The Institute’s authority depends upon its independence. That independence is protected not only by how the Institute is governed, but by how it is funded — in both the amount it accepts from any source and the character of the source itself. This page sets out the funding on which the Institute operates and the safeguards that attach to it.
How the Institute is funded. The Institute is funded principally through [an endowment / a waqf — Institute to confirm the legal form] established to sustain its operations at arm’s length, supplemented by sponsorship within defined categories and, to a lesser extent, by accreditation fees paid by advisory firms. No single element of this funding confers any influence over the Institute’s standards, its accreditation decisions, or any determination issued through an accredited firm.
The permissibility of funding sources. As a body concerned with Shariah compliance, the Institute holds that the sources of its own funding must themselves be consistent with Shariah. The Institute does not accept funding from sources that would compromise this principle. In particular, it declines funding derived substantially from interest-based lending (riba), from activity of a gambling or unlawful speculative character (maysir), or from sectors impermissible under Shariah. The thresholds by which a source is assessed are set by the Institute’s Shariah committee, with reference to recognized Shariah screening standards, such as those issued by AAOIFI. [Shariah committee to confirm the applicable thresholds.]
Categories of funder. The Institute classifies funders as follows:
- Unrestricted — charitable foundations, endowments, and philanthropic contributors that hold no interest in the Institute’s determinations. Funding from this category is subject to the general safeguards below.
- Restricted — industry participants that do not have a matter before the Institute and are not seeking a determination or accreditation. Funding from this category is accepted only subject to the general safeguards, per-funder limits, and full disclosure.
- Declined — any party with a matter currently under review or accreditation; any party whose funding is offered on condition of an outcome; and any source assessed as impermissible under the standard described above.
Safeguards. The following apply to all funding accepted by the Institute:
- A limit on concentration. No single funder may provide more than [10% — provisional; Institute to confirm] of the Institute’s annual operating income, so that the Institute does not become dependent upon any one source.
- A covenant against influence. Every contribution is accepted subject to a written covenant under which the funder acknowledges that it acquires no role in, and no influence over, the Institute’s standards, accreditation, or determinations.
- A prohibition on conditioned funding. The Institute does not accept funding offered on condition of any determination, classification, or accreditation outcome.
- No representation of endorsement. Support for the Institute does not constitute endorsement of the funder, and a funder may not represent its support as bearing upon any determination or classification.
- Separation from review. Funders have no access to, and no part in, the review of any asset or the accreditation of any firm.
Disclosure. The Institute maintains a public register of its funders, updated [annually — provisional; Institute to confirm cadence], so that any party may examine the sources on which the Institute operates. The Institute regards this disclosure as a condition of the trust it asks others to place in it.