The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks

This study aims to provide empirical evidence on the Maqasid al-Shari’ah performance of Islamic banks in Indonesia for the period from 2012 to 2016. The Simple Additive Weighting (TSAW) is employed to obtain the performance of IBs according to the Maqasid al-Shari’ah. This study found that the Maqas...

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Main Authors:	Rahman, Audia Syafa’atur, Haron, Razali
Format:	Article
Language:	English
Published:	IIUM Institute of Islamic Banking and Finance (IIiBF), International Islamic University Malaysia (IIUM) 2019
Subjects:	HB126.4 Islamic Economics HG3368 Islamic Banking and Finance HG4001 Financial management. Business finance. Corporation finance.
Online Access:	http://irep.iium.edu.my/72730/ http://irep.iium.edu.my/72730/ http://irep.iium.edu.my/72730/1/72730_The%20Effect%20of%20Corporate%20Governance.pdf

id	iium-72730
recordtype	eprints
spelling	iium-727302020-02-21T07:38:07Z http://irep.iium.edu.my/72730/ The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks Rahman, Audia Syafa’atur Haron, Razali HB126.4 Islamic Economics HG3368 Islamic Banking and Finance HG4001 Financial management. Business finance. Corporation finance. This study aims to provide empirical evidence on the Maqasid al-Shari’ah performance of Islamic banks in Indonesia for the period from 2012 to 2016. The Simple Additive Weighting (TSAW) is employed to obtain the performance of IBs according to the Maqasid al-Shari’ah. This study found that the Maqasid Index for Indonesia IBs within the range between 11% and 28% with only few banks achieved above 20%. The impact of SSB characteristics and board structures are then tested on the IBs Maqasid al-Shari’ah performance. Regression result indicates that SSB characteristics (SSB size, SSB cross membership, SSB Education and SSB reputation) and board structures (Board size and Board independence) have an essential role in improving the performance of IBs. The findings denote SSB with smaller size, higher portion of SSB cross membership, lesser SSB hold doctorate degree, lesser reputable scholar, more members on board of directors, and less independence non-executive directors enhance the performance of IBs. This study offers practical implication and regulators in Indonesia should set up and impose a more robust and new tool to evaluate the Maqasid al-Shari’ah performance index in order to assess how far the role of IBs have contributed to the society. This will help all stakeholders to have informed decision which not only concentrates on performance based on financial ratios but also the entire dimensions of IBs that reflect the main purpose of IBs. IIUM Institute of Islamic Banking and Finance (IIiBF), International Islamic University Malaysia (IIUM) 2019-06-19 Article PeerReviewed application/pdf en http://irep.iium.edu.my/72730/1/72730_The%20Effect%20of%20Corporate%20Governance.pdf Rahman, Audia Syafa’atur and Haron, Razali (2019) The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks. Journal of Islamic Finance, 8 (Special Issue). pp. 1-18. ISSN 2289-2109 E-ISSN 2289-2117 https://journals.iium.edu.my/iiibf-journal/index.php/jif/article/view/343/153
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HB126.4 Islamic Economics HG3368 Islamic Banking and Finance HG4001 Financial management. Business finance. Corporation finance.
spellingShingle	HB126.4 Islamic Economics HG3368 Islamic Banking and Finance HG4001 Financial management. Business finance. Corporation finance. Rahman, Audia Syafa’atur Haron, Razali The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks
description	This study aims to provide empirical evidence on the Maqasid al-Shari’ah performance of Islamic banks in Indonesia for the period from 2012 to 2016. The Simple Additive Weighting (TSAW) is employed to obtain the performance of IBs according to the Maqasid al-Shari’ah. This study found that the Maqasid Index for Indonesia IBs within the range between 11% and 28% with only few banks achieved above 20%. The impact of SSB characteristics and board structures are then tested on the IBs Maqasid al-Shari’ah performance. Regression result indicates that SSB characteristics (SSB size, SSB cross membership, SSB Education and SSB reputation) and board structures (Board size and Board independence) have an essential role in improving the performance of IBs. The findings denote SSB with smaller size, higher portion of SSB cross membership, lesser SSB hold doctorate degree, lesser reputable scholar, more members on board of directors, and less independence non-executive directors enhance the performance of IBs. This study offers practical implication and regulators in Indonesia should set up and impose a more robust and new tool to evaluate the Maqasid al-Shari’ah performance index in order to assess how far the role of IBs have contributed to the society. This will help all stakeholders to have informed decision which not only concentrates on performance based on financial ratios but also the entire dimensions of IBs that reflect the main purpose of IBs.
format	Article
author	Rahman, Audia Syafa’atur Haron, Razali
author_facet	Rahman, Audia Syafa’atur Haron, Razali
author_sort	Rahman, Audia Syafa’atur
title	The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks
title_short	The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks
title_full	The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks
title_fullStr	The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks
title_full_unstemmed	The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks
title_sort	effect of corporate governance on islamic banking performance: a maqasid shari’ah index approach on indonesian islamic banks
publisher	IIUM Institute of Islamic Banking and Finance (IIiBF), International Islamic University Malaysia (IIUM)
publishDate	2019
url	http://irep.iium.edu.my/72730/ http://irep.iium.edu.my/72730/ http://irep.iium.edu.my/72730/1/72730_The%20Effect%20of%20Corporate%20Governance.pdf
first_indexed	2023-09-18T21:43:05Z
last_indexed	2023-09-18T21:43:05Z
_version_	1777413270473277440

The effect of corporate governance on Islamic banking performance: a maqasid Shari’ah index approach on Indonesian Islamic banks

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