Innovation and the Islamic Economy

A commonly held misperception with regard to Islamic Economy sectors is that they are a compendium of old concepts and instructions that lack novelty and innovation.

Islamic Economy's detractors doubt its ability to keep up with dynamic market realities and its resilience in shaping a progressive and impactful ecosystem. Looking closer, we realise that the focus on regulations and standards in an Islamic economy governing businesses and defining their objectives and outcomes, might well have nurtured such doubts to begin with.

However, we need to ask ourselves whether ethics are incompatible with innovation after all. Also, is the humanitarian element of Islamic economy standards confined to a time period in the past? Furthermore, can innovation and compliance with Islamic sharia-standards coexist to ensure that Islamic economy retains the much-needed dynamism imperative for organic growth?

Looking at the bigger picture, we realise that innovation is not an absolute concept and is certainly not confined to any specific period in history - innovation is therefore as limitless and timeless as the imagination.

Innovation represents our ability to commit to the ethics of business, while continuously adapting our standards, and expanding our horizons to accurately evaluate any new idea. Innovation enables us to judiciously decide whether to embrace a new idea or reject it - based on our assessment of past experiences and lessons learnt. In addition, innovation bases itself on the compulsive human need to build a safe and sustainable future.

Now that we have established the prerequisites for innovation, we realise that the Islamic Economy - as an ecosystem - is an innovation in itself. One that combines modernity and tradition, and seamlessly links diverse sectors ranging from finance to halal products. In doing so it demonstrates a unique resilience to meet current challenges and is considered amongst the most prominent innovations that the economic landscape has witnessed in decades.

Based on a new economic theory, the Islamic Economy has presented the world with an alternative economic system that did not gain momentum prior to the launch of the Dubai: Capital of Islamic Economy initiative. Replete with new and original ideas, this innovation is rich in lessons and experiences extracted from history - not isolated from it.

The efforts made by the Islamic economy ecosystem to adopt ethical working practices clearly reflects the boldness and responsibility of this innovation. Islamic economy triumphs over its conventional counterpart that focused on instant profits even at the cost of future imperatives.

Responsible innovation offers solutions to the challenges ahead rather than overlooking them. It commits to the common good rather than to the interests of a select few and seeks sustainability through achieving a paradigm shift in outdated laws. Global financial crises are the outcome of selfish and unethical practices and the social gap that continues to exist in several countries to this day is a case in point.

This premise holds true not only with regard to finance, but equally for climate change, threats to water and food security, and the challenge of depleting human resources. All of these are undoubtedly modern issues. Stable economies and secure and responsible investments that ensure positive social impact are critical as they eliminate poverty, ignorance and unemployment. These factors triggered the innovation of the Islamic economy framework that represented a clear and specific mission - to ensure change while simultaneously driving economic development and social stability.

Responsible innovation reflects the relation between an individual and a business entity that transcends stereotypical functionality or the security of a pay check. The relationship between an individual and an institution working within the Islamic economy ecosystem is based on a sense of belonging and collaboration in offering wholesome, value-added services and products to the community. It is nurtured by the individual's loyalty and commitment to the institutions that form the bedrock of society. Ultimately in such a system, the individual is responsible for innovating to ensure the growth and development of social institutions.

At the same time, institutions that represent the Islamic economy must encourage their employees to innovate through offering appropriate incentives and providing them with a healthy work environment that prioritises their safety, rights and financial security. In addition, these institutions must nurture a culture of responsible work, through demonstrating for employees how their work has a tangible positive impact on individuals and the society at large.

Innovation in a new economic ecosystem - such as the Islamic Economy - offers far greater potential for sustainable economic development than the conventional economic system. The latter overconsumed its resources and exhausted any possible solutions that could have stemmed from its culture and regulations - through resisting change and development.

The Islamic Economy has proven itself to be deeply receptive to innovative suggestions and offers scope for unlimited possibilities. All its sectors, ranging from institutions to financing and investment tools, are structured to welcome and embrace change and inherently based on ethical values and a system of transparency.

When we speak of innovation, we need to undoubtedly focus on shaping skilled human resources - for our own ease of understanding this refers to the youth and the generation that will drive the growth of the Islamic economy ecosystem. These resources, more than any other, need to be empowered with new technologies. They need to innovate to produce, manage, manufacture and shape synergies across diverse sectors. After all, as we have already established, innovation is a natural outcome of an open mind that is committed to the goals of Islamic economy.

Given these requirements, the education sector has a significant role to play in driving innovation across the new economic system. Academic curricula should empower students with the ethics of Islamic economy as well as sound business ethics. Educational and training programmes should be designed to inculcate trust in the potential of Islamic economy - and in its ability to overcome the challenges and respond efficiently to the disruptive changes of the modern era.

We consider the Islamic Economy a synergetic ecosystem that ensures knowledge transfer across sectors - the economy, laws, Fiqh and social sciences. The ability of this sector to gather disparate elements and thread them together in one cohesive chain, will produce a new generation of smart individuals who are knowledgeable, well educated, confident of their abilities, and capable of innovation. They will add value to the Islamic Economy ecosystem in particular, and to the global economy as well.