Corporate Governance in Islamic Banks

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.

scholarly journals PENGARUH MEKANISME ISLAMIC CORPORATE GOVERNANCE TERHADAP KINERJA BANK SYARIAH DI INDONESIA BERDASARKAN MAQASHID SYARIAH INDEKS

2018 ◽  
Vol 6 (1) ◽  
pp. 36
Author(s):  
Anton Anton
Keyword(s):  
Corporate Governance ◽  
Supervisory Board ◽  
Islamic Banks ◽  
Governance Mechanism ◽  
Governance Mechanisms ◽  
Business Goals ◽  
Corporate Governance Mechanisms ◽  
Corporate Governance Mechanism ◽  
Rights And Interests

To be able to realize the business goals and social objectives of Islamic banks need to be supported by Islamic corporate governance mechanisms that protect the rights and interests of all stakeholders who are subject to the rules of sharia. The purpose of this study was to determine the effect of Islamic corporate governance mechanism variables on the performance of Islamic banks in Indonesia based on the maqashid sharia index. The results showed that the number and education of the Sharia Supervisory Board had a significant effect. While concurrent positions and meetings of the Sharia Supervisory Board have no significant effect on the performance of Islamic banks in Indonesia based on the maqashid sharia index.

scholarly journals Directors' Monitoring Role, Ownership Concentration and Audit fees

2020 ◽  
Vol 14 (5) ◽  
pp. 3-25
Author(s):  
Rabih Nehme ◽  
Amir Michael ◽  
Jim Haslam
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Audit Committee ◽  
Audit Fees ◽  
Governance Mechanism ◽  
Corporate Executives ◽  
Corporate Governance Mechanisms ◽  
The Board Of Directors ◽  
Corporate Governance Mechanism

The research objective is to analyse different factors potentially involved in influencing the size of audit fees. The association between the Board of Directors and the shareholders of listed companies should be effectively developed and there should be a higher spirit of compliance with the governance code. The empirical model is constructed to assess the theoretical and statistical relationship between audit fees and corporate governance characteristics over a period of four years (for FTSE 350 companies excluding financial institutions between 2012 and 2015). Different testing techniques are used for robustness reasons. We found that Board of Directors' characteristics are significant in relation to audit fees. Some of the Audit Committee characteristics are affected by the collegiality principle in relation to the Board of Directors' characteristics. The consultative role of audit committee directors is dominated by the role of the Board of Directors. Mandatory audit fees, and not total auditors' remuneration is included in this study. While other studies assess mainly one corporate governance mechanism in relation to audit fees, we include the corporate governance mechanisms that are directly related to auditors' scope. This paper can be used as a tool for audit practitioners and corporate executives to seek a better auditor-client relationship.

scholarly journals PENGARUH MEKANISME CORPORATE GOVERNANCE DAN UKURAN PERUSAHAAN TERHADAP KINERJA KEUANGAN (Survei Pada Perusahaan Manufaktur yang terdaftar di BEI )

2018 ◽  
Vol 2 (2) ◽  
pp. 010-031
Author(s):  
Animah Animah ◽  
Lukman Effendy ◽  
Alamsyah M. Thahir ◽  
Erna Widiastuty
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Firm Size ◽  
Sampling Technique ◽  
Partial Least Square ◽  
Least Square ◽  
Governance Mechanism ◽  
Governance Mechanisms ◽  
Corporate Governance Mechanisms ◽  
Corporate Governance Mechanism

The purpose of this research is to examine the effect of corporate governance mechanisms,  firm size of financial performance. The Population of this research is the company manufacturing  in BEI. The sampling technique used is purposive sampling. The analytical tool used is using partial least  square program. The independent variables in this research are corporate governance mechanism,  firm size  while the dependent variable is the performance of the financial. The result of the research shows that firm size  influence to financial performance, while other variables such as corporate governance mechanisms have no effect negative  to financial performance.

scholarly journals The Effect of Good Corporate Governance Mechanism On The Financial Performance of Banking Companies Listed In Stock Exchange Indonesia 2012-2016

2019 ◽  
Vol 3 (2) ◽  
pp. 273-287
Author(s):  
Desi Pipian Pujakusum
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Board Of Directors ◽  
Audit Committee ◽  
Stock Exchange ◽  
Governance Mechanism ◽  
Return On Assets ◽  
Good Corporate Governance ◽  
The Board Of Directors ◽  
Corporate Governance Mechanism

This study aims to examine the effect of good corporate governance mechanism on the financial performance of banking companies listed on the Indonesian Stock Exchange 2012-2016 period. The corporate governance mechanism is proxied by the size of the board of directors, the size of the board of commissioners, audit committee size, the board of director's education, and the board of commissioner’s education. The company's financial performance is proxied by return on assets (ROA). Samples were taken by using purposive sampling. The total number of samples used in this study amounted to 180 research samples. This study was tested with SPSS 20 program. Data analysis technique used in this research is simple regression analysis.  The results showed that the size of the board of directors, the size of the board of commissioners, and audit comitee size have a significant effect on return on assets. These three factors have a significant effect on return on assets, while the board of commissioners education and the board of director's education have no significant effect on return on assets.

scholarly journals The Role of Islamic Corporate Governance and Risk Toward Islamic Banking Performance: Evidence from Indonesia

2021 ◽  
Vol 22 (3) ◽  
pp. Layouting
Author(s):  
Emile Satia Darma ◽  
Akhsyim Afandi
Keyword(s):  
Corporate Governance ◽  
Supervisory Board ◽  
Islamic Banks ◽  
Governance Mechanisms ◽  
Business Units ◽  
Corporate Governance Mechanisms ◽  
Negative Effect ◽  
Conventional Banks ◽  
Positive Effect

Research aims: This study aims to analyze the role of Islamic corporate governance mechanisms on the performance of Islamic banks. Besides, it also analyzes the effect of risk profiles, especially those that are directly related to bank financing, on the performance of Islamic Banks.Design/Methodology/Approach: Sharia banks that become the objects are Sharia Commercial Banks (SCB) and Sharia Business Units of Conventional Banks (SBU). This study uses data from 20 sharia banks (11 SCB and 9 SBU). The analytical tool used in this study is panel data regression.Research findings: The results show that the meeting frequency of the Board of Commissioners, Sharia Supervisory Board (SSB), Financing to Deposits Ratio (FDR), and bank size have a significant positive effect on the performance of Islamic banks. Non-Performing Financing (NPF) has a significant negative effect on the performance of Islamic banks.Theoretical contribution/Originality: This study utilized Stakeholders theory, Maqoshid Sharia concept, and corporate governance to investigate the role of Islamic corporate governance mechanisms and risk management on sharia Banks performance.Practitioner/Policy implication: The implication of this study is that SSB activities had a direct and robust influence on Islamic Banks, which have relatively larger assets. Hence, the task of the Sharia Supervisory Board should not be limited to only monitoring the conformity of transactions with sharia but also providing input so that banks can increase their profits in line with sharia.Research limitation/Implication: The limitation in this study is the number of corporate governance variables that was limited.

scholarly journals Corporate governance and innovation: a theoretical review

2019 ◽  
Vol 28 (3) ◽  
pp. 266-284 ◽  
Author(s):  
Diego Asensio-López ◽  
Laura Cabeza-García ◽  
Nuria González-Álvarez
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Empirical Evidence ◽  
Ownership Structure ◽  
Theoretical Background ◽  
Future Research ◽  
Governance Mechanisms ◽  
Content Type ◽  
Corporate Governance Mechanisms ◽  
The Board Of Directors

Purpose The purpose of this paper is to present a review of the literature on two lines of research, corporate governance and innovation, explaining how different internal corporate governance mechanisms may be determinants of business innovation. Design/methodology/approach It explores the theoretical background and the empirical evidence regarding the influence of both ownership structure and the board of directors on company innovation. Then, conclusions are drawn and possible future research lines are presented. Findings No consensus was observed regarding the relation between corporate governance and innovation, with both positive and negative arguments being found, and with empirical evidence not always pointing in the same direction. Thus, new studies trying to clarify this relationship are needed. Originality/value Over recent years, interest has grown in the influence of governance mechanisms on innovation decisions taken by the management. Innovation efforts and results depend on factors that are influenced by corporate governance, such as ownership structure or the functioning of the board of directors. Thus, the paper shows an updated state of the art in this field proposing future lines for empirical research.

scholarly journals Effect of Corporate Governance Mechanism on Company Value with Company Performance as Intervening Variable

2021 ◽  
Vol 9 (12) ◽  
pp. 115-131
Author(s):  
NUR ADILA ◽  
Zaenal Arifin
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Audit Committee ◽  
Company Performance ◽  
Governance Mechanism ◽  
Company Value ◽  
The Board Of Directors ◽  
Long Time ◽  
Corporate Governance Mechanism

Corporate Governance is a system that regulates and controls a company which expected to give and increase Company Value to investors. With the existence of Corporate Governance, it is expected that Company Performance will give a good influence on the company. One of the cases is after Indonesia went through a prolonged crisis since 1998, the repairing process in the companies took a long time and it is caused by the weakness of Corporate Governance application in the companies, which will affect the companies’ performance and decrease the companies’ values. The purpose of this research is to analyze the effects of the Corporate Governance mechanism on Company Value with Company Performance as an intervening variable. The case study used in this research is the companies included in IDX BUMN 20 Tahun 2020 list. The result of this study is that Independent Commissioner doesn’t affect values and Company Performance, the board of directors affects Company Value positively, the board of directors doesn’t affect Company Performance. The Audit Committee doesn’t affect the Company Value. The Audit Committee affects the Company Performance positively. The Company Performance is not capable to mediate the independent commissioner’s effect on Company Value. The Company Performance can mediate the effect of the Board of Directors on the Company Value, the Company Performance can’t mediate the effect of Audit Committee on the Company Value.

scholarly journals PENGARUH CORPORATE GOVERNANCE MECHANISM TERHADAP NILAI PERUSAHAAN MELALUI PERTUMBUHAN, PROFITABILITAS DAN KEBIJAKAN DIVIDEN

2017 ◽  
Vol 19 (1) ◽  
pp. 42
Author(s):  
Muhamad Umar Mai
Keyword(s):  
Corporate Governance ◽  
Growth Effect ◽  
Governance Mechanism ◽  
Manufacturing Companies ◽  
Governance Mechanisms ◽  
Board Size ◽  
Return On Equity ◽  
Dividend Payments ◽  
Corporate Governance Mechanisms ◽  
Corporate Governance Mechanism

The purpose of this research is to analyze the influence of corporate governance mechanisms to the value of the firm through growth, profitability and dividend policy. The population of this study are all of manufacturing companies listed on the Indonesia Stock Exchange for the period of 2000-2012.  The sampling method used in this study was purposive sampling, with the criteria that the company distributed cash dividends and have an independent member of the board of trustees. This study proves that the growth of the company affecting the profitability and the firmsvalue, despite the fact that the company reduced its dividend payments. Sobel’s test result shows that firm’s growth effect to firm value mediating by profitability significantly, represented by return on equity. Corporate governance mechanisms plays an important role in preventing unproductively growth of companies that have reached the stage of maturity. The intensification of the firms value, also influenced by its ability to increase the profitability and dividend payments. Institutional ownership and board size as a proxy for corporate governance mechanism plays an important part to encourage companies to improve their return on equity, while the independent board persuade companies to increase the dividend payments. In this study the board size variable has shown a very important role on the increase of profitability, dividend payments, and therealizations of the value of the company.

scholarly journals Good Corpotare Governance dan Manajemen Laba di Perbankan Syariah

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.

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