If it's not ethical, how can it be Halal?

As you can probably imagine, at HalalFocus we hear all kinds of stories…good, bad and ugly. In general, our approach has been to stay away from the bad and the ugly; there is plenty of that everywhere else, and we try and stay positive. It is so easy to be critical of everyone who is not doing things the way you think they should be done.

And when we are critical, we also try not to mention names too much; rather just to make a general point….like I am about to do now.

We got some news today from a business colleague of ours, a Halal food manufacturer, the kind of guy who shows up at all the global Halal sector events; very committed, good at his job, really works hard to make sure his Halal products are good quality and also correctly certified. The kind of guy who will bother to find out where all the hoops are, and then work out how to jump through them in the best way.

He was just informed that he had lost an account selling his products to a restaurant chain. The restaurant insisted that the products be certified by one particular agency. That agency, when approached, said they would only issue a Halal certificate if his company obtained all the raw materials from suppliers who were also certified by them.

On further investigation, our guy finds out that those suppliers do not meet his standards of quality, reliability and quantity…so there is no way he can use them as suppliers.

And so he loses the business. He gets punished for maintaining his high manufacturing standards by the certification agency that purports to be upholding Islamic standards.

Is this ethical behaviour by the Halal certification agency? It does not seem like it to me. Is this not ‘selling your religion for a paltry price’…?

Why is it that, time and time again, the Halal market place is full of reports of unethical (tyrannical?) behaviour by the certification bodies? For all their cries of ‘doing it for the community’ and their affiliations to this or that mosque, why are transparent ethical business practices nearly always absent?

So for all the fears surrounding the proposed new labelling laws, creeping shariah and Islamophobia, we would do well to get our own houses in order. Why worry about it being torn down from the outside if we are tearing it down from within?

If you are in the business of certifying what is Halal and what is not, then you had better have plenty of ‘fearful awareness’…that blade is a two-edged sword. It can cut both ways.

by Abdalhamid Evans

Founder, HalalFocus

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Halal industry, as an asset class, is looking for compliant liquidity. Islamic finance, as a movement connected to the real economy, is looking for impactful intra-OIC (compliant) investment and financing opportunities.

The convergence is happening in real time, and one of the “leaders” in the reunification is a strong-willed pioneering woman, Jumaatun (Juju) Azmi, founder and managing director of KasheDia.

Question: Please explain the link between KasheDia, International Halal Alliance (IHI) and World Halal Forum (WHF).

Jumaatun: KasehDia is a private company formed by myself back in 1999 to offer contemporary communication solutions for Islamic concepts. One of our products is the World Halal Forum (WHF) whose inaugural event was in 2006. It was in that same year that the IHI was formed following a resolution passed by the delegates. As of 2011, the ownership of WHF has been transferred to IHI, so that it maintains a non-profit non-governmental organisation status.

Question: Prime Minister Datuk Seri Najib Razak has spoken about a halal economy, how is your group leading the efforts?

Jumaatun: KasehDia, in leveraging our in-depth knowledge of the global halal industry, was able to assist the government of Malaysia in formulating the chapter on halal industry in the Third Industrial Master Plan. In addition to promoting the halal products sector, the WHF has always sought to widen the realm of halal to include services and the ancillary industries, such as training, laboratory testing and logistics. A key component in a halal economy is Islamic finance and we started the convergence conversation and integration actions of halal products and services sector few years ago.

Question: In Islamic finance, there are international industry bodies, like AAOIFI (Accounting and Auditing Organisation for Islamic Financial Institutions), IFSB (Islamic Financial Services Board), etc, halal industry does yet have one, what is your organisation doing?

Jumaatun: The WHF gave birth to the IHI Alliance, which is envisioned to be the global authority to fill the gap. Through its strategic partnership, IHI Alliance has already obtained a mandate from the OIC to develop a global comprehensive programme for the halal sector, which includes harmonising standards and certification practices. It is working closely with all stakeholders, especially the relevant importing authorities and industry players.

Question: What are the hot button issues in halal industry today?

Jumaatun: The recurring theme is need for standardisation in a fragmented market, much like in Islamic finance. Some of the issues include stunning, mechanical slaughter and use of animal-based gelatin. There are also the debates between activist groups, acting in the name of animal welfare, pitted against halal (and kosher) over the notion of what is known as “religious slaughter.” This essentially means slaughter without the prior use of a device or method to render the animal unconscious. This has become a hot issue in Europe and spilled over into the political area in Holland, France, etc.

Question: How has the WHF evolved since its inception event in 2006?

Jumaatun: During the early days of WHF, we managed to bring the concept of halal from the purely religious realm to the talk of industry, multinational corporations and seemingly unrelated sector players. We framed it in a different context and introduced new ideas and service sectors that are very much part of the whole halal ecosystem. We moved towards addressing the immediate issue of standardisation!

However, we soon became less idealistic and more realistic as the Ummah is a globally diverse community. We realised that a single standard cannot be imposed on 1.6 billion Muslims everywhere. Hence, we refined our approach to be more practical. Simply put, to establish a robust system where the halal certification industry adheres to internationally accepted standards of professionalism and transparency. This has been the task of IHI Alliance.

Question: The WHF 2012 just ended, what were the highlights of the event?

Jumaatun: In line with evolving themes, from perception of a business forum, WHF 2012 was focused more on the important stakeholder: the consumer. This year, we introduced creativity in the form of literary arts, visual arts, entertainment and media. We wanted to show a softer side of Islam that is inspiring, innovative and beautiful with universal appeal to both Muslims and non-Muslims. The topic of social justice was discussed in the light of the current financial impacting the “have nots”. It was encouraging to see solutions lie with Islamic instruments, such as zakat, waqf, gold dinar and so on.

Question: Why is there more emphasis on halal in Malaysia than in Gulf Cooperation Council (GCC) countries?

Jumaatun: Malaysia is very much a pluralistic society with a 60 per cent Muslim population and the Muslim community is conscious of the non-halal products in the food supply chain.

The era of industrialisation in Malaysia, 1980s and 1990s, had the effect of creating a Malay middle class with increased purchasing power. Therefore, businesses in the food and hospitality services sectors were compelled by market forces to provide a halal offering. The momentum of this development has been continuing from the tabling of a trade description act on halal in 1972 to the introduction of halal certification in 1994 to the first integrated halal conference and expo in 2006.

In the GCC and other Muslim countries, where more than 90 per cent of the population is Muslims, halal is taken for granted. The seeds of awareness have barely been planted in these countries. Today, 54 out of the 57 member states of the OIC have no form of legislation to regulate halal. Hence, they need to catch up with Malaysia and we are doing our part in assisting.

Question: Why do you think there is minimal Islamic financing in the halal industry?

Jumaatun: The halal industry was previously not identified as an asset class. Islamic finance providers would more likely view the firms’ underlying industry sector, e.g. food, agriculture, personal care, logistics etc as the determining profile. Conversely, those companies already involved in the halal sector are not compelled to adopt Islamic finance. Around 80 per cent of companies producing halal products are controlled by non-Muslims. There is no religious impetus. Even in Malaysia, which has one of the most mature Islamic finance industries, the penetration rate is less than 40 per cent. Conventional financing is well established and halal producing firms tend to be averse to switching unless there are substantial economic or monetary benefits.

Question: At the WHF 2011, the world’s first halal food index, SAMI Halal Food Index, was launched and witnessed by the former prime minister, Tun Abdullah Ahmad Badawi. Is it a beginning of convergence between halal industry and Islamic finance?

Jumaatun: The launch had an impact for both the halal industry and Islamic finance. We had always been talking about the convergence theory, but this was the first time that it materialised into something tangible – an index. WHF and others had been promoting the halal sector as a growth sector, even catching the attention of mainstream media including Forbes, Time and the Economist magazines. The tracking of the SAMI index’s stellar performance quantified and empirically proved what we had been saying all along.

Question: The SAMI index is about inward and intra-OIC investments as the companies are only from Muslim countries. How can Malaysia Inc lead halal as an asset class, like it has in Islamic finance?

Jumaatun: For starters, Malaysia can claim a fair amount of credibility as leader because Malaysian-listed companies constitute almost half the total market capitalisation of the SAMI index. Malaysia offers probably the most comprehensive range of Islamic financial products. When coupled with the slew of incentives that are further reinforced in the Second Capital Markets Masterplan, the “conversion” of the balance sheets, visa sukuk, of halal industry players to become syariah-compliant is facilitated. Malaysia already leads in Islamic finance as well as thought leadership in the halal sector, so naturally it can lead in propagating halal as an investment asset class.

Question: Finally, what have been your major accomplishments and what are the remaining major challenges for you?

Jumaatun: There is still so much to be done, but we have made some impact through our efforts. Through our various communication channels including guidebooks, magazines, TV shows, awards and events, we have managed to draw the world’s attention to halal as an industry.

The figure of US$580 billion (estimated annual value of the halal food sector in 2005) was first introduced at WHF 2006, and quoted in articles in mainstream media was a solid beginning. My favourite was seeing halal on the cover of Time magazine. It would be rather presumptuous for us to claim credit for all worldwide milestones, but the WHF was the catalyst for a series of events and achievements. For example, halal themed conferences and exhibitions have become global, from Brussels to Bangkok. Halal meat exporters from Australia and New Zealand have enacted new regulations to improve the integrity of their halal production. Greenfield countries fast-tracked to set up halal certification bodies to address demand from importing Muslim majority countries.

At the same time, IHI Alliance has worked tirelessly trying to bring some orders to the global industry. Eight modules of the ICCI-IHI Alliance halal standard have been published – each one providing sector specific requirements for every part of the halal supply chain. IHI’s membership now includes over 50 halal certification bodies in 36 countries covering six continents. The halal lead auditors training course, which has been rolled out over the last two years, seeks to harmonise halal certification practices.

Yet, there is so much more that needs to be achieved. We already talked about 45 out of the 57 OIC countries are still without a halal standards. In Europe, more than 20 million Muslim consumers have no legal recourse to ensure the integrity of their dietary requirements in the absence of even a basic labelling law. The general level of auditing and certification processes have yet to conform to internationally accepted norms.

We did not expect to be able to solve all the key issues in seven years and we cannot do it alone. For our efforts to be effective, we need the cooperation of all stakeholders, including the relevant importing authorities.

Rushdi Siddiqui is Thomson Reuters’ Global Head of Islamic Finance based in New York.

Read more: When ‘separated twins’ reunite http://www.btimes.com.my/Current_News/BTIMES/articles/KASEH/Article/#ixzz1vbQrSc1q

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New Halal Legislation is being planned for implementation in the UK by January 2013 and is currently undergoing ‘consultation’. This follows amendments to the European Legislation Law 1099 issued earlier this year. These new laws pose some of the biggest threats to the continuance of Halal in a generation. It is time for the Muslim community to sit up and pay attention.

Week after week, articles are being published calling for the ban of religious slaughter or restricting the production of religious slaughter (both kosher and Halal). These are being voiced by various groups including, Animal Welfare lobbies, Christian far right, veterinarians, secularist groups and the tabloid press.Watch carefully as story after story is released often carrying mis-information aimed at demonising the Halal brand and the religious needs of the 3 million+ Muslims in this country. Biased views and the threat of Islam are being used to justify the indefensible.

HMC says it is time to wake up to this threat and be counted.

The latest attack came from a leading vet Bill Reilly who criticised religious slaughter on Saturday 5th May and the timing seems very deliberate as the Government prepares its consultation papers on the new EU Legislation 1099, due at the end of this month.

HMC, which has been at the forefront of protecting Halal and the prophetic method of religious slaughter calls upon the Muslim community to unite and defend the prophetic method of slaughter and be prepared to respond to the consultation paper due out at the end of the May.

The Legislation draft we expect, will undoubtedly carry unbalanced laws aimed at making religious slaughter more difficult, possibly limiting its production and increasing costs for the Halal industry. They are promoted under the banner of animal welfare, but they are purely there to carry the biased views being promoted by various groups telling Muslims how we should produce and eat Halal!

Stunning is being promoted, yet many methods of stunning which were promoted as best welfare for animals over the past 20 years are now being phased out due to being cruel. In fact some stunning methods that are described as cruel by The European Food Safety Authority (EFSA) and have been recommended to be phased out have been ignored by the European Commission citing economic reasons! “Recommendations to phase out the use of carbon dioxide for pigs and the use of waterbath stunners for poultry are not included in this Regulation because the impact assessment revealed that such recommendations were not economically viable at present in the EU”.

The prophetic method remains the most humane method of slaughter and for the majority of Muslims an absolute requirement for the observance of their faith. Many Western countries including the United States recognise this method as humane in statute. Muslims and Jews believe that their method of slaughter when done properly with good standards is better than any other method available.

Labelling non-stunned meat and poultry

There are also strong calls from many quarters to label un-stunned meat and poultry. Although, HMC is in favour of labelling in principle, we feel the current calls are bias towards demonising un-stunned slaughter, rather than being in the interests of consumers.

Of course, every consumer has a right to know what they are eating, and therefore HMC calls on fair and impartial labelling, through the labelling of all meat and poultry and not only un-stunned. Let us label meat that has been shot with a captive bolt gun, gassed, electrocuted, drowned or mis-stunned, and then we can also label un-stunned, giving real information to consumers.

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By Rushdi Siddiqui

The New York Stock Exchange – Muslims working in non-Muslim countries do understand work is for work, even in Islamic finance, and informed non-Muslim colleagues understand basic tenets of Islam.

The New York Times recently interviewed several American Muslims, including me, working in the financial arena for the article, “Muslims on Wall Street, Bridging Two Traditions.” It explored two ‘conflicts’: Muslims working in conventional finance may encounter ‘interest’ against their faith, and challenges of abiding by Islamic ‘traditions’ in a secular workplace.

Today, it seems to an outsider, the burning issues for Muslims on Wall Street include prayer breaks, fasting and productivity, bonding after-office drinks, shaking a woman’s hand wearing a hijab, and structuring instruments dealing with (the prohibited) interest.

This cannot be what Muslims are about. Also, more credit must be given to working non-Muslim colleagues on understanding Muslim sensitivities.

Common Shared Values

Muslims, like other people with strong beliefs, do not see themselves exclusively focused on or defined by such  issues. Islam has spread throughout the world because of its dynamic nature, where it influences local customs and is ‘influenced’ by the older local culture.

Religion is a private matter and it’s looked upon as foundation for building inner discipline and external strength to address challenging situations. People of faith, like their secular colleagues, want to climb the corporate ladder and break the glass ceiling to get to the executive floor, if not the corner office. Muslims have been on Wall Street and High Street for many years, if not decades, and it’s only now they are being noticed. The difference between then and now is there are more Muslims in the financial sector and non-Muslim colleagues know more about Islam because of a combination of internet, 24-7 news, 9/11, documentaries, Dubai’s accomplishments, Islamic finance and personalities like His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai.

It should be noted that many Muslims were involved in the Occupy Wall Street movement because of common shared values. In the New York Times article there are two quotes that best summarise how Muslims, residing in
a non-Muslim country such as the US, should think about and approach a place of work and perception of fellow workers. “I think Muslim professionals are too sensitive and underestimate our co-workers,” comments a consultant in the article.

“Seek the opportunities and firms that speak to their set of values, expertise and passion,” said Mohammad Al Arian, CEO of Pimco.

Just as an employer interviews a potential employee, the latter also needs to interview the former.

I have worked at two multinational companies in the US, heading their Islamic finance business, in New York. First at Dow Jones Indexes for 10 years and now at Thomson Reuters.

A common denominator for international companies is their diverse employee base due to extensive international presence, including many Muslim countries. The corporate culture in these companies reflects common shared values formalised in codes of ethics. Thus, these companies understand ‘sensitivities’, and have high expectations of all employees.

As Muslims working in the West we do have a tendency to initially “underestimate our co-workers” in understanding our rituals (prayers, fasting, etc.), and our prohibitions (alcohol). While it could be attributed to many things, such as prejudices, with time there is a mutual understanding and respect.

The New York Times article used examples of Muslims finding places for praying during working hours or Friday prayers, and fasting during Ramadan. The article should have taken this one step further, and asked the Muslim worker about non-Muslim colleagues fasting or visiting a mosque.

Most, if not all, of us have non-Muslim colleagues who have fasted, some partially (till lunch time) and others until sunset. One of the great attributes of Americans is they like challenges, and will push the envelope of endurance. Others have visited mosques, and made observations such as “nothing fancy inside”, “where are the stained glass windows, pews, gold crescent and star?”

Maybe the article should have interviewed non-Muslims working in senior positions in Islamic finance in Saudi Arabia, the UAE or Malaysia on drinking alcohol, shaking hands with conservative women, breaking meetings for prayer time and so on. As senior executives, they are deemed ambassadors of the Islamic financial institution, and it does imply abiding by a certain level of Islamic code of conduct in public places.

Bottomline

The bottomline is that there is understanding and respect for rituals as long as teamwork, quality and deliverables are not compromised.

Muslims working in non-Muslim countries do understand work is for work, even in Islamic finance, and informed non-Muslim colleagues understand basic tenets of Islam. Muslims need to continue taking a pragmatic,
over dogmatic, approach to finding the balance between faith and finance.

This article was originally published in Gulf News. Siddique is the Global Head of Islamic Finance and OIC Countries at Thomson Reuters.

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The British “debate” about meat, animal cruelty and ritual slaughter has become a proxy for deep fears about Muslims in our midst.

I am sitting in one of London’s finest Indian restaurants, Benares, in the heart of Mayfair. I’ve just placed an order for the “Tandoori Ratan” mixed-grill appetiser – a trio of fennel lamb chop, chicken cutlet and king prawn.

I’ll be honest with you: I’m pretty excited. Most of the upmarket restaurants in London do not cater for the city’s burgeoning Muslim population. Benares is one of the few exceptions: all of the lamb and chicken dishes on its menu are halal.

The restaurant opened in 2003 and its owner, Atul Kochhar, is a Michelin-starred chef. “Right from day one, we’ve kept our lamb and chicken halal,” Kochhar says. “It was a very conscious decision because I grew up in India, a secular country, where I was taught to have respect for all religions.” Kochhar, who is a Hindu, says Muslims make up “easily between 10 and 20 per cent” of his regular diners. It isn’t just a taste for religious pluralism that has dictated the contents of his menu; serving halal meat makes commercial, as well as cultural, sense.

To other, perhaps less tolerant types, however, the rise and rise of halal meat in the west and here in the UK, in particular, is a source of tension, controversy, fear and loathing. British Muslims are living through a period of halal hysteria, a moral panic over our meat. First there came 9/11, 7/7 and the “Islamic” terror threat; then there was the row over the niqab (face veil) and hijab (headscarf); now, astonishingly, it’s the frenzy over halal meat.

Last month, MPs in the Commons rejected a ten-minute-rule bill that would have made it mandatory for retailers to label all of the halal and kosher meat on sale and make it clear on the packaging that the animals were “killed without stunning”. The bill’s proponent, the Tory backbencher Philip Davies, claimed that the meat was being “forced upon” shoppers “without their knowledge”. It was defeated by the narrowest of margins – 73 votes to 70.

As is so often the case, the right-wing press is behind much of the fear-mongering and misinformation. “Britain goes halal . . . but no one tells the public,” screamed the front-page headline in the Mail on Sunday on 19 September 2010. The paper claimed that supermarkets, restaurants, schools, hospitals, pubs and big sporting venues such as Wembley Stadium were “controversially serving up meat slaughtered in accordance with strict Islamic law to unwitting members of the public”.

The following week, readers were treated to two more stories suggesting a sinister plot to inflict halal meat on innocent, animal-loving, non-Muslim Britons. “How 70 per cent of New Zealand lamb imports to Britain are halal . . . but this is NOT put on the label”, said the Daily Mail on 25 September 2010. “Top supermarkets secretly sell halal: Sainsbury’s, Tesco, Waitrose and M&S don’t tell us meat is ritually slaughtered,” proclaimed the Mail on Sunday the next day.

With the threat from terrorism receding, Britain’s Islam-baiters have jumped on the anti-halal bandwagon, and not just the neo-fascists of the British National Party and the English Defence League, which has a page on its website devoted to its (anti-) “halal campaign”, but mainstream commentators, too. The Spectator’s Rod Liddle – who once wrote a column entitled “Islamophobia? Count me in” – has demanded that halal meat be banned and called for a boycott of Tesco, Asda, Sainsbury and the rest until they agree to stop stocking halal products. “I will buy no meat from supermarkets,” he wrote, rather melodramatically, back in 2010.

In this year’s French presidential election, candidates seemed to spend more time discussing halal meat than rising unemployment or the ballooning budget deficit. Marine Le Pen, leader of the Front National, alleged that “all the abattoirs in the Paris region sell halal meat without exception”, while the outgoing president, Nicolas Sarkozy, claimed that the halal issue was a “central concern” for French voters. (For the record, halal constitutes 2 per cent of all the meat sold in Paris.)

Last year in the Netherlands, the lower house of parliament approved a bill, introduced by the Party for the Animals (PvdD) and backed by the Islamophobe Geert Wilders’s Freedom Party, to have all ritually slaughtered meat, including halal and kosher, banned. The Dutch government refused to sign off on the bill but agreed to appoint a commission to consider tighter procedures for slaughter.

Stun guns

So, what is it about halal that provokes such anger and hysteria? The word literally means “lawful” and refers to any object – not just food – or action or behaviour that is deemed permissible under Islamic law.

For meat to be considered halal, three conditions must be met:

1) The animal must be healthy and uninjured and, crucially, it must be killed with a cut.
2) All the blood must be drained from the animal’s body.
3) The slaughterer must recite the appropriate Islamic prayer at the time of slaughter.

Islam, like Judaism, prescribes a single-cut method of slaughter: the animal is killed with a quick cut to the throat using a sharp knife. This allows the blood to drain out and, it is believed, makes the meat cleaner.

Naturally, the image of blood flowing out from the slit throat of a dead cow or sheep doesn’t help. But Muslims, like Jews, insist that so-called ritual slaughter is humane and pain-free because the animal quickly loses consciousness. “There is no time to start feeling any pain,” in the words of Dr Majid Katme, a former spokesman for the Muslim Council of Britain.

In contrast, modern western non-ritual methods of slaughter demand that the animal be rendered unconscious before it is killed – usually by means of stunning, with a bolt gun, or electrocution. The stunning of livestock before slaughter has been compulsory in the EU since 1979 but most member states, including the UK, grant exemptions to Muslims and Jews.

So, for the moment, non-stunned halal meat is available in Britain, but contra the Mail on Sunday, there’s not enough of it to satisfy the growing demand. As a Muslim, I often have great difficulty in deciding where to eat out, given the lack of halal restaurants (hence my excitement at Benares). One recent survey suggested nine out of every ten UK Muslims adhere to the strict rules on halal eating – that is, they reluctantly opt for the salmon, and not the steak, when eating out.

Nonetheless, even though they represent just 3 per cent of the population, Britain’s two million Muslims tend to eat much more meat, on average, than their non-Muslim counterparts. Reports suggest that British Muslims consume a fifth of all red meat sold in the UK.

I have British Muslim friends who book their holiday flights on Emirates, whatever their end destination, specifically in order to be able to stop off in transit in Dubai and buy a Big Mac from the airport’s halal McDonald’s. Some Muslims, it seems, will travel to the corners of the earth in pursuit of halal food.

Is it any wonder that the UK halal meat market is estimated to be worth £3bn? Or that fast-food chains in the UK such as McDonald’s and Domino’s Pizza are working on trials offering halal meat?

Nando’s, the Portuguese mid-market restaurant chain, has perhaps gone furthest and fastest. One in five of its branches in the UK now serves halal-certified chicken, and I never cease to be amazed by the sea of hijabs among the diners at the Nando’s in south Harrow that has been my “local” for the past decade.

Then there’s KFC, which has responded to the raft of halal fried-chicken franchises (see Sophie Elmhirst’s piece on page 28) by running a halal trial in a hundred of its restaurants nationwide. On its UK website, KFC promises its customers that “our food is just as tasty and finger lickin’ good as it has always been”. Perhaps unsurprisingly, it also includes a list of defensive answers to “frequently asked questions” such as “Why have you chosen my store?” and “Does this mean your animal welfare standards have changed?”.

Protecting animals is the cover behind which critics of halal meat often hide. This month, Professor Bill Reilly, a past president of the British Veterinary Association, condemned the rise in the number of animals killed in ritual slaughter as “not acceptable”. “[I]f we cannot eliminate non-stunning, we need to keep it to the minimum,” he wrote in the Veterinary Record. “This means restricting the use of halal and kosher meat to those communities that require it for their religious beliefs and, where possible, convincing them of the acceptability of the stunned alternatives.”

Opponents of ritual slaughter cite a raft of scientific studies that condemn the practice as painful and abusive. In a much-discussed report published in 2003, the Farm Animal Welfare Council (FAWC), an independent body that advised the UK government until its dissolution last year, argued that ritual methods of slaughter resulted in “significant pain and distress” for the animal and recommended that Muslims and Jews be banned from slaughtering livestock without stunning the animals first.

The FAWC’s findings were backed by a major EU-funded study “on issues of religious slaughter”, which concluded in 2010: “. . . it can be stated with the utmost probability that animals feel pain during the throat cut without prior stunning”.

Case closed? Not quite. Ruksana Shain, of the Muslim consumer group Behalal.org, says the scientific evidence against halal slaughter “isn’t conclusive”. But she would say that, wouldn’t she? OK. Well, consider the verdict of Joe Regenstein, professor of food science at Cornell University in the United States, who leads the university’s Kosher and Halal Food Initiative.

“Many of those attacking religious slaughter have no clue as to what is happening,” he tells me. “It is more of an Islamophobic issue, not an animal well-being issue.” Compared to modern, secular methods of slaughter, he says, “the traditional or Prophetic method might actually be equal or possibly superior” because the initial pain of the throat cut results “in the animal releasing large quantities of endorphins, putting it in a state of euphoria and numbness”. The cut thus serves as its own stun. The scientific evidence against halal slaughter, Regenstein says, “is extremely weak and has often been done poorly with an agenda driving a desired outcome”.

Missing defence

To pretend that Muslims do not care about animal welfare is unfair. There are several Quranic verses and sayings of the Prophet warning Muslims not to harm livestock; mistreatment of animals is considered a sin by the vast majority of Islamic scholars. In fact, advocates of halal slaughter can call on their own slew of scientific studies for support.

In 1978, research led by Wilhelm Schulze of the University of Veterinary Medicine Hanover showed that “the slaughter in the form of a ritual cut is, if carried out properly, painless in sheep and calves according to EEG [electroencephalography] recordings and the missing defensive actions [of the animals]”. The German Federal Constitutional Court based its 2002 verdict permitting ritual slaughter on this study.

Then there are the writings and research of Temple Grandin, professor of animal sciences at Colorado State University and one of America’s leading experts on the humane treatment and slaughter of livestock. She sees no difference between stunned and non-stunned slaughter if both are conducted properly and professionally. When a ritual slaughter is “done really right”, Grandin has said, “the animal seemed to act like it didn’t even feel it – if I walked up to that animal and put my hand in its face I would have got a much bigger reaction than I observed from the cut, and that was something which really surprised me”.

Remember, the “secular ways of slaughter”, as Regenstein points out, also have their downsides: “If the public were to discover that animals were subject to a pre-slaughter intervention – like having their skull cracked open, [being] electrocuted, or put in a gas chamber – they might not really like that either.” Shouldn’t consumers have a right to know which of these methods were used? Shouldn’t they be told about the danger of “mis-stunning”, which leaves the animal conscious and in pain, and occurs “relatively frequently”, according to a 2004 report by the European Food Safety Authority? Why not label all meat with detailed explanations of how exactly the animal in question was killed, and let consumers decide? “Why only pick on halal?” Ruksana Shain asks.

In the Commons debate on food labelling on 24 April, the Labour MP Gerald Kaufman, who is Jewish, criticised Philip Davies for singling out Muslims and Jews, saying he had “picked on two small minorities who share the way in which the meat they eat is killed”. However, Kaufman added that he would not have expressed his “total opposition to this bill” if it had cast its net wider to include other animals such as chickens that had been kept in “dreadful conditions”.

Preventing animal cruelty goes far beyond the “debate” about stunning or not stunning. And ironically, not all Muslims are opposed to stunning. There are two main organisations that regulate the halal food industry in the UK – the Halal Monitoring Committee, which has a “blanket ruling disallowing stunning in any form”, and the Halal Food Authority, which allows controlled stunning where the “animal or the birds do not die prior to slaughtering”, and which has certified KFC’s stunned chicken as halal.

Thus, most Muslim, and non-Muslim, participants in the heated debate over halal meat are ignoring a critical point. Data produced by the Meat Hygiene Service in 2004 suggested that roughly 90 per cent of halal slaughter in the UK involved stunning. In September 2011, the Food Standards Agency reported that “the majority of animals destined for the halal trade in both the red and white meat sectors are stunned before slaughter”. So what’s all the fuss about?

Consider the scare stories from the Daily Mail and Mail on Sunday, which automatically assume that all halal meat derives from the traditional,  non-stunned method of slaughter. What drove both papers’ coverage of the story? Are we seriously expected to believe that either the Mail or the Mail on Sunday gives a damn about animal rights? I struggle to recall the last occasion on which either tabloid splashed on the abuse or neglect of animals. More often than not, Mail columnists reserve rather harsh words (“deranged fanatics”, to quote Richard Littlejohn) for animal rights activists.

Crucially, if the hysteria over halal meat in Britain isn’t the product of Islamophobia, how do halal-obsessed politicians and journalists explain their silence on the subject of kosher meat? The 2003 Farm Animal Welfare Council report condemned both halal and kosher methods of slaughter. Yet, for instance, the Mail on Sunday, despite referring to “ritually slaughtered meat” in the headline of its “Britain goes halal . . .” report, went on to discuss only halal meat for the first 24 paragraphs of the piece before mentioning kosher meat – in passing – in the 25th paragraph.

The truth is that halal has become a proxy for much deeper fears and concerns about the presence of a growing and vocal Muslim population in our midst. “It’s being used as a political issue, especially by xenophobic and Islamophobic folks, to whip up a backlash against ‘the other’,” Regenstein says.

To pretend otherwise is naive, if not disingenuous. If this was a debate about animal welfare, it would be about all forms of slaughter; if it was a debate about ritual slaughter, it would address kosher, and not just halal, meat.

“Why only pick on halal?” It’s an important question in need of an urgent answer.

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Given they are barred from charging interest and must abide by a strict religious code, Islamic financial institutions are often dismissed by sophisticated western bankers as living in the dark ages. However, according to a couple of recent major reports, shariah-compliant financial institutions are not only coming of age, but also have much to teach their western counterparts.

In a report, Empowering Risk Intelligence in Islamic Finance: Managing Risk in Uncertain times, Deloitte’s Islamic Finance Knowledge Center said that the approach to risk management used in Islamic finance has more in common with the western approach than is often assumed.

The report – based on a survey of 20 Islamic financial institutions located across the Middle East and South-East Asia, which have aggregate assets of $50 billion – suggested that Islamic finance, a cash-rich sector, has much to teach the west’s financial system, which has yet to fully recover from the near-death experiences of 2007-09.

The Empowering Risk Intelligence report found that Islamic financial institutions came late to adopting formal approaches to risk management. 79% of respondents had established their risk-management departments in the past five years, with only 5% having a risk management department prior to 2002. But things are changing, and fast. The report found that 83% of Islamic finance firms today have both a formal risk-management function and a risk committee responsible for overseeing all risks.

Yet Deloitte acknowledged there is room for improvement in the risk management area. Key risk-management and regulatory challenges facing the Islamic sector include that two-thirds of Islamic financial institutions don’t have any external credit rating, and that only 25% have considered or received an external rating from a specialist Islamic rating agency such the Bahrain-based Islamic International Rating Agency. The report said:

“This constitutes a real challenge posed to industry participants and standard-setters such as the [Kuala Lumpur-based] Islamic Financial Services Board, [Bahrain-based] Accounting & Auditing Organization for Islamic Financial Institutions (AAOIFI), [Bahrain-based] International Islamic Financial Market (IIFM) and the Islamic International Rating Agency (IIRA), to enforce best practices.”

The report suggested that the main causes of shariah-compliance risks include non-standardized practices, diverse interpretations of shariah law, and the fact shariah laws are unenforced in many jurisdictions. Dr Hatim El Tahir, director of Deloitte’s Middle East Islamic Finance Knowledge Center, said:

“One thing is certain – the traditional operations and management of Islamic finance will need to change. Institutions offering Islamic financial services around the globe will not only need to deal with risk management but will also need operational effectiveness and a skilled workforce to empower risk intelligence in Islamic finance.”

The Deloitte findings came as an op-ed published by Project Syndicate, The Challenge of Islamic Finance, sang the praises of Islamic finance and suggested it has an important role in counter-balancing the bonus-fuelled procyclicality and morally hazardous nature of western finance.

Authors Andrew Sheng, ex-chairman of the Hong Kong Securities &  Futures Commission (and one of the voices of sanity in the movie Inside Job) and Ajit Singh, emeritus professor of economics at Cambridge University, said there is growing convergence between Islamic and western finance.

“Despite skepticism regarding accommodation between Islamic and global finance, leading banks are buying Islamic bonds [also known as sukuk] and forming subsidiaries specifically to conduct Islamic finance. Special laws have been enacted in non-Muslim financial centers – London, Singapore, and Hong Kong – to facilitate the operation of Islamic banks and associated financial institutions.”

Sheng and Singh argued that Islamic finance, already a $3 trillion sector, has an important role to play in improving the ethical framework of western-style finance (which, as everyone other than bankers and financiers recognizes, seriously lost its way during the credit bubble of 1999-2007).

They suggested that if the ethical values in Islamic finance, rooted as they are in shariah religious law, could:

“further deter moral hazard and the abuse of fiduciary duties by financial institutions, Islamic finance could prove to be a serious alternative to current models of derivative finance.”

“The test of any alternative financial system depends ultimately on whether it is – or can be –
more efficient, ethical, stable, and adaptable than the prevailing system.”For now, there is no Islamic global reserve currency and no lender of last resort. But the Islamic world is the custodian of huge natural resources that back its trading and financial activities.”

If the scenario outlined by Sheng and Singh is correct, prepare for the centre of gravity of global finance to shift from London and New York to the Gulf and Kuala Lumpur.

Ian Fraser, a journalist since 1988, is working on programmes about the banking and financial crisis for the BBC. He writes about business and finance for the Financial Times, the Sunday Times, the Independent on Sunday, the Daily Mail, and the Mail on Sunday. He is a visiting lecturer in financial journalism at the University of Stirling (since October 2009). Previous roles include business editor of the Sunday Times Scotland, financial editor of the Sunday Herald, deputy editor of Director, assistant editor of EuroBusiness and editor of internal publications at Unilever. He previously worked in the advertising industry in Edinburgh, London, and Paris. Ian graduated MA honours in English from the University of St Andrews.

Further reading on Islamic finance:

• Procedures for Reporting Financial Risk in Islamic Finance by Daud Vicary Abdullah and Ramesh Pillai

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The Guardian

For Muslim women hoping to combine stylish clothes with modest dressing, Vivienne Westwood protegé Barjis Chohan may have the answer. And with Muslim fashion worth an estimated £59 million globally, the rest of the fashion world is sure to follow

Barjis Chohan’s AW 2012 collection: ‘Young, fashionable Muslims are struggling to buy clothes from the Western, high-street shops’ Photograph: Barjis Chohan

It’s 2012. We’re bored to death with debates about the hijab. Why women wear it. Whether they are coerced into it. “Oh, but I bet they have a lovely head of hair under there”. SNORE. All this talk neglects the role of fashion in the hijab’s popularity. It’s just easier to be a fashionable Muslim in Britain these days – walk down Oxford street and stereotypes of the hijab as bland and restrictive are laughable. There are gaggles of friends wearing bright leopard print H&M shawls as a hijab, girls with a mountain of fabric piled up to create a beehive style hijab – hell, I even saw a lady wearing a glittery blue cardigan as a headscarf once (I saw the sleeve hanging out).

But mainstream brands seem reluctant to target Muslim women, so the hijab-wearing shopper has to be extra discerning on the highstreet. The whole outfit has to be considered. This means that unless you are wearing an abaya, you need to learn how to layer. Maxi dresses need a jacket, midi skirts need leggings or trousers underneath them and low-cut tops need a sufficiently long hijab. Barjis Chohan, a protegé of Vivienne Westwood, is looking to make things easier with her clothing label, Barjis. Chohan saw a gap in a market flooded with polyester abayas and over-embellished abayas that are impractical and only suitable for special occasions. “Young, fashionable Muslims are struggling to buy clothes from the Western, high-street shops, because of the unsuitable hemlines and necklines, and they resort to wearing layers, which are very hot and uncomfortable in the summer. So that is why I created Barjis, to fill this gap, with practical, high-quality, modest and fashionable day and evening wear for the busy, modern woman.” Her autumn/winter collection features abayas with peter pan collars and dresses designed to be worn over trousers.

The minimalist style of Barjis’ line is reminiscent of Zara’s ‘Studio’ range and the sleekness of maysaa.com. But is it that hard for a muslim to dress on the high-street right now? Last year maxi skirts and dresses were freed from the stigma of hideous boho-chic, thanks in part to Jil Sander’s spring/summer 2011 collection. With its sleek paperbag dresses, Sander’s influence still has the highstreet flooded with maxi skirts. Tapered chinos have trumped skinny jeans as the bottoms of choice, and more recently the Prada and Chanel autumn/winter 2012 shows included mostly dresses and long coats worn over trousers, which the highstreet will be sure to copy.Chohan’s research found that the global muslim fashion market is worth $96 million (£59 million) and with Harrods selling abayas, it’s no surprise that after Issa was bought by Camilla Fayed it featured headscarves and summery twists on the abaya. Of course, fashion fetishises trends as quickly as it discards them, but part of the joy of combining a dress-code with fashion is in searching for new combinations. We can’t all dress like Sheikha Mozah, who has her couture outfits adjusted for modesty, but it’s fun trying.

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From humble beginnings in the 1990’s, Islamic finance has become a trillion-dollar industry. And, despite scepticism regarding accommodation between Islamic and global finance, leading banks are buying Islamic bonds and forming subsidiaries specifically to conduct Islamic finance.

HONG KONG – With Britain now in talks to sell part of the government’s 82 percent stake in the Royal Bank of Scotland to Abu Dhabi sovereign-wealth funds, the Islamic world’s growing financial clout is once again on display. That clout also poses a systemic challenge to the dominant way that finance is now practiced around the world.

From humble beginnings in the 1990’s, Islamic finance has become a trillion-dollar industry. The market consensus is that Islamic finance has a bright future, owing to favourable demographics and rising incomes in Muslim communities.

Despite scepticism regarding accommodation between Islamic and global finance, leading banks are buying Islamic bonds and forming subsidiaries specifically to conduct Islamic finance. Special laws have been enacted in non-Muslim financial centres – London, Singapore, and Hong Kong – to facilitate the operation of Islamic banks and associated financial institutions.

How should these developments be viewed from the perspective of Western finance and mainstream economic analysis? Does Islamic finance really constitute a viable alternative financial system?

The very fact that such a question is asked nowadays is significant. Not so long ago, Islamic finance was superficially dubbed a zero-interest-rate system that would lead to inadequate and inefficient resource mobilization and utilization. Ironically, mainstream central bankers today routinely use precisely such policies when pursuing massive “quantitative easing.”

There are two central precepts of Islamic finance: absolute prohibition on charging interest on financial transactions, and high moral standards on the part of lenders and borrowers. Interestingly, the best economic rationale for a zero-interest-rate system is provided in John Maynard Keynes’s The General Theory:

Keynes suggested that only a very low or zero interest rate could ensure continuous full employment and distributional equity. Keynes’s endorsement of such a policy does not necessarily make it right, but his analysis does suggest that it should be regarded as a serious proposition.

Importantly, although interest is prohibited under Islamic finance, profit is not; the latter is derived from various arrangements that combine finance and enterprise. In essence, this is a profit-sharing and risk-sharing system that is based entirely on equity finance.

Islamic finance thus contrasts with the current dominant system based on interest-bearing debt, in which risks are theoretically transferred to debt holders, but in practice are socialized during crises. Other things being equal, most economists will agree that debt finance leads to greater instability than equity finance.

It follows from the second major tenet of Islamic finance that if people adhered strictly to its ethical requirements, there would be fewer moral-hazard problems in Islamic banking. Moral hazard exists in all systems in which the state ultimately absorbs the risks of private citizens.

But, whether any particular system is efficient in avoiding moral hazard is a matter of practice, rather than of theory. Many would agree that, historically, Christian morality played an important role in the rise of Western capitalism. Secular capitalism, however, has experienced an erosion of values, whereby the financial sector has put its own interests above those of the rest of society.  If the ethical values in Islamic finance – grounded in sharia religious law – can further deter moral hazard and the abuse of fiduciary duties by financial institutions, Islamic finance could prove to be a serious alternative to current models of derivative finance.

Moreover, the basic tenets of Islamic finance force us to re-think the ethical basis of modern monetary arrangements, which have evolved into a global reserve-currency system founded on fiat money. In the past, gold had been the anchor of monetary stability and financial discipline, even if it was deflationary.

Andrew Sheng, President of the Fung Global Institute in Hong Kong and Chief Adviser to the China Banking Regulatory Commission, is a former Chairman of the Securities and Futures Commission of Hong Kong. Ajit Singh is Emeritus Professor of Economics at Cambridge University.  This article is based on their forthcoming Cambridge Centre for Business Research Working Paper on Islamic finance.

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The Arab world today is home to millions of young people with hopes, plans and the desire to work. With more than 100 million young people between 15 and 29, representing 30 per cent of the total population, the region is facing an unprecedented “youth bulge”.

This reality has led to many challenges when it comes to youth employment – but it can also be seen as an opportunity to foster youth-powered positive change, using social networks and technology to create much-needed impact.

Today, there simply aren’t enough jobs for youth coming into the region’s labour markets. Public sector jobs are no longer a guarantee for graduates, and the private sector is unable to grow fast enough. For example, in Egypt 600,000 young people enter the labour market each year, but only about 250,000 of them find a job.

The result: millions of young adults are forced to make a living on their own through self-employment, despite low incomes. For many of these micro-entrepreneurs – who have very small, self-owned enterprises – the only thing standing between subsistence level income and thriving, sustainable businesses is a lack of reliable, affordable capital. But too many financial institutions see young people as a risk when it comes to loaning money.

It may be time for others to help fill the gap.

Even though young Arabs may still be looking for work, they definitely have found their voice. The advent of technologies such as the Internet, mobile phones and social media has provided young people with tools to help them make change happen. One way to drive change is to fund, engage and celebrate young people who are trying to make a living on their own, and show how we as individuals around the world can help foster change. Technology and social media play an important role in achieving this.

Accordingly, two organisations—Silatech, the Arab region’s largest youth microenterprise support provider, and Kiva, the world’s largest online microlending platform—have together created Kiva Arab Youth, an online platform that offers a way for people throughout the world to help young Arab entrepreneurs start or grow their businesses through small microloans of as little as $25. An example of how this works in practice is Shawgy, a 26-year-old man who lives in Taiz, Yemen.

He couldn’t afford an education and decided to start his own shop, which he has run for four years to help support his family. He wants to increase his sales to offer his parents a better future – but in order to do so needs to buy more products that offer his customers more variety. He lacks the capital to do this on his own, but a small loan will allow him to buy more products and increase his sales. Kiva lenders – ordinary people around the world – can make small contributions towards loans for individuals like Shawgy in the Arab world through Kiva’s online platform, which are matched by Silatech.

But this is only the start.

There is a clear opportunity for the creation of online peer-to-peer platforms in Arabic that connect charities, lenders and donors (in Arab countries and globally) — potentially including Islamic charitable giving— to self-employed young men and women from disadvantaged backgrounds. There is a growing movement in the Arab and Muslim worlds toward more strategic, capacity-building forms of charitable giving which focus on long-term, sustainable impact.

Sustainable giving models such as “revolving loan funds”(which are loaned, repaid and returned to the lender to be reinvested to help more people), or “social investments”(which direct investor attention towards projects which generate social, as opposed to purely financial, returns), provide an opportunity to use these technology platforms to enable more impactful giving. These can be created for the young, and potentially by the young as well.

If widely adopted by the Arab world, such technology initiatives could mobilise billions of dollars by re-focusing current streams of charitable giving. Forums like the World Congress of Muslim Philanthropists (WCMP), a global network of individuals, foundations and corporations advancing charitable giving, offer a significant opportunity to showcase potential solutions that increase engagement between donors and recipients and fund projects that have positive social impacts.

Organisations such as Silatech – through its stakeholders, sponsors and partners in Qatar and elsewhere in the Arab region – have an opportunity to spark such a discussion and influence strategies and mind-sets about innovative uses of technology, as well as new forms of social giving.

Opinion shapers, social entrepreneurs, religious figures and other influencers in the region should consider putting their support behind this and similar forms of sustainable social action.

* Ramakant Vempati is Senior Advisor and Justin Sykes is Manager for Social Innovation at Silatech.

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China’s legendary cuisine has been a secret weapon to winning many an investment. But when a major ingredient of the culinary experience is pork, hospitality can only go so far when it comes to entertaining Muslim businessmen from countries like Indonesia and the Gulf’s emirates.

How the Chinese have been able to adjust can be seen in Hong Kong, the international trade port that many of these business people go through on their way to mainland China.

Take a look at the Islamic Centre Canteen, just a few floors above the Wan Chai mosque. Wrapped up in the savory, little dumplings the canteen serves is the quintessential Hong Kong culinary experience, sans the pork. That kind of accommodation for Islamic dietary rules is growing, along with business prospects from the Muslim world.

In 2010, there were only 14 certified halal restaurants and markets in Hong Kong, advertised by visitor centers. In the past year alone, however, the number has almost tripled. Muslim community leaders have intimated that the Hong Kong government has collaborated with Islamic clergy to lure prospective Muslim guests with dining options. The Hong Kong Tourism Board reports that in recent years, the number of Middle Eastern visitors to the region has grown by as much as 20% annually.

One can often find tourists from the Middle East, Pakistan and Indonesia in the Tsim Sha Tsui district, where 13 of Hong Kong’s official halal restaurants are located. The tourists usually buy wholesale mobile phones — often knockoffs — manufactured at mainland factories for resale at home. “There has been an increase in halal restaurants in the past few years; not only that, but supermarkets are now serving lots of halal products,” says Wael Ibrahim, an Egyptian businessman who has lived in the greater China region for a decade and chairs Serving Islam, Hong Kong’s Muslim community organization. Ibrahim explains that promoting halal-food offerings is an effective way of “tightening the relationship between Hong Kong and other countries.”

Establishing Muslim-friendly services in China’s Hong Kong Special Autonomous Region may well be part of a multipronged attempt to establish a stronger business relationship between the natural-resource-rich Muslim world and the greater China region, which is in dire need of fuels for its burgeoning economy. “Mutually beneficial cooperations between China and the Muslim world are extremely important to China,” says Ma Hongjian, president of the Beijing-based China-Arab Council for Investment Promotion, explaining that since 9/11, trade partnerships between the two have skyrocketed because many Muslim businesspeople were unable to obtain visas to the West and instead started going to China in droves. “There are so many examples of the Chinese government trying to provide facilities for our Muslim guests,” says Ma, himself a Chinese Muslim.

In 2010, the mainland Chinese city of Guangzhou, which has become a hub for international Muslim businesses in recent years, hosted the Asian Games. Over half of the 45 participating nations were majority-Muslim countries and major sources of China’s oil and energy needs. For the occasion, the Guangzhou city government poured some $2.4 million into the construction of a giant mosque, a monument to the Prophet Muhammad’s uncle, Saad Ibn Abi Waqqas, who is traditionally believed to be entombed nearby. The government estimates that 30% of the food served at the games was certified halal.

More recently, Hong Kong has been trying to position itself as a conduit for Muslim business with the mainland. And it is not just by offering the business community more dining options but also by developing a strong platform for Islamic finance — which is compliant with Shari’a and prohibits usury, which many modern-day practitioners interpret to mean any form of interest. Investments in un-Islamic industries dealing, for example, in pornography, gambling and alcohol are also prohibited. “We hope to develop a wholesale Islamic capital market,” says a spokesperson for Hong Kong’s Financial Services and the Treasury Bureau. That would include Islamic bonds, known in Arabic as sukuk, which pay investors in assets to avoid, at least nominally, the exchange of interest.

Local Muslims are still skeptical. “We hear that [Hong Kong banks like HSBC] are studying about implementing Islamic finance in Hong Kong, but so far nothing major has materialized,” says Ibrahim of Serving Islam. Indeed, while the official policy of the Hong Kong government may be to welcome Muslim business to the region, perennial reports of workplace discrimination and harassment of Pakistani and Indonesian Muslims abound.

Hong Kong may work to offer Muslim visitors halal dumplings at the Islamic Centre Canteen in Wan Chai, but the city’s employers often refuse to let Muslim migrant workers practice their religion as desired. Sullying Hong Kong’s name in Indonesia late last year, two live-in Indonesian domestic workers were reportedly forced to eat pork and take off their headscarves by Hong Kong employers, according to the Jakarta Post. They also told the newspaper that they no longer prayed five times a day. “There’s no time, and the employers always complain, so we just gave up. It’s easier that way.”

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