An Overview of Corporate Governance Practices of Selected Islamic Banks
DOI:
https://doi.org/10.21111/tsaqafah.v12i1.366Keywords:
Abstract
Complying with Corporate Governance (CG) standards is not mandatory but with collapse of many financial institutions, compliance with high standards of CG in banking operation has become a necessity. This is due to the fact that many banks and companies worldwide collapsed as a result of poor corporate governance practices such as Bank of Credit and Commerce International (BCCI) 1991, Barings Bank 1995, Lehman Brothers 2008, Enron 2001, WorldCom 2001, etc. Therefore, the objective of this paper is to examine and ascertain whether present level of CG standards practiced by Islamic banks is adequate to prevent or safeguard the banks from collapsing. The approach of the study is to evaluate the effectiveness of board and the various board committees utilizing data published in financial statement of the selected banks. The methodology used in this paper is analytical descriptive to reach accurate results and as more appropriate approach with this research. The study finds out that the selected banks comply with CG standards adopted; however such compliance does not mean that the board, the board committees will be constantly reliable. Therefore, instilling the Islamic values such as the concepts of iḥsân, honesty, and accountability is paramount to prevent CG failures and protect/safeguard the banks from collapsing.Downloads
References
Abu-Tapanjeh, Abdussalam Mahmoud. “Corporate Governance from the Islamic Perspective: A Comparative Analysis with OECD Principles”, Critical Perspectives on Accounting, Volume 20, Issue 5, July 2009, Page 559. doi:10.1016/j.cpa.2007.12.004.
Ali, Hassan. 1977. Târîkh al-Tasyrî’ al-Islâmiy: al-Madkhal li al-Fiqh al-Islâmî. Kuwait Kuwait University.
Annual Report of European Islamic Investment Bank PLC, 2014. http://www.eiib.co.uk/documents/eiibannualreport2014.pdf, Retrieved September 02, 2015.
Annual Report of Masraf al-Rayan, http://www.alrayan.com/en/Annual-Reports, Retrieved September 15, 2015.
Berger, Allen N., et. al. 2012 “The Roles of Corporate Governance in Bank Failures during the Recent Financial Crisis”, European Banking Center Discussion Paper No. 2012-023. Netherlands: Tilburg University.
Braithwaite, Valerie., and Levi, Margaret. 2003. Governance and Trust. New York: Russell Sage Foundation.
Buraqaba, Shawqi. 2009. Corporate Governance in Islamic Banks. Algeria: University of Sceinse in Economics.
Company Info: About Us: European Islamic Investment Bank PLC, 2015. http://www.eiib.co.uk/html/aboutus.asp, Retrieved September 02, 2015.
Hasan, Zulkifli. 2008. “Corporate Governance From Western And Islamic Perspectives”, Annual London Conference on Money, Economy, and Management. Durham: School of Government and International Affairs, University of Durham.
Khan, Humera. 2011. “A Literature Review of Corporate Governance”, International Conference on E-business, Management, and Economics, IPEDR Vol. 25. Singapore: IACSIT Press.
Kirkpatrick, Grant. “The Corporate Governance Lessons from the Financial Crisis”, OECD Journal: Financial Market Trends, Vol. 2009, Issue 1.
Kwan, Vincent P.C. 2008. “Proposed Changes to the Listing Rules”, The Chamber of Hong Kong Listed Companies Magazine. Hong Kong: The Chamber of Hong Kong Listed Companies.
List of Corporate Collapses and Scandas, https://en.wikipedia.org/wiki/List_of_corporate_collapses_and_scandals, Retrieved October 03, 2015.
RHB Islamic Bank, “Annual Report, RHB Islamic Bank, 2012’, http://www.rhbgroup.com/uploads/files/investor-relations/annual-reports/rhb-islamic-bank-2012.pdf, Retrieved April 15, 2015
Youssef, M. Tarek. “Corporate Governance An Overview – Around the Globe”, http://www.eiod.org/uploads/Publications/Pdf/Corp.%20Governance-1.pdf
Downloads
Submitted
Published
Issue
Section
License
The author whose published manuscript approved the following provisions:
- The right of publication of all material published in the journal / published in the Tsaqafah is held by the editorial board with the knowledge of the author (moral rights remain the author of the script).
- The formal legal provisions for access to digital articles of this electronic journal are subject to the terms of the Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License (CC BY-NC-SA 4.0), which means that Tsaqafah reserves the right to save, transmit media or format, Database), maintain, and publish articles without requesting permission from the Author as long as it keeps the Author's name as the owner of Copyright.
- Printed and electronic published manuscripts are open access for educational, research and library purposes. In addition to these objectives, the editorial board shall not be liable for violations of copyright law.
- It is a serious offense for anyone to publish any article of Tsaqafah without permission.
