Social Impact Bonds in Light of Maqasid Al-Shari'ah and Maslahah

Azman, Syed Marwan Mujahid Syed

doi:10.12816/0024786

Cited by 5 publications

(4 citation statements)

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“…Generally, SRI and Islamic finance share the same fundamental aim, which is to utilize the funds with high morals and ethics. SRI use funding and investment activities to express individual and institutional values or advance the institution's mission (Caplan et al, 2013) Besides, SRI investing also aims to improve investment performance, outcomes and the benefits to the society through varieties of the social program such as to overcome the issue of poverty, unemployment, homeless, healthcare, criminal offending and others (Marwan, 2015). This motion contradicts the traditional conventional finance practice, which mainly focuses on maximizing the profits.…”

Section: The Commonalities Between Sri and Ifimentioning

confidence: 99%

Sustainable and Responsible Investment: Concept and the Commonalities with Islamic Financial Institutions

Wahab

Naim

2020

Etikonomi

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This paper aims to highlight the Sustainable and Responsible Investment (SRI) concept, similarities, and opportunities with Islamic financial institutions (IFIs), especially in Malaysia's perspectives. This paper is conceptual., thus the methodology used in this paper is qualitative, focusing on document analysis method by analyzing previous literature, books, reports, official website, and articles. Based on the analysis, SRIs and IFIs share the same fundamental aim, which is to utilize the funds with high morals and ethics. Besides, the analysis also indicates that SRIs and IFIs have shown significant growth over the last two decades and became the most rapidly growing sectors. In the context of the opportunities, both concepts can become a new value proposition and product innovation in order to capture the future preferences of investors and customers. The IFIs and SRIs are capable of bridging the gap both entities considering their fundamental mutual aim, which is to utilize the funds through high morals and ethics.JEL Classification: E22, G20How to Cite:Wahab, M. Z. H., & Naim, A. M. (2020). Sustainable and Responsible Investment:Concept and the Commonalities with Islamic Financial Institutions. Etikonomi: Jurnal Ekonomi, 19(1), 141 – 154. https://doi.org/10.15408/etk.v19i1.13772.

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Section: The Commonalities Between Sri and Ifimentioning

confidence: 99%

Sustainable and Responsible Investment: Concept and the Commonalities with Islamic Financial Institutions

Wahab

Naim

2020

Etikonomi

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“…Dusuki and Abdullah (2007) argued that maslahah as the manifestation of "aqidah" (creed), "ibadah" (worship) and "akhlaq" (morality and ethics) in economics, business and other worldly activities. Many researchers stress the importance of the maslahah concept when they are discussing Maqashid Al-Shari'ah (Al-mubarak and Osmani, 2010;Dusuki and Abdullah, 2007;Marwan, 2015). Some placed maslahah as one of the core concepts of Maqashid Al-Shari'ah (Antonio et al, 2012;Dayyan and Mohammed, 2012;Mohammed and Razak, 2008;Mohammed and Taib, 2010).…”

Section: The Concept Of Maslahahmentioning

confidence: 99%

Maqashid Al-Shari’ah-based performance measurement for the halal industry

Rahman

Tareq

Yunanda

et al. 2017

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Purpose The halal industry is one of the most growing industries in the world. It refers to the industry in line with Islamic principles and requirements. The emergence of this industry aims to fulfil the requirement of Islamic-compliant products and services. Surprisingly, the industry has been growing in both Muslim and non-Muslim countries. Assessing the performance of the industry will be notable for ensuring that it obtains its objectives. The proper performance measurement should highlight business perspectives and religious aspects. This study aims to explore the current issues and challenges in developing Maqashid Al-Shari’ah-based performance measurement in the halal industry. Design/methodology/approach This is a qualitative research using in-depth interviews, and uses content analysis to interpret and explain the interview result. Interviews were conducted with experts in Maqashid Al-Shari’ah and Islamic capital markets. Findings The existence of the concept of Maqashid Al-Shari’ah is to create maslahah for all human beings. The development of Maqashid Al-Shari’ah performance measurement for the business is very important. It has only been developed for Islamic financial industry. Unfortunately, it is found that the development of Maqashid Al-Shari’ah performance measurement has not been carried out comprehensively in non-financial industry. The main issue is the absence of the applicable measurements. Therefore, collective decision is required to develop the appropriate measurements. Practical implications There is a necessity for regulator to produce standards on Maqashid Al-Shari’ah-based performance measurement. The government policy plays an important role in the development and implementation of Maqashid Al-Shari’ah -based measurement index. Originality/value This paper highlights the issue of the development of Maqashid Al-Shari’ah -based performance measurement in halal business and commerce which has not much discussed in prior studies.

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“…However, the general model of SIBs does not seem to show any features that violate Sharīʿah principles, especially with reference to avoiding ribā (interest), maysir (gambling) and gharar (uncertainty). The objectives of SIBs are also argued to be in line with the principles of Sharīʿah (Marwan, 2015; Marwan and Haneef, 2019). On the other hand, the fundamental structure of CBs, which usually involve ribā and have elements of gharar and maysir in them, clearly violates the principles of Sharīʿah.…”

Section: Literature Review and Hypotheses Of The Studymentioning

confidence: 99%

An empirical comparison of sustainable and responsible investment ṣukūk, social impact bonds and conventional bonds

Azman

Ismail

Haneef

et al. 2022

IJIF

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PurposeThe objectives of this paper are two-fold: first, to empirically compare and contrast the salient features of three financial instruments (FIs), namely sustainable and responsible investment (SRI) sukuk, social impact bonds (SIBs) and conventional bonds (CBs) and second, to examine the differences between the perceptions of the investors and the developers on the features of the three FIs.Design/methodology/approachUsing a questionnaire survey, 251 completed and useable responses were received, representing a 42.54% response rate. In examining the differences and similarities in the characteristics of the three FIs, the inferential statistical of frequency and percentage were used. Wilcoxon test and Mann–Whitney tests were conducted to investigate the differences in the salient features of the three FIs and the differences between the investors and developers' perceptions on the salient features of SRI, SIBs and CBs, respectively.FindingsThe results reveal that stakeholders view SRI Sukuk, SIBs and CBs to be statistically significantly different from each other. This shows that stakeholders do not view SRI sukuk as “old wine in a new Shariah-compliant bottle” but instead considered different from SIBs and CBs. Furthermore, stakeholders also differentiate between SIBs and CBs.Originality/valueThe paper provides empirical evidence that Islamic finance (IF) instrument, represented by SRI sukuk, is viewed as different instruments to conventional tools, represented by SIBs and CBs. First, it debunks the notion that IF is viewed as similar to its conventional counterpart. Second, SIBs are seen as different from CBs, illustrating the distinct categorisation of impact investing instruments. As such, third, the development of SRI sukuk and SIBs can provide diversification to portfolios as it is a unique instrument in the social finance and financial market.

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Social Impact Bonds in Light of Maqasid Al-Shari'ah and Maslahah

Cited by 5 publications

References 0 publications

Sustainable and Responsible Investment: Concept and the Commonalities with Islamic Financial Institutions

Sustainable and Responsible Investment: Concept and the Commonalities with Islamic Financial Institutions

Maqashid Al-Shari’ah-based performance measurement for the halal industry

An empirical comparison of sustainable and responsible investment ṣukūk, social impact bonds and conventional bonds

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