Women’s role in Islamic finance and why work flexibility matters.

The fast-growing Islamic finance sector, and the financial industry, has traditionally been dominated by men. With the rise on Fintech, are we going to be seeing the same pattern of male domination? Recent headlines are full of praise for female leadership in the Covid-19 pandemic, with Jacinda Ardern leading the way, one should ask why aren’t there more women in senior roles and most importantly why aren’t more women applying for these positions? 

To normalize women in management positions in companies, one must acknowledge the professional differences when it comes to women and men. A well-known research study by Hewlett Packard found that women would only apply for a position once they met 100% of the criteria. On the other hand, men were more confident and would apply when they just met 60% of the requirements (Harvard Business Review). 

A woman’s role in Islamic finance should not be any different to a woman’s role any other financial career. Women have always played influential roles in Islamic history from policy making, medicine to finance. Islamic finance is not a man’s world, rather it is an ethical guideline put in place to serve a better and more thriving community where people can engage in economic activities while upholding socio-economic justice. Everyone is a stakeholder in this.

In a time of petty discussions over where a woman’s place in the professional world is, one must remember Khadija Bint Khuwaylid, the first wife of Prophet Muhammed, peace be upon him. She was a trader of substantial wealth, who had a great reputation for fair trading throughout Arabia. Khadija had employed Muhammed (pbuh) and sent him on various business trips representing her before she later married him. Khadija was also a philanthropist and contributed to various charity projects. 

Another account of women in senior roles, was in the time of the Caliph Omar. Under the ruling of Omar, who was known to be fiercely fair and just man, he had appointed Shifa bint ‘Abd Allah, as a market inspector and would consult her in matters regarding the market. Shifa’s responsibilities included supervision of market activities and ensure that trade conformed to Islamic values. There was also another female appointed as a market inspector, which suggests that women were involved in market activities, over a thousand years ago in Arabia.

Years later, segregation became an obstacle for women to move around in society and we saw an adoption of agents or people representing women. It was through this new system where women, who had time to reflect, learnt new skills and many would manage their husband’s wealth, and so they become known for philanthropy and sponsoring endowments such as hospitals, schools, and charities. 

Today, when it comes to securing financing or females applying for senior roles in the industry, women face more obstacles than men. According to a 2018 report, McKinsey found that males and females begin their finance careers on equal footing, but as time goes on, women only account for 19% of the executive and senior positions.

There is big demand amongst women for better working hours to balance professional and family life. Although the Covid-19 pandemic has forced people to revaluate working conditions and allow more remote working around the 9-5, the current job market is not a flexible one. To have more women onboard, positions should appeal more to women therefore a first step that can be taken to change this narrative is by offering more flexible working hours to candidates. According to a survey by Timewise, – a staggering estimated 87% of employees want to work flexibly. Employees, and especially women, compromise to get the flexibility they need, or even end up abandoning their professions. These potential workers trade down for better working hours and this results in not only a loss of skills, but also businesses missing out on competent candidates. 

Financial rewards as attractive and motivating as they are, are not the only factors that drive women. Neuroscientists have found that men become so rewards orientated even when there is a small probability of actual gains. Men, not only take more risks than women, under pressure also appeared to be more bullish about the chance of winning. The study found that males are less risk averse than the female participants.  Women, in the same situation, become more risk-alert under stress and go for the guaranteed smaller wins. Women would do well in Islamic finance as they are smaller risk takers than men, therefore would be compliant in following sharia principles. Profit should always be accompanied by risk but also responsibility.

Malaysia is a great example of this, where women account for33% of the senior management positions, according to Grant Thornton International Business Report: Women in Business 2020. Most notably is Dr. Zeti Akhtar Aziz, the former Governor of Bank Negara Malaysia. The UK being the European hub for Islamic finance and a leading centre for Islamic finance outside the Muslim world, should be the first to lead the way and strive to have more women on boards and in senior positions within Islamic finance institutions.

Women and men have different approaches to finance, and now more than ever we need different attitudes in navigating Islamic finance to see it flourish. Fintech would be a great starting point as a relatively new branch of finance that has great and growing potential. The lack of women in senior roles in the financial industry is not a new issue, but perhaps Islamic finance can lead the way by opening more positions for female candidates in the field.

The fast-growing Islamic finance sector, and the financial industry, has traditionally been dominated by men. With the rise on Fintech, are we going to be seeing the same pattern of male domination? With the recent headlines full praise for female leadership in the Covid-19 pandemic, with Jacinda Ardern leading the way, one can ask why aren’t there more women in senior roles and most importantly why aren’t more women applying for these positions? 

To normalise women with senior positions in companies, one must acknowledge the professional differences when it comes to women and men. A well know research study by Hewlett Packard found that women would only apply for a position once they met 100% of the criteria. On the other hand, men were much more confident and would apply when they just met 60% or the requirements (Harvard Business Review). 

A woman’s role in Islamic finance should not be any different to a woman’s role any other financial career. Women have always played influential roles in Islamic history from policy making, medicine to finance. Islamic finance is not a man’s world, rather it is an ethical guideline put in place to serve a better and more thriving community where people can engage in economic activities while upholding socio-economic justice. Everyone is a stakeholder in this.

In a time of petty discussions over where a woman’s place in the professional world, one must remember Khadija Bint Khuwaylid, the beloved first wife of the Prophet Muhammed, peace be upon him. She was a trader of substantial wealth, who had a great reputation for fair trading throughout Arabia. Khadija had employed Muhammed (pbuh) and sent him on various business trips representing her, and she later married him. Khadija was also a philanthropist and contributed to various charity projects. 

Another account of women in senior roles, was in the time of the Caliph Omar. Under the ruling of Omar, who was known to be fiercely fair and just man, he had appointed Shifa bint ‘Abd Allah, as a market inspector and would consult her in matters regarding the market. Shifa’s responsibilities were to supervise market activities and ensure that the trade conformed to Islamic values. There was also another female appointed as a market inspector, which suggests that women were involved in market activities, over a thousand years ago in Arabia.

Years later, segregation became an obstacle for women to move around in society and we saw an adoption of agents or people representing these women. It was through this new system where women, who had time to reflect, learn new skills and many would manage their husband’s wealth, that they become known for philanthropy and sponsoring endowments such as hospitals, schools, and charities. 

Today, when it comes to securing financing or females applying for senior roles in the industry, women face more obstacles than men. According to a 2018 report, McKinsey found that males and females begin their finance careers on equal footing, but as time goes on, women only account for 19% of the executive and senior positions.

There is big demand amongst professional women for better working hours to balance professional and family life. Although the Covid-19 pandemic has forced people to revaluate working conditions and allow more remote working around the 9-5, the current job market is not a flexible one. To have more women onboard, positions should appeal more to women therefore a first step that can be taken to change this narrative is by offering more flexible working hours to candidates.

According to a survey by Timewise, – a staggering estimated 87% of employees want to work flexibly. Employees, and especially women, compromise to get the flexibility they need, or even end up abandoning their professions. These potential workers trade down for better working hours and this results in not only a loss of skills, but also businesses missing out on competent candidates. 

Financial rewards as attractive and motivating as they are, are not the only factors that drive women. Neuroscientists have found that men become so rewards orientated even when there is a small probability of actual gains. Men, not only take more risks than women, under pressure also appeared to be more bullish about the chance of winning. The study found that males are less risk averse than the female participants.  Women, in the same situation, become more risk-alert under stress and go for the guaranteed smaller wins. Women would do well in Islamic finance as they are smaller risk takers than men, therefore would be compliant in following Sharia principles. Profit should always be accompanied by risk but also responsibility.

Malaysia is a great example of this, where women account for33% of the senior management positions, according to Grant Thornton International Business Report: Women in Business 2020. Most notably is Dr. Zeti Akhtar Aziz, the former Governor of Bank Negara Malaysia. The UK being the European hub for Islamic finance and a leading centre for Islamic finance outside the Muslim world, should be the first to lead the way and strive to have more women on boards and in senior positions within Islamic finance institutions.

Women and men have different approaches to finance, and now more than ever we need different attitudes in navigating Islamic finance to see it flourish. Fintech would be a great starting point as a relatively new branch of finance that has great and growing potential. The lack of women in senior roles in the financial industry is not a new issue, but perhaps Islamic finance can lead the way by opening more positions for female candidates in the field.

Khadiga Elmanea
Author:
Khadiga is currently completing her MA in Islamic Finance and Economics at Istanbul Zaim University. She is passionate about education, economic development and start-ups. In her free time Khadiga enjoys reading, photography and discovering new brunch places.