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Article
Publication date: 1 November 2023

Marwan N. Al Qur’an

The purpose of this paper is to review and analyze assumptions and the appropriateness of the most dominant strategic decision-making theories within the Islamic cultural context…

Abstract

Purpose

The purpose of this paper is to review and analyze assumptions and the appropriateness of the most dominant strategic decision-making theories within the Islamic cultural context as an attempt to develop an Islamic decision-making framework.

Design/methodology/approach

This paper adopted the integrative literature review approach as a research method (Torraco, 2005). This method allows the researcher to evaluate and syndicate the relevant literature to, critically, review and expand on the theoretical foundation of the topic and, hence, develop new theoretical perspectives and views.

Findings

Based on the critical review of the decision-making theories from an Islamic perspective, Islamic culture confirms the behavioural decision theory as the most appropriate approach to make strategic decisions in organizations. In addition, the study reveals that mutual consultation and consultative decision-making (Shura), based on knowledge and Islamic ethics, is the principal Islamic approach to strategic decision-making.

Practical implications

The developed Islamic decision-making framework will, significantly, assist management practitioners, managers and policy makers in both private and governmental organizations to improve their decision-making skills through adopting the Shura approach in decision-making.

Originality/value

The paper expands the boundaries of knowledge in managerial decision-making through developing an Islamic decision-making framework. This theoretical framework brings new insights and open new opportunities of thinking on Islamic decision-making among business scholars and represents fundamental grounds for future research in cross-cultural management in the area of managerial decision-making from an Islamic perspective, which is rare among scholars of management.

Details

Journal of Islamic Accounting and Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 6 June 2023

Fahrettin Pala, Aylin Erdoğdu, Muhammad Ali, Faisal Alnori and Abdulkadir Barut

The purpose of this study is twofold. First, this research explores the level of Islamic financial literacy of customers in the context of Islamic banking. Second, this study…

Abstract

Purpose

The purpose of this study is twofold. First, this research explores the level of Islamic financial literacy of customers in the context of Islamic banking. Second, this study examines the determinants of customer adoption of Islamic banking in Turkey.

Design/methodology/approach

This study gathered sample data from 409 participants determined using the purposive sampling method. In the study, first, the reflective measurement model is used to examine the reliability, validity and multicollinearity problems of the variables. Then, AMOS structural equation model (SEM) is used to reveal the relationship between Islamic financial literacy and Islamic banking services. Additionally, this study performed both descriptive and inferential analysis to understand customer literacy about Islamic banking and their adoption behavior of Islamic banking.

Findings

The results obtained from descriptive assessment indicate that Turkish customers of Islamic banking possess sufficient literacy about Islamic banking. Moreover, the results from SEM indicate that the adoption of Islamic banking by customers is significantly predicted by the role of Sharia Board management, Islamic banking and purpose of financial institution, religious factor and legitimacy of Islamic financial system.

Research limitations/implications

This study focuses only on the level of knowledge and perceptions of customers who have accounts in Islamic banks or financial institutions in Turkey. It does not focus on the level of knowledge and perception of Muslims who do not have accounts in Islamic banks and financial institutions.

Originality/value

Previous studies on Islamic banking are mostly studies that investigate customers’ perceptions of the Islamic banking system and why individuals prefer Islamic banks. In particular, studies examining the relationship between individuals’ Islamic financial literacy level and Islamic banking preferences are limited. This study is considered to be an original study as it investigates the relationship between the Islamic financial literacy level of individuals and their adoption of Islamic banking services in Turkey.

Details

Journal of Islamic Accounting and Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 9 January 2024

Salwa Bin Idrees, Syed Musa Alhabshi, Ashurov Sharofiddin and Anwar Hasan Abdullah Othman

The purpose of this study is to frame the dimensions of the external institutional environment, namely, cultural-cognitive, normative and regulative dimensions as the main actors…

Abstract

Purpose

The purpose of this study is to frame the dimensions of the external institutional environment, namely, cultural-cognitive, normative and regulative dimensions as the main actors in the organisational field. More precisely, Libyan commercial banks have been identified as empirical evidence, to identify constraints of the institutional environment governing the behaviour and decision-making of commercial banks, when adopting Islamic financial transactions.

Design/methodology/approach

A questionnaire has been designed for 14 Libyan commercial banks which is distributed to the Board of Directors, managers, directors of departments, and personnel. The exploratory factor analysis (EFA) and the measurement model by using the first-order and second-order confirmatory factor analysis (CFA) have been applied as essential steps to embody the conceptual framework and test the research hypotheses.

Findings

The results of the EFA indicated sufficient correlation among the dimensions of the external environment. The CFA supported this study’s hypotheses. The modelling showed that the cultural-cognitive, normative and regulative dimensions are institutional constraints impeding Libyan commercial banks’ adoption of Islamic financial transactions. Interestingly, the findings of the CFA align with the EFA findings in supporting the conceptual framework of the research. They portrayed that the cultural-cognitive dimension has been identified by explicit and implicit cognition.

Originality/value

This study systematically embodies the dimensions of the external institutional environment, namely, cultural-cognitive, normative and regulative dimensions, as the main factors in the organisational field to be conceptually rich lenses to investigate social considerations to reinforce institutional thought broadly. The results of this study were consistent with extant Islamic financial literature, reflecting symmetry and similarity across commercial banks, particularly at the first stage of adopting Islamic financial transactions.

Details

International Journal of Ethics and Systems, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2514-9369

Keywords

Article
Publication date: 17 November 2023

Nik Hadiyan Nik Azman, Abdul Hadi Zulkafli, Tajul Ariffin Masron and Abdul Rahman Abdul Majid

Financial illiteracy could pose a significant challenge to micro-entrepreneurs. There is a pressing need to foster financial literacy;, therefore, the purpose of this study is to…

Abstract

Purpose

Financial illiteracy could pose a significant challenge to micro-entrepreneurs. There is a pressing need to foster financial literacy;, therefore, the purpose of this study is to examine particularly how Islamic financial literacy may enhance their businesses toward achieving financial sustainability.

Design/methodology/approach

This study uses quantitative methods. Three hundred (300) questionnaires were distributed to micro-entrepreneurs in three states in Malaysia, namely, Kedah, Kelantan and Terengganu. This study used the partial least squares (PLS) analysis using the SmartPLS 3.2.

Findings

The study found that the most robust Islamic financial literacy factors are financial behavior, followed by financial knowledge and financial attitude .The outcome of Islamic financial literacy, which is financial sustainability, also demonstrates a positive and significant relationship.

Social implications

All variables show a positive and significant relationship toward financial sustainability. Stated differently, micro-entrepreneurs are aware that understanding the basic concepts of Islamic finance may help them achieve long-term financial sustainability

Originality/value

This study incorporates Islamic financial concepts into financial literacy while also assessing demographic aspects like years of business operation and education as moderators, which were not considered by previous studies.

Details

Journal of Islamic Accounting and Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 30 April 2024

Nurfarahin Mohd Haridan, Ahmad Fahmi Sheikh Hassan and Sabarina Mohammed Shah

This study aims to investigate the pragmatic issues on the radical call for the establishment of an external Shariah auditor (ESA) in the governance framework of Islamic banks…

Abstract

Purpose

This study aims to investigate the pragmatic issues on the radical call for the establishment of an external Shariah auditor (ESA) in the governance framework of Islamic banks (IBs).

Design/methodology/approach

From 11 well-established Malaysian IBs, 16 internal auditors were interviewed to provide an in-depth understanding on how ESA can provide greater assurance to stakeholders in Malaysian IBs.

Findings

This study reported mixed acceptance from internal auditors on the proposed additional governance layer to be undertaken by the ESA. Generally, internal auditors reluctantly agreed that Shariah auditing by the ESA would enhance the quality of Shariah assurance but maintain several practical concerns regarding lack of guidelines on Shariah auditing, the additional cost to be borne by IBs and the possible tensions between the ESA and Shariah board (SB) amid the diverse Shariah interpretations available for experts in the field.

Practical implications

The critical point on the manifestation of an ESA in the contemporary IB practice brought by this study highlights the need for regulation and policy promulgation that embrace a comprehensive approach to Shariah audit process within the religio-ethical dogma of Islamic banking and the pragmatic approach to banking.

Originality/value

This study provides evidence on the expected role and competency of an ESA and explores the implications produced by its implementation in Malaysian IBs. This study also clarifies how IBs should delineate the role of Shariah assurance from SB to ESA.

Details

Journal of Islamic Accounting and Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 3 November 2023

Lalu Rizky Adriansyah and Aisyah As-Salafiyah

This study aims to examine idle funds in mosques in Mataram City and analyze the intentions of the mosque chairman to place mosque funds in Sharia banks. Six variables are used to…

Abstract

Purpose

This study aims to examine idle funds in mosques in Mataram City and analyze the intentions of the mosque chairman to place mosque funds in Sharia banks. Six variables are used to analyze the intention; attitudes, subjective norms, behavioral control, sharia financial literacy, sharia banking knowledge and the responsibility of the management for the trust of the society.

Design/methodology/approach

This research consists of two studies; descriptive research examining idle funds of mosques and correlational research analyzing the intentions of mosque directors to place mosque funds in Sharia banks. Intentions will be analyzed using the theory of planned behavior approach, developed through the PLS-SEM method, and the data obtained from questionnaires through surveys were processed using the SmartPLS 3 application.

Findings

This study found that the average surplus between income and expenditure reaches IDR2.7m monthly. Also, 75% of mosques have placed their funds in Islamic banks. This study shows a positive relationship between the level of Islamic financial literacy, knowledge of Islamic banking, responsibility for public trust, attitudes toward Islamic banking, subjective norms and behavioral control in influencing the intentions to place mosque funds in Islamic banks. However, only behavioral control is accepted as it significantly influences intentions. Behavioral control means that to maximize intentions, Islamic banks need to make it easier for mosque administrators to place funds.

Originality/value

This research signifies a pioneering effort in examining idle funds within mosques, particularly those equipped with comprehensive financial reports within Mataram City. Furthermore, it spearheads an inquiry into the intentions of mosques to channel their funds into Sharia banks, underpinned by rigorous quantitative methodologies.

Details

Journal of Islamic Accounting and Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 1 May 2024

Mohammad Mominul Islam and Mostofa Mahmud Hasan

While the Noble Quran dictates the prohibition of interest, conventional banks promote Islamic banking by opening Islamic banking windows. Against this backdrop, this study aims…

Abstract

Purpose

While the Noble Quran dictates the prohibition of interest, conventional banks promote Islamic banking by opening Islamic banking windows. Against this backdrop, this study aims to investigate the perceived gaps between managers and clients in Islamic marketing and banking, focusing on conventional banks’ Islamic banking windows.

Design/methodology/approach

Guided by a qualitative approach, semi-structured personal interviews and observations served as the data collection methods, involving 25 banks and 50 respondents in 3 different districts, namely, Shirajganj, Rajshahi and Chapainawabganj of Bangladesh from January to October 2023. The data were analysed using ATLAS.ti 2023 to explore codes and quotations derived from 14 interview questions. Further, ATLAS.ti 2023 facilitated synthesizing content, concepts, code occurrence, network analysis and thematic analysis.

Findings

Islamic and non-Islamic banks use Quranic verses, hadiths (prophetic traditions), images of mosques, the Kaaba and Arabic texts as Islamic marketing tools. These spiritual, divine and prescriptive tools are associated with Islamic banking. However, conventional banks receive criticism for having separate Islamic banking windows to serve religiously conscious clients, which generates tension among clients and bank managers.

Practical implications

The findings can theoretically assist academics in examining conventional banks’ Islamic marketing and banking practices, opening Islamic banking windows. Importantly, Shariah boards can play policy roles in safeguarding the function of Islamic marketing and banking. Managers can use the findings to anticipate client perceptions and enhance Islamic marketing and banking strategies. Likewise, the social implications include the explicit stance of Shariah to mitigate the mixture of halal and haram banking.

Originality/value

This pioneering study explores the perspectives of Islamic banking windows by non-Islamic banks. The combination of Islamic marketing and banking is a noteworthy novelty in this study and deserves recognition for its unique contribution to halal marketing and finance.

Details

Journal of Islamic Accounting and Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 23 April 2024

Hajira Liaqat, Ishfaq Ahmed and Sheikh Usman Yousaf

This study aims to explore the phenomenon of Islamic religious communication and how Islamic banks in Pakistan use religion-based communication, along with its expected outcomes.

Abstract

Purpose

This study aims to explore the phenomenon of Islamic religious communication and how Islamic banks in Pakistan use religion-based communication, along with its expected outcomes.

Design/methodology/approach

Transcendental phenomenology approach is opted using a multi-stage data collection strategy consisting of observations, documentary reviews and semi-structural interviews to get deep into the phenomenon in a particular context.

Findings

Findings highlight Islamic religious communication as workplace Islamic da’wah that is majorly categorized into compulsive da’wah, objectics da’wah and impulsive da’wah, serving its role in bringing spirituality to work through work-faith integration.

Research limitations/implications

The finding of the study can be used in planning, formulating and implementing Islamic da’wah-based model to induce spirituality at work.

Originality/value

This study is the first of its type exploring Islamic da’wah in an organizational context as a mean to bring spirituality at work.

Details

Journal of Islamic Accounting and Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 30 April 2024

Sana Rhoudri and Lotfi Benazzou

This paper aims to examine the antecedents of adoption intention of profit-sharing investment deposits (PSID) among Moroccan customers.

Abstract

Purpose

This paper aims to examine the antecedents of adoption intention of profit-sharing investment deposits (PSID) among Moroccan customers.

Design/methodology/approach

Applying an extended version of diffusion of innovation (DOI) theory and using a non-probability sampling technique with convenience approach, a quantitative survey was developed and administered to 171 Islamic banking users. Structural equation modeling was then used to evaluate the significance of relationships between the various variables under study using SPSS 21.0 and AMOS 26.0 statistical packages.

Findings

Empirical findings of the structural analysis indicated a significant direct relationship between adoption intention and six out of seven variables: perceived relative advantage, perceived compatibility, perceived complexity, perceived risk, religiosity and social influence, all of which had a significant effect on Moroccan customers’ intention to invest their funds in profit-sharing based deposit instruments, whereas customer awareness exerted an insignificant positive effect.

Research limitations/implications

The absence of a longitudinal study tracking the actual adoption behavior is the main limitation of this study. Furthermore, data were collected solely from Islamic banking users. Finally, despite being insightful, the empirical findings should be generalized with caution since the sample was purposely selected by the banks’ management.

Practical implications

This study implied that participatory banks should pay substantial attention to risk perceptions, as PSID adoption intention is typically inhibited by high perceived risks associated with these products. Moreover, this study provides great indications to Moroccan regulators and policymakers on a number of issues related to this emerging business.

Originality/value

To the best of the authors’ knowledge, this paper represents the first attempt to confirm the effectiveness of the Rogers’ DOI in examining the intention to adopt a financial innovation in the Moroccan context. It is also the first of its kind to address customers’ apprehensions regarding profit-sharing investment products.

Details

Journal of Islamic Marketing, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0833

Keywords

Article
Publication date: 8 August 2023

Jarita Duasa, Nurul Jannah Zainan Nazri and Raudlotul Firdaus Fatah Yasin

This study aims to investigate the tendency that Malaysian consumers will choose the recombinant collagen-like protein (RCLP) from bacteria as an alternative source of collagen in…

Abstract

Purpose

This study aims to investigate the tendency that Malaysian consumers will choose the recombinant collagen-like protein (RCLP) from bacteria as an alternative source of collagen in their consumption and the determinants of the consumer acceptance.

Design/methodology/approach

Quantitative approach is adopted in the study. Descriptive analysis and logistic regression are used to analyze primary data collected from a survey.

Findings

The likelihood of consumers choosing RCLP as an alternative source of collagen is higher among elderly and females. The choice is significantly influenced by the idea that the collagen should support maqasid al-syariah, approved by national Islamic body, should clear on the ingredients used and could boost local economic activities in the future.

Research limitations/implications

An ethical halal policy should be outlined as the guiding principles to the potential producers of RCLP.

Originality/value

An alternative source of collagen using bacteria as proposed is not yet being introduced in Malaysian industry, and the analysis on probability that consumers will accept this new sourced collagen product is using primary data from survey.

Details

Journal of Islamic Accounting and Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0817

Keywords

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