Are Malaysian Islamic banks’ corporate social responsibilities effective? A stakeholders’ view

2018 ◽  
Vol 36 (1) ◽  
pp. 111-125 ◽  
Author(s):  
Haruna Babatunde Jaiyeoba ◽  
Abideen Adeyemi Adewale ◽  
Mahmud Oluwaseyi Quadry
Keyword(s):  
Factor Analysis ◽  
Quantitative Research ◽  
Islamic Banks ◽  
Content Type ◽  
Social Responsibilities ◽  
Confirmatory Factor ◽  
Islamic Financial Institutions ◽  
Research Findings ◽  
Using Data ◽  
Corporate Social

Purpose The purpose of this paper is to investigate the effectiveness of Islamic banks’ corporate social responsibility (CSR) using data collected from stakeholders in Malaysia. While Islamic scholars have developed the Islamic CSR from the Qur’anic verses, the Sunnah of the Prophet (SAW) and from the western ideologies, the focus of this paper is to assess the effectiveness of the developed Islamic CSR practices. Design/methodology/approach Quantitative research design was adopted for this study. Exploratory factor analysis, confirmatory factor analysis, and other analyses are performed on the data collected from 193 stakeholders in Malaysia. Findings Based on the data collected and analyzed, the results show that stakeholders view the Malaysian Islamic banks’ CSRs as effective. Research limitations/implications This study investigates the effectiveness of Malaysian Islamic banks’ CSR based on the survey data collected. However, future studies could explore this in greater depth using mixed methods. Practical implications The research findings have great implications for researchers. Since this study is among the few research studies that investigate the effectiveness of Islamic CSR, the researchers have paved ways for further investigation in this area. In addition, the study encourages the Malaysian Islamic banks and other Islamic financial institutions to contribute more to the society. Originality/value The study examines the effectiveness of Islamic banks’ CSR and contributes to the growing discussions on the Islamic CSR. The study has opened up this area for further investigations by other researchers.

Measuring halal brand association (HalBA) for Islamic banks

2016 ◽  
Vol 7 (3) ◽  
pp. 331-354 ◽  
Author(s):  
Suharni Maulan ◽  
Nor Asiah Omar ◽  
Maisarah Ahmad
Keyword(s):  
Factor Analysis ◽  
Three Dimensions ◽  
Islamic Banks ◽  
Content Type ◽  
Islamic Bank ◽  
Brand Association ◽  
Bank Managers ◽  
Confirmatory Factor ◽  
Banking Institutions ◽  
Corporate Social

Purpose The main purpose of this paper is to develop a reliable and valid scale for measuring halal brand association (HalBA) for Islamic banks. Brand association is a core dimension of brand equity that Islamic bank managers need to develop to maintain competitiveness. Using the process proposed by Churchill for developing measures of marketing constructs, an instrument to assess HalBA for Islamic bank is formulated. Design/methodology/approach The methodology consists of developing the scale based on a literature review and qualitative method. The proposed scale is then purified and validated through exploratory factor analysis (EFA) and confirmatory factor analysis (CFA). Findings Based on the EFA and CFA, the result reveals that HalBA for Islamic banks contains 15 attributes which can be categorized into three dimensions: Shari’ah-compliant association, God-consciousness association and corporate social responsibility association. Practical implications The scale developed could assist practitioners in further understanding the dimensions and measurement of halal bank association, particularly in Islamic banking institutions. Knowledge of the dimensions of HalBA that customers seek from an Islamic bank can help managers and marketers to design branding strategies that better meet the needs of consumers, thereby increasing their satisfaction and loyalty. Originality/value The concept of brand association has been explored primarily from a conventional marketing perspective. This study offers a new dimension of HalBA in the context of Islamic banks.

Social disclosure: compliance of Islamic banks to governance standards No. 7 of AAOIFI (2010)

2020 ◽  
Vol 11 (7) ◽  
pp. 1427-1452 ◽  
Author(s):  
Nouha Ben Brahim ◽  
Mounira Ben Arab
Keyword(s):  
Banking Sector ◽  
Annual Reports ◽  
Insurance Companies ◽  
Future Research ◽  
Islamic Banks ◽  
Content Type ◽  
Western Model ◽  
Cultural Effects ◽  
Islamic Financial Institutions ◽  
Corporate Social

Purpose This paper aims to investigate the compliance of Islamic banks (IBs) with the AAOIFI standard No. 7, in Middle East and North Africa area during the period 2010-2014. The authors seek to identify, among the 15 countries and 72 banks, those which conform more to this standard. The level of compliance is expected to be more stringent in countries where AAOIFI standards are made mandatory. Design/methodology/approach The paper uses the unweighted disclosure method which measures the corporate social report disclosure (CSRD) score of a bank as additive. Each country and bank are assessed according to two obligatory and voluntary CSRDs. Findings The empirical results indicate that even though the global disclosure index has been improved over the observation period, it has remained relatively low. The results also allowed us to see that the global, mandatory and voluntary societal disclosures vary according to the country and banks. Further, it has been seen that banks allow more attention to the mandatory disclosure recommendations of AAOIFI Governance Standard No. 7, in comparison with the voluntary CSRD. Research limitations/implications One limitation of this study is that the sample is restricted to only the Islamic banking sector. Future research could include other Islamic financial institutions (IFIs) such as insurance companies. Second, the study could be extended to other countries to better control the religious system and cultural effects. Because in our modern era, traditional laws in the Muslim world have been widely replaced by statutes inspired by European models, the authors suggest then to apply a new classification that separates, for instance, countries that rely on an Islamic model from those with a western model, and national banks from those allied with western banks. Finally, the paper’s data collection relies solely on annual reports and does not include publications from bank sites. Future research could consider all these limitations. Another possible avenue could examine the determinants of such disclosure level. Practical implications Almost no study has been limited to the text of the AOIFFI. This detail is important for some countries where the AAOIFI standards are mandatory. Social implications The findings may be of interest to shareholders and all those who deal with IBs that have religious expectations. Originality/value Despite the fact that most studies investigated compliance of IB Sharia law, almost no study has been limited to the text of the AOIFFI. This detail is important for some countries where the AAOIFI standards are mandatory. The findings may be of interest to shareholders and all those who deal with IBs that have religious expectations.

scholarly journals CSR Disclosure, Corporate Governance and Firm Value: a study on GCC Islamic Banks

2020 ◽  
Vol 28 (4) ◽  
pp. 607-638
Author(s):  
Mohd Shukor Harun ◽  
Khaled Hussainey ◽  
Khairul Ayuni Mohd Kharuddin ◽  
Omar Al Farooque
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Institutions ◽  
Firm Value ◽  
Islamic Banks ◽  
Content Type ◽  
Gcc Countries ◽  
Islamic Financial Institutions ◽  
Corporate Social

Purpose This study aims to explore the corporate social responsibility disclosure (CSRD) practices of the Islamic banks in the Gulf Cooperation Council (GCC) countries during the period 2010-2014 and examines the determinants of CSRD and its effects on firm value. Design/methodology/approach Based on the Accounting and Auditing Organization for Islamic Financial Institutions Governance Standard No. 7 guidelines and using content analysis, the paper develops a comprehensive CSRD index for GCC Islamic banks. The study applies ordinary least squares regression analysis for hypothesis testing and for finding determinants of respective dependent variables. Findings The results show a very low level of CSRD among the sample Islamic banks in GCC countries. When using corporate governance characteristics to examine the determinants of CSRD, this study provides evidence of a significant positive association between board size and CSRD practice in Islamic banks and a significant negative relationship of chief executive officer (CEO) duality with CSRD, as per expectation. For the economic consequences of CSRD, the study documents an inverse performance effect of CSRD while board size, board composition and CEO duality indicate significant positive effects on firm value. Research limitations/implications The relatively small sample size of GCC Islamic banks may limit the application of the findings to other Islamic financial institutions such as Takaful and the Islamic unit trust company. Practical implications The findings of this study initiate the global debate on the need for corporate governance reform in Islamic banks by providing insights on the role played by corporate governance mechanisms in encouraging and enhancing CSRD practices among Islamic banks. The findings also have important implications for investors, managers, regulatory bodies, policymakers and Islamic banks in the GCC countries. Social implications The results of the study do not support the idea that Islamic banks operating on Islamic principles can meet their social responsibilities through promoting corporate social responsibility (CSR) activities and by differentiating themselves from non-Islamic banks. Originality/value This is the first study to examine the determinants of CSRD in GCC Islamic banks using comprehensive CSRD and corporate governance variables and, therefore, adds value to the existing CSR literature in banking.

Implementation of the AAOIFI index on CSR disclosure in Indonesian Islamic banks

2019 ◽  
Vol 17 (3) ◽  
pp. 365-382 ◽  
Author(s):  
Peni Nugraheni ◽  
Erlinda Nur Khasanah
Keyword(s):  
Supervisory Board ◽  
Islamic Banks ◽  
Content Type ◽  
Islamic Financial Institutions ◽  
The Government ◽  
Csr Disclosure ◽  
Corporate Social ◽  
Positive Effect ◽  
Practical Implications ◽  
Suitable Measure

Purpose The purpose of this study is to discuss the extent to which Indonesian Islamic banks (IBs) disclose corporate social responsibility (CSR) according to the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) index. It also empirically examines the determinants of CSR disclosure in Indonesian IBs, based on disclosure from AAOIFI index, which is based on Islamic principles. Design/methodology/approach The determinant used in this paper is the corporate governance (CG) mechanism, which focuses on the board of commissioners (BOC) and Sharia Supervisory Board (SSB) and their characteristics. The paper uses multiple regression analysis to examine the influence of these variables on CSR. Findings The results indicate that the level of CSR disclosure of IBs measured by the AAOIFI index continues to be low. The statistical results reveal that CSR disclosure has an insignificant relationship with BOC size and SSB qualifications, while the other results show a negative association between the composition of independent BOCs and CSR disclosure, and the frequency of BOC and SSB meeting has a positive effect on this. Research limitations/implications The study focuses on Indonesian IBs. The variables of the CG mechanism are limited to the BOC and SSB, while the BOC exists only in countries that adopt two-tier boards. Practical implications IBs should provide a wider range of information to be disclosed. The government should establish specific items that need to be disclosed by IBs, considering there are no specific CSR disclosure regulations for IBs in Indonesia. Originality/value This study uses the AAOIFI index, which may be a suitable measure of CSR in IBs. The study also analyzes why certain items in the index have a high disclosure level and others do not.

Corporate social responsibility (CSR) practices in Islamic banks of Bangladesh

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Md. Anowar Hossain Bhuiyan ◽  
Md. Abud Darda ◽  
Md. Belal Hossain
Keyword(s):  
Sustainable Development ◽  
Factor Analysis ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Well Being ◽  
Islamic Banks ◽  
Content Type ◽  
Arts And Culture ◽  
Corporate Social ◽  
The Impact

Purpose Corporate social responsibility (CSR) influences an organization in deciding its ethical approaches in the corporate practices and also important to maintain sustainable development. Islamic banks are capturing almost 40% of the total bank account holders in Bangladesh and contributing to the socio-economic and environmental development of the country through their CSR activities. The purpose of this paper is to investigate the impacts of CSR activities of Islamic banks for sustainable development in Bangladesh from the perception of the beneficiaries. Design/methodology/approach This study is based on a questionnaire survey of 200 conveniently selected beneficiaries from five purposively selected Islamic banks in Bangladesh. Respondents’ agreement score for various CSR-related activities has been observed in a five-point Likert scale and, finally, to identify the impact of CSR, exploratory factor analysis has been done. Findings Results revealed that respondents are expressing strong agreement for almost all the activities, and they are much satisfied with ongoing CSR activities by Islamic banks, which implies positive attitudes of beneficiaries regarding CSR activities. The results of factor analysis further confirm the perception of respondents toward CSR activities of Islamic banks in terms of social enhancement, education and health, socio-economic well-being and contemporary arts and culture. Originality/value The Islamic banks should enhance their CSR activities for socio-economic development, provide more allocation in education programs, increase sponsorship in sports events and assist in flourishing Bangladeshi arts and culture.

Corporate social responsibility in Islamic banks: to which extent does Abu Dhabi Islamic bank comply with the global reporting initiative standards?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Elias Abu Al-Haija ◽  
Mohamed Chakib Kolsi ◽  
Mohamed Chakib Chakib Kolsi
Keyword(s):  
Financial Institutions ◽  
Abu Dhabi ◽  
Global Reporting Initiative ◽  
Islamic Banks ◽  
Content Type ◽  
Csr Reporting ◽  
Social Standards ◽  
Islamic Financial Institutions ◽  
Sustainability Reports ◽  
Corporate Social

Purpose The purpose of this case study is to explore whether Abu Dhabi Islamic Bank (ADIB) complies with the Global Reporting Initiative Standards in terms of corporate social responsibility (CSR) disclosure practices for the period 2014–2019. Design/methodology/approach By analysing both annual and sustainability reports of the bank using content analysis for each Global Reporting Initiative (GRI) category, 100 universal standards, 200 economic standards, 300 environmental standards, 400 social standards. The authors then compute and discuss the degree of compliance of ADIB disclosures by using annual charts and graphs. Findings Results show that, although ADIB issues sustainability reports, numerous GRI standards do not appear in the bank’s reports such as general disclosures GRI 102, economic disclosures items such as anti-competitive behaviour GRI 206 and environmental disclosures such as gas emissions GRI 305 due to the nature of bank’s activities. However, the bank focuses mainly on social standards GRI 400 including community services, training and development. Hence, ADIB partially complies with the GRI standards (2016) especially social disclosures. Research limitations/implications The study encompasses some limitations: first, due to the discretionary nature of CSR reporting, many items were ignored or missed for the full period. Second, the disclosure of a sustainability report by the company was only available for the year 2017, which, in turn, makes it difficult for comparison. Practical implications The findings of this study have important implications for academics and researchers, and practitioners as they pave the way for further investigation regarding CSR compliance of Islamic financial institutions. The results also have important implications for Accounting and Auditing Organization for Islamic Financial Institutions in developing a CSR reporting standard if Islamic banks are to enhance their image globally and to maintain competitive advantages. Originality/value This paper contributes to the growing debate on CSR disclosures in the Islamic banking industry by comparing ADIB practices with regard to the GRI standards.

scholarly journals Measuring the Spiritual Brand Attribute of Islamic Banks

2019 ◽  
Vol 9 (Number 2) ◽  
pp. 51-70
Author(s):  
Siti Ngayesah Ab Hamid ◽  
Wan Jamaliah Wan Jusoh ◽  
Suharni Maulan
Keyword(s):  
Factor Analysis ◽  
Three Dimensions ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Spiritual Values ◽  
Significant Difference ◽  
Confirmatory Factor ◽  
Banking Institutions ◽  
Corporate Social ◽  
Reliable Scale

Islamic banking institutions are different from their conventional counterparts as they incorporate religious and spiritual values in their operations. Despite this significant difference, few studies have investigated this spiritual aspect especially from the perspective of the brand. The main purpose of this study is to develop a valid and reliable scale to measure the spiritual brand attribute of Islamic banks. Based on the result of the interviews and review of literature, 28 items were proposed and analysed using exploratory factor analysis (EFA) and confirmatory factor analysis (CFA). A total of 14 items remain on the final scale classified in three dimensions which are beliefs, ethics, and corporate social responsibility (CSR). The new brand attribute scale is different from the existing scale as it focuses mainly on the spiritual and religious aspect incorporated into the Islamic banking brand.

Examining the effect of employee green involvement on perception of corporate social responsibility

2019 ◽  
Vol 30 (1) ◽  
pp. 197-210 ◽  
Author(s):  
Anugamini Priya Srivastava ◽  
Sonal Shree
Keyword(s):  
Factor Analysis ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Stakeholder Management ◽  
Hierarchical Regression ◽  
Policy Makers ◽  
Ongoing Research ◽  
Content Type ◽  
Confirmatory Factor ◽  
Corporate Social

PurposeThe purpose of this paper is to understand the extent to which green involvement (GI) can affect employee perception of corporate social responsibility (CSR), with the intervening role of green training (GT).Design/methodology/approachThe sample for the study was collected from employees working in tourist hotels. Exploratory factor analysis and confirmatory factor analysis was conducted to assess the fit of the hypothesized model, and hierarchical regression analysis to test the hypothesis.FindingsThe results showed that GI of employees has a positive and significant relationship with their perception of CSR. The study further revealed that when there is an increase in GT, the relationship between GI and perception of CSR gets more positive.Originality/valueIt adds value to the ongoing research in the field of environment, training and CSR. The findings will be helpful for policy makers and researchers in the field of stakeholder management.

Importance-performance ratings of corporate social responsibility practices by employees in Macao’s gaming industry

2018 ◽  
Vol 30 (9) ◽  
pp. 2870-2887 ◽  
Author(s):  
Guihai Huang ◽  
Wai Ming To
Keyword(s):  
Factor Analysis ◽  
Corporate Social Responsibility ◽  
Health Insurance ◽  
Performance Analysis ◽  
Gaming Industry ◽  
Content Type ◽  
Confirmatory Factor ◽  
Casino Employees ◽  
Corporate Social ◽  
Responsible Gaming

Purpose Employees play a significant role in implementing corporate social responsibility (CSR) practices. This paper aims to examine the perceived importance of CSR practices and identifies improvement areas of CSR practices using the importance-performance analysis from Macao’s casino employees’ perspective. Design/methodology/approach Based on a literature review of CSR in the hospitality industry and ISO 26000, a comprehensive set of CSR practices including responsible gaming practices was identified. Data were collected from 298 casino employees. Importance-performance analysis as well as exploratory and confirmatory factor analysis were used to identify important CSR practices and the factor structure of CSR in Macao’s gaming industry. Findings Employees rated “providing good wages and health insurance” as the most important practice, followed by “creating a health and safe working environment” and “be fair and honest with employees.” The importance-performance analysis shows that employees perceived their firms performing well in “providing good wages and health insurance,” “protecting consumer data and consumer privacy” and “providing good consumer service and support.” The results of confirmatory factor analysis indicate that CSR in Macao’s gaming industry encompasses seven factors, namely, “Labor Practices,” “The Environment,” “Fair Operating Practices,” “Consumer Issues,” “Human Rights,” “Community Involvement” and “Responsible Gaming”. Originality/value Casino employees shape customer experience, recognizing and understanding how employees view CSR practices can help casino operators refine their CSR initiatives.

Developing generic competencies for infrastructure managers in India

2018 ◽  
Vol 11 (2) ◽  
pp. 366-381 ◽  
Author(s):  
Mona N. Shah ◽  
Anand Prakash
Keyword(s):  
Factor Analysis ◽  
Infrastructure Management ◽  
Academic Institutions ◽  
Content Type ◽  
Generic Competencies ◽  
Confirmatory Factor ◽  
Using Data ◽  
Leadership Dimensions ◽  
Engineering Projects ◽  
Practical Implications

Purpose The purpose of this paper is to develop a model for generic competencies based on lifecycle orientation of projects to support infrastructure managers (IMs) in India. Design/methodology/approach This study has reviewed literature on competency theories and their advancement of knowledge in management, construction and engineering projects. This study has applied exploratory factor analysis (EFA) to structure generic competencies founded on infrastructure practices in India. Further this study has applied confirmatory factor analysis (CFA) to test for confirmation on emerged dimensionality of the competence construct for IMs in India. Findings Using data collected from 175 usable questionnaires of managers serving in infrastructure firms in India for EFA followed by CFA, six generic competencies have been established in the domains of strategic, analytical, personal, managerial, professional and leadership dimensions significantly impacting competent performance. Research limitations/implications This study has applied plausibility sampling and it presents only generic competencies for executives working in the infrastructure sector alone. Practical implications Due to the growth in number of executives to be employed in infrastructure firms in India, academic institutions in this subcontinent have gained momentum in offering programmes covering the field of infrastructure management. These institutions are believed to be covering domains of strategic, analytical, personal, managerial, professional and leadership dimensions for assuring competent performance of IMs in India. Social implications Attention to these generic competencies can help IMs to contribute towards better performance, academic institutions to design curriculum, recruiters to acquire talent and executives to advance professionally. Originality/value Extant academic studies relating to generic competencies are available mostly in project and construction domains. There is a paucity of such academic studies in the domain of infrastructure.

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