Six Years in Achieving Maqasid Ash-Shariah: The Case of Islamic Commercial Banks in Indonesia

DOI

10.2991/ahsr.k.200723.005How to use a DOI?

Keywords

maqasid shariah index, performance, Islamic banks, ethical business, social responsibility

Abstract

As an Islamic system of values, ethics, and principles, shariah has an ultimate objective that is to promote the well-being of mankind in the world and the hereafter. Abu-Zahrah further identified the objective of shariah (maqasid al-shariah) into educating people, upholding justice and promoting social welfare. As a group of individuals, Islamic business institutions, including Islamic banks, should be operated in any way that is in line with those objectives. The aim of this study is to investigate the practice of Islamic commercial banks in Indonesia in educating people, upholding justice and promoting social welfare as described by Abu Zahrah in his concept of maqasid ash-shariah. Panel data related to financial ratios based on the operationalization of Abu Zahrah’s maqasid ash-shariah concept developed by Mohammed et al. were obtained from the annual reports of 11 Islamic commercial banks in Indonesia. The reports were published in six years’ time starting from 2011 to 2016. The data were further calculated to come out with maqasid al-shariah index to represent the overall performance of the banks in achieving maqasid al-shariah. To summarize the results, descriptive statistics were finally applied. This study reveals that the thirteen Islamic commercial banks in Indonesia have carried out the necessary activities to achieve the three objectives of shariah. The main focus carried out by the banks is to uphold justice followed by maintaining social welfare. The least priority was given in educating people. During the past seven years, the maqasid al-shariah indexes were fluctuated. The index touched the lowest point in 2014. On average, the maqasid al-shariah index was quite low, opening a room for the banks to improve their activities to be more ethical and social.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Sartini Wardiwiyono
PY  - 2020
DA  - 2020/07/24
TI  - Six Years in Achieving Maqasid Ash-Shariah: The Case of Islamic Commercial Banks in Indonesia
BT  - Proceedings of the 1st International Conference on Science, Health, Economics, Education and Technology (ICoSHEET 2019)
PB  - Atlantis Press
SP  - 20
EP  - 24
SN  - 2468-5739
UR  - https://doi.org/10.2991/ahsr.k.200723.005
DO  - 10.2991/ahsr.k.200723.005
ID  - Wardiwiyono2020
ER  -