Shariah Supervisory Board

A Shariah Supervisory Board (SSB) is an independent body of qualified Islamic scholars (fuqaha) appointed by an Islamic financial institution (IFI) to provide oversight, guidance, and certification of the institution's products, services, and operations for Shariah compliance. The SSB issues Fatwas (religious rulings) on new financial products, reviews existing offerings, conducts periodic audits, and publishes an annual Shariah compliance report. AAOIFI Governance Standard No. 1 establishes the mandatory framework for SSBs: minimum composition of three scholars, independence requirements, conflict-of-interest policies, appointment and dismissal procedures, and scope of responsibilities including product approval, supervisory review, and internal Shariah audit oversight. IFSB-10 (Guiding Principles on Shariah Governance Systems) complements AAOIFI by providing prudential guidance on SSB effectiveness, including requirements for a dedicated internal Shariah audit function and Shariah risk management. Central banks in Malaysia (BNM), Bahrain (CBB), UAE (CBUAE), and Pakistan (SBP) have issued national Shariah governance frameworks that incorporate or supplement AAOIFI and IFSB standards. The IOF platform maintains an active SSB with board-level approval workflows integrated into the contract template lifecycle: no new rail, contract type, or product feature becomes active without documented SSB sign-off, a Fatwa reference number, and an annual Shariah audit assertion in the compliance ledger.