Does time orientation improve Islamic cultural finance

Purpose - Time orientation as a proxy of culture can play an important role in promoting the industry and underpin the new field of “Islamic cultural finance.” This paper aims to investigate the effect of time orientation on Islamic finance. Design/methodology/approach - The dynamic generalized method of moments was used to study the influence of time orientation in 45 countries from 2012–2020 in the main analysis. Fixed-Effect Model was applied for the regional analysis. Findings - Results indicate the existence of a significant effect of “time orientation” on Islamic finance. In regional comparison analysis, time orientation is not significant in some regions, such as non-Asian and Arab countries. The market is very limited in non-Asian countries, while similarities in scope between Islamic and conventional finance reduce the long-term orientation in Arab countries. Practical implications - Improving the time orientation of weak countries enhances the industry’s status in those countries and pushes it to compete with the leading countries in the industry. Culture is a comprehensive framework that includes all factors located within it. While governance is imposed through regulation and procedures and raises the cost of business, culture is integral and built-in, and thus it is less expensive, and its presence is stronger, facilitating the applications of Islamic finance. Originality/value - This paper proposed time orientation as a proxy for culture and extended the new domain of Islamic cultural finance using quantum (econometric) methods instead of surveys and questionnaires.