Corporate Social Responsibility Disclosure: a Comparison Between Islamic and Conventional Financial Institutions
Islamic financial institutions are growing faster all around the world. Most in Muslim countries, conventional and Islamic financial institutions exist side by side, interacting with one another. The development of Islamic financial institutions has the potential to play a leading role in serving the Muslim Ummah and contribute towards socio-economic development of Muslim countries in conformity with Islamic sensibilities.
Financial institution primarily sell demand deposits, saving deposits, time deposits, insurance policies, pension funds, commercial papers, and bonds to the surplus units. In general financial institution consists of Profit-oriented institutions such as (bank, saving institutions, insurance company and …show more content…
Unlike in the western value, where religion is considered as a private matter (Rice, 1999) but in perspective of Muslim world, Islam is integrated in all aspect of society including politics, community, law and economy. The influence of Islam on people’s daily activities and business is well-documented in the Holy Qur’an and Sunnah. Islam is not only for personal religion but it is also on organization for society and its institutions.
From an Islamic perspective, CSR disclosure exercised by Islamic Financial Institutions is seen as a benefit rather than cost. The CSR disclosure has in IFIs has different dimension and an important strategic way to think about charity works (Abu-Sulayman, 1976). In fact, Islam takes an integrated view of individuals and society. Many of Islamic business value are part of core CSR activities. Furthermore, socio-economic justice is an essentials element of Islam. This is because the objective of Islam is to build a fair society, which was clearly stated in the Holy