The Risks of Risk Management
A Class Paper on Risks Associated with Islamic Financial Institutions (IFIs) [UIAM]
by Muhammad Zahid Abdul Aziz
In my view the biggest risk associated with IFIs is the risk of non compliance with Syariah. This risk is not just a subset of so many risks faced by the IFI but it is a risk that permeates every aspect of the IFI’s being as an entity. Let’s tackle the issue from the top, the risk of misinterpreting the shape and form of an IFI truly endorsed by Syariah. In our rush to have an alternative Financial System generally and an Islamic Financial Institution in particular we never truly addressed the philosophy, the epistemology and the ontology of the new knowledge we are about to create for it is in indeed a knowledge we are about to create in as much as it is a new financial system.