Guiding principles in developing Shari'ah governance framework for Islamic capital market
Shari’ah compliance is the foundation of the Islamic financial markets, including Islamic capital market. From the beginning, the Islamic capital market (ICM) was developed to support the other two Islamic financial markets such as Islamic Banking and Takaful. Later on, it became the investment av...
| Main Authors: | , |
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| Format: | Article |
| Language: | English English |
| Published: |
Serials Publications
2017
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| Subjects: | |
| Online Access: | http://irep.iium.edu.my/72818/ http://irep.iium.edu.my/72818/ http://irep.iium.edu.my/72818/2/72818_Guiding%20principles%20in%20developing%20Shari%27ah.pdf http://irep.iium.edu.my/72818/9/72818_Guiding%20principles%20in%20developing%20Shari%27ah_SCOPUS.pdf |
| Summary: | Shari’ah compliance is the foundation of the Islamic financial markets, including Islamic capital
market. From the beginning, the Islamic capital market (ICM) was developed to support the other two Islamic
financial markets such as Islamic Banking and Takaful. Later on, it became the investment avenue for investors
looking for Shari’ah compliant investment and financing. Presently, the Shari’ah governance framework and
regulations have been implemented for Islamic banks and Takaful. On the contrary, there is lack of similar
framework of Shari’ah Governance for the Islamic capital market. Malaysia having positioned itself as a hub
of Islamic finance should introduce a Shari’ah governance framework for the Islamic capital market. Thus, the
objective of this paper is to provide the principles on which the theoretical Shari’ah governance framework for
the Islamic capital market can be developed. These principles are Islamic accountability and responsibility,
independence and objectivity, competence, confidentiality and commitment, consistency, Shari’ah audit and
review, transparency and disclosure, corporate social responsibility and ethicality. In addition, this paper discusses
the Shari’ah governance practices in Indonesia, Bahrain, Pakistan, Kuwait and Malaysia. This write-up will be
of interest to individual players, regulators, investors and the public. |
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