the Next Billion The Market Opportunity of the Muslim World

1

Muslims represent nearly 1.8 billion of the world’s population.

‫يشكل املسلمون حوالي‬ ‫ مليار من سكان‬8,1 .‫العالم‬

Table of Contents Introduction

2

The Halal Economy

4

Islamic Finance

10

Managing Reputation

18

The Connected Muslim

20

Conclusion

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1

Bound together by shared values, Muslims number around 1.8 billion of the world’s population. This market provides huge potential for companies, organizations and others, from the west and from Muslim countries, and is on a steep growth path. The global Muslim population is expected to grow by about 35 percent over the next 20 years, rising from 1.6 billion in 2010 to 2.2 billion by 2030, or 26.4 percent of the world’s total projected population of 8.3 billion. By 2050, the Muslim population could grow to 2.6 billion and represent nearly 30 percent of the global projected population.

increase

1.8

2.2 billion

billion

YEAR

2012

2030

billion

30% of total world population

35%

2.6 26.4% of total world population

INTRODUCTION

While many countries and companies continue to chart out their BRIC and emerging market strategies, developing their businesses and growing consumer bases, the single biggest market in the world has been largely overlooked. This is why this report talks about the opportunity of the next billion: A collection of people larger than the markets of India and China, united under a single umbrella – their beliefs.

2050

Muslim Population Also by 2030, 79 countries are expected to hold a million or more Muslim residents, as opposed to the current 72 countries. Although many western business executives may not realize it, a majority of the world’s Muslims (more than 60 percent) will continue to live in the Asia Pacific region, while about 20 percent will live in the Middle East and North Africa. Muslims will remain relatively small minorities in Europe and the Americas, but will constitute a growing share of the total population in these regions. To be 26%Africa, Pharmaceuticals successful in Asia, as well as the Middle East and North western companies must learn to understand and address the Muslim market on a large scale.

Halal Market

11% Cosmetics

One demographic factor makes the Muslim market particularly attractive to a variety of companies – it is largely young and part of an emerging middle class on the road to greater consumption. Islamic doctrine, by 2% Other and large, is not ascetic and does not discourage trade or consumerism. Likewise, it does not divide the state from religion, which means that Muslims practice their faith hand in hand with the political, social and cultural roles they play in society. 61% Food In Islamic majority and minority countries throughout Asia, the Middle East, Africa, and Europe, business activity is escalating, with Islamic trade currently estimated in trillions of dollars. The Muslim market is large, lucrative and underserved.

It has already attracted the attention of many western multinationals. Nestlé is manufacturing many of its brands using Halal processes and working with Halal accreditation agencies to fasttrack growth in Islamic markets. In 2008, Nestlé achieved US$5.2 billion revenue in Halal products alone. Several western fast food chains including Nandos, Burger King and Subway are opening more outlets that serve Halal products, and makers of personal care and cosmetics products such as Unilever and L’Oreal have adapted their formulations and marketing, and introduced products and campaigns to gain the loyalty of one of the fastestgrowing segments in the developing world – middle-class Muslim women. But alongside these immense opportunities, companies face communications challenges when they approach Muslim markets, and can risk negative consumer reaction in their home markets, based on preconceptions and misinformation. In November 2010, for example, KFC saw a consumer backlash when news reports announced that some of its branches in the UK had converted to a Halal-only menu. A Facebook group quickly emerged with several thousand members protesting against a perceived imposition of Halal practices on the UK public. The issue was further compounded when the discussion moved to the nature of Halal slaughter and immensely damaging language entered the discussion. Indeed, this sort of backlash is a regular occurrence when companies enter the Muslim space. In many cases, the backlash is from non-Muslims and is played out in the media or, increasingly, across digital platforms. Companies that fail to fully consider these communication challenges – from the Muslim market or from the wider audience – expose their reputations to considerable damage. Companies are coming to understand the great opportunity that the Muslim consumer represents. But addressing this market is not as straightforward as dealing with other billion population consumer markets such as India and China. For a start, the Muslim community is not a single homogeneous group. Muslims live in every country in the world, represent every race and come from every social and economic stratum. And although they share the common thread of their beliefs, they have their own cultural, regional or local nuances, preferences and practices. The diversity of the Muslim consumer can prove to be a challenge to those who view markets as geographies and for whom the concept of an Islamic

consciousness operating across market frontiers is alien. Neither can the Muslim economy be as easily defined as other cross-border markets such as the “green economy” or the “pink dollar”. Economist Ben Simpfendorfer suggests that the strong cultural and historical links between the Muslim and non-Muslim worlds are starting to come to the fore. He gives the example of China as a country that is addressing the Muslim opportunity. In his book, “The New Silk Road”, he cites the example of the city of Yiwu where an estimated 200,000 Arab nationals visit the Chinese coastal city every year because it boasts the largest wholesale consumer goods market in China. What sets Yiwu apart is that it has made commerce convenient, particularly for Muslim buyers from the Middle East and beyond. Besides products that appeal to Muslim consumers, Yiwu’s success lies in an open arms approach that the Chinese government has shown to Muslim traders and consumers. A prayer hall for nearly 10,000 worshippers has been constructed by the government, Halal food is easily available, while clerics appointed and subsidized by the government lead prayers – this at a time when governments in the west are questioning minarets on Mosques (Switzerland) or public prayer gatherings (France). For brands that find ways to embrace and engage the Muslim consumer, the rewards are rich. And smart, compelling communications will play a critical role in targeting a consumer market that already represents nearly a quarter of humanity. Much has already been written about Islamic finance and the Halal opportunity, and in more depth than we cover. Our purpose in this report is to flag up the development of the opportunity, highlight where the greatest potential lies and analyze the communications and reputation issues that companies need to be aware of. Fleishman-Hillard Majlis has adopted a clear position on the opportunity, which is to help both Muslim and non-Muslim organizations navigate the market and provide some pointers that companies need to consider. We believe that the next four to five years will see this market become more pronounced as the consumer base grows – in size and spending power – and companies need to have a clearer understanding of the opportunity and a strategy to adapt their brands to the Muslim consumer.

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1.8

2.2 billion

billion

30% of total world population

THE HALAL ECONOMY

increase

26.4% of total world population

35%

2.6

Excluding Islamic finance and banking, the global Halal market is valued billion at about US$2.3 trillion and is one of the fastest-growing global consumer markets. The worldwide Halal food market alone is worth an estimated US$650 billion or more and is close to 17 percent of the global food industry – presenting a major global opportunity. While the market has many facets and niche segments, understanding the umbrella term “Halal” is fundamental to approaching this market.

YEAR

2012

2030

2050

The largest opportunity within the Halal market is undoubtedly food, which is also where the greatest challenge lies. Indeed, the term Halal has become synonymous, in some Muslim minority countries, with food and is almost universally associated with the ritual slaughter (or Zabiah) of animals. This has narrowed the discourse around Halal, limiting the focus of many organisations and contributing to misunderstandings and reputational issues.

Muslim Population

26% Pharmaceuticals

Halal Market

11% Cosmetics 2% Other 61% Food

In the view of some non-Muslims, Halal goes against general sensibilities by requiring all blood to be extracted from meat (in much the same way as Kosher food). Thus, Halal, to some audiences, has become a negative word. But, given the size of the market and the relative ease with which food can be ‘converted’ to Halal, some companies have quietly introduced ‘Halal by stealth’. But this has only exacerbated the problem and, in the view of this report, held back the wider availability and acceptance of Halal products. The media have been quick to pick up on this growing trend, criticizing companies that have converted to Halal products without informing consumers. This has often led to consumer push-back and has damaged companies’ reputations and the Halal market at the same time. For instance, in the UK, Kellogg’s has come under fire from the media for including Halal certification on cereal boxes without formally announcing that the product is Halal-compliant. Criticism of Kellogg’s quickly expanded to an attack on Halal food in general. The marketing director of a leading fast food chain explained the challenge his company faces with Halal: “We know that the Halal market is huge and the potential is great but there are also challenges that have stopped us from a full-fledged endorsement of Halal. The big issues of Halal certification and the diversity of the overall market aside, the challenge we always face is balancing the needs of the Muslim minority

consumer against our other consumers. We face a communications tightrope and backlash if our main consumers believe they are being fed Halal products. There is great resistance to Halal and it is mostly down to a misunderstanding of what Halal is. Most consumers still associate Halal with ritual slaughter and they are uncomfortable with religion being ‘injected’ into their products. The biggest problem is a lack of understanding.” In short, Halal offers a great opportunity to target a relatively untapped market, but only if done correctly. On one hand, the Muslim market needs to be confident that the Halal product is genuine and authentic. As the author of a Knowledge@Wharton blog states: “Halal status should be preserved, not misused. If consumers lose confidence in the product’s Halal status (sic), they will not continue to buy it.” On the other hand, the non-Muslim public needs an opportunity to understand Halal in a nonemotional manner. For food product companies based in countries that are not predominantly Muslim, industry trade groups can educate customers on the facts behind Halal. Advisory boards made up of social, religious, academic, and nutrition and health experts can also create an appropriate forum for the consideration of relevant topics.

The term Halal, which means permissible in Arabic, refers to a product that adheres to Islamic law relating to consumption. Halal products are spread across several industries, including food and beverages, cosmetics, fashion and healthcare. Halal has become synonymous with the way an animal is slaughtered (to render the meat Halal). However, Halal (even within food) is a wider concept and extends to much more – from animal welfare to the investment structure of a company. For instance, a company that has interests in gambling or alcohol would not be considered a Halal investment. The opposite of Halal is Haram, translated as forbidden or not allowed. Islamic law also has two intermediate categories: Mashbooh, which means questionable and refers to a product whose status (Halal or Haram) is not fully known, and Makrooh, products that are not certified as Halal but not declared as Haram and are best avoided (if possible).

Brand marketing efforts can include the cultivation of a product’s fans to provide online advocacy. The foundation of these efforts requires research into the awareness and opinion of current and potential customers, as well as testing of a company’s marketing and educational messages and programs.

Medical, Pharmaceutical, Cosmetics and Personal Care: This promises to be another large growth area in the global Islamic market. For many Muslims who want to comply with Shariah Law and consume only what is Halal, there is a growing industry in generic medical, pharmaceutical, wellness and healthcare products that exclude non-compliant substances such as certain animal-based gelatines. The growth of this category, spurred by newly created Halal standards and accreditation facilities, has led some countries, such as Malaysia, to provide support to companies that manufacture medicines, pharmaceutical and cosmetics products. The Halal cosmetics market alone is worth an estimated US$13billion and is growing at a compound annual rate of about 12 percent. Luxury markets, such as the Middle East, Singapore and some European markets, are also seeing a surge in interest in Halal cosmetics. A number of cosmetics companies are beginning to develop this market by releasing Halal-certified product lines that contain no animal ingredients and are not tested on animals. In fact, the market potential of these products extends beyond Muslims to vegetarians/vegans and those concerned with animal welfare. In some markets, 60 percent of Halal cosmetics brand users are non-Muslims who see Halal brands as either ethically sound or organically pure. Growth in the Halal cosmetics market is mirrored by a growth in consumer knowledge and product awareness, fuelled by social networks.

The Body Shop – taking advantage of the Halal opportunity: The Body Shop, although not a certified Halal brand, is a popular choice among consumers because it does not contain animal products and takes a clear stance against animal testing. In the Middle East, The Body Shop is marketed in line with Muslim values without alienating other customers. Similarly, luxury perfume brands have realised the potential held by the affluent Muslim consumer by creating nonalcohol based perfumes and utilizing local ingredients such as Arabian Oud

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A 2009 survey conducted in Malaysia showed that although current awareness of Halal cosmetics is still low, this is changing as more and more consumers claim to prefer purchasing Halal cosmetics, if and when they are available. Among these respondents, however, more than half admitted to having difficulty finding Halal cosmetics. Increasingly, awareness of the use of porcine-based ingredients in cosmetics is creating a movement towards Halal-certified products. The use of swine placenta in cosmetics, including wrinkle creams and facemasks (due to its biological similarities to human placenta and its skinhealing properties) is becoming a major issue among Muslim consumers. Issues that could arise in the area of Halal cosmetics can be seen by a recent fatwa (ruling) that suggested the use of Botox by Muslims may be forbidden. This led to a drop in sales of Botox procedures in markets including Malaysia, Indonesia and the Middle East.

The Halal cosmetics market is worth an estimated US$ 13billion and growing at an annual compound rate of around 12 per cent; luxury markets such as the Middle East, Singapore and some European markets are seeing a surge in interest in Halal cosmetics. ‫ُيق ّدر سوق مستحضرات التجميل من‬ ‫ مليار دوالر‬31 ‫املكونات "احلالل" بنحو‬ ‫أميركي ومبعدل منو سنوي ُم َر ّكب تبلغ‬ ‫ وتشهد‬،‫في املائة‬21 ‫نسبته حوالي‬ ،‫ كأسواق الشرق األوسط‬،‫األسواق الفاخرة‬ ‫وسنغافورة وبعض األسواق األوروبية‬ ‫تزاي ًدا كبي ًرا في االهتمام مبستحضرات‬ ."‫التجميل من املكونات "احلالل‬

The Halal pharmaceutical industry is estimated by some analysts to be worth as much as US$500 billion. As with the food industry, pharmaceuticals present enormous challenges to the Muslim community. This is partly because the Islamic laws that govern medicines are different and more complex than those for food. But it also stems from the fact that pharmaceutical products, especially non-OTC products, do not always detail ingredients in the same way that food products are required to do. The prevalence of porcine substances in medicine can be high and, in many cases, difficult to identify. Historically, the BSE (Bovine Spongiform Encephalopathy or “mad cow disease”) outbreak in the late 80s in Europe brought about a conscious move from bovine to porcine-based materials for many pharmaceutical products. The Halal Index, developed in Malaysia, provides a list of Halal and Haram compounds used in the pharmaceutical sector and is designed to raise awareness among Muslim consumers and the pharmaceutical industry. A contributor and supporter of the index, Professor Dr. Zhari Ismail, Professor in Pharmaceutical Chemistry and lecturer of Medicinal Chemistry and Pharmacognosy at Universiti Sains Malaysia, said: “While much has been written on the subject of Halal and Haram in the food industry, there is no single work that does the same for Halal and Haram in the pharmaceutical sector. With the Halal Index, we have sought to deal with the complex issues surrounding Haram and porcine compounds in the pharmaceutical chain. Our purpose is to educate Muslim consumers and direct them towards alternatives.” The Index and other information sources (online and in print) present an opportunity for some and threats to others. The Islamic ruling is clear that Haram (forbidden) components are Halal (permissible) only if alternatives are not available. For pharmaceutical companies that offer synthetic enzymes, for example, the opportunities are greater. For a traditional product with a porcine component or a capsule made of gelatine, however, a significant part of the market could be at risk.

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Supply Brazil, the world’s largest exporter of beef and one of the largest producers of poultry products, exports between US$2 to $6 billion in Halal products every year. Industry reports have revealed that 33 percent of Brazilian poultry and 40 percent of its meat production are classed as Halal. Neighbourhoods such as Bras in Sao Paulo are lined with Halal butchers catering to Brazil’s two million-plus Muslim population, as well as for export to other South American countries. A substantial proportion of New Zealand lamb is Halal – some estimates suggest as much as 70-85 percent. Turkey is leading an effort to establish Halal standards across Europe. In April 2009, its Good Auditing and Certification Research Association (GIMDES) started issuing Halal certificates for Turkish food manufacturers. A number of Asian nations have begun to emerge as centers for Halal standardisation, research, testing, production and international trade. Malaysia is aiming to become an international Halal hub and has championed the World Halal Forum to create a platform for discussions around Halal. Malaysia is also developing the Malaysian Standard for Halal Pharmaceutical – MS 2424:2010 – which provides a set of guidelines for Halal pharmaceutical manufacturers looking to capture the global Halal market. Malaysia’s export of Halal products for the year 2011 was 5.1 percent of the country’s total exports. The food industry in Singapore is also attempting to become a Halal hub and has launched large advertising campaigns in the Middle East. Thailand is striving for recognition as a Halal center of excellence in science and testing. China and India have expanded Halal industries, with a competitive advantage because of low labor costs. Increasingly, retailers and manufacturers are publicly promoting Halal products via the mass media. Other global brands are promoting Halal products, which now account for about 5 percent of Nestlé’s total annual revenue. This includes tea, coffee, infant formula, baby food and breakfast cereals. Nestlé is the world’s leading manufacturer of Halal food, with 2008 sales of about $5.23 billion. Its established Halal food markets include Malaysia, Indonesia, Turkey and Middle Eastern countries,

while France, Britain and Germany are emerging as its key Halal markets in Europe. Abbott is the first company in the food industry to obtain Halal certification for all its products eligible to be certified. The company can now market its products around the world under a Halal assurance and has communicated to Muslims living around the world that Abbott Nutrition products are truly Halal.

Demand To feature global Halal market and key hotspots around the world, inc: Indonesia, United Arab Emirates, Algeria, Saudi Arabia, Iraq, Morocco, Iran, Malaysia, Egypt, Turkey, Tunisia, Kuwait, Jordan, Lebanon, Yemen, Qatar, Bahrain, Syria, Oman and Pakistan.

Mulsim Population by Country Indonesia

205 million

pakistan

178 million

India

177 million

bangladesh

149 million

egypt

80 million

turkey

75 million

China

23 million

Russia

16 million

Philippines

5 million

France

5 million

Germany

4 million

United Kingdom

3 million

The fastest growing region is Asia, driven by countries that include Indonesia, China, India and Malaysia. Increasing popularity of the Halal market in Europe is driven by Russia, France and the United Kingdom. The United Kingdom has a Muslim population of around 1.6 million (or nearly 3 percent of the total population). Most are immigrants from South Asia, particularly Pakistan, Bangladesh and India. The European Halal food market was valued at around US$67billion in 2010. More multinational corporations are selling Halal produce, including retailers targeting Muslim customers through Halalspecific shelf space in their hypermarkets. Nestlé has estimated that the Halal food business in Europe may grow by 20 to 25 percent within the next decade.

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Some countries are taking advantage of the Halal food market opportunities by attempting to become Halal hubs or, at least, centers for Halal growth. Two such countries are Malaysia and Brunei.

Malaysia: A Case Study in Halal

In recent years, a number of Asian nations have begun to emerge as centers for Halal standardization, research, testing, production and international trade. Malaysia is at the forefront of this bold move to become an international Halal hub.

Halal consumption is not limited only to the Muslim population; other consumer goods are seeking halal food due to halal food’s reputation for healthy and safe food products and the humane treatment of animals.

‫وال يقتصر استهالك البضائع احلالل على‬ ‫ بل يسعى‬،‫سكان الدول اإلسالمية فقط‬ ‫مستخدمو السلع االستهالكية األخرى إلى‬ ‫األغذية احلالل ملا جنته األغذية احلالل‬ ‫من سمعة في توفير منتجات غذائية‬ ‫ وضمان املعاملة اإلنسانية‬،‫صحية وآمنة‬ .‫للحيوانات‬

Malaysia has separated the Halal certification element of its products from the promotional and informational aspects. The certification agency, which accredits Malaysia’s companies and products, is the Malaysia Department of Islamic Development (JAKIM) and the promotional/knowledge agency is the Halal Industry Development Corporation (HDC). The Halal Industry Development Corporation and its Halal Knowledge Centre (www.knowledge.hdcglobal.com), have been created to position Malaysia as the global support center for all Halal standard products and services. Malaysia also organizes the world’s largest Halal conference, the World Halal Forum, and HDC presents the annual World Halal Research Summit. On the logistics front, Malaysia has designated one of its two largest seaports as Halal, supported by a local Halal shipping service. Malaysia has also adopted a Halal pharmaceutical standard (MS2424:2010). Backed by the success of its Islamic finance initiatives, Malaysia can provide many solutions to companies wishing to access and explore the global Halal market. For example, Nestlé Malaysia, producer of the global company’s biggest range of Halal products, celebrates its centenary in 2012, and is now the company’s global Halal Centre of Excellence. Nestlé Malaysia produces about 300 Halal products in its food and beverage line, which it exports to more than 50 countries worldwide. Malaysia was Nestlé’s first market to apply for Halal certification for all its food products, following the Malaysian government’s introduction of voluntary Halal certification in 1994.

Developing a Halal brand: The Brunei Halal Brand The Brunei Halal Brand is a unique government project initiated by the Ministry of Industry and Primary Resources with the cooperation of the Brunei Islamic Religious Council and its Ministry of Religious Affairs and Ministry of Health. It was launched in 2011 to address the challenges to Halal certification and labelling by proving a support infrastructure for Halal products. The Brunei Halal Brand is given to products that are certified Halal and considered to be of high quality. The brand targets the regional market and the Gulf Coast Countries, as well as Europe and the United States. It is part of Brunei’s aim to become one of the major players in the Halal economy. By offering Halal products, Brunei is observing the Islamic obligation of “Fardh-e-Kifayah” (where one body provides a service for the

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benefit of an entire community). The development of this brand also gives Brunei the opportunity to diversify its economy away from a reliance on oil and gas, while opening opportunities to export local products and support its small to medium sized market.

.

Brunei is relying on its major strength – the high quality of its certification standards – to attract companies wishing to leverage their marketing efforts by gaining Brunei accreditation. As the Brunei Halal website (http:// www.brunei-halal.com/) describes it: “The Brunei Halal Brand offers the kind of backing you need to have total trust in your Halal purchases. Our green motif is set to become the benchmark for Halal, quality, safety and sustainability. Any product that carries it will have undergone rigorous inspections and tests to ensure it complies with our exacting standards. And while we make it tough for food providers to earn the green mark, you will find it easy to instantly identify Halal, safety and quality with our distinctive logo”. The Brunei Halal Brand was launched with the signing of a joint venture partner from Hong Kong – Kerry FSDA Ltd. – to form a company called Ghanim International Food Corporation Sdn. Bhd. The combination of Brunei’s highest standards of Halal integrity together with Kerry’s product, marketing and distribution expertise has enabled Brunei to get products to markets efficiently and effectively.

The Consumer Major growth in Asia has been driven by higher incomes and changing lifestyles, as more affluent Muslim consumers look for a more diverse range of Halal products. In the Middle East and Europe, strong economic growth and rising per capita incomes have fueled demand for diversified Halal products, enabling higher consumption levels and more opportunities for Halal food producers. Halal consumption is not limited to the Muslim population. Other consumers are seeking Halal food because of its reputation for health and safety benefits and, by some interpretations, its more natural, ethical or humane treatment of animals. In the United States, Muslims spend around US$16 billion a year on Kosher products, because of the lack of Halal products. For each Halal product, there are 86 Kosher products available on the market.

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ISLAMIC FINANCE

Modern Islamic finance and banking emerged in the 1940s and developed in the 1970s into the current stable of mostly interest-free products. Islamic financial institutions have expanded in many parts of the world and, since the financial downturn of 2008, have established themselves as an alternative to mainstream banking, in large part because of Islamic banking’s prohibition on interest and speculation. The approach has become so well accepted, in fact, that few eyebrows were raised when the Vatican’s newspaper Osservatore Romano said banks should look at the Islamic finance model to restore confidence among their clients. The author even suggested that the 2012 Olympic Games in London could have been funded through Islamic bonds (known as Sukuk). The extent of Islamic finance’s growth, according to figures cited by The Banker magazine at the end of 2011, shows that assets compliant with Islamic banking’s Shariah Law topped the US$1 trillion mark and recorded another year of double-digit growth. The total value of Shariah-compliant assets has grown by 150% since 2006 and, by many accounts, Islamic banking has been growing at a rate of 10 to 20 percent per year with signs of consistent future growth. The industry’s global assets are expected to rise 33 percent from 2010 levels by the end of 2012, according to consultants Ernst & Young. Today, Islamic banks have more than 300 institutions spread over 51 countries – including the United States – through companies such as the Michigan-based University Bank. There are also some 250 mutual funds that comply with Islamic principles.

The United States is now one of the largest markets in the world for Islamic finance and investment transactions and some analysts predict the launch of a US Islamic bank by 2020. However, The USA is constitutionally disallowed from asking the religion of its population and, therefore, finding out where Shariah compliant products are needed can be difficult.

Figures from the Statistical, Economic and Social Research and Training Centre for Islamic Countries (SESRIC) show that Islamic products represent about 1 percent of the global financial system, while Muslim countries account for about 7.6 percent of the world’s GDP. Growth among the 57 Muslim majority nations is greater than in the rest of the world, underlining future potential. Globally, around 12 percent of Muslims use Islamic financial products, but as other countries (predominantly Muslim or with large Muslim populations) express interest in using more of these services, the market seems likely to continue growing. One of the pioneers of modern Islamic finance is Iqbal Khan, who started HSBC Amanah and is the founder and CEO of Fajr Capital. He explains: “Growth in Islamic finance can be seen in many parts of the world and especially in emerging economies in Asia and the Middle East, where Islamic finance seems finally to have come of age.” “In many ways, the recent financial downturn seems to be moving consumers towards alternative banking, and Islamic finance and banking have not only demonstrated their resilience to the issues that conventional finance faced – they are also emerging as ethical alternatives. In many respects, some stakeholders see Islamic banking in the same way that people have long seen co-operative and mutual banking. And that is a good thing, as far as I’m concerned.” He suggests that growth in Islamic banking is inevitable, since vast numbers of Muslims do not use conventional banks and some use no banks at all.

Islamic banking is governed by Shariah Law and prohibits, among other things, the use of interest or speculation. Shariah also prohibits the fixed or floating payment or acceptance of specific interest or fees (known as Riba or usury) for monetary loans. Investing in businesses that provide goods or services considered contrary to Islamic principles is also Haram (forbidden). Islamic finance is, by definition, all about taking a risk – because any sort of guaranteed return to investors would be regarded in Shariah Law as the receipt of interest, which is forbidden. The global Islamic finance and banking sector is pegged at US$1 trillion with an estimated growth rate that is four times higher than conventional financial services that should see it the global Islamic finance sector valued at $5 trillion in 2016.

Islamic Finance Opperations Around the World India – home to approximately 150 million Muslims, is seen as the largest untapped market for Islamic banking and finance. Malaysia – the country’s importance as a financial hub and the health of the Sukuk market underline the rising interest in Islamic finance, as the demand for Shariah-compliant products spreads around the Asia Pacific region. Singapore – changed laws to create a market in Islamic property investment trusts. Indonesia – positive developments include reform of the approval process for Islamic banking products. Australia – looking at legal reforms to encourage Sukuk issuance. One region that has proved disappointing for some is the UK, the main center for Islamic finance in the non-Muslim world. Since the British government decided not to issue a sovereign Sukuk, some believe the market has lost its momentum.

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The Current Sukuk Market The issuance of Islamic bonds has surged in 2012, despite surrounding controversies, such as the minimum number of Islamic scholars who need to endorse a bond, the absence of a single, worldwide body to set standards for Shariah compliance, and product standards that are sometimes contradictory and that act as loose guidelines rather than firm, enforceable rules. Investors also often think they own the assets involved in a Sukuk, but may only own the right to the cashflow from assets – a crucial difference in a default. According to the latest quarterly report from Zawya, a business information firm, global Sukuk issuance in the first quarter of 2012 was $43.3 billion, almost half the total for all of 2011.

To date, Islamic finance consists of over 300 institutions spread over 50 countries, with an additional 250 mutual funds that comply with Islamic principles. ‫ تتألف املؤسسات املالية‬،‫حتى تاريخه‬ ‫ مؤسسة‬003 ‫اإلسالمية من أكثر من‬ ‫ باإلضافة‬،‫ بل ًدا‬05 ‫موزعة على‬ ‫ صندو ًقا استثمار ًيا‬052 ‫إلى‬ ‫مشتر ًكا متواف ًقا مع مبادئ الشريعة‬ .‫اإلسالمية‬

From practically being non-existent a decade ago, total issuance could reach $126 billion this year. The variety and scale of the projects financed utilizing this model have ensured its continued buoyancy. Malaysia, which dominates the global Sukuk issuance market, is more than 60 percent Muslim, and Islamic banking assets make up around a quarter of the country’s total. Indeed, the success of Sukuk and its asset-backed nature have established a completely new asset class that has combined Shariah compliance with returns that are competitive with conventional finance. Globally, only 7 percent of Islamic funds are currently invested in Islamic bonds, compared with the 22 percent of conventional funds being invested in fixed income instruments, according to Ernst & Young. As Islamic and conventional fund managers adjust their portfolios, the demand for Sukuk will grow accordingly. Sukuk provides a relatively easy way for western companies to tap into Islamic finance pools, as well as allowing Middle Eastern governments and companies to attract western finance.

“The proportion of the unbanked is likely to be higher among Muslims – partly because countries like India and Bangladesh happen to have large Muslim populations who are unbanked, but also because Muslims have a different relationship with conventional banking. These consumers will have a natural affinity with Islamic banking and greater relevance makes them part of the growth in this sector,” Khan said. Of the Next Eleven group of countries – Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, the Philippines, South Korea, Turkey and Vietnam – seven have sizeable or majority Muslim populations. Combined with large Muslim populations in countries such as India, China, Malaysia and other emerging markets, the demographic dividend of a young population and new middle classes bodes well for Islamic finance. In many of these countries, consciousness of Islamic products is already high with consumers preferring their “own products.” Data compiled for this report shows that nearly 60 percent of Muslim consumers would consider switching to Islamic banking from conventional banking if a comparable product existed, while a majority of Muslim consumers polled in the UK, Turkey, India and Malaysia are actively seeking 12

Al Baraka Islamic Bank in Manama, Bahrain

investment opportunities with Shariah-compliant products. Of this group, less than half claim to have succeeded in identifying a product that meets both their Islamic and investment needs. As developing nations become more sophisticated, more of their citizens will begin using banks and financial institutions, with many likely to do so in line with their religion, say strategists. Interestingly and importantly, Islamic finance is also attracting the attention of non-Muslims in significant numbers. Our research reveals that some western and local Islamic banks are attracting more new non-Muslim than Muslim customers to their retail banking services. On the wholesale side, Malaysia’s sovereign wealth fund launched the world’s first Chinesecurrency Islamic bond in 2011. The Renminbi Sukuk was heavily subscribed by global investors, but also by members of China’s Muslim population of nearly 90 million. China has also awarded its first Islamic banking license, allowing its banks to offer Shariah-compliant products.

Kuwait Finance House’s Malaysian unit has 40 per cent of the depositors and 60 per cent of its borrowers are non-Muslims ‫متثل نسبة غير املسلمني في بيت‬ ‫ في‬04 ‫التمويل الكويتي في ماليزيا‬ ‫ في املائة من‬06‫املائة من املودعني و‬ .‫املقترضني‬

In summary, the discontent that still surrounds conventional finance, combined with the growing understanding and appeal of this viable alternative model, add up to substantial opportunities for the global Islamic finance industry. However, there are also some potential hurdles that need to be understood and overcome.

Innovation and Training Challenges It is widely suggested that if the Islamic finance industry is to live up to its potential, it will have to produce more innovative products and ensure that skilled human capital is more widely available. These are difficult challenges to meet. Presently, Islamic banking and financial products are clearly limited in comparison with conventional portfolios. The route to innovation is, in the main, market liberalization that allows for new product development. Malaysia’s success as an Islamic finance hub is a prime example, with many specialized products widely used in many forms. For example, experimentation has been allowed that has led to such innovations as healthcare and plantation REIT instruments. While demand for Islamic banking is on the increase, service quality and product development tends to lag behind. Banks and other institutions are product-focused, and as a result have not developed the more intangible side of the customer brand experience. The lack of trained human capital on the service side places local banks behind their western counterparts, resulting in a distinct shortage of services to cater to the fast-changing lifestyles of Muslims. And across the Islamic finance industry as a whole, the skill base is inadequate.

Communications Challenges Despite its growth potential, the Islamic finance market faces further potential issues that could check future growth. First is a record of poor marketing, with an emphasis almost entirely on products versus the needs of investors. Also, Muslim and non-Muslim consumers alike are faced with a barrage of complex new terminology. A plain-spoken approach and active outreach to educate the consumer on Islamic finance are key needs. Companies such as HSBC and UBS have done this to some extent, but further expanding the market will require a more sustained and coordinated effort to explain the underlying concepts of Islamic finance. 14

Particular issues that require communications solutions include the following: Addressing controversy – Sukuk remains controversial among Muslims, since Islamic law insists on a “real” asset (such as real estate, equipment or a factory) to underpin the offering. Most Islamic bonds are structured so that they are “asset-based” rather than “asset-backed.” The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) has previously stated that some structures do not comply with Islamic law closely enough. Although this discussion has largely dissipated, it worries some investors. Addressing this potential issue and providing clarity on the surrounding issues is critical to easing such worries.

Asset-based Sukuk: These issues are more like debt, since investors do have recourse to the originator in case of a shortfall in payments. Asset-backed Sukuk: The originator sells the assets to a special-purpose vehicle (SPV) that holds them and issues the Sukuk. Buyers of the Sukuk do not have recourse to the originator if there is a shortfall in payments. The asset-backed Sukuk, which are closer to equity than debt, represent a minority of Sukuk issues. An issue of contention in recent defaults has been whether the SPV (and thus the Sukuk holders) truly have complete ownership of the assets.

Brand credibility – While global banks can trade, to some extent, on the equity of their brand names, local Islamic banks find this more difficult, as they are not usually skilled at branding and marketing techniques and their brand images suffer. In many cases, they rely on playing the local religious angle, which does not work outside their own countries – nor, in many cases, inside them. When, in a product-sense, all is equal and knowledge of products uncertain, strong brands win. This is the case with HSBC Amanah and Standard Chartered Saadiq, which have strong brand credibility and equity across many Muslim countries. Shortage of scholors – An inherent issue facing Islamic finance is that as demand inevitably grows, the sector may not be able to keep up with credible support systems – including Shariah committees – to underpin products. Currently, a very small number of Shariah advisers control the reins of the US$1 trillion industry through their rulings on whether financial products satisfy Islamic law.

Finance products and services at Islamic banks must be approved by a Shariah committee consisting of an independent panel of scholars and experts who are appointed by the financial institution. This committee issues fatwas on whether the product is in line with Islamic law.

Though there are more than 400 Shariah scholars worldwide, it is estimated that only around 15 to 20 are experienced in Islamic banking. This shortage creates demand for scholars to sit on multiple boards.

Scholars must understand Islamic law, have credibility in the community and be knowledgeable enough on modern finance to cover both aspects of their job – commercial acumen and religious knowledge.

The top scholars hold 14 to 85 positions each, occupying a total of around 620 board positions or 55 percent of the industry, according to data compiled by investment research firm Funds@Work. Communications paradox – For Islamic finance to grow beyond a niche, it has to become more mainstream – but the more it moves towards the mainstream, it risks credibility and appeal as a customized category serving unique needs. Also, as Iqbal Khan points out: “There will always be a resistance to the concept of Islamic finance the moment Shariah is used to explain it or, for some, when Islam is mentioned. The sensitivity in certain areas to Shariah will be problematic.”

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Additionally, and in connection with the above, Islamic products are not easily understood, particularly at retail level. Mass advertising does not work because of this fact and to the ‘religious’ perception – the ‘backlash’ effect in non-Muslim countries. Both western and local banks have found it difficult to communicate how products work and why they should be bought. Much more face-to-face marketing and community involvement is required to be successful, and new approaches have to be learned. Reputation – In October 2011, Goldman Sachs launched its first Islamic bond, a US$2 billion Sukuk, as a product to comply with Islamic law, approved by a group of eminent scholars for listing on the Irish Stock Exchange via a Cayman Islands registered vehicle. 15

In its prospectus, Goldman Sachs advises (even warns) that “as with any Shariah views, differences in opinion are possible.” The bond quickly faced criticism by many commentators for not ensuring the debt will be traded at par value, as mandated by Islamic law. Commentators also cited uncertainty about whether Goldman Sachs would use the funds it raised in compliance with Shariah law, which would prevent it from paying interest and investing in businesses associated with gambling or alcohol. Legal complexities aside, some observers say Goldman Sachs failed to explain its product from the outset and hurt its reputation by not gauging the way many in the Islamic community would react to its entry into this sensitive sector, given its background in conventional banking. As one commentator posted: “It’s a bit like a genetically modified food company, announcing a range of organic products.” The capacity to develop an offering tailored to an Islamic marketplace is just one component of success. A company’s products and services must stand up to scrutiny, and Islamic customers and business partners must accept the broader context of the company’s business relationships, its reputation, its operations, and its use of funds. Contrast this with the work that HSBC Amanah has done in reaching the Muslim consumer. Its focus has been on developing a proposition with clear messaging, delivered through non-traditional marketing formats that seem to have resonated better with the target audience. Eschewing mass advertising for discrete promotional work either in niche titles and through on-the-ground community engagement has worked better with Muslim consumers. HSBC Amanah’s discrete positioning has also worked to explain Islamic banking to non-Muslim consumers and prevented the backlash effect impacting the parent brand.

A Summary of the Opportunities • Muslim consumers seem to be actively seeking alternatives to conventional banking and would consider switching to an Islamic option if available. • Islamic finance products suffer from poor marketing and have focused too much on the product side and not enough on consumer needs. The products also require considerable explanation, while the combination of banking and religious terminology is doubly confusing. • Islamic finance companies, especially at the retail level, need to invest more in education, branding and communication. A ‘launch it and the consumer will come’ approach is not enough. • Credibility and reputation are critical in this space and greater consideration needs to be placed on managing the brand image through communication. • Islamic products are not easily understood, especially at the retail level, and more education communication needs to be considered by companies and at a cross industry level. • Face-to-face marketing and community involvement are important channels for explaining Islamic finance to the target consumer.

16

Petronas Twin Towers in Kuala Lumpur, Malaysia

MANAGING REPUTATION

Realizing the opportunities of this new market depends to a large degree on clear, effective communications in what can be a charged environment. Whole Foods faced a consumer issue in 2011 after introducing a Halal range of products. The media received a leaked memo from one of its regions that asked some stores to limit point-of-sale promotions for Halal products. Whole Foods quickly clarified its position on Twitter and confirmed that it did not cancel the promotion and that it was “excited” to be offering Halal products to customers. By stating that “we stand behind them and our promotion of them, just like we do with other seasonal and holiday products”, Whole Foods managed to downplay any special significance attached to its Halal products. Whether in their home markets or in new predominantly Islamic markets, companies that wish to expand their base of business need to form real relationships with customers, employees, business partners and communities that share Muslim values. It is essential that companies understand how they and their products are actually perceived, versus the perceptions they seek. Research to answer these questions is similar in Islamic markets as in other market segments or regions, except that the techniques, subjects, and protocols for interaction must reflect the culture and structure of the specific Islamic market being addressed. In many locations, a snapshot of social media topics associated with a company and its brands can be an effective starting point. Research results are best understood if a company’s team has immersed itself in issues and opportunities associated with Islamic markets. Such workshop-style sessions should cover specific issues related to the product category, the company’s history with sensitive issues, and a review of other companies that have faced challenges in similar situations. In-market message testing and product positioning support are essential whenever a product is ready for introduction or market expansion. The same is true for communications to non-Islamic audiences about the brand or company’s move into Islamic markets. Because of the 24/7 global nature of information flow, companies must be ready to handle issues or reactions that arise in one market and spread quickly to others. Issues management in this context requires two kinds of prevention. First is an on-going effort to monitor political and social concerns, as well as news involving other multinational companies in their dealings with Islamic markets. The second is a continuing effort to build a real understanding of, and active relationships with, the Muslim community in each market. Such engagements form a basis for learning as well as a source of potential support if problems arise.

A Summary of the Opportunities • The Halal economy presents a huge opportunity for brands to target a new, emerging consumer that is becoming more conscious about the products he/she consumes. • The Halal opportunity is dominated by the food sector, but new areas are beginning to take shape that are already presenting new opportunities for growth – from pharmaceuticals to tourism to clothing and cosmetics. • Educating all consumers (Muslim and non-Muslim) about Halal is long overdue in most markets – too many misconceptions exist that have shaped public consciousness against the concept of Halal. • There is a need for an industry wide approach to explain Halal in much the same way as organic foods have been explained and promoted. • The introduction of Halal without explaining it first, or by stealth, is one of the major issues facing mainstream brands and a media flashpoint that brands need to be careful to avoid. • Advisory boards made up of academic, nutrition, health experts can help improve the image of Halal brands and extend them beyond the Muslim consumer. • Social media channels have provided an active outlet to discuss products and their Halal credentials and this presents both an opportunity and a risk to most brands.

Dissecting this issue presents an important case in how to manage an organization’s reputation when addressing the Muslim issue and the potential for damage in wider communities. ‫يقدم حتليل هذه القضية دراسة مهمة‬ ‫في كيفية إدارة سمعة املؤسسة عند‬ ‫تناولها ملسألة تتعلق باإلسالم واحتمالية‬ .‫وقوع ضرر في املجتمعات األوسع‬

19

the connected muslim

The Muslim market lends itself well to digital communications for two reasons: The demographics of the market are in line with general digital communications trends, and traditionally, Muslims operate as a minority in the media. As the MuslimYouth blog suggests: “Muslims generally, and the youth in particular, have never really had access to mainstream media where it matters and counts. Our voices have been limited to niche, late night programs or when there is a particular issue. The Internet and social media are the great levellers.” Digital channels are also able to maneuver between groups within Muslim communities – Sunni to Shia, Arab to Asian and male to female – allowing Muslim consumers to interact without the usual constraints of geography and cultural norms. In fact, digital platforms open more of the Muslim community to brands than ever and, since such interactions are direct, they are also likely to be more authentic. Sub-segments, such as difficult-to-reach Muslim women and Muslims in emerging markets, such as India or Egypt, have become easier to reach through online channels. The now defunct Muxlim.com was a perfect example of the need for and viability of a faith-based digital business. Headed by Mohamed El-Fatatry, the company was created as a Muslim lifestyle social media network with a primary focus on Muslims in Muslim minority countries. The company was also known for providing marketing gateway services to the global Muslim consumer market, using Muxlim.com as a launch pad for marketing messages by global companies and attracting marketing spend from brands including PepsiCo, Wilson Basketball and Ulker Foods (of Turkey). It was registering nearly a million Muslims every month at its height in 2010-2011. Muxlim’s founder explained the uniqueness of the opportunity as a niche market that is also a fifth of the global population: “We first called it MuslimSpace but after some references and comparisons were made to Linux, decided to rebrand it Muxlim. At the time of the launch, we found many sites that offered core religious services or marriage services, and a lot of political analysis websites. There was nothing for the Muslim consumer, or for general social networking, and the target audience felt unserved – they wanted a site where they could share content about the fashion they were interested in, the music they wanted to listen to, or the movies they watched.” Muxlim was ultimately shut down in February 2012. Today the online space for Muslims is without a dominant player. Journalist and blogger Ali Eteraz said he has seen sites such as Muxlim and Mecca.com pick up a large number of members at launch, but then growth slows significantly, usually when constraints on marketing budgets occur. Eteraz also suggests that in the digital space, Muslims aren’t looking for niche, minority services but want to be part of the mainstream. Facebook remains popular with this group because it treats them as any other consumer, and the Muslim social network user is no different from other social network users. Currently, thousands of Facebook Groups have a Muslim link, some with a handful of fans, many with multi-million followings. Interestingly, some groups are discussing Halal, where mainstream brands are sometimes given a thumbs up or down among millions of Muslims, without the brands

taking part in the conversation. For instance, The Halal Food group on Facebook has over a million fans discussing brands from Nestlé, Mars and Unilever, declaring some of them as Haram (or forbidden to Muslims). At no point in the conversations does there seem to be representation from the brand itself. Brands including Vodafone, MoneyGram (see below) Nokia and the UAE’s Mobily seem to be actively reaching out to Muslims through targeted campaigns.

Examples of campaigns

Demographic estimates suggest that by 2050, Muslims will account for around 60% of the world’s population under 18 years of age.

The Halal Facebook: SalamWorld, which has been dubbed the ‘Halal Facebook’, aims to provide a “cleaner, Islam-centered” version of the famous social networking site by filtering out harmful content and ensuring pages uphold and respect family values. The company behind the site wants to provide a platform for the estimated 300 million Muslim Internet users around the globe and provide a better picture of Islam to non-Muslims.

Examples of Mobily campaigns

Other features of the site are set to include an online city guide, providing information on Mosques, Islamic centers, Halal restaurants and Muslim businesses to create an Islamic social network.

Example of Vodaphone campaigns

Technology is also playing an important role in reaching out to Muslims worldwide on religious matters/issues. YouTube and Twitter are popular for sharing Quranic verses and religious content and online fatwas (Islamic rulings), while mobile apps developed for Muslims help find the nearest Mosque or Halal restaurants. The MeccaLocator app is a typical example: It has been downloaded over a million times since launch in 2009 and is one of the highest ranked Muslim apps on the iTunes and Android platforms. This is in line with the suggestion from some developers that apps for religion are the number two category for Android apps. The opportunities for technology based business are likely to grow as the Muslim market continues to embrace the digital and online space. As long as mainstream digital media continues to include Muslim audiences, provide an outlet for participation and offer an outlet for faith based conversations, this growth is the most likely trend for the Muslim consumer. In summary, the Muslim world is open for business and represents a fresh canvas of opportunities for Islamic and non-Islamic companies. The opportunity lies in offering the next billion a values driven choice that meets their needs – whether through more niche marketing on existing platforms, such as Facebook, or through a dedicated service aimed at Muslims, such as a successor to Muxlim. As the youth proportion of the Muslim population continues to grow, the opportunities will grow with it. 21

Using Social Media to Generate Business: MoneyGram International is a global payment services company providing consumers with affordable, reliable and convenient payment services. The diverse array of products and services enables consumers, most of whom are not fully served by traditional financial institutions, to make payments and transfer money around the world, helping them meet the financial demands of their daily lives. The nature of the business positions MoneyGram as an important connection between many people in different countries and cultures. Over the years, the company has recognized that the Muslim community represents one of the key customer segments using their services. Muslims have immigrated globally. Millions live in the US, Europe and other parts of the world, but maintain connections with friends and family in their mother countries, especially through holidays and traditions. As a result, MoneyGram explored and launched strategic marketing efforts aimed at such consumers, particularly during the religious festivals of Ramadan and Eid. “We see a large increase of remittances from countries like the USA and Canada to South Asia and the Middle East during Ramadan,” said Zainab Ali, senior marketing manager at MoneyGram. “With more than 203,00 locations across the world, we are able to meet the needs of Muslims everywhere who want to send funds to their families.” During Ramadan 2010, MoneyGram combined promotion and social media, as it launched a global Ramadan and Eid initiative across Asia Pacific, Canada, Europe and the United States in which customers, who remitted money through MoneyGram, had the chance to win US$1,000 every week. The goal of the campaign was to increase the volume of transactions and to create awareness of the MoneyGram brand among the Muslim community. The company launched an effort that encouraged people to share stories of kindness across the Muslim community through a social media campaign called “Ramadan Kindness”. Social media channels including Twitter and Facebook were primarily used to develop and share stories highlighting Muslims undertaking extraordinary acts for others. MoneyGram banner adverts were also placed on a series of high traffic Muslim sites. The campaign results encompassed a series of metrics including: Likes, fans, comments, sharing and views. The MoneyGram Ramadan Kindness social media campaign resulted in thousands of views and likes on Facebook. In the first five weeks, MoneyGram Ramadan Kindness surpassed the company’s own one-year-old fan page by 57 percent – there were more than 40,000 content views, around a thousand comments and more than 30,000 shares and likes. Banner ads combined with the campaign experienced a 0.31 percent click-through rate against an average of 0.07 on other sites without social media. The MoneyGram campaign combined the use of established social media platforms, such as Twitter and Facebook, but also specialist networks such as Muxlim.com. Source: ‪Islamic Branding and Marketing‬: ‪Creating a Global Islamic Business‬, Paul Temporal. ‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬

22

Circular Roadway in Jakarta, Indonesia

CONCLUsION

Economist Ben Simpfendorfer describes the opportunity as “The New Silk Road” (he is the author of a book by the same name), comparing globalization with the original enduring trade route that stretched from Xian in China to Istanbul in Turkey for more than 1,500 years. The Silk Road was a trade route for the most important commodities of that time – dates and spices heading east, in return for jade and silk heading west. But it also served as a vector for the diffusion of ideas thoughts and beliefs – enabling civilizations from Europe, the Middle East and Asia to interact. The New Silk Road is much like the old one – and just as much as the products of trade have changed, the channels have changed too. And the way in which the two parties communicate is just as important. • The opportunity is immense but has to be clearly understood – it is more than the size of the market or the seeming commonality of the Muslim consumer. • Even with the size of the market, the demographics of the group have to be addressed and how the youth bulge, for instance, will impact organizations. • The clear areas of opportunity lie in the untapped/underutilized sectors such as Islamic finance and Halal foods. But also in new areas such as Halal cosmetics, niche FMCG products and tourism. • Understanding what has worked and failed and following the best practices can provide great insights into the strategy that should be adopted. • The social media space is perfectly suited to the Muslim market and is likely to develop into a major channel for engagement with the Muslim consumer. • Reputation and credibility is absolutely key when dealing with the Muslim market, or when a brand touches the issues affecting the Islamic space. The potential to get things wrong hangs over this opportunity and companies need to carefully consider their messaging and positioning before they start work with the Muslim consumer. • Even those companies not directly targeting the Muslim consumer need to consider the potential impact they may have when their products or services come into contact with the Muslim market. For some companies, operating in some markets, auditing potential issues that could affect their brands should be considered preemptively. • Engaging with experts and specialists can help explain and focus a strategy. These experts are becoming more accessible, especially in the areas of finance and foods.

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