The Middle East is lagging behind other major centres for Islamic finance when it comes to employing female executives and scholars, which is discouraging women from entering the sector lower down the ranks.
Malaysia, one of the world’s largest Islamic finance centres, is setting the pace when it comes to appointing women scholars and executives, according to Bloomberg, with six female members of its 35-strong Shariah Advisory Board. The Middle East has yet to catch up.
“The Middle East is not as progressive as Malaysia when it comes to women’s place in the workforce, and this is reflected in the low number of female executives and scholars in the Islamic finance sector,” argues Professor Rodney Wilson, of Durham University’s Centre for Middle East and Islamic studies.
The largest centre for Islamic finance in the Gulf is Saudi Arabia, which is threatening to overtake Malaysia as the largest issuer of sukuks this year, and it is the most restrictive of the GCC states when it comes to women in the workforce.
This could be more of a problem in the future. According to the Islamic Financial Services Board, the demand for professionals in the sector has been growing by 20% annually since 2000 and there’s been a well-reported skills-shortage in Islamic finance for some time now.
“While there are examples of female in key positions in the Middle East Islamic finance sector, it remains a male-dominated industry,” says one senior Islamic banker who declined to be named. “This has had the knock-on effect of discouraging women from entering the sector, and stemming the pipeline of female talent for the future. But as the sector develops I believe this imbalance will begin to change.”
One of the exceptions appears to be the comparatively small Islamic investment banking market. Nida Raza, senior vice president at Unicorn Investment Bank in Bahrain, told Bloomberg that more female Westerners are entering the market.
This “may lead to a rise in women in the Islamic finance industry,” she said.
Often they come from a conventional background – Raza previously worked at JP Morgan in London, for instance.
“In the investment banking and capital markets functions, the shortage of talent with specific Islamic experience has meant many institutions have recruited from the conventional sector, where an understanding of the commercial principles has been gained,” adds the Islamic finance banker. “This has meant that there are more women working in this area, and could mean more female leaders going forward.”