P.S. This should be a word of the day, if it hasn't been already. It comes from the Bible, specifically Judges 12:5-6, as a way of discernin at the stream crossing, whether a particular person was friend or foe: friends could pronounce "shibboleth" (meaning "stream") while foes could only say "sibboleth." (There's a joke in there, but decorum constrains me from stating it.)
Incidentally, this is the opposite of Japanese, which doesn't have a "si" sound but only an "shi" sound. Here endeth the lesson...
Ancient Greek did not have the "sh" sound so they did not adopt a letter from the Phoenician alphabet to represent that sound. The character for the "sh" sound in the Cyrillic alphabets looks similar to the Hebrew "shin" (which has an "sh" sound). Most of the Cyrillic letters are derived from Greek letters but the inventor of the alphabet must have studied some Hebrew and took a character for "sh" from that alphabet.