The Comparison of the Characteristics of the Anglo-Saxon Governance Model and the Islamic Governance of IFIs

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Azmi Abd. Hamid Mohd Nizal Haniff Muhammad Rahimi Othman Ahmad Saiful Azlin Puteh Salin

Abstract

During the Asian Financial Crisis in 1996-1998 and the recent economic downturn due to sub-prime tribulations in 2008-2009, most corporations that were severely hit are non-Islamic corporations and financial institutions. Although some of the Islamic corporations and banking groups were affected, but the damage done were not as serious as suffered by conventional corporations and financial institutions. We also noticed that almost all financial institution and banking groups around the globe are embarking on Islamic banking products. This paper will examine what are the factors that contribute to the sort of insulation on Islamic corporations and financial institutions from these two economic crises. The discussion will also include the comparison of corporate governance characteristics of the western Anglo-Saxon model and Islamic corporate governance. Unlike the western concept of corporate governance which is based on the western business behaviour that is secular driven, this article suggests that corporate governance in IFIs is founded on the epistemological aspect of Tawhid, Shari’ah and ethics. The initial findings submit that Islam presents unique values and unique characteristics of corporate governance with the aim to uphold and maintain the principle of social morality not only to the shareholders of the firm but to all stakeholders.Keywords: Islamic Corporate Governance, Anglo-Saxon governance, shariah board governance

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How to Cite
ABD. HAMID, Azmi et al. The Comparison of the Characteristics of the Anglo-Saxon Governance Model and the Islamic Governance of IFIs. Management & Accounting Review (MAR), [S.l.], v. 10, n. 2, p. 1-12, dec. 2011. ISSN 2550-1895. Available at: <http://arionline.uitm.edu.my/ojs/index.php/MAR/article/view/228>. Date accessed: 14 aug. 2018.
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