AAOIFI Shariah Standard 62: A hexagonal fiqhi-market synthesis

The global sukuk market has undergone significant structural evolution since its modern inception, adapting to investor appetites, regulatory frameworks, and market dynamics while navigating persistent tensions between Shariah authenticity and financial functionality and adapting to the changing needs and dynamics of the global financial market and stakeholder appetites. The following evolutionary depiction, adapted from Yagci, Izhar, and Turkhan Ali (2025), traces this trajectory:

AAOIFI Shariah Standard 62 (SS62) represents a pivotal development in the evolution of the global  sukūk market. At its core, the standard seeks to address a long-standing structural imbalance—namely, the pre-dominance of asset-based sukuk structures that grant investors only beneficial ownership rather than the asset-backed arrangements grounded in genuine ownership and effective risk transfer. While this corrective shift is firmly anchored in classical Shariah principles, its implications for contemporary financial markets are significant and potentially far-reaching.

By requiring substantive ownership and the assumption of risk, SS62 realigns sukuk structures with foundational Shariah maxims such as al-ghunm bi al-ghurm and al-kharāj bi al-ḍamān. The standard also carries important implications for tradability, placing greater emphasis on the actual composition and nature of underlying asset pools rather than relying solely on numerical thresholds or ratios. In doing so, it reinforces the legitimacy of jurisprudential approaches where ownership and risk-bearing are genuine and substantive.