Reputation management for fintech within Islamic finance

Lawrence Oliver is the Director and Deputy CEO of the DDCAP GroupTM, and Ian Bernard is the Group’s Head of Compliance.

In an ever-shrinking world where media runs 24 hours a day, seven days a week, reputation has become an even more important cornerstone of business, perhaps nowhere more so than in the rapidly developing Fintech sector that is and will increasingly underpin business activity within the Islamic finance industry. There is no clearer sign that reputational risk is becoming more significant than the recently published Wolfsberg Group guidance on Negative News Screening and how it has become a critical tool for client on-boarding and due diligence processes. Negative news screening applies a range of public information, data, and analysis to help determine the risk profile of a customer and to better understand, and manage, the financial crime and other reputational risks posed by a business relationship.

There has been an elevation in recent years in the extent of scrutiny of clients, service providers and business partners to ensure that, through business engagement, these third parties do not pose any undue reputational risk to financial market institutions, who have developed a heightened sensitivity to this type of risk.