Purpose – This study examines the influence of the Shariah supervisory board (SSB) and Islamic banks’ characteristics on tax avoidance practices in Indonesia. Methodology – This research uses ...secondary data using the panel data analysis method fixed effects model; the research sample is an Islamic bank in Indonesia from 2017 to 2021. Findings – The results indicate that SSB size, SSB reputation, and bank size have a positive effect on tax avoidance. The variables across SSB members, SSB education level, bank age, and bank profitability have a negative effect. Meanwhile, the SSB expertise variable, SSB remuneration, and turnover do not affect tax avoidance. Implications – Islamic banks play an essential role in social welfare to align with tax contributions in developing countries. Therefore, tax regulators and Islamic banks must collaborate to review the treatment of expenses according to tax regulations. Originality – This study fills a research gap by investigating the relationship between SSB characteristics and tax avoidance in Indonesian Islamic banks, which has yet to be discussed in previous papers.
The article is devoted to the characteristics of the Russian legislation on public joint stock companies, for which this concept is quite new, since it received legal recognition only in 2014, when ...the Civil Code of the Russian Federation was reformed, followed by the reform of the entire corporate legislation of the Russian Federation. The legislation on public joint stock companies is considered both in a narrow sense – only federal laws, and in a broad sense – other regulatory legal acts, primarily those adopted by the Central Bank of Russia. Legislative regulation of public joint stock companies is characterized as imperative, in other words, «strict» regulation. At the same time, the so-called «soft» regulation represented by the Corporate Governance Code also plays a certain role in regulating the legal status of a public joint stock company. Since the beginning of 2022, Russian corporations, primarily public joint stock companies, have been operating under unprecedented economic sanctions and restrictions imposed by the collective West and the United States. The restrictions affected corporate governance procedures and conditions, which ultimately violated the rights and legitimate interests of their shareholders (participants). Legislative measures adopted at the beginning of 2022 and in force in 2023 are aimed at maintaining the manageability of corporations, creating mechanisms to ensure the functionality of boards of directors (supervisory boards) as strategic bodies of corporations, as well as protecting the interests of corporations and their shareholders (participants). In general, corporate governance in Russian corporations, despite the imposed sanctions and restrictions, demonstrates a high level of sustainability and continues to function as an effective system. Purpose: to show the dynamics of legislative development on public joint stock companies, to analyze the transformation of legislation in the conditions of sanction restrictions. Methods: theoretical method, including analysis of current regulatory legal acts, as well as synthesis, formalization, specification and generalization of regulatory legal material. Results: despite the small number of public joint stock companies compared to non-public joint stock companies and open joint stock companies, it should be recognized that the formation of Russian legislation on public joint stock companies has been completed. Currently, its development continues, coupled with the introduction of a number of restrictive sanction measures. The measures adopted by the legislator in 2022–2023 are extraordinary in nature and do not always comply with the principles of good corporate governance (in particular, the separation of competence between the board of directors and the executive body, information transparency and openness of a public joint stock company), but they are of a forced nature and are aimed at preserving the manageability of public j oint stock companies.
This study examines the position and legitimacy of the establishment of a Notary Inspection Board within the Indonesian legal framework, with a particular focus on the Law on Notary Position (UUJN) ...and Ministerial Regulation of Law and Human Rights (Permenkumham) Number 15 of 2020. The research employs a normative legal method to scrutinize norms within the UUJN and Permenkumham 15/2020, prompted by perceived normative disharmony between these regulations regarding oversight and sanctioning of notaries. Contrary to prior research that suggested a normative disharmony, this study finds that the Inspection Board acts on behalf of the Notary Oversight Board, as its members are part of the latter, with duties delegated by the Chairperson of the Notary Oversight Board. Thus, Permenkumham 15/2020 does not contradict the UUJN. Nevertheless, for greater clarity, the study recommends revisions to Permenkumham 15/2020, emphasizing the basis of authority and formation of the Inspection Board.Highlights: No legal disharmony between Ministerial Regulation 15/2020 and the Law on Notary Position. Notary Examination Board is part of the Notary Supervisory Board. Amendments to Regulation 15/2020 are suggested for clearer authority and establishment process. Keywords: Notary Examination Board, Notary Supervisory Board, Ministerial Regulation 15/2020, Law on Notary Position, legal harmonization.
This study aimed to investigate the impact of Board of Directors and Sharia Supervisory Board (SSB) characteristics on sustainability reporting in global Islamic banks. A sample of 136 Islamic banks ...(IB) was examined, encompassing 536 observations from 2018 to 2021. Sustainability reporting was measured using an index developed by A. Jan et al. (2019), which modified the Global Reporting Initiative standards to suit the characteristics of Sharia-compliant financial institutions. The data was analyzed using a panel data estimation technique known as the Random Effects Model. The study findings revealed that certain board characteristics, such as the size of the Board of Directors, independence of the Board of Directors, size of the SSB, and cross-membership in the SSB, had a positive influence on sustainability reporting in Islamic banks. Additionally, board meetings of the Board of Directors were found to have a negative effect on sustainability reporting. These findings provide valuable insights for companies and policymakers, enhancing their understanding of the board composition that encourages firms to pursue reporting strategies based on sustainable development. Overall, the study contributes to the existing literature by examining the relationship between board attributes and sustainability reporting, particularly from an Islamic perspective.
This commentary provides a comprehensive overview of Shariah governance in Islamic financial institutions (IFIs). This piece draws on a literature review of various relevant studies and their key ...findings and observations. It emphasises the importance of implementing a robust Shariah governance framework in IFIs and argues that the current Shariah governance frameworks are complicated, resulting in each country adopting a different approach. The commentary highlights that the existence of different Shariah governance approaches can lead to inconsistencies in Shariah rulings, potentially undermining the credibility of IFIs and eroding consumer confidence.Additionally, the study reveals that certain IFIs have failed due to a deficient Shariah governance system. However, the commentary argues that the collapse of an institution does not necessarily indicate a weak Shariah governance framework. The framework itself remains robust, but the problem lies in how the Shariah supervisory board (SSB) interprets and makes decisions. As a result, a standardised Shariah governance framework could help address some of the inconsistencies contributing to these issues. This commentary is valuable for both academics and non-academics who are interested in understanding Shariah governance.
This study examines the influence of non-halal funds, zakat, and the number of Sharia Supervisory Board (SSB) on the reputation of Islamic banking in Indonesia. The sample is determined by the ...purposive sampling method and resulted in 7 banks or 35 observations from 2014 to 2018. The results showed that non-halal funds did not affect the reputation of Islamic banking. However, non-halal funds in the company's financial report notes show that Islamic banks, especially in Indonesia, have not fulfilled sharia regulations. The results also showed that zakat affects the reputation of Islamic banking. Zakat in Indonesia is greatly influenced by company size in terms of its assets. Zakat paid by Islamic banks in Indonesia is still low, and the gap for the welfare of the directors and employees of Islamic banks is a huge difference. Furthermore, this study indicated that the number of SSB affects the reputation of Islamic banking. Therefore, SSB has a significant role in compiling reports about sharia compliance. The ideal number of SSB is between 3 and 6 people.
Although equity financing is a core value in Islamic finance, it is rarely used by Islamic banks which prefer other instruments such as markup or leasing contracts. The purpose of this paper is to ...investigate the potential determinants of equity financing. Shariah supervisory board (SSB) is regarded as crucial in promoting equity financing. We use hand-collected data on equity financing and governance structure of 88 Islamic banks in 16 countries between 2009 and 2014. Our findings reveal that Islamic banks’ equity financing is influenced by the characteristics of SSB. Specifically, the duality of SSB members positively affects equity financing whereas the existence of a Shariah department within banks has a negative impact. We also find that the role of SSB in Islamic banks is influenced by the characteristics of the board of directors (BOD) and the banking environments. The impact of SSB on equity financing is reduced in the better banking environment, possibly suggesting substitution role between SSB and institutional and Islamic environment.
•We link equity financing and Shariah board in Islamic banks.•The duality of Shariah board positively affect equity financing.•Equity financing is negatively associated with Shariah department.•The role of Shariah board is reduced in the better banking environment.
Abstract We address the scarcity of empirical research on Shariah Compliance Disclosure (hereafter referred to as SCD) by presenting new evidence on the levels and range of SCD, of 807 bank‐year ...observation of Islamic Financial Institutions (hereafter referred to as IFIs) in 19 countries for the period from 2010 to 2020 and its determinants. Using an unweighted disclosure index measured by manual content analysis categorized into Shariah Supervisory Board (hereafter referred to as SSB) information, audit process, Shariah compliance review and Zakat, several outcomes are documented. In general, the SCD level is above average (57.38%) and hence evidence an overall growth during the sample period. Further, the study examines the relationship between corporate governance (CG) and SCD and the results indicate that foreign investors, institutional investors, board size, board independence, SSB reputation and SSB size are vital and influence the extent of SCD level. The study also conducted several tests to examine the main findings' robustness. The findings deliver valuable in‐depth empirical insights to regulatory bodies on the current SCD practises of IFIs to assist policymakers in modifying reporting frameworks or guidelines accordingly. In addition, this research can support academics, policymakers or standard setters and managers interested in seeking information about SCD and CG.
There is a growing concern about environmental issues, particularly carbon emissions, in many countries. Indonesia, with its huge population, also suffers from excessive carbon emissions. This study ...aims to investigate the effect of family businesses on environmental performance, specifically carbon emission disclosure. This study also explores the role of the family supervisory board and management on the quality of carbon emission disclosure. The study employed 62 non-financial family-listed firms in 2017–2019 (186 observations). The analysis found a positive and significant relationship between family enterprises and the disclosure of carbon emissions, implying that family firms expose more information about their carbon emissions. It also revealed a significant positive association between the family supervisory board and carbon emission performance, suggesting that having family members on the supervisory board aligns with policies for reducing and maintaining accountability for carbon emissions. In summary, the findings suggest that family enterprises prefer to exercise their indirect control by holding a position on the supervisory board and owning a substantial percentage of the company’s stock corresponding to their socio-emotional wealth agenda. Additionally, there is a non-linear association between family firms and the disclosure of carbon emissions. Carbon emission performance decreases as family share ownership rises to 53.1% but increases when family equity exceeds this cut-off point. Finally, family shareholders in non-polluted firms report higher quality of carbon emission disclosure.
Purpose -This study empirically investigates the function of Shariah Supervisory Board (SSB) in legitimizing the social and ethical existence of Sudanese banks through the dissemination of data ...onIslamic social in annual reports. Design/methodology/approach -The paper examines a panel dataset covering the period 2006 – 2015 through the use of disclosure index and content analysis from 150annual reports of Sudanese banks. The role of SSB is expressed from the aspects of Corporate Governance mechanisms (i.e. board size, independency, doctoral qualification, cross- directorship, and the overall effect of SSB mechanisms).The current study employs the multiple regression models by using STATA-13 statistical toolin answering the research questions. Findings -The empirical results indicate that the board size, doctoral qualification, and cross-directorship of the members were positively correlatedwith the disclosure degree of Islamic Corporate Social Responsibility (ICSR) in the annual reports of Sudanese Islamic banks, which is in favour of legitimacy theory. Meanwhile, results indicate that, in contrary to legitimacytheory’s assumptions,the independence of SSB members is found to negatively correlate with the ICSR level of disclosure of the sampled Sudanese banks’ annual reports. Furthermore, the overall effects of SSB mechanisms are found to positivelyimpact the ICSR disclosure level. The study’sfindings add new empirical evidence to support the view that social information disclosure by companies is influenced by country- cultural context within which the company operates. Theoretical implication - In theory, this paper offers an analysis on CSR in Sudan from Islamic point of view. This paper is vital in view that social responsibility is highly regarded by Islam. Therefore, social responsibility must be adopted by all Islamic organizations, particularly the Islamic banks. Originality/value – From the researchers’ perspective, this study is the pioneer thatinvestigates the role of SSB on Sudanese Islamic banks through social responsibility reporting using legitimacy theory.
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