What have you done today to make you feel proud?

I walked away from the Global Islamic Finance Forum (GIFF) with two quotes that I can’t get out of my head. The first: “a rising tide lifts all boats” from John F. Kennedy, 1963. The second: it is “better to live one day as a tiger than a thousand years as a sheep” by Tipu Sultan in the 1700s.

Both quotes touched me deeply, as they are sayings that should stay with you for life.

The first, from JFK, is about making sure that everyone is alright. It is the opposite of what actually happens in America but, in Islamic finance, it is a core principle. All of us should be included and supported. Bank Negara, the central bank of Malaysia, calls this VBI, which is Values Based Intermediation – others might call it social finance – either way, it is finance with a conscience.

The core Islamic products of social finance are Zakat, Sadaqah and Waqf.

Zakat is a mandatory charitable contribution in Islamic finance. It takes around 2.5% of your wealth to give to the less fortunate, and strengthen community bonds. The funds are distributed to specific eligible groups such as the poor, the needy, and debtors.

Sadaqah is a voluntary act of charity in Islamic finance. Unlike the mandate of Zakat, it has no set amount and can be given at any time in various forms, including monetary donations, acts of kindness, and even a smile. Sadaqah is an integral part of Islamic social finance aimed at supporting community welfare, seeking spiritual reward, and purifying wealth.

Waqf is a charitable endowment of an asset for religious or charitable purposes. It is often a building, land, or cash, where the principal asset remains intact while its proceeds are used to benefit specific categories of people or causes. This concept serves as a vital tool for socioeconomic development by supporting institutions like mosques, schools, and hospitals, and can even be structured as a cash-waqf to create sustainable financial funds.

Going back to my previous blogs about GIFF, these themes resonate.

I took a book away from the conference from Bank Islam with the title: “a rising tide lifts all boats”. It’s all about social finance, and is not something I have seen in many other conferences. A key quote in the book is from Bank Negara’s Governor, Dato’ Seri Abdul Rasheed Ghaffour:

“Social finance is able to give a new dimension to the socio-economic development of the people by applying the principles of an inclusive financial system, considering the long-term impact and uniting all stakeholders.”

It is all about harmony between society and commerce, and a good example is from Bank Islam who, in 2018, launched Sadaqa House. Sadaqa House is a social finance initiative that is core to the bank’s Value-Based Intermediation.

VBI is “an intermediation function that aims to deliver the intended outcomes of Sharīʿah through practices, conduct, and offerings that generate positive and sustainable impact to the economy, community, and environment, consistent with the shareholders' sustainable returns and long-term interests.”

Source: Global Alliance for Banking on Values https://www.gabv.org/opinion/value-based-intermediation-a-framework-for-ethical-islamic-finance/

Bank Islam articulates this by making clear that their investment fund is run with five clear principles focused upon society and raising all boats. The five principles?

1) focus on the fund’s purpose and the intended social impacts;

2) contribute to meaningful social change by ensuring the effective allocation of the contributed funds;

3) improve impact measurement and management to emphasis greater accountability in managing social finance funds;

4) tailor investment solutions for social impact investors; and

5) give donors the opportunity to contribute to a specific impact  and not a certain group.

This is the lasting memory and message I took away from GIFF: it is all about ethical, social finance to raise all boats.

The second quote came from Tipu Sultan https://en.wikipedia.org/wiki/Tipu_Sultan who had an exhibition dedicated to his life in the Islamic Art Museum that was near to my hotel in Kuala Lumpur. As I walked into the exhibition, the quote: “better to live one day as a tiger” was written over the entrance.

The full quote: “better to live one day as a tiger than a thousand years as a sheep” stayed with me. It reminded me that, almost every day, I wake up and say carpe diem or seize the day. Unfortunately, for me and most of us, we actually live every day as a sheep. But a tiger? What does that mean?

It means waking up and seizing the day.

Wake up, seize the day and lift all boats are two great messages I took from my short trip to Malaysia and the Global Islamic Finance Forum. What are you going to do today to seize the day and lift all boats?

https://www.youtube.com/watch?v=OygsHbM1UCw