How Do Sharia Supervisory Board and Good Corporate Governance Relate to Islamic Banks Performance?

This study aims to investigate the relationship between the characteristics of the Sharia Supervisory Board (SSB) and Good Corporate Governance (GCG) on the performance of Islamic Banks (IBs). Data were collected from 14 IBs listed on the Financial Services Authority (OJK) during 2013–2019. The multiple regression results empirically show that SSB with the academic position as professor shows a significant positive relationship on IBs performance. Meanwhile, SSB with doctoral education has no positive relationship with IBs performance. Although it is not positively correlated, doctoral education is still needed but with a background in law or sharia education, economics including finance or accounting, and muamalah. Educational background is proven to have a significant positive relationship with IBs' performance. Meanwhile, SSB, which only has a finance or accounting background, does not positively affect IBs' performance. In addition, GCG shows a very significant positive relationship with the IBs' performance. It indicates that effective and efficient governance by the Board of Directors, Board of Commissioners, and SSB through implementing better GCG and sharia principles will improve IBs performance.==========================================================================================================ABSTRAK – Bagaimana Kaitan Dewan Pengawas Syariah dan Good Corporate Governance dengan Kinerja Bank Syariah? Penelitian ini bertujuan untuk mengetahui hubungan antara karakteristik Dewan Pengawas Syariah (DPS) dan Good Corporate Governance (GCG) terhadap kinerja Bank Syariah (BS) di Indonesia. Data dikumpulkan dari 14 BS yang terdaftar di OJK selama periode 2013-2019. Berdasarkan hasil regresi berganda secara empiris menunjukkan bahwa DPS yang memiliki jabatan akademik sebagai profesor menunjukkan hubungan positif yang signifikan dengan kinerja BS. Sedangkan DPS dengan pendidikan doktor tidak memiliki hubungan positif dengan kinerja BS. Walaupun tidak berkorelasi positif, pendidikan doktor tetap diperlukan tetapi dengan latar belakang pendidikan hukum atau syariah, ekonomi termasuk keuangan atau akuntansi, dan muamalah. Karena latar belakang pendidikan tersebut terbukti memiliki hubungan positif yang signifikan dengan kinerja BS. Sedangkan DPS yang hanya berlatar belakang keuangan atau akuntansi tidak menunjukkan hubungan positif dengan kinerja BS. Selain itu, GCG menunjukkan hubungan positif yang sangat signifikan dengan kinerja BS. Hal ini menunjukkan bahwa tata kelola yang efektif dan efisien oleh Dewan Direksi, Dewan Komisaris, dan DPS melalui penerapan prinsip-prinsip GCG dan syariah yang lebih baik akan meningkatkan kinerja BS.

Download Full-text

Pengaruh Dewan Direksi, Dewan Komisaris Independen. Kepemilikan Manajerial, Kepemilikan Institusional, Dan Dewan Pengawas Syariah Terhadap No Performing Financing (Studi Kasus Pada Bank Umum Syariah Yang Terdaftar Di OJK Periode 2015-2019)

Ratio : Reviu Akuntansi Kontemporer Indonesia ◽

10.30595/ratio.v2i2.10378 ◽

2021 ◽

Vol 2 (2) ◽

Author(s):

Yugi Maheswari ES ◽

Iwan Fakhruddin ◽

Azmi Fitriati ◽

Bima Cinintya Pratama

Keyword(s):

Corporate Governance ◽

Board Of Directors ◽

Commercial Bank ◽

Financial Services ◽

Supervisory Board ◽

Secondary Data ◽

Institutional Ownership ◽

Managerial Ownership ◽

Good Corporate Governance ◽

The Board Of Directors

Tujuan penelitian ini untuk mengetahui pengaruh penerapan Good Corporate Governance (GCG) yang diproksikan oleh dewan direksi, dewan komisaris independen, kepemilikan manajerial, kepemilikan institusional, dan dewan pengawas syariah terhadap risiko pembayaran yang diukur dengan rasio Non Performing Financing (NPF) pada Bank Umum Syariah. Populasi penelitian adalah Bank Umum Syariah Yang Terdaftar di Otoritas Jasa Keuangan. Data yang digunakan adalah data sekunder berupa laporan tahunan Bank Umum Syariah periode 2015-2019. Sampel yang dikumpulkan adalah 14 bank syariah sebayak 70 data. Hasil penelitian menunjukkan bahwa dewan direksi berpengaruh negative erhadap NPF. Dewan komisaris independen, kepemilikan manajerial, kepemilikan institusional, dan dewan pengawas syariah tidak berpengaruh terhadap NPF. The purpose of this study is to determine the effect of the implementation of Good Corporate Governance (GCG) which is proxied by the board of directors, the board of independent commissioners, managerial ownership, institutional ownership, and the sharia supervisory board against payment risk as measured by the Non Performing Financing (NPF) ratio at the Bank Sharia General. The study population was a Sharia Commercial Bank Registered at Financial services Authority. The data used was secondary data in the form of reports annual Sharia Commercial Bank for the period 2015-2019. The samples collected were 14 Islamic banks as much as 70 data. The results showed that the board of directors has a negative effect on NPF. Independent board of commissioners, managerial ownership, institutional ownership, and sharia supervisory board have no effect on NPF.

Download Full-text

Good Corpotare Governance dan Manajemen Laba di Perbankan Syariah

Journal of Islamic Finance and Accounting ◽

10.22515/jifa.v2i2.1925 ◽

2019 ◽

Vol 2 (2) ◽

Author(s):

Rosyid Nur Anggara Putra

Keyword(s):

Corporate Governance ◽

Earnings Management ◽

Board Of Directors ◽

Audit Committee ◽

Supervisory Board ◽

Islamic Banks ◽

Management Behavior ◽

Purposive Sampling ◽

Good Corporate Governance ◽

The Board Of Directors

Penelitian ini bertujuan untuk menguji pengaruh mekanisme Good Corporate Governance dengan variabel ukuran dewan komisaris, proporsi komisaris independen, ukuran dewan direksi, ukuran komite audit, ukuran dewan pengawas syariah, dan kompetensi dewan pengawas syariah terhadap manajemen laba pada bank syariah di Indonesia periode 2014-2018. Sampel ditentukan dengan teknik purposive sampling sehingga diperoleh 12 bank syariah sebagai sampel penelitian. Data dianalisis menggunakan regresi data panel dengan fixed effect model dengan software eviews 10. Hasil analisis menunjukkan bahwa ukuran dewan komisaris dan ukuran dewan pengawas syariah berpengaruh positif terhadap perilaku manajemen laba. ukuran komite audit berpengaruh negatif terhadap manajemen laba, sedangkan proporsi komisaris independen, ukuran dewan direksi, dan kompetensi dewan pengawas syariah tidak berpengaruh terhadap perilaku manajemen laba pada bank syariah di Indonesia.This study aims to examine the effect of Good Corporate Governance mechanism with variable size of the board of commissioners, the proportion of independent commissioners, the size of the board of directors, the size of the audit committee, the size of the sharia supervisory board, and the competence of the sharia supervisory board on earnings management in Islamic banks in the 2014-2018 period. The sample is determined by purposive sampling technique so that 12 Islamic banks are obtained as a research sample. Data were analyzed using panel data regression with fixed-effect models with software e-views 10. The results of the analysis showed that the size of the board of commissioners and the size of the sharia supervisory board had a positive effect on earnings management behavior. Audit committee size has a negative effect on earnings management, while the proportion of independent commissioners, the size of the board of directors, and the competence of sharia supervisory boards do not affect earnings management behavior in Islamic banks in Indonesia.

Download Full-text

Syariah Governance Pada Perbankan Syariah

JES (Jurnal Ekonomi Syariah) ◽

10.30736/jes.v1i1.1 ◽

2016 ◽

Vol 1 (1) ◽

pp. 1-15

Author(s):

Joko Hadi Purnomo

Keyword(s):

Corporate Governance ◽

Financial Services ◽

Supervisory Board ◽

Internal Audit ◽

Islamic Banks ◽

Islamic Bank ◽

External Monitoring ◽

Research Activities ◽

Good Corporate Governance ◽

Shariah Governance

Shariah governance is concatenation of two concepts, these are the concept of good corporate governance and shariah compliance. The governance of banks applies the principle of transparency, accountability, responsibility, professionalism and fairness whereas shariah compliance is the duty of Islamic bank to meet compliance with Islamic principles. The operation of Islamic banks must strictly adhere to the provisions of shariah. The application of shariah governance is the implementation of good corporate governance principles and shariah compliance. The implementation of shariah governance in Islamic banks relies on surveillance covering all research activities, observation and measurement on the course of operations, both internally and externally. Based on the above background, author makes formulations of the problem; (a) how is the implementation of Shariah governance in Islamic bank?; (b) How is the supervision of the application of Shariah governance in Islamic bank?. The purpose of this paper is to know the implementation of Shariah governance in Islamic banks and to know the supervision of the implementation of Shari'a governance in Islamic bank. The implementation of GCG in Islamic banking creates transparency to prevent fraud, conduct accountability with the system that controls the relationship between the organs of company, do responsibility, keep independence, and keep in touch with fairness. The application of sharia compliance at Islamic banks without riba in bank transactions, no vagueness (gharar) in bank transactions, there is no gambling (maisir) in bank transactions. Bank conducts business on the basis of allowed (halal) profits. Banks manage zakat, sadaqah, and infaq according to the shariah provisions. The implementation of sharia governance in Islamic banks relies on surveillance covering all research activities, observation and measurement on the course of the operation by using elements of the AGM, Board of Commissioner, Board of Auditor, Shariah Supervisory Board (DPS), Director of Compliance, Internal Audit, Internal Shari'a Reviewers of SKAI and external monitoring system consists of elements of the Financial Services Authority (OJK), Public Accountant, National Sharia Council (DSN) and Stakeholders.

Download Full-text

Syariah Governance Pada Perbankan Syariah

JES (Jurnal Ekonomi Syariah) ◽

10.30736/jesa.v1i1.2 ◽

2019 ◽

Vol 1 (1) ◽

Author(s):

Joko Hadi Purnomo

Keyword(s):

Corporate Governance ◽

Financial Services ◽

Supervisory Board ◽

Internal Audit ◽

Islamic Banks ◽

Islamic Bank ◽

External Monitoring ◽

Research Activities ◽

Good Corporate Governance ◽

Shariah Governance

Download Full-text

Good Corporate Governance Principles in Indonesian Syariah Banking

International Journal of Law and Public Policy ◽

10.36079/lamintang.ijlapp-0201.86 ◽

2020 ◽

Vol 2 (1) ◽

pp. 8-13

Author(s):

Andrew Shandy Utama

Keyword(s):

Corporate Governance ◽

Financial Services ◽

Islamic Law ◽

Good Governance ◽

Banking System ◽

Supervisory Board ◽

Islamic Banking ◽

Islamic Banks ◽

Good Corporate Governance ◽

Conventional Banks

Islamic banks are banks that carry out their business activities based on the principles of Islamic law in banking activities based on fatwas issued by the National Sharia Council of the Majelis Ulama Indonesia. This research aims to explain the principles of Good Corporate Governance in Islamic banking in Indonesia. The method used in this research is normative legal research. The results of the research explained that to maintain the trust of Indonesian people who are predominantly Muslim, Islamic banking must apply the principle of Good Corporate Governance in its management. The application of the principle of Good Corporate Governance in Islamic banking is strictly regulated in Article 34 Paragraph (1) of Law Number 21 of 2008, which emphasizes that Islamic banks must implement good governance that includes the principles of transparency, accountability, responsibility, professionalism and fairness in carrying out its business activities. Form of application of the principles of Good Corporate Governance in Islamic banking is supervision conducted by the National Sharia Council of the Majelis Ulama Indonesia in general and the Sharia Supervisory Board specifically in each Islamic bank. Based on data from the Financial Services Authority in 2017, currently there are 13 Islamic banks in Indonesia, 13 Islamic business unit of conventional banks, and 102 Islamic rural banks. This is evidence of the existence and development of Islamic banking that is significant in the national banking system.

Download Full-text

Dampak Tata Kelola Bank Syariah Terhadap Kepatuhan Syariah Berbasis Maqashid Syariah

Wahana ◽

10.35591/wahana.v23i2.188 ◽

2020 ◽

Vol 23 (2) ◽

pp. 239-259

Author(s):

Rifqi Muhammad ◽

Hapsari Yuni Oktaviyanti

Keyword(s):

Corporate Governance ◽

Board Of Directors ◽

Financial Services ◽

Commercial Banks ◽

Supervisory Board ◽

Variable Number ◽

Annual Reports ◽

Good Corporate Governance ◽

The Board Of Directors ◽

Supervisory Boards

This study aims to determine the effect of Good Corporate Governance as measured by the number of sharia supervisory boards, sharia supervisory board meetings, number of board of directors, board of directors meetings, number of board of commissioners, board of commissioners meeting on the performance of sharia maqashid. The sample used in this study is Full-fledge sharia banks in Indonesia based on sharia banking statistics published by the Financial Services Authority as of July 2019. The study was conducted based on an analysis of 72 annual reports and GCG reports obtained from 12 Sharia Commercial Banks in 2013 - 2018. The results of this study indicate that the variables of the board of directors' meeting significantly influence the performance of the Maqashid syariah. While the variable number of sharia supervisory boards, sharia supervisory board meetings, number of board of directors, number of board of commissioners and board of commissioners meeting on maqashid syariah performance.

Download Full-text

Perbandingan Implementasi Prinsip Good Corporate Governance pada Bank Konvensional dan Bank Syariah

Jurnal Daya Saing ◽

10.35446/dayasaing.v2i1.43 ◽

2016 ◽

Vol 2 (1) ◽

pp. 39-45

Author(s):

Andrew Shandy Utama

Keyword(s):

Corporate Governance ◽

Financial Services ◽

Supervisory Board ◽

National Committee ◽

Research Use ◽

Islamic Banks ◽

Good Corporate Governance ◽

Conventional Banks ◽

Relationship Of ◽

The Relationship

Abstract: In principle, the relationship between the bank and its customers are saving money in the bank based on the relationship of trust, so that each bank is required to have to continue to maintain the level of health. Solutions that can be taken by the banks, both conventional banks and Islamic banks, to maintain the existence and level of health is with the implementation of the principles of good corporate governance. Therefore, it is interesting to examine the comparison of implementation of the principles of good corporate governance in conventional banks and Islamic banks. The method used in this study is a normative legal research. This research use approach legislation. The results showed that in essence, the implementation of the principles of good corporate governance in conventional banks and Islamic banks are the 'same', because it refers to the "Code of Good Corporate Governance Indonesian Banking" issued by the National Committee on Governance (NCG). The fundamental difference lies in Islamic principles used by Islamic banks. In addition to guided and supervised by the Financial Services Authority as conventional banks, Islamic banks are also supervised by the National Sharia Board MUI and Sharia Supervisory Board who served in each Islamic bank. Keywords: The Principles of Good Corporate Governance

Download Full-text

Corporate Governance in Islamic Banks

Corporate Governance and Its Implications on Accounting and Finance - Advances in Finance, Accounting, and Economics ◽

10.4018/978-1-7998-4852-3.ch015 ◽

2021 ◽

pp. 322-337

Author(s):

Sami Ben Mim ◽

Yosra Mbarki

Keyword(s):

Corporate Governance ◽

Board Of Directors ◽

Supervisory Board ◽

Islamic Banks ◽

Governance Mechanism ◽

Governance Mechanisms ◽

Transmission Channels ◽

Corporate Governance Mechanisms ◽

The Board Of Directors ◽

Corporate Governance Mechanism

This study investigates the efficiency of the Shariah supervisory board as a corporate governance mechanism in Islamic banks. The authors mainly seek to examine the effect of the Shariah board's composition (size and academic background of its members) on the performance of Islamic banks. They also try to highlight the transmission channels explaining this effect, and compare the efficiency of the Shariah board with that of traditional corporate governance mechanisms, namely the board of directors. The empirical investigation is based on a sample of 72 Islamic banks from 19 countries. Estimation results suggest that the Shariah board positively affects the Islamic banks performance through the number of Islamic Shariah scholars. This effect is mainly due to the size and cost transmission channels. These results are robust to different performance measures. On the other hand, results show that the board of directors' size produces a positive effect on a bank's performance, offering evidence for complementarity between traditional and Islamic governance mechanisms.

Download Full-text

Analisis Pengukuran Sharia Compliance dalam Pelaksanaan Good Corporate Governance Bank Syariah di Indonesia

JURNAL AKUNTANSI DAN KEUANGAN ISLAM ◽

10.35836/jakis.v2i2.44 ◽

2019 ◽

Vol 2 (2) ◽

pp. 107-126 ◽

Cited By ~ 1

Author(s):

Dedhi Ana Mey Saramawati ◽

Ahmad Tarmizi Lubis

Keyword(s):

Corporate Governance ◽

Content Analysis ◽

Exploratory Study ◽

Supervisory Board ◽

Financial Statement ◽

Reporting Standards ◽

Islamic Banks ◽

Unit Of Analysis ◽

Analysis Methodology ◽

Good Corporate Governance

This research is an exploratory study aimed to measure and assess sharia compliance inthe framework of implementation of Good Corporate Governance in Sharia BankingIndonesia based an indicators used. That the results of this study can be compared byresearch of other similar, used indicators is an indicator that has been adapted from twoearlier studies i.e Thea Vinnicombe (2010) with title “ AAOIFI Reporting Standards :Measuring Compliance” and Sepky Mardian (2011) “ Study Exploration of DisclosureApplication of Sharia Compliance in Islamic Banks”. This research using 4 (four) indicators are : (i) Sharia Supervisory Board, which is a key player in Sharia Banking, (ii) Murabaha, is one contract that dominates Sharia Banking assets, (iii) zakah, an appraiser social function of Sharia Banks, and (iv) Mudharaba, which is a profit loss sharing contract with the identity of Sharia Banks. This research uses content analysis methodology, namely to make the sets specific text as the unit of analysis to figure out the purpose of the disclosure to be assessed in accordance with sharia compliance. Theannual reports are used GCG Implementation report and Financial Statement period2011. The results of this research indicate that level of Sharia Compliance Sharia Banking in Indonesia has been quite adequate with a percentage exceeding 50%, and in general, the tenth of Sharia Banking has been disclosed sharia compliance in the implementation of GCG.

Download Full-text

Effect of Corporate Governance Rules on Voluntary Disclosure in Jordanian Corporations Listed with the Amman Stock Exchange (ASE): (An Empirical Study)

Studies in Business and Economics ◽

10.2478/sbe-2019-0012 ◽

2019 ◽

Vol 14 (1) ◽

pp. 154-168

Author(s):

Al-Nimer Munther

Keyword(s):

Corporate Governance ◽

Board Of Directors ◽

Voluntary Disclosure ◽

Audit Committee ◽

Positive Relationship ◽

Stock Exchange ◽

Family Ownership ◽

Significant Positive Relationship ◽

Amman Stock Exchange ◽

The Board Of Directors

AbstractThis paper aims to examine the impact of corporate governance (CG) rules using several variables—size of the board of directors, size of the audit committee, family ownership ratio, and their impact on the level of the voluntary disclosure of companies listed with Amman Stock Exchange (ASE). The study was conducted based on the annual reports of the first market that include 55 firms. Content analysis was applied to collect the required data from several sectors (financial, insurance, services, and industrial sectors) from 2016 to 2017.The results indicate a negative association among family ownership ratio, size of the audit committee, and voluntary disclosure level. However, the study shows that the size of the board of directors has a significant positive relationship with the level of voluntary disclosure. Furthermore, the results show that CG rules (size of the board of directors, size of the audit committee, and family ownership ratio) have a significant positive relationship with the voluntary disclosure level of the companies listed with ASE. In the borderline market environment, the study contributes to a theoretical understanding of the corporate governance of voluntary disclosure and the relationship between corporate governance mechanisms and voluntary disclosure. The outcomes provide empirical support for the theoretical notion that effective corporate governance plays an important role in increasing the extent of voluntary disclosure.

Download Full-text