Social responsibility disclosure in Islamic banks: a comparative study of Indonesia and Malaysia

Amran, Azlan; Fauzi, Hasan; Purwanto, Yadi; Darus, Faizah; Yusoff, Haslinda; Zain, Mustaffa Mohamed; Naim, Dayang Milianna Abang; Nejati, Mehran

doi:10.1108/jfra-01-2015-0016

Cited by 118 publications

(127 citation statements)

References 47 publications

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“…As per the Hexun criteria, the overall CSR score for a specific pharmaceutical firm may be calculated as the following equation: (1) where CSR(SHA), CSR(EMP), CSR(CUST & SUP), CSR(ENV), and CSR(SOC) are corporate fulfillment towards the CSR dimensions of shareholders, employees, customers and suppliers, the environment, and society respectively. The score of each dimension, as well as the overall CSR score, were directly extracted from Hexun CSR rating.…”

Section: Csrmentioning

confidence: 99%

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Does CSR Influence Firm Performance Indicators? Evidence from Chinese Pharmaceutical Enterprises

2019

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This research is carried out in the backdrop of increasing product quality and environmental degradation scandals associated with Chinese Pharmaceuticals in recent years. We examined the data of 125 Chinese Pharmaceuticals between 2010–2016 to investigate the impact of overall corporate social responsibility (CSR) performance as well as the performance on five unique aspects of CSR such as shareholders, employees, customers and suppliers, environmental practices, and the society to gauge the impact of these individual dimensions on the firm’s financial performance. The Hexun rating system is used to gauge a firm’s CSR performance on various stakeholder dimensions as it is one of the widely accepted CSR measurement criteria in China. The firm performance is measured by Tobin’s Q, return on assets (ROA), return on equity (ROE), and earnings per share (EPS) ratios. The outcome of the panel-based regression models reveals that the overall CSR score has a positive and significant influence on a firm’s financial indicators. Moreover, although all the CSR dimensions relate positively to firm performance, the environmental aspect of CSR has the most profound impact on firm performance followed by customers and suppliers, and employees. However, the shareholders and social dimensions have a relatively lesser influence on firm performance. These results imply that Chinese Pharmaceuticals shall further optimize each aspect of CSR performance as it can not only create a favorable brand image for various stakeholders but also results in sustainable financial performance.

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Section: Csrmentioning

confidence: 99%

“…Corporate social responsibility (CSR) has gained momentum as a critical issue for many firms because of the increase in public awareness about the impact of corporate activities on the environment and society [1]. Companies are expected to act in a socially responsible manner as well as be financially accountable [2].…”

Section: Introductionmentioning

confidence: 99%

Does CSR Influence Firm Performance Indicators? Evidence from Chinese Pharmaceutical Enterprises

2019

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“…The variable of total sustainability was used for empirical testing. Consistent with [56], for measuring sustainability scores the following formula was used, i.e., = dj N , where, N means the total number of disclosures while d j are the numbers of discoursers performed by the banks. The formative variable of total sustainability is considered as an endogenous variable by the previous studies [57].…”

Section: Total Sustainability Score (Formative Variable)mentioning

confidence: 99%

“…It represents the total number of members available in the Shariah supervisory committee of the Islamic banks. The author of [11] used the average of SSB, while [56] used the number of SSB members to proxy this variable. This study will use the log of the total number of Shariah scholars on the board.…”

Section: Shariah Supervisory Board Size (Ssbs)mentioning

confidence: 99%

Sustainable Business Practices and Firm’s Financial Performance in Islamic Banking: Under the Moderating Role of Islamic Corporate Governance

et al. 2019

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This paper examines the moderating role of Islamic corporate governance on the link between sustainable business practices and the firm’s financial performance. A post-crisis period sustainability data for the decade of 2008–2017 was collected by the study. For data collection, this study used the weighted content method. The Generalized Method of Moments (GMM) statistical test was used for empirical testing. The results of the study found that the link between sustainable business practices with the firm’s financial performance measured from the shareholders’ and the management’s perspective is positive, while the subjected link measured from the market perspective was found to be insignificant. This implies that the market stakeholders of the Islamic banks are reluctant for their bank’s spending on sustainable business practices. Interestingly, the insignificant link between sustainable business practices and market performance became significant with the moderating role of Shariah governance and managerial ownership. It shows that the moderating role of Shariah governance and managerial ownership is giving confidence to market stakeholders of Islamic banks for receiving a higher financial return through sustainable business practices initiatives. These results may provide insights for several policymakers of the Islamic banking industry about integrating vital sustainability practices in their business models and about the balanced moderating role of Islamic corporate governance in the link between sustainable business practice and the firm’s financial performance. It provides a roadmap to the Islamic banking industry for efficient management of sustainability practices from an Islamic perspective and subsequently improvement of financial performance through it.

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“…Many previous studies examined voluntary disclosure in annual reports of Islamic financial institutions in different countries ( Amran et al (2017) found that CSR reporting of Islamic banks has generally increased in both Malaysia and Indonesia. More precisely, workplace and society dimensions were found to be the most commonly reported areas by Islamic banks in both countries.…”

Section: Literature Reviewmentioning

confidence: 99%

The extent of voluntary disclosure in the annual reports of Islamic banks: empirical evidence from Yemen

Homaidi

Allamy

Ahmad

et al. 2020

Banks and Bank Systems

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This article aims to measure the level of voluntary disclosure in the published annual reports of Yemeni Islamic banks. Four full-fledged Islamic banks from Yemen are selected for the current study. A disclosure checklist covering 266 items is prepared and a 10-year period, 2005–2014, is taken. The disclosure index items were classified into seven groups, such as basic information on Islamic banks, financial ratios, corporate governance information, financial statements data, corporate social disclosure, Zakat information, and other information that has been taken as an important attribute of voluntary disclosure. The obtained results show that the amount of voluntary disclosure that Yemeni Islamic banking institutions publish in their annual reports has gradually increased over the ten years examined. The results revealed that the highest average disclosure index score over the ten years was achieved by Tadhamon Islamic International Bank (TIIB), the second highest average disclosure score was obtained by Saba Islamic Bank (SIB), and the lowest average voluntary disclosure rating score during the ten years surveyed was achieved by Shamil Bank of Yemen &amp; Bahrain in Yemen during the study period. Substantially, the result of voluntary disclosure scores indicates that the degree of voluntary disclosure by Yemeni Islamic financial institutions has relatively expanded during the ten years investigated. The findings provide new evidence for voluntary disclosure, particularly, Islamic disclosure items. The survey findings can be useful for regulators in Yemen to improve overall disclosure practices by Islamic banks operating in Yemen.

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Social responsibility disclosure in Islamic banks: a comparative study of Indonesia and Malaysia

Cited by 118 publications

References 47 publications

Does CSR Influence Firm Performance Indicators? Evidence from Chinese Pharmaceutical Enterprises

Does CSR Influence Firm Performance Indicators? Evidence from Chinese Pharmaceutical Enterprises

Sustainable Business Practices and Firm’s Financial Performance in Islamic Banking: Under the Moderating Role of Islamic Corporate Governance

The extent of voluntary disclosure in the annual reports of Islamic banks: empirical evidence from Yemen

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