Authors: Sharif M Abu Karsh, Leena Mahareeq.
Relevance: The Islamic banking industry has worked more effectively for decades during the era of Muslim civilization and has made a resurgence into a global platform. This in turns leads to efficient corporate governance in Islamic financial institutions, structured to fulfill the requirements and regulations of sharia.
Purpose: The purpose of the research is to determine Islamic Banking’s perception on corporate governance.
Method: This paper presents a descriptive analysis on cooperate governance of Islamic Backing. The study reviewed articles on corporate banking systems, the Islamic banking system, the underlying structures that exist in both systems, their rules and regulations, and the relationship between both systems of banking.
Result: The study found that Islamic banking has well-structured corporate governance guided by different bodies, including a multi-layered organization comprising the Sharia Supervisory Board (SSB), board of directors, investors, and commissioners. The SSB sits at the top of the corporate governance ladder; it offers oversight of all the transactional operations and compliance of the Islamic banking system based on sharia law (rule and regulations) known as Super Authority. This has accelerated the growth of Islamic banks.
Conclusion: Islamic banking runs a multi-layered corporate governance whose primary transactional operation is guided by Sharia principles. This sole technique has contributed to the extensive growth on its corporate governance.
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