Shari’ah Governance Applicable to Islamic Banks in Malaysia: Effect of Islamic Financial Services Act 2013

Abstract

Purpose

This chapter aims to explore the Shari’ah governance rules applied in the Malaysian Islamic banking arena and the effect of Islamic Financial Services Act 2013 on it.

Design/Methodology/Approach

This is a legal exploratory study primarily focused on library research.

Findings

Shari’ah governance is a concept that has been developed and applied gradually in Malaysia and the new Islamic Financial Services Act 2013 has taken it to the next level. However, this does not mean that it has resolved the problems in Shari’ah governance that existed before the enactment of the act.

Originality/Value

Islamic Financial Services Act 2013 is a new statute that repealed Islamic Banking Act 1983. As such, not many have reviewed this new piece of legislation. This chapter will give insight into the evolution of Shari’ah governance as part of corporate governance of Islamic banks in Malaysia and will help explain the most recent developments in this arena along with the challenges.

Citation

Muneeza, A. (2014), " Shari’ah Governance Applicable to Islamic Banks in Malaysia: Effect of Islamic Financial Services Act 2013", The Developing Role of Islamic Banking and Finance: From Local to Global Perspectives (Contemporary Studies in Economic and Financial Analysis, Vol. 95), Emerald Group Publishing Limited, Leeds, pp. 31-44. https://doi.org/10.1108/S1569-3759(2014)0000095010