Page 3 - Valentino Cattelan - In the name of God: managing risk in Islamic finance

IANUS n. 26-2022 ISSN 1974-9805

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IN THE NAME OF GOD: MANAGING RISK IN ISLAMIC FINANCE

Valentino Cattelan

Lecturer in Law,
Birmingham City University

In Against the gods: the remarkable story of risk (1996), Peter L. Bernstein illustra come il saper dominare
il rischio abbia guidato la moderna società occidentale nel convertire «il futuro da nemico in opportunità», laddove
il rischio vine quantificato, misurato, e gestito per mitigare i pericoli dell’inatteso, e dove procedure di risk-taking, -
transfer e pooling sono divenute esse stesse fonti di legittimo profitto. Commentando il lavoro di Bernstein nel
passaggio dal ‘rischio’ occidentale alla nozione araba di ﻕﺯﺭ rizq, ‘il sostenimento (divino)’, questo articolo si
riferisce all’azzardo umano, o fortuna, in arabo ﺭﻫﺯ zahr, i ‘dadi’ delle future chances, attraverso una

prospettiva comparativa ed interculturale. Più precisamente, l’articolo intende mostrare come specifiche
assunzioni antropologiche conducano ad una teoria ed una pratica alternative della gestione del rischio in un
mercato la cui peculiarità sta nell’operare non ‘contro’ ma ‘in Nome di Dio’: vale a dire, il mercato della finanza
islamica.

In Against the gods: the remarkable story of risk (1996), Peter L. Bernstein illustrates how the mastery
of risk has driven modern Western society into converting «the future from an enemy into an opportunity», where
risk is quantified, measured, and managed to mitigate the perils of the unexpected, and where risk-taking, -
transfer and -pooling have become per se sources of legitimate profit. Commenting on Bernstein’s work while
moving from the Western ‘risk’ to the Arabic ﻕﺯﺭ rizq, ‘(God’s) sustenance’, this article looks at human hazard,
ﺭﻫﺯ zahr, the ‘dice’ of future chances, through a comparative and inter-cultural perspective. More precisely, it
aims to show how specific anthropological assumptions result in an alternative theory and practice of risk
management in a market whose peculiarity is to operate not ‘against’ but ‘in the Name of God’: namely, the
market of Islamic finance.

Summary:

1. Gods, men and the (un)expected: from Bernstein’s risk to the Arabic rizq (ﻕﺯﺭ)
2. Islamic finance, Muslim anthropology, and legitimate profit: al-kharaj bi-l-daman
3. Conceiving and managing risk in God’s creation: the logic of Islamic finance
4. Conclusions: another, remarkable, story of risk?

 Saggio sottoposto a double-blind peer review.
1 This article remained for a long time in the preliminary format of working paper (CATTELAN, In
the Name of God: managing risk in Islamic finance, in Eabh Working Papers Series, 14-07, 2014; available
online at http://www.eabh.info/publications/eabh-papers). I thank the editorial committee of
IANUS for the opportunity to give it appropriate collocation as article in a peer-reviewed journal.
Transliteration note: please consider that in the transliteration from Arabic into English graphical
forms have been simplified (e.g. riba instead of ribā; Shari‘ah in the place of šarī‘ah; daman instead of
ḍamān; haqq in the place of ḥaqq; and so on).
Quotations of the Qur’an are taken from YUSUF ALI, An English interpretation of the Holy Qur’an
with full Arabic text, Lahore, 1975. The sura is specified in Roman numbers; the ayat in Arab numbers
th
(e.g. Q. IX:51, 51 ayat of the 9 sura).
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