The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) Governance and Ethics Board (AGEB / the board) approved in its 33^rd meeting the issuance of the governance standard (GS) 17 “Shari’ah Compliance and Fiduciary Ratings of Sukuk and Other Islamic Finance Instruments”.

This standard is a continuation of and complements AAOIFI GS 10 “Shari’ah Compliance and Fiduciary Ratings for Islamic Financial Institutions”. It sets out principle-based guidance on Shari’ah compliance and fiduciary ratings of Sukuk and other Islamic finance instruments.

This standard addresses various significant aspects including but are not limited to key compliance requirements applicable to rating agencies, assessment scope and benchmarked parameters, as well as, documentation, archiving and confidentiality.

Mr. Farrukh Raza, chairman of AGEB stated that “the issuance of AAOIFI GS 17 “Shari’ah Compliance and Fiduciary Ratings of Sukuk and Other Islamic Finance Instrument” is an important step taken towards supporting the Islamic finance industry development on strong footings. I am confident it will contribute to the implementation of good governance practices for rating agencies which will eventually enhance stakeholders’ confidence in the Islamic finance instruments”. He added that “we highly appreciate the efforts and time devoted by the board, working group, and the secretariat in developing this standard despite their eventful work agendas and industry engagements”.

On this occasion, Mr. Omar Mustafa Ansari, Secretary General, AAOIFI stated that“I would like to extend my sincere appreciation to the board and relevant working group for their dedication and remarkable commitment. I would like also to thank Islamic International Rating Agency (IIRA) for their support in the development of this standard”. He added that “during the year, three public hearings in English and one in Arabic language were held as part of the standards development process to obtain industry feedback and benefit from the knowledge and experience of industry stakeholders such as rating agencies, Shari’ah scholars, professionals, regulators and academicians. Our public consultation process ensures the issuance of high-quality standards”.

AAOIFI GS 17 “Shari’ah Compliance and Fiduciary Ratings of Sukuk and Other Islamic Finance Instruments” can be accessed by CLICKING HERE.