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Abstract
Corporate governance involves a set of administrative relationships between a company and other stakeholders. The shareholders and management should take part in protecting the interests of all stakeholders by making decisions and building policy framework processes that fulfill the stakeholders’ needs. As far as Islamic corporate governance (ICG) is concerned, the institution of the Shari’ah board comes into the picture and plays a crucial role in favoring the interest of the stakeholders by ensuring that all corporation activities are in line with the Shari’ah principles. This paper attempts to examine the administrative relationships between the SB and other stakeholders by looking at the duties, roles, and responsibilities of the SB toward other stakeholders and vice versa in Brunei Darussalam. For this purpose, it relies on doctrinal and Islamic worldview methodologies and uses both content and legal analysis methods. After the discussion, it is concluded that the administrative relationship between the Shari’ah board and other stakeholders may take the form of imamah (ultimate authority), wilayah (specific authority), taʿlimiyah (educational), or istishariyah (consultative) relationship, depending on the type of relevant stakeholder. Nonetheless, to align the administrative relationship between SB and other stakeholders with these notions, further legal and regulatory amendments need to be made to the Bruneian Shariah governance framework.
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Copyright (c) 2024 Mazin Hassan, Azrin Besar, Halida Jaidin
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References
- Ahmad, N. (2020). Introduction To Legal Method. UNISSA Press.
- Ahmed Ibn Ḥanbal (2001). Musnad Al-Imam Ahmed Ibn Ḥanbal (Said Al-Irnaud and Adil Murshid (Ed.). Beirut: Muasasat Al-Risalah.
- Al-Tabari. (2001). Tafsir Al-Tabari (A. Al-Turki (Ed.)). Damascus: Dar Hajr lil Tiba’a wa Al-Nashir.
- Alnasser, S. A. S., & Muhammed, J. (2012). Introduction to corporate governance from an Islamic perspective. Humanomics, 28(3), 220–231. https://doi.org/10.1108/08288661211258110
- Alnofli, A. (2021). Corporate Governance In Islamic Financial Institutions. International Journal of Fiqh and Usul-Al-Fiqh Studies, 6(2), 65–73.
- Aziz, H. A., & Ghadas, Z. A. A. (2022). Corporate Governance Framework for Shariah Compliant Corporation. Proceedings of the International Joint Conference on Arts and Humanities 2021 (IJCAH 2021), 618, 528–532. https://doi.org/10.2991/assehr.k.211223.092
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- Bhatti, M., & Bhatti, M. I. (2010). Toward Understanding Islamic Corporate Governance Issues in Islamic Finance. Asian Politics and Policy, 2(1), 25–38. https://doi.org/10.1111/j.1943-0787.2009.01165.x
- Companies Act (CAP 39), the Government of Brunei Darussalam
- Constitution of Brunei Darussalam 1959, the Government of Brunei Darussalam
- Fatima, S., Bilal, M., & Muhammad Ishtiaq. (2019). Shari’ah Compliant Corporate Governance. Journal of Managerial Science, 14(4), 170–197.
- Gower, L. C. B. (1992). Gower’s Principles of Modern Company Law (fifth edit). Sweet & Maxwell Ltd.
- Grassa, R. (2013a). Shariah supervisory system in Islamic financial institutions: New issues and challenges: A comparative analysis between Southeast Asia models and GCC models. Humanomics, 29(4), 333–348. https://doi.org/10.1108/H-01-2013-0001
- Grassa, R. (2013b). Shariʿah Governance System in Islamic Financial Institutions : New Issues and Challenges. Arab Law Quarterly, 27(2), 171–187.
- Guidelines on the Islamic Product Approval Process under Section 14 of the Syariah Financial Supervisory Board Order 2006, Brunei Darussalam Central Bank
- Hamza, H. (2013). Sharia governance in Islamic banks: effectiveness and supervision model. International Journal of Islamic and Middle Eastern Finance and Management, 6(3), 226–237. https://doi.org/10.1108/IMEFM-02-2013-0021
- Hassan, M., Besar, M., & Jaidin, J. (2022). The Nature of the Administrative Relationship between the Shariah Board and the Stakeholders in the Kingdom of Bahrain. Journal of Islamic Finance, 11(2), 48–55.
- Ibn Kathir. (1999). Tafsir Ibn Kathir (S. Al-Salamah (Ed.)). Dar Taiba lil Nashir wa Al-Tawzi’. https://ia802902.us.archive.org/24/items/43005PDF/tqa2.pdf
- Iqbal, Z., & Mirakhor, A. (2004). Stakeholders Model of Governance in Islamic Economic System. Islamic Economic Studies, 11(2), 43–63.
- Islamic Banking Order 2008, Brunei Darussalam, the Government of Brunei Darussalam
- Jamaludin, A. (2021). The Islamic Models Of Corporate Governance Turkish Journal of Computer and Mathematics Education Research Article. Turkish Journal of Computer and Mathematics Education, 12(11), 874–878.
- Malkawi, B. H. (2013). Shari’ah Board in the Governance Structure of Islamic Financial Institutions. 61(3), 539–577.
- Martin, E. (Ed.). (2013). Oxford Dictionary of Law (seventh). Oxford University Press.
- Notice to Financial Institutions on Syariah Governance Framework, Brunei Darussalam Central Bank
- OECD Principles of Corporate Governance 2004, Organization for Economic Cooperation and Development
- Samra, E. (2020). Corporate governance in Islamic financial institutions. Journal of Governance and Regulation, 9(2), 75–82. https://doi.org/10.22495/jgrv9i2art5
- Al-Bukhari, Muhammad. Sahih Al-Bukhari. Damascus: Dar Ibn Kathir, 2002.
- Muslim, Abu Al-Hassan. Sahih Muslim. Edited by Nazir Abu Qutaibah. Al-Riad: Dar Taiba lil Nashir wa Al-Tawzi’, 2006.
- Shariah Advisory Body Resolutions | Bank Islam Brunei Darussalam. (n.d.). Retrieved September 15, 2022, from http://www.bibd.com.bn/media-centre/shariah-advisory-body-resolutions/
- Subordinate Act (CAP 6), the Government of Brunei Darussalam
- Supreme Court Act (CAP 5), the Government Brunei Darussalam
- Syariah Courts Act (184), the Government of Brunei Darussalam
- Syariah Financial Supervisory Board Order, 2006, the Government of Brunei Darussalam
References
Ahmad, N. (2020). Introduction To Legal Method. UNISSA Press.
Ahmed Ibn Ḥanbal (2001). Musnad Al-Imam Ahmed Ibn Ḥanbal (Said Al-Irnaud and Adil Murshid (Ed.). Beirut: Muasasat Al-Risalah.
Al-Tabari. (2001). Tafsir Al-Tabari (A. Al-Turki (Ed.)). Damascus: Dar Hajr lil Tiba’a wa Al-Nashir.
Alnasser, S. A. S., & Muhammed, J. (2012). Introduction to corporate governance from an Islamic perspective. Humanomics, 28(3), 220–231. https://doi.org/10.1108/08288661211258110
Alnofli, A. (2021). Corporate Governance In Islamic Financial Institutions. International Journal of Fiqh and Usul-Al-Fiqh Studies, 6(2), 65–73.
Aziz, H. A., & Ghadas, Z. A. A. (2022). Corporate Governance Framework for Shariah Compliant Corporation. Proceedings of the International Joint Conference on Arts and Humanities 2021 (IJCAH 2021), 618, 528–532. https://doi.org/10.2991/assehr.k.211223.092
Besar, M. (2019). Corporate Governance: Infusing Muamalah Contracts in Shareholders’ Relationship. Research in Corporate and Shari’ah Governance in the Muslim World: Theory and Practice, 79–86. https://doi.org/10.1108/978-1-78973-007-420191006
Bhatti, M., & Bhatti, M. I. (2010). Toward Understanding Islamic Corporate Governance Issues in Islamic Finance. Asian Politics and Policy, 2(1), 25–38. https://doi.org/10.1111/j.1943-0787.2009.01165.x
Companies Act (CAP 39), the Government of Brunei Darussalam
Constitution of Brunei Darussalam 1959, the Government of Brunei Darussalam
Fatima, S., Bilal, M., & Muhammad Ishtiaq. (2019). Shari’ah Compliant Corporate Governance. Journal of Managerial Science, 14(4), 170–197.
Gower, L. C. B. (1992). Gower’s Principles of Modern Company Law (fifth edit). Sweet & Maxwell Ltd.
Grassa, R. (2013a). Shariah supervisory system in Islamic financial institutions: New issues and challenges: A comparative analysis between Southeast Asia models and GCC models. Humanomics, 29(4), 333–348. https://doi.org/10.1108/H-01-2013-0001
Grassa, R. (2013b). Shariʿah Governance System in Islamic Financial Institutions : New Issues and Challenges. Arab Law Quarterly, 27(2), 171–187.
Guidelines on the Islamic Product Approval Process under Section 14 of the Syariah Financial Supervisory Board Order 2006, Brunei Darussalam Central Bank
Hamza, H. (2013). Sharia governance in Islamic banks: effectiveness and supervision model. International Journal of Islamic and Middle Eastern Finance and Management, 6(3), 226–237. https://doi.org/10.1108/IMEFM-02-2013-0021
Hassan, M., Besar, M., & Jaidin, J. (2022). The Nature of the Administrative Relationship between the Shariah Board and the Stakeholders in the Kingdom of Bahrain. Journal of Islamic Finance, 11(2), 48–55.
Ibn Kathir. (1999). Tafsir Ibn Kathir (S. Al-Salamah (Ed.)). Dar Taiba lil Nashir wa Al-Tawzi’. https://ia802902.us.archive.org/24/items/43005PDF/tqa2.pdf
Iqbal, Z., & Mirakhor, A. (2004). Stakeholders Model of Governance in Islamic Economic System. Islamic Economic Studies, 11(2), 43–63.
Islamic Banking Order 2008, Brunei Darussalam, the Government of Brunei Darussalam
Jamaludin, A. (2021). The Islamic Models Of Corporate Governance Turkish Journal of Computer and Mathematics Education Research Article. Turkish Journal of Computer and Mathematics Education, 12(11), 874–878.
Malkawi, B. H. (2013). Shari’ah Board in the Governance Structure of Islamic Financial Institutions. 61(3), 539–577.
Martin, E. (Ed.). (2013). Oxford Dictionary of Law (seventh). Oxford University Press.
Notice to Financial Institutions on Syariah Governance Framework, Brunei Darussalam Central Bank
OECD Principles of Corporate Governance 2004, Organization for Economic Cooperation and Development
Samra, E. (2020). Corporate governance in Islamic financial institutions. Journal of Governance and Regulation, 9(2), 75–82. https://doi.org/10.22495/jgrv9i2art5
Al-Bukhari, Muhammad. Sahih Al-Bukhari. Damascus: Dar Ibn Kathir, 2002.
Muslim, Abu Al-Hassan. Sahih Muslim. Edited by Nazir Abu Qutaibah. Al-Riad: Dar Taiba lil Nashir wa Al-Tawzi’, 2006.
Shariah Advisory Body Resolutions | Bank Islam Brunei Darussalam. (n.d.). Retrieved September 15, 2022, from http://www.bibd.com.bn/media-centre/shariah-advisory-body-resolutions/
Subordinate Act (CAP 6), the Government of Brunei Darussalam
Supreme Court Act (CAP 5), the Government Brunei Darussalam
Syariah Courts Act (184), the Government of Brunei Darussalam
Syariah Financial Supervisory Board Order, 2006, the Government of Brunei Darussalam