Could you provide a brief journey of how you arrived where you are today?
My first steps on the Islamic finance path occurred in early 1995 when I was seconded to work at the Norton Rose office in Bahrain. Amongst my first clients was Shamil Bank. The Islamic finance practice became a very important component of the work undertaken by the Bahrain office. After five years in Bahrain, during which time I became a partner in the firm, I returned to London. I started looking for Islamic finance work in London and very soon formulated the idea of an “Islamic Finance Group” to focus the firm’s Islamic finance efforts. Ironically, it was not until after the watershed events of 9/11 that the true potential for the industry became apparent and, following a short hiatus of 6 months or so, the firm was well-positioned to support the burgeoning growth which started at that time.
We had already recruited personnel in Bahrain and London to support the sector. During 2002 I largely stopped doing conventional finance work to devote myself fully to Islamic finance.
What does your role involve?
As the global leader of the Islamic Finance Group, my primary role is to co-ordinate the firm’s activities in the sector. We try to ensure that all the offices and teams involved in Islamic finance know what the others are doing. We exchange market information and know-how. We are creating an extensive knowledge management resource which I believe will be very important in future years, and in due course we aim to publish practical materials and guidance based on our experiences. Inevitably, I spend a reasonable amount of time travelling to visit clients and offices and to speak at conferences and seminars.
What is your greatest achievement to date?
I think my greatest achievement has been to create a space in which the young lawyers who join Norton Rose (in many cases from non-traditional legal backgrounds) can learn new skills, can flourish both as lawyers and as individuals, and can realize their personal goals. For me, leading a high-profile area of our business is all about enabling the individual, giving that person the opportunity to set challenges and develop as a person.
Which of your products/services deliver the best results?
In delivering a legal service or product, we are focused on enabling our clients to deliver the financial products they want to offer to their customers. As commercial finance lawyers, our objective is to help our clients deliver products (old or new) and close transactions efficiently and within the law. As practitioners of Islamic finance, we have the additional responsibility of observing the Shariah.
However, if I were to identify a single product that has had the biggest impact on the perception of Islamic finance, I would probably say it was the work we have done in creating residential housing products for use in the UK property market. The fact that the product transformed from pure Ijarah to an Ijarah-based diminishing co-ownership model, and the fact that the UK is now a jurisdiction offering a more tax efficient Islamic home finance product than many Muslim majority states, makes one realize how momentous that process has been.
What are the strengths of your business?
Our people. The practice of law is all about the people who undertake the work. Above all else I want the lawyers who practice Islamic finance at Norton Rose to be recognized for their integrity. This translates into not just being careful about observing the law, but also making sure the form and the spirit of Shariah compliance are observed in all that we do.
What are the factors contributing to the success of your company?
Our people. The quality of our people has enabled us to deliver a consistently high quality product and help Norton Rose to help its clients deliver innovative new products.
What are the obstacles faced in running your business today?
Ever since I started working in Islamic finance, the single most difficult obstacle has been the shortage of human resources. We have good people but we need more. The lack of suitably experienced and widely respected Shariah scholars is also a potential major problem for the growth prospects of the industry. One major worry I also have as a lawyer concerns the area of reputational and systemic risk. We are in a period of rapid change and innovation. Care has to be taken to keep things under control. In Islamic finance prohibitions exist for principle-based reasons. In conventional finance, a problem becomes merely a challenge that has to be navigated around. This approach should not be imported into the Islamic finance sector, as it would undermine the ethical rationale on which Islamic finance is based.
Where do you see the Islamic finance industry, maybe in the next five years?
The industry has changed remarkably during the past five years. It will change remarkably in the next five years. I do find myself questioning whether the rapid growth of the industry is being built on sound enough fundamentals. I would hope that during the course of the next five years we see very clear evidence that some of the shorter term, highly speculative activities are compensated by a more strategic balancing of portfolios for the long term. This may be less exciting and less remunerative, but long-term players need to build annuity business and long-term relationships. There are also too many banks chasing too few people. A reduction in the number of banks, an increase in scale and a concentration of talent is required before an Islamic bank can become truly world class.
Name one thing you would like to see change in the world of Islamic finance?
I think there needs to be more women practising Islamic finance in the banks. I am sure there would be a wealth of talent available. Islamic finance is already operating across borders, using the language of finance to knock down political differences. It should do the same across genders.
Norton Rose is a leading international legal practice offering a full business law service from offices across Europe, the Middle East and Asia. We have over 30 years’ of Islamic finance experience and are widely recognized as one of the leading legal practices in this field.