Common conceptual flaws in realizing maqāṣid al-Sharīʿah vis-à-vis Islamic finance

Abstract

Purpose

This paper aims to scrutinize the misconceptions about maqāṣid al-Sharīʿah (objectives of Islamic law) that complicate its actualization, particularly in Islamic finance.

Design/methodology/approach

This study adopts a qualitative inductive method to identify the flaws in understanding maqāṣid al-Sharīʿah vis-à-vis Islamic finance. It uses the views of classical and modern maqāṣid scholars to critically examine the flaws.

Findings

This study concludes that the five objectives of the Sharīʿah constitute the framework of maṣlaḥah (well-being). The levels of maṣlaḥah ― namely ḍarūriyyāt (essentials), ḥājiyyāt (needs) and taḥsīniyyāt (embellishments) ― are the categories of the means to ends. The demand for financial products falls under the ḥājiyyāt and taḥsīniyyāt categories, not ḍarūriyyāt. The maqāṣid (objectives) are derived from aḥkām (provisions) being verified by the parameters, while aḥkām are guided by maqāṣid.

Research limitations/implications

This study recommends further research to theorize the concepts of ḍarūriyyāt, ḥājiyyāt, taḥsīniyyat and mukammilāt (complements); to harmonize the maqāṣid with their essential elements and to formulate a conceptual framework for actualizing maqāṣid al-Sharīʿah in Islamic finance.

Practical implications

This paper will improve perceptions and bridge gaps between the understanding of maqāṣid theory and existing practices. It suggests that instead of ḍarūriyyāt, Islamic financial institutions (IFIs) should refer to ḥājiyyāt and taḥsīniyyāt.

Originality/value

This paper identifies and clarifies the misconceptions about maqāṣid al-Sharīʿah vis-à-vis Islamic finance in the existing literature. The findings align with the views of leading maqāṣid scholars in understanding the idea.

Citation

Al-Nahari, A.A.A.Q., Monawer, A.T.M., Haji Abdullah, L.B., Ali, A.K.B., Abdul Rahman, N.N.B. and Achour, M. (2022), "Common conceptual flaws in realizing maqāṣid al-Sharīʿah vis-à-vis Islamic finance", ISRA International Journal of Islamic Finance, Vol. 14 No. 2, pp. 190-205. https://doi.org/10.1108/IJIF-12-2020-0259

Introduction

Maqāṣid al-Sharīʿah (objectives of Islamic law) play a significant role in defining the legality of Islamic dealings as those maqāṣid decide the relationship between human behaviour and its effect on public welfare (Ariff and Rosly, 2011). Hence, scholars stress the need for fuqahāʾ (Muslim jurists) to master the knowledge of maqāṣid al-Sharīʿah in order to perform ijtihād (utmost intellectual effort to make a decision) (Saifuddeen et al., 2014). The knowledge of maqāṣid al-Sharīʿah concerning financial transactions can guide the Sharīʿah boards of Islamic banks and fiqh boards of international Islamic organizations (Ibn Zughaybah, 2001; Al-Qahtani, 2015; Kholisha et al., 2020). Perhaps it is for this reason that the theory of maqāṣid al-Sharīʿah has been recently adopted as the guideline in regulating Islamic financial institutions (IFIs) to comply with the moral standards and virtuous consciousness encouraged by Sharīʿah (Islamic law).

The essence of maqāṣid al-Sharīʿah is the well-being (maṣlaḥah) of humanity. The Sharīʿah has high regard for economic wealth and considers it as one of the five primary objectives that lead to social well-being (El-Mesawi, 2006). Since the era of Imām al-Ghazālī, there has been a consensus among all scholars ― comprising fuqahāʾ and uṣūliyyūn (scholars of Islamic legal theory) ― on the preservation of wealth as the fifth essential (ḍarūrah) of human beings (Al-Qaraḍāwī, 2008a). Maqāṣid al-Sharīʿah in Islamic finance denotes the overall goals and meanings that the Sharīʿah intends to achieve from its tenets and provisions regarding financial activities and transactions (Laldin and Furqani, 2013); and these are the ends (maqāṣid) in financial transactions. There are some specific maqāṣid of Islamic finance. Once a product is designed to achieve any particular Sharīʿah objective and is evaluated by the maqāṣid benchmark, it is considered to be in line with maqāṣid al-Sharīʿah (Mohammad and Shahwan, 2013). Some parameters determine the degree of human needs, and their needs are given priority based on the degrees/levels. Modern Muslim societies have access to different types of financial transactions and financing products. Hence, the maqāṣid al-Sharīʿah in financial transactions have received significant attention from academia, Islamic finance practitioners and students of this discipline (Ismail and Wan Ibrahim, 2020; Satia Nur and Setya Ayu, 2021).

However, many contemporary researchers in the area of economy and finance do not have proper Sharīʿah knowledge, particularly a clear understanding of maqāṣid al-Sharīʿah and the depth of fiqh al-muʿāmalāt concepts (Dusuki and Abozaid, 2007; Al-Qahtani, 2015; Monawer et al., 2019). Lack of in-depth knowledge may create confusion among contemporary researchers and practitioners over the maqāṣid al-Sharīʿah in financial transactions (Al-ʿĀmilī, 2007; Bedoui and Mansour, 2014). The confusion appears over the levels of maṣlaḥah, parameters (ḍawābiṭ), maqāṣīḍ and indicants (adillah) of Sharīʿah (Al-Ṣabbāgh, 2009; Dusuki and Abozaid, 2007). Consequently, the maqāṣid al-Sharīʿah are inaccurately used in juristic classification (takyīf fiqhī) and promotion of some financial products (Abozaid, 2010). Some IFIs utilized some financial contracts based on an erroneous understanding of maqāṣid (Rosly and Sanusi, 1999; Usmani, 2007; Ghani and Lambak, 2015; Aziz, 2017). IFIs also promote these products using the concepts of maṣlaḥah, ḍarūrah and maqāṣid al-Sharīʿah that contradict the texts (nuṣūṣ) of Sharīʿah. Hence, there is a dire need to ascertain the misconceptions about maqāṣīd al-Sharīʿah and clarify them to prevent any erroneous adoption, misuse or abuse of the concept of maqāṣid al-Sharīʿah by IFIs.

In this context, the objective of this paper is to provide a critical survey of the modern literature of maqāṣid al-Sharīʿah within the area of Islamic finance. It scrutinizes the misconceptions about maqāṣid al-Sharīʿah and clarifies them using financial examples.

The significance of the present research lies in helping to clarify the understanding of maqāṣid al-Sharīʿah and prevent abuse of the concept. It aims to fill the gap of misunderstanding in the existing adoption of maqāṣid al-Sharīʿah in IFIs. Contrary to previous studies, it clarifies misunderstandings about the five essential elements of maqāṣid al-Sharīʿah with examples drawn from the practice of Islamic finance. Methodologically, this paper attempts to correct the existing misconceptions based on the views of classical jurists and leading modern maqāṣid scholars.

This paper begins with the background and rationale of the study in the introduction, followed by a literature review in the second section comprising discussion of the maqāṣid of financial transactions and prior reviews of literature. The subsequent section describes the methodology adopted in this study. Section four critically analyzes fallacies associated with maqāṣid al-Sharīʿah and provides clarifications. The conclusion summarizes the results of the scrutiny and puts forward some recommendations for further research.

Literature review

Maqāṣid al-Sharīʿah in Islamic finance

Wealth preservation is the fifth fundamental and universal objective of Sharīʿah that is relevant to Islamic finance (Al-Ghazālī, 1413 AH; Al-Shāṭibī, 1997; Al-Qaraḍāwī, 2008b). The Sharīʿah requires the acquisition of everything beneficial for the healthy growth of wealth, and the rejection of everything that corrupts it. The means of preserving wealth are categorized into three levels: ḍarūri (essential), ḥājī (needing) and taḥsīnī (embellishing). There is also a mukammil (complements) category of means for each of the three groups (Al-Ghazālī, 1413 AH; Al-Shāṭibī, 1997).

The means of preserving wealth are also classified into kullī (macro) and juzʾī (micro). For example, “prevention of transgression” (manʿ al-iʿtidāʾ) is a macro-objective to be achieved in financial transactions. This is compared to micro-objectives such as the prohibition of usurpation (ghaṣb) and theft (sariqah). However, “prevention of transgression” is also considered a micro-objective when compared to an even more comprehensive macro-objective such as “preservation of wealth” (ḥifẓ al-māl) (Ibn Bayyah, 2010).

Ibn ʿĀshūr (2001) highlighted for the first time the specific maqāṣid of different areas of human life, including the specific maqāṣid (maqāṣid khāṣṣah) in financial transactions. He mentioned five maqāṣid of financial transactions under a particular topic entitled “maqāṣid al-taṣarrufāt al-māliyyah (objectives of financial transactions)” in his remarkable book Maqāṣid al-Sharīʿah al-Islāmiyyah (objectives of Islamic Law). The five objectives are circulation (rawāj), transparency (wuḍūh), preservation (hifẓ), durability/certainty (thabāt) and equity/justice (ʿadl) (El-Mesawi, 2006).

Afterwards, many contemporary scholars and researchers, namely Chapra (1979), Al-Yūbī (1998), Ibn Zughaybah (2001), Sānū (2002), Al-Qaraḍāwī (2008b), Al-Ḥuṣayn (2009), Ibn Bayyah (2010), Al-Raysūnī (2012), Lahsasna (2013), Laldin and Furqani (2013) and Āmāl (2013) and others, contributed to the maqāṣid of economic order and financial transactions throughout the period from Ibn ʿĀshūr until now.

For example, Ibn Bayyah (2010) dealt with the five maqāṣid mentioned by Ibn ʿĀshūr through the processes of review, justification, explanation, addition and rephrasing. He also rearranged those maqāṣid in order of accumulation (kasb) and wealth production (ījād al-māl), preservation of wealth (ḥifẓ al-māl), transparency (wuḍūh) and circulation (tabādul/tadāwul).

As the means of the maqṣad “preservation of wealth”, he mentioned five micro-maqāṣid, namely: proper management (tadbīr), moderation (wasaṭiyyah), mutual consent (tarāḍī) of both parties, the prohibition of hoarding (ihtikhār) and the prohibition of transgression (iʿtidāʾ) such as robbery, theft and harming others' ownership. The maqṣad of mutual consent is achieved through the prohibition of cheating (ghishsh) and hoaxing (khadīʿah) and refraining the legally incompetent (maḥjūr ʿalayhi) from financial transactions (Ibn Bayyah, 2008, 2010). He also mentioned that maqāṣid al-Sharīʿah pertaining to wealth fall into each level of ḍarūrī, ḥājī and taḥsīnī. For example, avoidance of ribā is a main objective (maqṣad aṣlī), and it falls under the ḍarūriyyāt. The prohibition of consuming others' property unlawfully, stealing and hoarding (ihtikhār) are maqāṣid as well (Ibn Bayyah, 2008). Al-Shubaylī (2015) added some financial maqāṣid, namely bearing risk (mukhāṭarah), protection of wealth, permitting prohibited means (waṣāil) in the absence of the effective cause (ʿillah) of the prohibition, encouraging productive investment, avoiding speculation, possession of commodities and facilitation of procedures. Fāḍil (2017) emphasized the maqāṣid of supporting wealth growth (numū), strengthening human dignity (karāmah) and promoting equitable distribution of wealth.

Prior reviews of literature

Previous literature reviews, including critical studies and systematic reviews, have mainly been conducted on the understanding of maqāṣid al-Sharīʿah vis-à-vis Islamic economics, banking and finance. However, only a few studies attempted to explore the conceptual gaps in understanding of maqāṣid al-Sharīʿah vis-à-vis Islamic finance. As for critical studies, Dusuki and Abozaid (2007) raised some issues, namely:

1. Inadequate knowledge of maqāṣid al-Sharīʿah in Islamic economics;

2. Erroneous adoption of maqāṣid al-Sharīʿah in Islamic banking and finance;

3. Potential conflicts between macro-maqāṣid and micro-maqāṣid; and

4. Possible abuse of maqāṣid al-Sharīʿah to justify some financial contracts which contradict the Sharīʿah texts.

Dusuki (2009) and Abozaid (2010) also noticed an overemphasis on form over substance to rationalize some financial products by maṣlaḥah.

As to the systematic reviews on the current research topic, Shinkafi and Ali (2017) reviewed 62 articles on maqāṣid al-Sharīʿah concerning Islamic economy, banking, finance, Islamic financial products and economic development. However, the authors found only the four misconceptions criticized by Dusuki and Abozaid (2007). Eldersevi and Haron (2019) commented on the non-methodological use of maṣlaḥah by IFIs' Sharīʿah committees in justifying some financial products and services by compromising Sharīʿah principles to maximize profits. Abozaid (2010) addressed the methodology of validating financial products and the misguided justification of Sharīʿah conformity for banking products. He raised and clarified two misconceptions, namely conflict between a perceived maṣlaḥah and Sharīʿah texts and overruling prohibitions on the grounds of ḍarūrah. Apart from these challenges, some other prevalent misconceptions impede the realization of maqāṣid al-Sharīʿah in Islamic finance. There is a dire need to raise such issues and correct the misconceptions to prevent any possible abuse of maqāṣid al-Sharīʿah. This paper aims to fill in this gap.

Research methodology

This paper adopts a qualitative inductive method. Secondary sources of data on the topic are collected from different published journal articles and books in Arabic and English. It reviews the classical and modern literature on maqāṣid al-Sharīʿah vis-à-vis Islamic finance to explore misconceptions about maqāṣid al-Sharīʿah and their adoption in Islamic finance. This study identifies five main misconceptions:

1. Distinction between maqāṣid (objectives) and maṣāliḥ (well-being),

2. Confusion over the levels of maṣāliḥ,

3. Mix-up of primary objectives with others,

4. The neglect of aḥkām (provisions) and

5. The neglect of ḍawābiṭ (parameters).

This study also employs a critical analysis method to examine these misconceptions. The scrutiny is underpinned by the views of classical theorists' views, namely Al-Ghazālī (1413 AH), Al-Juwaynī (1418 AH), Al-Fāsī (1993), Al-Shāṭibī (1997) and Ibn ʿĀshūr (2001) as well as the leading contemporary maqāṣid scholars, namely Al-Būṭī (1973), Al-Zuḥaylī (1986), ʿAṭiyyah (2003), Al-Qaraḍāwī (2008a) and Al-Raysūnī (2013). This study corrects the misconceptions and furnishes some concrete suggestions and recommendations towards an accurate adoption of maqāṣid al-Sharīʿah in Islamic finance.

Common flaws in understanding maqāṣid al-Sharīʿah and financial examples

Distinction between the terms “maqāṣid” and “maṣāliḥ”

The major challenge faced by some contemporary researchers and practitioners relates to the terms maqāṣid and maṣlaḥah. These two terms are perceived as two different principles or legal devices of Sharīʿah. Based on this perceived difference, some try to integrate one with another and formulate a framework to guide financial institutions, design products and evaluate projects (Jalil, 2006; Dusuki and Abozaid, 2007; Darus et al., 2013). This dual understanding of the very essence of maqāṣid and maṣlaḥah leads to challenges in comprehending the theory of maqāṣid al-Sharīʿah and its application. The same applies to realizing maqāṣid in financial activities. The perceived distinction between the two terms contributes to an inaccurate classification (takyīf) of financial products and promotion of those products based on maṣlaḥah.

For example, some financial products based on bayʿ al-ʿīnah (sale and buyback), such as bayʿ bithaman ājil (deferred cost-plus rate), Islamic credit cards, Islamic private debt securities (IPDS) and Islamic overdraft facilities, have been practiced in several Muslim countries (Dusuki and Abozaid, 2007; Ibn Hāshim, 2009; Kamali, 2017). In these products, IFIs should act as traders ― being involved in the process of selling or buying, according to the meaning of the word bayʿ. In reality, IFIs are merely financiers that provide funds without taking risks or participating in the investment process. Bayʿ al-ʿīnah here is resorted to as a legal device (ḥīlah) providing a screen for ribā-based financing. Yet, as far as the substance is concerned, bayʿ al-ʿīnah-based financing and the conventional ribā-based financing are the same. They accomplish the same goals and share the same economic essence and effects, which is ribā, albeit their forms differ (Dusuki and Abozaid, 2007). Some IFIs maintained the legality of forms, abiding by provisions according to Imam Shāfiʿī's view. Yet, they overlooked the legality of the substance by neglecting the conditions set by Imam Shāfiʿī. Despite the existence of ribā, IFIs rationalized the products on the basis of maṣlaḥah (Rosly and Sanusi, 2001). Here, the flaw in the distinction between maṣaliḥ and maqāṣid becomes relevant. Some practitioners permitted the products structured by bayʿ al-ʿīnah due to maṣlaḥah, based on the need of the society. However, they forgot that maṣāliḥ could not be achieved by overlooking the maqāṣid. They neglected the maqṣad of avoiding the injustice caused by ribā (Al-Mubarak and Osmani, 2010). Thus, the assumed distinction between maṣāliḥ and maqāṣīd led to the inaccurate adoption of financial products. Surprisingly, maqāṣid al-Sharīʿah have been used here to justify the categorization of such contentious transactions whereas due consideration of maqāṣid al-Sharīʿah would be the main criterion to determine their prohibition as they entail injustice resulting from ribā.

To clarify, the essence of maqāṣid and maṣlaḥaḥ is similar, and both terms are not two different principles. Instead, their function is analogous, and they are sometimes used interchangeably (Abdelkader, 2003; ʿAwdah, 2006; Auda, 2007). Kamali (2008) also has a similar view as he joins both terms while discussing the categories of maqāṣid. He says:

The ʿulamāʾ (Muslim scholars) have classified the entire range of maṣāliḥ-cum-maqāṣid into three categories in descending order of importance, beginning with the essentials followed by the complementary benefits, and then the embellishments (Kamali, 2008, p. 2).

Al-Ghazālī (1413 AH, p. 174) states

Maṣlaḥah is essentially an expression for the acquisition of benefit or the repulsion of injury or harm, but that is not what we mean by it, because the acquisition of benefits and the repulsion of harm represent human goals, that is, the welfare of humans through the attainment of these goals. What we mean by maṣlaḥah, however, is the preservation of the Lawgiver's objectives. The Lawgiver's objectives are five, and these are the preservation of religion, life, mind, offspring, and wealth. Everything that leads to the preservation of these five foundations is considered maṣlaḥah, and everything that leads to the disruption of these foundations is mafsadah, and its removal is maṣlaḥah. And whenever we mention “intuitive meaning” (maʿnā makhayyal) or “appropriate” (munāsib) in the chapter of analogy (qiyās), we mean by it this type [of maṣlaḥah]. And the preservation of these five foundations falls at the level of essentials (ḍarūriyyāt), and that is the strongest level of maṣlaḥah.

According to Al-Ghazālī (1413 AH), maqāṣid comprise an integral part of maṣlaḥah, and both terms lead to the same direction, which is well-being. The difference between them appears in their perspectives and forms, not in essence and substance. Maqāṣid refer to the goals behind the provisions (aḥkām) of Sharīʿah intended by the Lawgiver (Shāriʿ), whereas maṣlaḥah denotes the preservation of the goals. Also, the five maqāṣid could be perceived as the framework of maṣlaḥah because it cannot be achieved by neglecting the maqāṣid.

Al-Shāṭibī (1997) also mentioned the five essentials as the fundamentals or foundations of all universals (kulliyyāt). Thus, both terms differ from and relate to each other. As for the realization of maqāṣid al-Sharīʿah in financial activities, Ibn ʿĀshūr (2001) mentioned five financial objectives, namely circulation, transparency, preservation, durability and equality. These five ends (maqāṣid) constitute the framework of maṣlaḥah in Islamic finance. Financial well-being (maṣāliḥ) must be realized within the framework of these five objectives. Thus, the economic activities will comply with the intents of Sharīʿah.

Confusion over the levels of maṣāliḥ

The perception of ḍarūriyyāt, ḥājiyyāt, taḥsīniyyāt and mukammilāt still appears vague and obscure in the mind of some practitioners, as the literature shows. For example, a mix-up is mainly observed between ḍarūrah (essential) and ḥājah (need). Besides, confusion also arises between ḍarūrah and maṣlaḥah sometimes (Awang et al., 2014). Moreover, the maṣlaḥah of the mukammilāt category sometimes appears like any of the three primary levels. Furthermore, misunderstanding of the types of ḍarūrah and ḥājah appears among some practitioners. Such confusion over the categories of maṣlaḥah affects the understanding of the level of individuals' financial needs and the degree of IFIs' sustainability. It thus contributes to an inaccurate fiqh categorization of financial products.

For example, the need for some banking products and takāful/retakāful was perceived as falling under the ḍarūriyyāt level, which is the most substantial level of human needs, albeit none of the financial transactions falls under ḍarūrīyyyat (Dusuki and Abozaid, 2007; Dusuki, 2015; Ghani and Lambak, 2015). Instead, all types of financial contracts, including sale, lease, partnership, etc. fall under ḥājiyyāt, and Islam permits these transactions due to ḥājah as previously mentioned. The perceived meaning of ḍarūrah perhaps led some banks in Malaysia to promote some products using bayʿ al-ʿīnah, which contain ribā, as permissible. For example, over the last two decades, there was a tendency in many IFIs to handily use ḍarūrah as a rationale to legalize certain transactions, namely the features of guaranteed profit and principal in equity-based ṣukūk structures (Dusuki, 2015), albeit all jurists agreed on their impermissibility (Usmani, 2007).

Rosly and Sanusi (2001) also criticized the use of bayʿ al-ʿīnah without fulfilling the contract's conditions that meet Sharīʿah principles and objectives. This example applies to those who cite the permissibility of bayʿ al-ʿīnah according to the Shāfiʿī School. However, the Shāfiʿī School only allows bayʿ al-ʿīnah with certain conditions. If an IFI applies bayʿ al-ʿīnah without observing those conditions, there is no school of Islamic jurisprudence that would permit it. In addition, the relevance of ḍarūrah itself is subject to scrutiny. It should be investigated by the following questions:

1. Which contracting party is in a ḍarūrah situation?

2. Are there any financial alternatives, whether from the bank's products or other sources like qarḍ ḥasan (interest-free loan), zakat, charity, etc., to fulfil the need?

3. Which of the maqāṣid does this product serve?

The need for banking products does not fall under ḍarūriyyāt because the banking practice itself is not essential for the survival of an individual, albeit products are necessary for the survival of banks (Dusuki and Abozaid, 2007). However, it may fall under ḥājiyyāt if it becomes the sole means of fulfilling one's need, or it may fall under taḥsīniyyāt. Also, one has many alternatives to satisfy his need that negate the ḍarūrah situation. It will be more apparent if his case is checked with the parameters of ḍarūrah. Besides, the contracts of financial transactions are permitted to achieve the maqṣad of circulation (rawāj) of wealth which falls under ḥājiyyāt (El-Mesawi, 2006). Thus, the need for ṣukūk structures neither falls under the ḍarūrah ʿāmmah (general necessity) nor the ḍarūrah khāṣṣah (specific necessity). Instead, it falls under ḥājah. Perhaps, for this very reason, Usmani (2007), Dusuki (2015) and Aziz (2017) criticized the rationalization of banking products using ḍarūrah. Aziz (2017) viewed that IFIs deal with prohibited elements as means of ḍarūrah and used it as a mechanism to safeguard the conventional products. The inaccurate categorization of equity-based ṣukūk structures may have resulted from confusion over the levels of maṣāliḥ. Though the ḍarūrah category of maṣlaḥah permits individuals to consume illegal goods, it does not allow IFIs to legalize prohibited products. In addition, all types of financial transactions, including IFIs' products and services, fall under the ḥajah category of maṣlaḥah, not ḍarūrah per se.

To clarify the categories of maṣāliḥ, the ḍarūriyyāt (i.e. the first level of maṣāliḥ) are benefits whose realization is vital for the society, both collectively and individually. The community's social order will not correctly function if there exists any flaw in these maṣāliḥ (El-Mesawi, 2006). The examples of ḍarūriyyāt are the death sentence for a disbeliever who deceives and punishment for an innovator in religion (mubtadiʿ fī al-dīn). Besides, the five pillars of belief (īmān), execution of blood money (diyyah) and death sentence (qiṣāṣ), marriage, the prohibition of adultery and alcohol are also instances of ḍarūriyyāt (Al-Ghazālī, 1413 AH; Al-Būṭī, 1973; Al-Zuḥaylī, 1985).

As for ḥājiyyāt (i.e. the second level of maṣāliḥ), according to Al-Shāṭibī (1997), it includes what is needed to achieve comfort and relieve hardship. If it is neglected, human beings (mukallafūn) will undergo hardship and difficulty. Nonetheless, the injury resulted from neglect of this category cannot be equated with that of ḍarūrī category. As the instances of the ḥājī category, the uṣūliyyūn referred to contracts of bayʿ (sale), ijārah (leasing), mushārakah (partnership), qirāḍ (speculative partnership) and musāqāh (sharecropping) (El-Mesawi, 2006).

Concerning taḥsīniyyāt (i.e. the third category of maṣāliḥ), according to Al-Ghazālī (1413 AH), it functions as adorning factors that facilitate the achievement of virtues and pleasing ways in manners and dealings, encourage the means of good and block the means of evil, etc. (El-Mesawi, 2006).

Some other types of maṣāliḥ are called mukammilāt. They are complementary to each of the three levels. The mukammilāt are those matters whose absence will not necessarily lead to the destruction of the maṣāliḥ of the respective category, albeit the defect of mukammilāt causes a defect in the main category (Al-Ghazālī, 1413 AH; Al-Zuḥaylī, 1986; Al-Shāṭibī, 1997). Examples of mukammilāt are a witness for a sale contract, pawn (rahn), option (khiyār), charity out of pure earning, etc (Al-Khādimī, 2001). Interestingly, due to the hierarchical relationship between the levels of maṣlaḥah, the maṣlaḥah of a lower category plays the role of mukammil to another maṣlaḥah of a higher class, i.e. the taḥsīnīyyāt are complementary for ḥājiyyāt. In contrast, the ḥājiyyāt and taḥsīnīyyāt are complementary for ḍarūriyyāt. Moreover, the complement of a lower category is also the complement to a higher category. It is due to the principle that the complement of a complement is a complement or the means of a means is a means (Al-Yūbī, 1998; Al-Khādimī, 2001). Thus, the three levels of maṣāliḥ pertain to the means (wasāʾil) not the ends (maqāṣid) (ʿAṭiyyah, 2003).

In connection with the classification of ḍarūrah, it is primarily of two types: ḍarūrah fiqhiyyah (legal essentials) and ḍarūrah uṣūliyyah (jurisprudential essentials). The former is perceived from a fiqhī (legal) perspective, is partial (juzʾī) and relates to individuals. In contrast, the latter is adopted from an uṣūlī (jurisprudential) perspective, is universal (kullī) and concerns the whole of humankind. Similarly, ḥājah is of two types: ḥājah fiqhiyyah (legal need), which is private, and ḥājah uṣūliyyah (jurisprudential need), which is public (Ibn Bayyah, 2009).

To differentiate, ḍarūrah fiqhiyyah is defined as: “a situation in which one reaches a limit where if one does not take a prohibited thing, one will perish or be about to perish” (Al-Suyūṭī, 1959, p. 61). Al-Juwaynī (1418 AH) says that this type of ḍarūrah does not establish an absolute ruling on a kind (jins); instead, it applies to specific persons for eating dead meat and food owned by others to be permissible in case of perishing. As for ḍarūrah uṣūliyyah, it is defined as:

a compelling situation resulting in fear of injury to one's life, organs, lineage, reason or his property. It is a license which not only allows a Muslim to commit a prohibited act but to omit an obligation as well, or delay an obligation (Al-Zuḥaylī, 1985, pp. 67–68).

According to Al-Juwaynī (1418 AH), this type of ḍarūrah establishes an absolute ruling on a kind, albeit its ruling differs concerning specific persons. For example, the sale is a ḍarūrah at the communal level since:

if people do not exchange with one another what is in their possession, this will lead to an obvious need. The practice of buying and selling, then, rests upon ḍarūrah which results from [the nature of this] type [of transaction] and the existence of the community (Al-Juwaynī, 1418 AH, p. 923; Al-Raysūnī, 2006, p. 292).

Thus, ḍarūrah fiqhiyyah differs from ḍarūrah uṣūliyyah. Furthermore, ḍarūrah differs from ḥājah in several aspects such as:

1. The hardship in ḍarūrah is more than that in ḥājah;

2. Ḍarūrah originates from what is unlawful by its own sake, or the thing itself is inherently forbidden (ḥarām li dhātihī), such as murder, theft and what Allah mentioned in the Qurʾān, whereas ḥājah originates from what is unlawful due to external factors (ḥarām li ghayrihī) such as sales with ribā. Therefore, selling is permitted, but ribā is prohibited;

3. The basis of ḍarūrah is compulsion (iljāʾ), whereas the basis of ḥājah is ease (taysīr); and

4. The applications of ḍarūrah's rulings are temporary, whereas the applications of ḥājah's rulings are continuous (Kāfī, 2004; Ibn Bayyah, 2009).

Besides, maṣlaḥah is different from ḍarūrah, albeit it is one of the categories of maṣlaḥah. There is no equipollence (talāzum) between maṣlaḥah and ḍarūrah, which allows the promotion of maṣlaḥah at the expense of ḍarūrah. Thus, the relation between them is that maṣlaḥah is ʿāmm (superordinate/hypernym) or macro (kullī), whereas ḍarūrah is khāṣ (hyponym) or micro (juzʾī). The maṣāliḥ of the mukammilāt category also play an important role in realizing each of the categories: ḍarūriyyāt, ḥājiyyāt and taḥsīniyyāt. The defect of mukammilāt causes a defect in the original categories (aṣl) of maṣlaḥah (Al-Ghazālī, 1413 AH; Al-Shāṭibī, 1997).

To further crystallize, the five ḍarūriyyāt are universal, meaning, if any of them is completely absent, the whole community will be in trouble. Ḍarūrīyyāt are so named based on the universal concept (mafhūm kullī) and general genre (ʿumūm al-nawʿ), not based on the partial (juzʾī) and individuals' (afrād) perspective (Al-Juwaynī, 1418 AH). This signifies that the five essential maṣāliḥ are termed ḍarūriyyāt as end goals in their totality for their universality, not for any partial benefit. Al-Ṭūfī (1990), Al-Shāṭibī (1997) and Al-Shawkānī (1999) also agreed with Al-Juwaynī (1418 AH) on the essentials due to their universality. Ḍarūriyyāt are called that in the sense that the individual life will not function properly, or the community's order will decline if any of the five objectives is absent or any defect happens to them (Kāfī, 2004). Hence, it does not necessarily mean that every maṣlaḥah that incorporates into ḍarūrah falls under the same category. Accordingly, the preservation of wealth is the fifth maṣlaḥah among the five ḍarūriyyāt. It does not mean that any financial need or any banking product that necessarily falls under ḍarūriyyāt must be achieved (Ibn Bayyah, 2008). However, many maṣāliḥ, besides the five primary objectives, fall within ḍarūriyyāt, and this will be discussed in the next section.

Mix-up of primary objectives with other objectives

According to the literature, the difference between the five objectives and other objectives falling within ḍarūriyyāt, and their mukammilāt, is not clear to some practitioners. Therefore, they are confused about ḍarūriyyāt and ḥājiyyāt in terms of understanding these concepts, their provision (ḥukm) and their actualization. The five objectives are exclusively termed the “five universals” (al-kulliyyāt al-khams) due to the need for them by all of humanity. They are also called the “five essentials” (al-ḍarūriyyāt al-khams) based on their necessity for human survival (Al-Zuḥaylī, 1985) and “five fundamentals/foundations” (al-uṣūl al-khamsah) due to the fact that they are the foundation of all types of human well-being (Al-Ghazālī, 1413 AH; Al-Shāṭibī, 1997).

There are many forms of maṣāliḥ other than the five objectives (al-maqāṣid al-khamsah), be they ends (maqāṣid) or means (wasāʾil), which fall within ḍarūriyyāt; and there are also many universals (kulliyyāt) that belong to ḥājyyāt and taḥsīniyyāt. Thus, the five primary objectives are different from other maṣāliḥ that fall within the ḍarūriyyāt category and the maṣāliḥ that belong to ḥājiyyāt and taḥsīniyyāt categories, whether they are macro (kulliyyāt) or micro (juzʾiyyāt) (Al-Būṭī, 1973; Al-Zuḥaylī, 1985; ʿAṭiyyah, 2003).

As for ḍarūrah concerning financial transactions, the safeguard of wealth is ḍarūrī in its totality because if it disappears completely, human life will be in trouble, and the order of the society will not function properly. The means of safeguarding wealth fall into different levels. Some of them fall within ḍarūriyyāt and others belong to ḥājiyyāt and taḥsīniyyāt. For example, the circulation of wealth is ḍarūrī, according to Al-Juwaynī (1418 AH) and Al-Shāṭibī (1997). Similarly, avoidance of ribā falls within the ḍarūriyyāt category (Ibn Bayyah, 2008). The contracts of sale and lease fall at the ḥājiyyāt level, whereas the prohibition of selling impure objects is considered among taḥsīniyyāt (Ibn Bayyah, 2010).

The neglect of aḥkām in realizing maṣlaḥah

Understanding the integral relation between aḥkām and maqāṣid is also a challenge facing IFIs' practitioners. Many perceived a conflict between aḥkām and maqāṣid (Abozaid, 2010). The supposed conflict has drawn the researchers' attention for resolution. Scholars tried to resolve the conflict within the “form versus substance” framework and differed in regard to whether to weigh form over substance or substance over form. This framework leads to an unending dispute of the issue as it cannot reconcile both; instead it causes overlooking the issue of reconciling and resolving conflict as discussed by El-Gamal (2006), Dusuki and Abozaid (2007), Abozaid (2010), Maurer (2010), Asutay (2013), Khorasi (2014), Shamsudina et al. (2014), Hanif (2016), Hamour et al. (2019) and Piotrowski (2020), and many others. Perhaps, this is one of the reasons behind the neglect of aḥkām or the overlooking of maqāṣid in financial products. There exist examples of neglecting aḥkām and maqāṣid in IFIs' practices; some transactions strictly stick to Sharīʿah principles (aḥkām) without satisfying the maqāṣid. On the other hand, some others resorted to maṣāliḥ (analogous to maqāṣid), neglecting the Sharīʿah principles. The impact of neglecting aḥkām is an inaccurate categorization of contracts using maṣlaḥah, as criticized earlier.

To clarify, the aḥkām and the maqāṣid are integral parts of the Sharīʿah, and they stand for the Sharīʿah as two sides of the same coin. The maqāṣid are rooted in the aḥkām and vice versa. In this regard, Al-Fāsī (1993) made a remarkable statement saying: Sharīʿah is aḥkām containing maqāṣid, and Sharīʿah is also maqāṣid containing aḥkām (p. 47). Al-Raysūnī (2013, p. 107) explains this statement as follows: the provisions are derived from maqāṣid while the maqāṣid are derived from aḥkām too. It is an excellent and precise expression on the correlation of aḥkām and maqāṣid. It means that the maqāṣid are developed from aḥkām through induction of all Sharīʿah texts and provisions related to a particular area or all areas. In contrast, the aḥkām are understood and deduced in the light of related maqāṣid. Thus, both maqāṣid and aḥkām are interconnected, and none can be achieved without the other.

The correlation of aḥkām and maqāṣid in product development could be understood as follows: suppose a financial institution wants to develop a product based on the objective of “taysīr” (ease/facilitation). In that case, it should observe the aḥkām focussing on taysīr and the aḥkām concerning the contracts that develop a particular product, including all procedures to check whether the aḥkām allow it. If the aḥkām favour the legality of this product, it will be a maqāṣid-based product. However, the adoption of maqṣad or the maqṣad itself will be fallacious and alien to the Sharīʿah if it proves otherwise. In addition, if any product is developed based on the fallacious maqāṣīd, the product will never satisfy the maqāṣid al-Sharīʿah nor the purpose of the product.

The neglect of maqāṣid parameters

Neglecting the parameters (ḍawābiṭ) of maqāṣid while determining any maqṣad is a great mistake. It leads to considering fallacious maqāṣid, a mix-up between maqāṣid and its dimensions (i.e. legal maxims, parameters, rulings, etc.), and consequently causes inaccurate adoption of maqāṣid. For example, Al-Ṣabbāgh (2009) assumed “considering consequences and substances” (iʿtibār al-maʾālāt wa al-maʿānī) as an original objective (maqṣad aṣlī) in Islamic finance. He also mentioned some other rules as the auxiliary objectives (maqāṣid tabʿiyyah) of this original objective. For instance, the permissibility of interference in other's affairs without his consent even for his benefit; compelling one to do what benefits others but does not harm; compelling compensation to remove injustice, to prevent harm, to fulfil the needs of ḥājah or ḍarūrah level, etc. In addition, Al-ʿAskar (1435 AH) mentioned “blocking the means” (sadd al-dharāʾiʿ) as one of the maqāṣid al-Sharīʿah and tried to rationalize some contracts.

However, the concept of “blocking the means” and the concept of “considering consequences and substances” and their sub-concepts are not maqāṣid for the following reasons: first, these concepts are juristic indicants (adillah uṣūliyyah) or juristic methods (manāhij uṣūliyyah) to understand and realize the maqāṣid al-Sharīʿah (Wūrqiyah, 2003). Second, the assumed maqāṣid is not disciplined (munḍabiṭ) and hence not in line with the parameters of maqāṣid. As for the auxiliary objectives, they could not also be considered maqāṣid for some reasons. First, these phrases represent some parameters (ḍawābiṭ) to regulate interference in others' affairs. Second, the wording of the concepts is not precise and concise. Nevertheless, classical jurists and contemporary scholars have crystallized the objectives of Sharīʿah in terms of wording and expressions such as the five ends of financial transactions (namely circulation, transparency, preservation, certainty, equity) besides the five primary objectives of Sharīʿah (namely, religion, life, intellect, offspring and wealth).

To clarify, the maqāṣid are regulated and determined by certain parameters (ḍawābiṭ). The singular Arabic term ḍābiṭ is defined as “an inclusive (kullī) principle, which applies to several details (juz'iyyāt) under a particular chapter or group” (Al-Maymān, 2005, p. 129). The parameters of maqāṣid are the regulating principles that verify the maqāṣid, crystallize the essence of maqāṣid, and control its notion from misconception, misuse and deviation. Yet, some researchers discussed the same parameters as the conditions (shurūṭ) of maqāṣid (Al-Mubarak and Osmani, 2010), while some others discussed them as characteristics (khaṣāʾiṣ) (Al-Aḥmadī, 2016).

The maqāṣid and/or maṣāliḥ are derived from the detailed indicants (adillah tafṣīliyyah) of Sharīʿah. Hence, maqāṣid and maṣāliḥ are the kullī which is inclusive, whereas the indicants and provisions are the juzʾī which is partial. An inclusive objective cannot be understood or actualized without observing the detailed indicants. As the detailed indicants of Sharīʿah are numerous, the uṣūliyyūn formulated parameters to make a bridge between kullī and juzʾī as well as to control the maqāṣid and connect them with detailed indicants. Any maqṣad or maṣlaḥah neglecting these parameters will be considered alien to Sharīʿah (Al-Būṭī, 1973). The parameters of maqāṣid are legitimacy (sharʿiyyah), not negating the original indicant, certainty (thubūt), rationality (maʿqūliyyah), discipline (inḍibāt), generality (kulliyyah), constancy (iṭṭirād) and not leading to the loss of a greater maqṣad (al-Būṭī, 1973; Ibn ʿUmar, 2009).

Al-Būṭī (1973), Al-Zuḥaylī (1986), Al-Yūbī (1998), Al-Khādimī (2001) and Ibn ʿUmar (2009) added, rephrased and expounded the parameters of maqāṣid. Ibn Ḥarzullāh (2007) classified such parameters according to their functions and reached a total of 16.

All these criteria should be fulfilled in any concept to be considered as the objective of Sharīʿah. Any maqṣad that is not justified by these parameters will be deemed fallacious. Consequently, the financial products rationalized with fallacious maqāṣid will fail to meet the maqāṣid al-Sharīʿah.

Conclusion and recommendations

This paper has made a critical assessment of the contemporary literature on maqāṣid al-Sharīʿah in Islamic finance, identified five conceptual flaws and clarified them. The significant findings to emerge from this study can be summarized as follows.

The maqāṣid (objectives) refer to underlying purposes behind the provisions of Sharīʿah intended by the Lawgiver, whereas maṣlaḥah denotes preservation of the goals. The five primary maqāṣid constitute the framework of maṣlaḥah. The function of maqāṣid and maṣāliḥ is analogous; they are different only in perspectives; hence, they are sometimes used interchangeably. The three levels of maṣāliḥ, namely ḍarūriyyāt, ḥājiyyāt and taḥsīniyyāt pertain to the means (wasāʾil) to the ends (maqāṣid). The ḍarūriyyāt originated from human survival, whereas the ḥājiyyāt stemmed from hardship in human life. Financial products are related to the ḥājiyyāt and taḥsīniyyāt not ḍarūriyyāt. Maṣlaḥah does not necessarily mean ḍarūrah but instead comprises ḍarūrah as a component. Thus, the relation between maṣlaḥah and ḍarūrah is superordination/hypernymy. The former is superordinate/hypernym (ʿāmm), whereas the latter is hyponym (khāṣ), or in other words, the former is macro (kullī), whereas the latter is micro (juzʾī).

The five primary objectives are called ḍarūriyyāt as end goals in totality due to their universality, not for any partial benefit. The five primary maqāṣid/maṣāliḥ are different from other categories of maṣāliḥ, whether they fall within ḍarūriyyāt, ḥājiyyāt or taḥsīniyyāt. Similarly, the means to safeguarding wealth fall into different levels. However, the demand for banking products does not fall under ḍarūriyyāt, but rather it may fall under ḥājiyyāt if it becomes the sole means of fulfilling one's need, or it may fall under taḥsīniyyāt. The maqāṣid are derived through induction of aḥkām of Sharīʿah, while aḥkām are understood in the light of maqāṣid. Aḥkām and maqāṣid stand as the two sides of Sharīʿah; neither can be achieved without the other; thus, both are interconnected. The parameters verify the maqāṣid, control them and connect them with related indicants. Any maqṣad or maṣlaḥah neglecting the parameters will be considered strange to the Sharīʿah.

This study recommends the harmonization of the objectives with their essential elements (mustalzamāt) ― the parameters and provisions ― while designing or adopting any product under any particular objective. Future research may also theorize the concepts of ḍarūriyyāt, ḥājiyyāt and taḥsīniyyat, comprising their classifications, parameters and other details in the English language. The paper also recommends formulating a framework of actualizing maqāṣid al-Sharīʿah in Islamic finance.