Governor Dr. Zeti Emphasises Value of Continuous Education as IBFIM Launches Latest Skills Upgrading Programme (by MIFC)

An important part of the human talent development function is continuous education and upgrading of skills and competencies - from senior management to down the chain. This is the message which Bank Negara Malaysia's Governor Dr. Zeti Akhtar Aziz stressed in her keynote address at the launching in December at Sasana Kijang of the latest such initiative, Islamic Banking and Finance Institute Malaysia (IBFIM) Islamic Finance Qualification Framework & Progression Route (IFQFPR), which focuses on 'Talent Development in Islamic Finance over the Next Decade'.

According to IBFIM, IFQFPR is an innovative training framework that provides a progressive structured route to the acquisition of the relevant knowledge for the different levels throughout the career of the workforce in the industry. Successful completion of the comprehensive series of programmes would lead to qualifications at three different levels. The modules of the programmes have been developed with extensive consultation with the industry. The framework also offers flexibility in learning, as participants can complete the modules at their own pace.

"Important in the offering of these programmes," explained Dr. Zeti, "is that there needs to be clarity in the qualification that is earned so that it avoids confusion with other qualifications offered by other centres of learning to those practitioners aspiring to gain qualifications in Islamic finance. Our resources for investment in human capital development for the industry must be optimised. This would enhance Malaysia's potential to become a centre of excellence for education in Islamic finance."

Islamic finance is the most rapidly growing financial market segment not only in Malaysia but also in several other jurisdictions. As such, advised Dr. Zeti, in a highly dynamic and challenging environment, talent development for the financial services industry has become an even more important agenda to ensure that its growth and development is supported by the necessary skills and capabilities.

Malaysian Islamic financial system is the most progressive, comprehensive and competitive. The market share of Islamic banking assets of total banking industry has grown from only 6.9 per cent in 2000 to 22 per cent in 2011. Islamic finance accounted for 2.1 per cent of GDP in 2009, as compared to only 0.3 per cent in 2000. This has led to greater job creation where employment in Islamic financial industry accounts for 11 per cent of total employment in the financial sector. Malaysia of course has also opened up its Islamic finance market to foreign players, and Malaysian Islamic financial institutions at the same time are expected to expand beyond national boundaries to increase economic and financial linkages with other parts of the world in the pursuit of more competitive returns and rewards.

"This rapid internationalisation of the financial system and technology advancement," maintained Dr. Zeti, "will demand a corresponding increase in quality skills and expertise of the industry. Talent upscaling will be even more important in the next decade, to steer the industry's advancement in the increasingly complex and competitive financial ecosystem. A strong and dynamic workforce will be one of the important pillars for the industry to remain stable and competitive. It will also serve as a catalyst to spur innovation."

BNM anticipates that over the next 10 years, a workforce of about 200,000 employees would be required, which is an increase of 56,000 people from the current 144,000 employees. There will therefore be strong demand across the financial sector, particularly for specialised skills in high growth and niche areas such as wealth management, Shariah advisory, corporate finance and investment advisory services.

Dr. Zeti identified several challenges for human capital development in the Islamic finance industry going forward:
• Human capital development needs to be comprehensive and holistic in meeting the requirements for all levels. It must meet the specific requirements of the workforce career progression, from the pre-employment stage, during employment and up to the leadership positions. Talent development solutions must also be for beyond the circle of the financial services community, to include other business communities, such as legal fraternity, Government officials and IT solution providers.
• The education and training programmes in Islamic finance needs to achieve the highest quality, be credible and globally recognised. To ensure the standards, the required infrastructure for standard setting and accreditation for Islamic finance training and education has now been put in place. The Asian Institute of Finance (AIF) is ready to provide accreditation to training programmes offered by training institutes following a rigorous assessment under the new Assessment and Accreditation Framework and to ensure the highest standard of the trainings offered. The Association for Chartered Islamic Finance Professionals, a body entrusted to raise the quality standards and professionalism of Islamic finance practitioners, would also contribute to achieve this objective.
• There needs to be greater partnerships and collaboration between the industry and academia to align training and development with the requirements of the industry. Greater involvement by the financial institutions is needed in designing the academic and training curriculum, and providing real business exposure and training through internship and sharing of experiences. Industry-universities partnership can also take the form of "summer school" programmes that emphasise on practical aspects of Islamic finance via business operation simulations. More structured continuous learning programmes are also needed for practitioners to sustain their professional competencies.
• Research is an important investment for long-term competitiveness of the industry and is a key driver for greater innovation. Joint research initiatives should extend beyond geographical boundaries, with cross-border initiatives and convergence of ideas. Further in-depth research on contemporary Shariah issues relating to risk mitigation, liquidity management and hedging would facilitate the generation of new ground-breaking developments in Islamic finance. Greater involvement of the industry is essential not only to provide funding support, but also to give perspectives that contribute to the implementation of the research output.