Islamic Finance: Ethics, Concepts, Practice

130 Pages Posted: 9 Jun 2015

See all articles by Usman Hayat

Usman Hayat

CFA Institute

Adeel Malik

University of Oxford; CFA Institute Research Foundation

Date Written: November 2014


Islamic economic thought and finance are rooted in Islamic ethics. Their ideals and means are not, however, exclusive to Islam. The principles of Islamic finance emphasize market-based risk-sharing modes of financing that promote assets and enterprise, deploy finance in service of the real economy, and facilitate redistribution of wealth and opportunity. Modern Islamic financial practices, however, privilege legal form over economic substance, which creates an expectations gap between Islamic finance’s theory and practice. In the wake of the global financial crisis of 2007-2008, the ideas underlying Islamic finance appeal to those more concerned with the broader impact of finance on society.

Keywords: Islamic Finance, Sukuk

JEL Classification: G1, G2

Suggested Citation

Hayat, Usman and Malik, Adeel, Islamic Finance: Ethics, Concepts, Practice (November 2014). CFA Institute Research Foundation L2014-3, Available at SSRN:

Usman Hayat (Contact Author)

CFA Institute ( email )

915 East High Street
Charlottesville, VA 22902
United States

Adeel Malik

University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom
01865618508 (Phone)
OX44BE (Fax)

CFA Institute Research Foundation ( email )

United States

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