Determinants and consequences of maqashid sharia performance: evidence from Islamic banks in Indonesia and Malaysia

Muhammad Taufik · Rifqi Muhammad · Peni Nugraheni

23 citations0/0 files storedJournal of Islamic accounting and business research

No readable copy stored yet — this record is metadata only.

No open-access location is known for this record yet.

Literature note Cite in a project Citation map

Islamic Finance and Banking Studies Corporate Social Responsibility Reporting Halal products and consumer behavior

Abstract

Purpose This study aims to examine how sharia supervisory board (SSB) characteristics are determinants of the maqashid sharia performance (MSP) of Islamic banks (IBs) and how MSP has implications for profitability and for profit-sharing investment account holders (PSIAHs). Design/methodology/approach MSP is ascertained by semi-structured interviews. The SSB characteristics measured are size, cross-membership, education level, expertise, reputation, rotation and remuneration. Annual reports of Indonesian and Malaysian IBs from 2010 to 2018 are analysed using panel data regression. Findings In Indonesia, SSB education level attenuates MSP, while other characteristics have only minor influence. However, in Malaysia, SSB size, education and reputation reinforce MSP, while others are ineffective. MSP in both countries is pseudo-Islamic; so their customers ignore religiosity. However, MSP in Malaysia can improve profitability because sharia assurance is more transparent; meanwhile, MSP in Indonesia cannot improve profitability because sharia assurance is less transparent. Practical implications In order for MSP to improve in Indonesia, the regulators need to increase SSB size, reduce cross-membership and arrange the format for sharia assurance in SSB reports, while IBs need to increase SSB education and expertise. Originality/value MSP is constructed in accordance with legal and social requirements to achieve IBs’ Islamic, economic, social and ethical objectives. Resource dependence theory is used to evaluate SSB, while PSIAH and profitability are investigated to demonstrate the impact of MSP. Finally, comparing SSB capabilities in Indonesia and Malaysia could be beneficial to regulatory and IB policies.

Paper brief

Loading…

Cite this work

Citation unavailable for this work.

BibTeX RIS CSL-JSON

No public copy is stored for this record, so only the metadata is cited.

Citations in this library

Citation map →

Stored only when both papers are in the corpus — 23 citations exist upstream.

References

2003Boards of Directors and Firm Performance: Integrating Agency and Resource Dependence Perspectives 2009Resource Dependence Theory: A Review 2014International Standard Classification of Occupations (ISCO)2011Determinants of corporate social responsibility disclosure: the case of Islamic banks 2015Consumer attitudes and purchase intentions toward Islamic banks: the influence of religiosity 2008Understanding the objectives of Islamic banking: a survey of stakeholders' perspectives 2017Corporate governance in Islamic banks: New insights for dual board structure and agency relationships 2011Customer's criteria for selecting an Islamic bank: evidence from Pakistan

Explore the map →

Papers that cite the same references — the relational fallback while embeddings are still backfilling.

Imported from OpenAlex (CC0) — nothing here is generated.