The relationship between awqaf and ethics is very strong and the sector shows great concern for ethical values such as honesty, integrity trust, commitment, and compassion. These values are very important and are beyond dispute. Ethical conduct is at the core of awqaf credo, and in Islam is considered an act of piety, a prime virtue and the basis of all human relations.

When we talk about ethics for awqaf, we focus on ethics of the nazir in a professional context. How should the nazir act in relation to beneficiaries and the broader range of awqaf stakeholders, what he can overlook and what he shouldn’t compromise. Philosopher and theologian P. J. Tillich once said: “Ethics is not a subject, it is a life put to the test in a thousand daily moments”.  Nowhere this could be more relevant than to the awqaf nazir whose behavior is under close scrutiny and is challenged from every quarter.

Nazirs  are not only required to act in good faith for the best outcomes for the waqf, but also to be seen acting lawfully, diligently and ethically, and building trust among those they deal with. There is nothing more damaging to awqaf than the loss of ethics. The negative effects are contagious and can spread across the entire awqaf sector. This is because the absence of ethics is often more noticeable than their presence. Unethical actions also impact public goodwill and erode confidence in awqaf institutions and their management.

Awqaf cannot be totally immune from the vagaries of human behavior. Ethical challenges arise at all levels and in all types of awqaf organizations and involve a complex relationship between the nazirs and their stakeholders. Some of these challenges can result in misrepresentation of the waqf deed, infringement of the waqif’s conditions, and misallocation of financial resources. Many a time, wrongdoing is done inadvertently and without intended malice by otherwise decent and admirable people.  We are all capable of doing things that go against our own values and at the same time continue to think of ourselves as ethical, upright persons. Many ethical issues involve grey areas, i.e. activities that are on the fringes of wrongdoing or that involves misallocation of resources or inadequate accountability and transparency. Despite his best intentions, a nazir may come up against certain legal and ethical challenges during his interaction with stakeholders. Some of the common issues that may arise include confidentiality, respecting the rights of beneficiaries and being aware of conflicts of interest.

Measurement of ethical credentials of nazirs is an equation with many unknowns and many assumptions. Add in the emotional variables and the equation becomes even more lopsided. The evaluation of ethical behavior requires awqaf to have a code of ethics to guide decision making and activities as well as the behaviour of employees, volunteers and board members. The code should address issues such as conflicts of interest, fairness, transparency and accountability. Unfortunately a code cannot cover and prevent every possible unethical act just as it cannot prevent wrong judgment or inappropriate decision, but it should define values and expectations of behaviour and provide some guidance for nazirs when they encounter ethical dilemmas. To be effective, a code of ethics and professional conduct needs to be interpreted by ethical individuals who do not focus on loopholes to be discovered or see the code as a hurdle to be overcome.

Being an awqaf nazir is not an easy task – Shariah compliance, legal responsibilities and sensitive decision making for little or no remuneration beyond the feeling of doing something important and worthwhile. Bing viewed as a trustworthy nazir can unlock boundless opportunities and make his work more engaging and challenging. Nazirs are respected and trusted not only because they comply with the law and the ethical principles of Sharia, but because of the insight they develop into what matters to their stakeholders and solve the “root” of an issue not just the symptom.

Increasingly, ethics is considered to be the proper measure of social progress. Awqaf is not only an economically viable sector, but ethically superior in achieving socio-economic development. Awqaf organisations are socially responsible entities that act in a socially responsible way and their values are exemplified by their nazirs. However, while it might not be possible to vouch for the honesty and integrity of every nazir, we should be able to vouch for the strength, vigour and effectiveness of the waqf’s ethical framework.

By Hisham Dafterdar, CPA, PhD
Chairman, Awkaf Australia Ltd