why the takaful industry must join the banking industry in participating at the upcoming Malaysia International Halal Showcase. Participation will indicate intent, non-participation reflects poorly on the takaful industry, showing the lack of commitment or ability to spot opportunities, or maybe even both. This certainly has to be addressed if the industry is to make any meaningful progress, this sort of things matter.
It needs to break out of the shadows of insurance by evolving new business and operating models. Concepts in takaful with rich potential, such as mutual takaful remain largely untested. The mutual model has a long history. It is also enjoying a resurgence with the rise of new online, peer-to-peer insurers in other countries. This is just one model. There might be others. Boards and senior management should lead the way in exploring these developments and charting new territory. This will require more active engagement of shareholders to develop a clear vision for the company and enlist support for bold strategies that will change the status quo for the better. 4/6  BIS central bankers' speeches  Various programmes such as FIDE and FIDE Forum already include content to help prepare directors in future proofing their institutions. The focus will be even stronger going forward. We are also pleased to announce that a specialised executive Islamic finance education programme tailored for directors of Islamic banks and takaful operators will be launched in the first half of this year. It will equip directors with an appreciation and knowledge of Islamic finance by incorporating practical business perspectives. With this, directors are better able to contribute towards growth and innovation, beyond their roles in ensuring that their institutions operate within sound Shariah and risk management parameters. At the level of employees, the reality is that good talent is in short supply. And so, the industry must take a longer view in its human capital strategies.