Sharia Governance and Sustainability Reporting: The Mediating Role of Financial Performance

Using a sample of registered Sharia Commercial Banks (BUS) in Indonesia during 2014-2017, we examine the effect of Sharia Governance on Sustainability Reporting with financial performance as a mediating variable. Our results support the idea that sharia governance (sharia supervisory board, independent commissioner, board of director's meeting and audit committee) has significant influence on the sustainability reporting. Further analysis indicates the mediating role of financial performance in the relationship between sharia governance and sustainability reporting. Our results suggest that it is essential for regulatory agencies to enhance the supervision role of independent commissioners.

The Malaysian Fund Managers Perspective on the Viability of Takaful Operators Investment

Takaful operators are expected by the policyholders to act beyond the role of traditional insurance companies that only offer Shariah-compliant protection services. They are expected to be commercially viable. One of the ways to be commercially viable is takaful operators must be able to invest the policyholders' funds in the profitable investment avenues. Nevertheless, the critical issue before investing the funds is to develop products that are suitable with the takaful operators' investment strategy. This study employed a questionnaire survey to gather the feedback of fund managers from 11 takaful operators in Malaysia — all were the senior staffs of takaful operators in Malaysia were surveyed. The questionnaire is developed in the form of a Likert scale ranging from 1 to 5 as the research instrument. By Delphi technique, the draft of the questionnaire was sent to a panel of experts for review, was adopted, and their feedback reflected in the final questionnaire. The experts were a shariah advisor, a corporate finance manager, and a senior executive at the central bank. Findings indicate that policyholders' expectations on their investments are met and the products so far compatible with takaful operators' investment strategies.

How Islamic Bank Managing Risk? An Emphasis on Anticipating Financial Crisis

The global economic crisis in 2008 shocked and pressured Indonesian macroeconomic and financial system stability. The decline in macroeconomic stability has an impact on banking policy in lending. Most banks in the world respond to the crisis by doing credit rationing, but how about Islamic bank response toward this condition in Indonesia? Therefore, this study aims to examine the effect of Capital Adequacy Ratio (CAR) and macroeconomic variables on the amount of Islamic banking financing in Indonesia. The method used in this study is the SVAR (Structural Vector Auto Regression) analysis method. The results showed that inflation, capital, and CAR variables had a significant effect on Islamic bank’s financing amount. In contrast, GDP had no significant impact on Islamic bank’s financing amount which means that Islamic banking in Indonesia was not implemented pro-cyclical based lending policy.

Halal Tourism Based on Value Creation

Nowadays, halal tourism product is not only focused on Muslim tourists, but also non-Muslim one. The halal tourism industry needs to develop the people understanding of halal values in order to bring benefits to consumers through recognition of the tourism management potency as well as the need of value identification. This research aimed to develop value-based tourism, identify the value types, as well as create value as the basis for managing lawful tourism, which needs a model to facilitate recognizion of the tourism product excellence. This research used qualitative case study approach, with the head of tourism in the region where has potency to implement Islamic Marketing Concept as the key informants. The result showed that halal marketing included not only about product but also about pricing, promotion, and place. Muslim consumers were keen on tourism services that implement lawful approach. Furthermore, there were ten values of tourism in Indonesia e.g. Religious Tourism, Geo Tourism, Natural Tourism, Fashion Tourism, Culinary Tourism, Medical Tourism, Historical Tourism, Sport Tourism, Culture Tourism, and Hospitality Tourism.

Do Indonesian Islamic Microfinance Institutions Need Lender of the Last Resort?

Liquidity risk is one of significant risk managed by financial intermediaries including Islamic Microfinance Institutions (IMFIs). The financial intermediaries accept short-term deposits and disburse these deposits in the form of long-term loans. This situation makes IMFI desperately need a lender of last resort (LOLR). Nevertheless, there has been no formal LOLR for Indonesian IMFIs. This study intends to construct the LOLR model for IMFI in Indonesia. This qualitative study applies a case study analysis. This study's subjects are IMFIs in East Java Province that was selected purposively with thirty managers as the key informants. Research findings show that the best model of LOLR is developing a secondary cooperative since the majority form of IMFIs in Indonesia are cooperative entities. With all members of a secondary cooperative deposit for reserve requirements, they can place excess liquidity in the secondary cooperative and ask for financial support.

Revisiting Green Marketing Implementation in Halal Cosmetic Brands

The growing green consumer who selecting products that socially and environmentally ethical products, encourages cosmetics producers in Indonesia to produce more environmentally friendly product in terms of materials, ingredients, packaging, and even the strategy to promote it. As this market segment continues to grow and develop, cosmetics manufacturers are required to be more competitive by applying green marketing values. Therefore, this study aims to investigate how halal cosmetic brands applying green marketing based on the concept of green marketing strategy and Islamic Marketing Ethics (IME). This case study uses a qualitative research approach that selecting four top halal cosmetic brands that marketed in Indonesia. Data was analyzed by data triangulation and method triangulation approach and presented in inductive summary. The results of the study concluded that among the top four halal cosmetics brands studied, two brands had implemented the concept of green marketing strategy and implementation comprehensively (shaded green and extreme green), while the other two brands applied lean green and defensive marketing strategy and implementation. The implication of this research is to provide suggestion to managerial marketing about how to create a more captivating halal products for all customers. The novelty of research proposes how is the level of Indonesian halal cosmetic brands green strategy that applying Islamic Marketing Ethics (IME).

Factors Affecting Tourist Interest on Sharia Tourism

Sharia tourism is part of the halal industry which becomes one of the major supporters of the sharia economy in Indonesia. Nevertheless, since 2011, the city of Bandung as the epicentrum of sharia tourism experienced a decreasing number of visitors. The purpose of this study is to analyze the factors that influence tourist interest in visiting sharia tourism destinations. The research method is quantitative. The results of this study indicate that service, safety, and tourism influence tourist interest. The safety and promotion factors significantly influence tourist interest in visiting Sharia tourism, while service has no significant effect on tourist interest.

Corporate Social Responsibility in Morocco: Are Small and Medium-Sized Enterprises (SMEs) Socialy Responsible?

CSR's dynamism in Moroccan business is very recent. It was started in 2006 with the initiative of the Moroccan Confederation of business associations (CGEM) through the CSR label. Nowadays, more than 70 companies in the majority of large firms had been labelled. In the same year, the Moroccan Kingdom accedes to the Global Compact. At the policy level, the country has presented its achievements regarding the objectives millennia and began the implementation of the objectives of sustainable development. In this dynamism, what about SMEs? Which are the key importance of the Moroccan economy? Therefore, the study aims to explore the existence of a specific CSR in the Moroccan context by focusing on SMEs' social practices. This study uses a qualitative approach based on a case study method that aimed at a scoping study in Moroccan CSR's nature. Our analysis demonstrates that SMEs' social practices would be socially responsible ones' and would reflect an implicit CSR that explained by the motivations of these practices and the relationship of SMEs with its stakeholders

The Synergy Model for Strengthening the Productivity of Indonesian Halal Industry

Halal industry has become a new commodity that is favoured by all countries around the world, including Indonesia. The main challenge of halal industry development is strengthening its position as a producer in the global halal industry market. This study aims to investigate the number of policy proposals relating to strengthening the productivity of the halal industry in Indonesia and then develop a model of synergy over this matter. This study uses a qualitative study approach, with literature review, observation and interview as data collection methods. The results obtained from this study include several things, specifically; the focus of economic development in Indonesia is fundamentally still focused on the processed industry, which incidentally is dominated by imported raw materials. Based on the results of the analysis of the discussion, the implications of these studies is providing input for authorities such as BPJH, MUI and related ministries to adjust the regulation that address the main business challenge of halal industry. Besides, the government should give special authority to state-owned and private sharia banks to finance the halal industries and agricultural to support their sustainable development.

The Role of Corporate Social Responsibility Disclosure in Improving Financial Performance (Case study in Indonesian Islamic Bank)

The influence of social care by business entities to their financial performance has been continuously debated in previous management reseearch. Nevertheless, studies about the influence of CSR on Islamic banks financial performance were rarely done. Therefore, this studyaims to examine the influence of Corporate Social Responsibility Disclosure (CSRD) on profitability as measured by Return On Assets (ROA), Return On Equity (ROE), Net Profit Margin (NPM) and Investment Account Holders (IAH) by debt and financing ratio. Data was obtained from Islamic banks in Indonesia through observation from 2012 to 2018 that analyzed by panel data regression and Fixed Effect Model (FEM). The results showed that the CSRD did not have a positive influence on ROA, ROE, NPM, IAH, Debt, and Financing Ratio. Therefore, the legitimacy theory was not proven in this study.