No abstract

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.

Article HistoryThis paper deals with the risks aggregation issue and adequate risk capital modeling within a multivariate setting. Focusing on the non-life insurance risk module, we examine the sensitivity of capital requirement to the dependence among risks for a multi-line Tunisian insurance firm. Such a context entails a nonlinear dependence of risks problem whose resolution may be intended by means of multivariate copulas. The relevant analysis relies profoundly on the dependence modeling by the means of vine copulas which are a flexible technique to model multivariate distributions constructed using a cascade of bivariate copulas. Under various confidence levels in VaR and TailVaR, the reached findings reveal the advantages of D-Vine copula in modeling inhomogeneous structures of dependency due to its flexibility of use in a simulation context. Practitioners and regulators can explore our conclusions for the assessment of risk capital under Solvency 2, which is based on stochastic models.Contribution/ Originality: This study uses new methodology based on CD-vine copulas estimation to investigate the sensitivity of solvency capital requirement to the dependence pattern between the losses derived from non-life business lines of a Tunisian insurance company.