Corporate governance and Islamic banks

Abstract

This paper examines Islamic bank governance in respect to their goals and objectives, Shari'ah supervisory boards, investment account holders, internal governance structure and external governance matters. Corporate governance has emerged as a key variable over the last two decades to address the question of how businesses, banks included, are governed with a view to enhancing the safety of capital provided by largely absent stakeholders in the inner decisions of the corporations. In the case of banks, governance issues are also tied together with the need to work within a set of closely regulating institutions as well as compliance with a set of standards.