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Ann Black, Hossein Esmaeili and Nadirsyah Hosen

This well-informed book explains, reflects on and analyses Islamic law, not only in the classical legal tradition of Sharia, but also its modern, contemporary context. The book explores the role of Islamic law in secular Western nations and reflects on the legal system of Islam in its classical context as applied in its traditional homeland of the Middle East and also in South East Asia. Written by three leading scholars from three different backgrounds: a Muslim in the Sunni tradition, a Muslim in the Shia tradition, and a non-Muslim woman – the book is not only unique, but also enriched by differing insights into Islamic law.
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Dawood Ashraf and Mohsin Khawaja

explanation for the existence of multiple shariah screening criteria is related to operational difficulties in the modern capital markets. For example, dealing in a transaction involving interest (riba) is forbidden in Islam. However, a purist approach with zero tolerance to riba may result in a very small investable universe for faith-adhering Muslims (Obaidullah, 2005; Derigs and Marzban, 2008). Under these circumstances, shariah scholars have allowed investment in the equity of those corporations which are below a pre-set level of specific financial ratios. The rationale

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Asad Zaman

. Human resources: Recognition of the importance of human beings in the process of wealth creation has led to the emergence of the field of ‘human resource management’, and a World Bank study (2006) showed that resources embodied within human beings are worth more than the natural resources. Wealthy nations are wealthy because their populations are more skilled. Yet it is a travesty to consider human beings as a means of production of wealth. Islam considers that every human being is infinitely precious, a lesson not within the ambit of these Western calculations

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Saiful A. Rosly

, in return for the right to earn a profit from the sale. Such taking of risks in financial transactions may require a critical look at the existing modern secular financial infrastructure that was primarily designed for the interest-based financial system. It may not work well with the conception of al-bay that warrants Islamic finance for the selling party to take ownership risk of assets they intend to sell on credit. This chapter attempts to argue that an organized effort to avoid such risks due to the financial infrastructure rigidities may invite non

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Adelina Zuleikha and Shamsher Mohamad

investment in the real sector whereas the conventional system offers interest as the return. As a wealth re-distribution tool faraid provides a wider scope of wealth distribution from the deceased’s property. The more people have a share of the wealth the more people contribute to production activities. ARIFF 9781786439383 PRINT.indd 301 01/12/2017 13:58 302 Islamic wealth management The increase in production activities leads to higher employment rates, increases the income distribution in society and accordingly increases the wealth allocation for consumption and

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Raphie Hayat and Celia de Anca

driven for example by lower discount rates because of (1) lower litigation risk related to Environmental Social and Governance (ESG) criteria (Renneboog et al., 2008), (2) better access to external finance (Cheng et al., 2014) or (3) more favorable recommendations from equity analysts (Luo et al., 2014), but an Islamic label does not say anything explicit about ESG criteria. Thus, it seems that an Islamic label, although very important to Muslims, is financially a meaningless label. This view fits well with recent research that investors react to financially

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Kaouthar Gazdar, Rihab Grassa and M. Kabir Hassan

formal legal rules (level 2), but the formal legal rules are the results of informal institutions (level 1). Stulz and Williamson (2003) argue that culture can affect finance through at least three channels: (1) the values that are predominant in a country depend on its culture. For example, interest rate is prohibited by Islam. (2) Culture affects institutions. The legal system is influenced by cultural values and (3) affects how resources are allocated in an economy. In fact, a religion that encourages spending on churches or guns takes resources away from investment

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Mohd M. Billah, Ezzedine GhlamAllah and Christos Alexakis

practices are free from the elements of Riba and other un-Islamic elements, but they revolve around the elements of al-Mudharabah, al-Tabarru’ and other Shari’ah justified elements. Insurance practices involve Riba (interest) and some other elements, which may not be justified by the Shari’ah principles. Extra Risk Premiums Generally, the premium rates imposed are fixed by the actuarial evaluation, and no one is discriminated against by foreseeable extra risk. Hence, no one shall be required to pay an extra premium over the fixed one. However, if a particular