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This paper aims to survey the screening practices and regulatory arrangements that can be gleaned from the experience of Islamic financial indices on international stock markets. Such indices can be regarded as experiments in the demarcation of “pockets” of Sharī‘ah-compliant securities exchange, in the context of non-Sharī‘ah-compliant stock markets. They offer valuable regulatory precedent, with a view to the development of a transnational domain of Islamic financial transactions.

The paper leverages the experience of Islamic financial indices for charting the fault lines between the foundational principles of Islamic finance, and those of interest-based investment commonly accepted on international financial markets. It subsequently reviews the most salient regulatory arrangements in place for discriminating between permissible and forbidden securities and modes of trading, as implemented on Islamic financial indices. These include selection criteria for index inclusion, and Sharī‘ah committees with ex ante and ex post supervisory duties.

The paper makes a case for viewing Islamic finance indices on international capital markets as capacity-building experiments for the regulation of transnational Islamic financial flows.

The study rejuvenates the pragmatic approach towards the development of Islamic capital markets, by suggesting that incremental organisational innovations, as developed in connection with Islamic financial indices, can build institutional capacity towards an economy that abides by Islamic values.

This research aims to explore the possibility of raising and adjudicating Shari'ah issues in Islamic financial contracts before the secular courts with specific reference to the UK and Malaysia.

This is a legal research, and therefore, the paper uses the qualitative research methodology whereby a content analysis, in-depth case study, and library-based research were mainly used.

Shari'ah issues raised before the UK courts, and arguably, before the secular courts in other Western jurisdictions, would not be adjudicated and enforced. English courts, in particular, would decide Islamic financial contracts according to the English law, disregarding Shari'ah issues. Conversely, Shari'ah issues raised before Malaysian civil courts would be duly adjudicated and enforced. The civil court is bound, by the new Central Bank of Malaysia Act 2009, to refer those issues to the Shari'ah Advisory Council of the Central Bank of Malaysia for them to be ascertained. The subsequent ruling of the SAC is binding on the courts.

The Malaysian model for the adjudication of Shari'ah issues in Islamic financial contracts is very effective. Therefore, the research proposes to the parties in international Islamic financial contracts to choose Malaysian law as the law of reference and Malaysian courts as the forum for settlement of disputes. The Malaysian model, being already tested, can also be successfully exported to other countries wishing to introduce or develop Islamic finance.

This study aims to examine the phenomenon of Fatwā shopping, its effect on consumer trust in Islamic finance products and the need for effective consumer protection regulations in the Islamic finance industry.

The methodology used in this study is qualitative research which draws significantly from relevant regulations on financial consumer protection through analytical method to identify common themes on Fatwā shopping and consumer trust in the relevant literature.

This study finds that the increasing practice of Fatwā shopping through clandestine searches by some Islamic banks to get their new products endorsed by leading Sharī‘ah scholars requires proper legal regulation to avoid a total erosion of trust in the entire Islamic finance industry.

Though Fatwā shopping is practiced in the Islamic finance industry, it is always difficult to get some desperate Islamic bankers to agree to this; hence, this study does not portend to examine the evidence on Fatwā shopping, but it seeks to bring to the fore the effect of Fatwā shopping on consumer trust in Islamic financial services, and the need for effective consumer protection regulations.

This study is expected to provide an invaluable guide and policy framework for emerging and promising jurisdictions on the need to regulate Fatwā shopping through an effective legal framework based on some best practices identified in the study.

Though there have been a number of studies relating to Fatwā shopping, focusing on the need for effective consumer protection regulations in the Islamic finance industry will enrich the existing literature and have significant implications for the future of the industry.

Shari’ah is the foundation of Islamic banks. Although all the Islamic banks required complying with the Shari’ah requirements fully, the level of compliance differs among the Islamic banks. At the same time, Islamic banks have been performing well, but all do not demonstrate similar financial performance. This paper aims to explore whether Shari’ah compliance efficiency makes any difference in financial performance of Islami Bank Bangladesh Limited (IBBL).

This study used IBBL as a case. For exploring the issue of study, this paper applied an e-mail interview approach and interviewed 24 interviewees including financial analysts, IBBL clients and executives of regulatory bodies, the IBBL and other Islamic- and interest-based traditional banks. Interview opinions are then analyzed and interpreted for a deeper understanding of the topic.

The study observed that some other factors influence the financial performance of IBBL, but Shari’ah compliance is the dominant instinct of acquiring the leading position. Superior Shari’ah compliance creates internal strengths and external opportunities that facilitate IBBL in achieving higher financial performance. Most interviewees argued that Shari’ah is the only disposition that makes IBBL unique. Moreover, the bank that considerably follows Shari’ah gets better financial outcomes.

The study used a qualitative method using interview responses only for evaluating the relationship between Shari’ah compliance and financial performance. Further study may be conducted based on a quantitative approach.

This paper expects to uphold the significance of Shari’ah in improving the financial performance of IBBL and simultaneously motivating the parties associated with the Islamic banks in enhancing the level of Shari’ah compliance. Moreover, this study provides new insights into the importance Islamic banks and their performance in relation to the choice of customers.

This study explores the significance of Shari’ah compliance in creating avenues for greater financial performance and develops a model showing the ways how Shari’ah compliance leads Islamic banks to achieve higher financial positions.

The chapter aims to examine the challenges and the opportunities for the development of Islamic stockbroking in Malaysia.

The chapter adopts library research to discuss the concept of Islamic stockbroking. It also employs a semi-structured interview with industry players to prognosticate the future development of Islamic stockbroking in Malaysia.

The study concludes that the future of Islamic stockbroking in Malaysia is very promising, triggered by drivers on both the supply side and the demand side. The large Muslim population, wealth and economic growth are among the key factors for the development of Islamic stockbroking from the demand side. On the other hand, the Shari’ah compliance of 89% of Malaysian stocks, Malaysia’s position as an Islamic finance hub and the natural progression of Islamic finance are all factors underpinning the future of Islamic stockbroking from the supply side. However, lack of qualified human resources, political inconsistency, information technology infrastructure, product innovation as well as public perception are obstacles to its development.

This chapter will add new literature in contemporary Islamic finance, as not many studies have been done on the subject.

This chapter explores the concept of corporate social responsibility (CSR) from an Islamic Shari'ah-compliant perspective. It provides a comprehensive literature review on CSR with an explicit focus on the Islamic perspective of CSR, Islamic models of CSR, CSR practices in conventional and Islamic banks, and the consequences of CSR to Islamic banks. This chapter's main contribution lies in considering the current CSR literature from a Shari'ah perspective. Likewise, it identifies gaps in the current literature and suggests potential areas for future research. This chapter attempts to improve the understanding of how Islamic banks integrate social responsibility into their operations. The insights from this chapter are helpful to practitioners and academic scholars in Islamic finance, accounting, and CSR. This chapter emphasizes the importance of incorporating Islamic values and principles into CSR practices and encourages further research and investigation in this area.

This chapter highlights the variations of agency theory in the unique and complex context of Islamic banks in Saudi Arabia. The results provide an insight into agency structures in the context of Islamic banking that may lead to trade-offs between shari'ah compliance and mechanisms for protecting the rights of investors. This empirical study finds that most of the surveyed Islamic banks appear to recognize the value of governance and have implemented some basic mechanisms. Certain flaws in governance pertaining to audit, control, and transparency were also noted. The situation gets worse in cases where the investment account holders do not have any representation on the board or any voice for control or monetary rights. Other peculiar models balancing the two key requirements may be effective regarding agency dynamics. This study should motivate the policy makers to tailor the regulations to safeguard the interests of all investors without violating the principles of shari'ah.

The purpose of this paper is to contribute to the existing body of work in the area of Islamic finance by examining the regulation of Islamic finance in Australia.

The method employed in this paper is a mixture of direct observation from legal and regulatory perspectives and authors' personal experience, curiosity, and association with this industry.

In Australia, where Muslims are minorities and full‐fledged Islamic banks are absent, it is expected that regulatory authorities would ensure there is a level playing field, so that neither Islamic financial services providers (IFSPs) nor conventional financial institutions are disadvantaged. They have also been expected to approve and monitor Islamic financial products, including those offered by Islamic managed funds.

The study is undertaken through the Shari'ah, where law, finance, economics, and business form a single dimension only, even though a very significant one. No attempt is made to evaluate the economic efficiency and profitability or otherwise, of IFSPs in Australia. Also, the approach for the study is not supplemented by any empirical work (e.g. by quantitative analysis of data or by survey or other qualitative methodologies).

The paper practically examines: the impact of banking and financial services regulation on Islamic banking and financing practice in Australia; and what further legislative measures and changes are needed to accommodate Islamic financing practice into Australian society to make it a truly viable alternative system of financing for Muslims in Australia.

Examination of the issues of the study is originally undertaken through one of the authors' personal expertise and working experience with some IFSPs in Australia, aiming at developing the relevant regulations by the Australian regulatory regime to make Islamic finance a viable alternative system of financing for Muslims in Australia.

The main purpose of this paper is to develop a reliable and valid scale for measuring halal brand association (HalBA) for Islamic banks. Brand association is a core dimension of brand equity that Islamic bank managers need to develop to maintain competitiveness. Using the process proposed by Churchill for developing measures of marketing constructs, an instrument to assess HalBA for Islamic bank is formulated.

The methodology consists of developing the scale based on a literature review and qualitative method. The proposed scale is then purified and validated through exploratory factor analysis (EFA) and confirmatory factor analysis (CFA).

Based on the EFA and CFA, the result reveals that HalBA for Islamic banks contains 15 attributes which can be categorized into three dimensions: Shari’ah-compliant association, God-consciousness association and corporate social responsibility association.

The scale developed could assist practitioners in further understanding the dimensions and measurement of halal bank association, particularly in Islamic banking institutions. Knowledge of the dimensions of HalBA that customers seek from an Islamic bank can help managers and marketers to design branding strategies that better meet the needs of consumers, thereby increasing their satisfaction and loyalty.

The concept of brand association has been explored primarily from a conventional marketing perspective. This study offers a new dimension of HalBA in the context of Islamic banks.

The purpose of this study is to investigate shari’ah scholars’ views and experiences pertaining the shari’ah issues, challenges and prospects in Islamic derivatives. Specifically, this paper critically examines the criticisms toward conventional derivative instruments and the controversies surrounding underlying contracts and current Islamic derivative products.

This study uses qualitative methods to form a deeper understanding of shari’ah scholars’ perception and experience on Islamic derivatives. Semi-structured interviews were conducted with five shari’ah scholars who are currently working in Islamic financial institutions in Malaysia and Singapore. This study used phenomenological techniques for its data analysis.

This study has found that shari’ah scholars are aware of the shari’ah issues surrounding Islamic derivatives and have provided comprehensive insight on the solution to these issues. It was found that it is important to take into account the derivatives instruments in Islamic financial industry because of the need for hedging and risk mitigation within Islamic financial institutions. Nonetheless, the study has also found that the use of wa’ad contracts to structure Islamic profit rate swaps and foreign currency exchanges are problematic because of it having features of bay’ al-kali’ bil-kali (the sale of one debt for another).

This study is one of few studies that highlight the shari’ah issues of Islamic derivatives in Islamic banking and finance industry. This paper is of value in discussing risk management and Islamic derivatives in Islamic financial institutions and how there are many issues under the investigation process, particularly issues related to controversial underlying contracts and products.