IDEAS home Printed from https://ideas.repec.org/a/spr/eurase/v12y2022i1d10.1007_s40822-021-00196-z.html
   My bibliography  Save this article

Depicting ethical dilemma in Islamic financial institutions; addressing the gender heterogeneity

Author

Listed:
  • Shinaj Valangattil Shamsudheen

    (Universiti Putra Malaysia)

  • Aishath Muneeza

    (International Centre for Education in Islamic Finance)

Abstract

Though the lex loci applicable to Islamic financial institutions (IFIs) are derived from Shariah that embeds ethical and moral values, IFIs still face ethical dilemma. Since the leadership and managerial roles are played by both genders, it is imperative to understand the implication of their contribution in this. As such, the objective of this paper is to examine the influence of gender using the aspects of al-Ghazali’s ethical philosophy in explaining the formation of ethical and unethical behavior within the purview of the Islamic finance industry of Malaysia, where both genders play a pivotal role in the industry. A total of 418 samples were collected from IFIs in Malaysia using a purposive sampling technique, and the empirical analysis was conducted with the measures of model fit and bootstrapping technique using Partial least square Structural equation modeling and Multi-group analysis. The empirical findings indicate the dedicated use of intellect in making decisions related to ethical issues where desires and emotions tend to overwhelm reason and human choices. While divine knowledge is found ineffective guidance of the intellect, the element of satanic force is found to significantly impacting decision-making. As the lack of religious consciousness is evident among respondents, higher exposure to operational risk is expected. These findings were found identical among both genders under study. Findings suggest respective authorities of Islamic financial institutions to intensify the capacity-building programs on the foundation of faith which includes Islamic thought and worldview, to enhance the corporate ethical decision-making irrespective of gender.

Suggested Citation

  • Shinaj Valangattil Shamsudheen & Aishath Muneeza, 2022. "Depicting ethical dilemma in Islamic financial institutions; addressing the gender heterogeneity," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 12(1), pages 29-54, March.
    • Handle: RePEc:spr:eurase:v:12:y:2022:i:1:d:10.1007_s40822-021-00196-z
    DOI: 10.1007/s40822-021-00196-z
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s40822-021-00196-z
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s40822-021-00196-z?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Roszaini Haniffa & Mohammad Hudaib, 2007. "Exploring the Ethical Identity of Islamic Banks via Communication in Annual Reports," Journal of Business Ethics, Springer, vol. 76(1), pages 97-116, November.
    2. Shinaj Valangattil Shamsudheen & Saiful Azhar Rosly, 2018. "Islamic conception of psychological nature of man; development and validation of scale with special reference to Al-Ghazali’s model," International Journal of Ethics and Systems, Emerald Group Publishing Limited, vol. 34(3), pages 321-337, August.
    3. Craig VanSandt & Jon Shepard & Stephen Zappe, 2006. "An Examination of the Relationship Between Ethical Work Climate and Moral Awareness," Journal of Business Ethics, Springer, vol. 68(4), pages 409-432, November.
    4. Khan, Tariqullah & Nabee Mohomed, Amiirah Bint Raffick, 2017. "Ethical Banking and Islamic Banking: A Comparison of Triodos Bank and Islami Bank Bangladesh Limited," Islamic Economic Studies, The Islamic Research and Training Institute (IRTI), vol. 25, pages 112-154.
    5. Raj Maham & Omar Khalid Bhatti & Ali Osman Öztürk, 2020. "Impact of Islamic spirituality and Islamic social responsibility on employee happiness with perceived organizational justice as a mediator," Cogent Business & Management, Taylor & Francis Journals, vol. 7(1), pages 1788875-178, January.
    6. Raj Maham & Omar Khalid Bhatti, 2019. "Impact of Taqwa (Islamic piety) on employee happiness: A study of Pakistan’s banking sector," Cogent Business & Management, Taylor & Francis Journals, vol. 6(1), pages 1678554-167, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Elasrag, Hussein, 2015. "Corporate social responsibility in Islam," MPRA Paper 63670, University Library of Munich, Germany.
    2. Yasser A. AL-Rawi & Yusri Yusup & Essa Ahmed & Ali F. Ali & Sofri Bin Yahya, 2023. "An examination of environmental taxes from the Islamic and Shariah perspectives," Journal of Environmental Studies and Sciences, Springer;Association of Environmental Studies and Sciences, vol. 13(1), pages 141-155, March.
    3. Muhammad Ali & Syed Ali Raza & Chin-Hong Puah & Mohd Zaini Abd Karim, 2017. "Islamic home financing in Pakistan: a SEM-based approach using modified TPB model," Housing Studies, Taylor & Francis Journals, vol. 32(8), pages 1156-1177, November.
    4. Ali, Muhammad & Syed ali, Raza & Chin-Hong, Puah, 2015. "Factors affecting intention to use Islamic personal financing in Pakistan: Evidence from the modified TRA model," MPRA Paper 66023, University Library of Munich, Germany.
    5. Chaudhry Ghafran & Sofia Yasmin, 2020. "Ethical Governance: Insight from the Islamic Perspective and an Empirical Enquiry," Journal of Business Ethics, Springer, vol. 167(3), pages 513-533, December.
    6. Sofia Yasmin & Roszaini Haniffa & Mohammad Hudaib, 2014. "Communicated Accountability by Faith-Based Charity Organisations," Journal of Business Ethics, Springer, vol. 122(1), pages 103-123, June.
    7. Ahmed Hassanein & Mohamed M. Mostafa, 2023. "Bibliometric network analysis of thirty years of islamic banking and finance scholarly research," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(3), pages 1961-1989, June.
    8. Elena Platonova & Mehmet Asutay & Rob Dixon & Sabri Mohammad, 2018. "The Impact of Corporate Social Responsibility Disclosure on Financial Performance: Evidence from the GCC Islamic Banking Sector," Journal of Business Ethics, Springer, vol. 151(2), pages 451-471, August.
    9. K. Praveen Parboteeah & Matthias Weiss & Martin Hoegl, 2024. "Ethical Climates Across National Contexts: A Meta-Analytical Investigation," Journal of Business Ethics, Springer, vol. 189(3), pages 573-590, January.
    10. Salem, Rami & Usman, Muhammad & Ezeani, Ernest, 2021. "Loan loss provisions and audit quality: Evidence from MENA Islamic and conventional banks," The Quarterly Review of Economics and Finance, Elsevier, vol. 79(C), pages 345-359.
    11. Muhammad Bilal Zafar & Ahmad Azam Sulaiman, 2019. "Corporate social responsibility and Islamic banks: a systematic literature review," Management Review Quarterly, Springer, vol. 69(2), pages 159-206, June.
    12. Paltrinieri, Andrea & Dreassi, Alberto & Migliavacca, Milena & Piserà, Stefano, 2020. "Islamic finance development and banking ESG scores: Evidence from a cross-country analysis," Research in International Business and Finance, Elsevier, vol. 51(C).
    13. Roshima Said & Corina Joseph & Noor Zahirah Mohd. Sidek & Azlyn Zawawi & Zaherawati Zakaria & Mahadir Ladisma@Awis & Roziya Abu & Normah Omar, 2018. "Development of Bumiputera Communicated Identity Index for Malaysian Statutory Bodies," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 8(3), pages 198-209, March.
    14. Laurence Romani & Betina Szkudlarek, 2014. "The Struggles of the Interculturalists: Professional Ethical Identity and Early Stages of Codes of Ethics Development," Journal of Business Ethics, Springer, vol. 119(2), pages 173-191, January.
    15. K. Parboteeah & Hsien Chen & Ying-Tzu Lin & I-Heng Chen & Amber Lee & Anyi Chung, 2010. "Establishing Organizational Ethical Climates: How Do Managerial Practices Work?," Journal of Business Ethics, Springer, vol. 97(4), pages 599-611, December.
    16. Arman Mergaliyev & Mehmet Asutay & Alija Avdukic & Yusuf Karbhari, 2021. "Higher Ethical Objective (Maqasid al-Shari’ah) Augmented Framework for Islamic Banks: Assessing Ethical Performance and Exploring Its Determinants," Journal of Business Ethics, Springer, vol. 170(4), pages 797-834, May.
    17. Arifur Khan & Mohammad Muttakin & Javed Siddiqui, 2013. "Corporate Governance and Corporate Social Responsibility Disclosures: Evidence from an Emerging Economy," Journal of Business Ethics, Springer, vol. 114(2), pages 207-223, May.
    18. Akrum Helfaya & Amr Kotb & Rasha Hanafi, 2018. "Qur’anic Ethics for Environmental Responsibility: Implications for Business Practice," Journal of Business Ethics, Springer, vol. 150(4), pages 1105-1128, July.
    19. Max Baker & John Roberts, 2011. "All in the Mind? Ethical Identity and the Allure of Corporate Responsibility," Journal of Business Ethics, Springer, vol. 101(1), pages 5-15, March.
    20. Riaz, Umair & Burton, Bruce & Fearfull, Anne, 2023. "Emotional propensities and the contemporary Islamic banking industry," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 94(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:eurase:v:12:y:2022:i:1:d:10.1007_s40822-021-00196-z. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.