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Shariah board and takaful performance: mediating role of corporate social responsibility

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  • Nourhen Sallemi

    (University of Sfax)

  • Ghazi Zouari

    (University of Sfax)

Abstract

This study aims to investigate the impact of Shariah board characteristics (Shariah board size, cross-membership, qualification, and reputation) on the performance of takaful insurance providers of distinguishable Muamalah contracts (wakalah and mixt), mediated by corporate social responsibility. Our sample covers 30 Takaful insurances divided into two subsamples: 18 insurance wakalah contracts offered in Southeast Asia (SEA) and 12 insurance mixte contracts offered in GCC over the period 2010–2020. We used the PLSPM method for data analysis. Corporate social responsibility (CSR) activities contribute to the success of takaful insurance. In fact, CSR has a partial mediating effect on the relationship between Shariah board size, qualification, and Takaful performance based on SEA countries and GCC. Furthermore, CSR has a full mediating effect on the relationship between cross-membership and takaful performance in SEA countries and a partial mediating effect on the relationship between cross-membership and takaful performance in GCC countries. Moreover, CSR has a partial mediating effect on the relationship between reputation and Takaful performance in both SEA and GCC countries. This study highlights that CSR is a source of efficiency that enhances Takaful’s performance. Regulators should appreciate this procedure for the formulation of suitable and useful ways to efficiently supervise the operations of Takaful insurance.

Suggested Citation

  • Nourhen Sallemi & Ghazi Zouari, 2024. "Shariah board and takaful performance: mediating role of corporate social responsibility," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 71(2), pages 175-204, June.
    • Handle: RePEc:spr:inrvec:v:71:y:2024:i:2:d:10.1007_s12232-023-00439-2
    DOI: 10.1007/s12232-023-00439-2
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    More about this item

    Keywords

    Shariah board; Takaful performance; Muamalat contract; Corporate social responsibility; PLSPM;
    All these keywords.

    JEL classification:

    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • G3 - Financial Economics - - Corporate Finance and Governance

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