Corporate law and Sharia governance: Empirical insights, risk-based bank rating, and ESG Islamic approach

This study aims to examine and analyze the effect of sharia compliance, Islamic corporate governance, Islamic social reporting on financial performance at Islamic Commercial Banks in Indonesia. This study uses three sub-variables of sharia compliance, namely Islamic income ratio, profit sharing ratio, and zakat performance ratio. The type of research in this study is causal associative. The population of this study are Islamic Commercial Banks registered with the Financial Services Authority in 2015-2019. The sample selection method uses purposive sampling (certain criteria), so the number of samples used is 12 Islamic Commercial Banks so that there are 60 sample data. Data analysis method using structural equation modeling (SEM)-partial least square (PLS) with a significance level of 5%. The results show that the Islamic income ratio has an effect on financial performance, profit sharing ratio has no effect on financial performance and zakat performance ratio has no effect on financial performance. Islamic corporate governance has an effect on financial performance. Islamic social reporting has no effect on financial performance.

This study aims to analyze the health of Islamic Commercial Banks in Indonesia using four indicators of the Risk-Based Bank Rating (RBBR) method: risk profile (NPF), profitability (ROA), capital (CAR), and good corporate governance (GCG) from 2021 to 2024. A descriptive research approach was employed, utilizing secondary data obtained from the Islamic Banking Statistics reports published by the Financial Services Authority (OJK). Data analysis was conducted by presenting tables and identifying performance trends in each of the main RBBR indicators, namely risk profile (NPF), profitability (ROA), capital (CAR), and good corporate governance (GCG). The results of the study indicate that Islamic Commercial Banks in Indonesia have demonstrated a positive trend across all indicators. The risk profile indicator, represented by Non-Performing Financing (NPF), showed a decline from 2.59% in 2021 to 2.08% in 2024, placing Islamic Commercial Banks in the "healthy" category. The profitability indicator also improved, with Return on Assets (ROA) increasing from 1.55% to 2.07%, reflecting enhanced operational efficiency and moving from a “fairly healthy” to “healthy” condition. In terms of capital, the Capital Adequacy Ratio (CAR) remained consistently high, ranging from 25.30% to 26.28%, indicating a very strong and resilient capital position. Finally, the GCG factor consistently achieved a score of 2, indicating a “good” level of corporate governance implementation. Collectively, these findings conclude that Islamic Commercial Banks in Indonesia were in a sound and stable condition throughout the observation period based on the RBBR assessment, affirming the effectiveness of these principles in ensuring the performance and sustainability of the Islamic banking sector.

This study aims to determine how the influence of Profitability (GPM), Liquidity (CR), and Leverage (DER) on Islamic Social Reporting (ISR) with Company Size as a Moderating Variable, in Islamic Commercial Banks in Indonesia which are registered with the OJK for the 2015-2019 period. This research uses quantitative research, type with secondary data in the form of panels analyzed through multiple linear regression data analysis method with Moderate Regression Analysis (MRA) test using EViews 9 software. The population used in this research is Islamic Commercial Banks (BUS) in Indonesia as many as 14 Islamic banks. The sampling technique in this study was purposive sampling. The sample used as the research object was 12 BUS. Based on the results of the study, the F-test results show that Profitability, Liquidity and Leverage simultaneously affect the ISR with a positive coefficient while the T-test shows that partially Profitability and Leverage have no effect on ISR, Liquidity has a negative and significant effect on ISR. Based on the MRA test, Company Size is unable to moderate the relationship between the effect of profitability on ISR, while Company Size is able to moderate and weaken the relationship between Liquidity and ISR, and Company Size is able to moderate and strengthen the relationship between Leverage and ISR.

The performance growth of Islamic commercial banks in Indonesia cannot be said to be good enough considering that Islamic commercial banks have been established for 30 years, therefore it is necessary to examine what factors can affect the performance of Islamic commercial banks. The purpose of this study is to determine the partial or simultaneous influence of Islamic Corporate Governance (ICG), Islamic Corporate Social Responsibility (ICSR) and Islamicity Performance Index (IPI) variables on the Financial Performance of Islamic Commercial Banks in Indonesia in 2016-2020. This study uses quantitative research methods. The population in this study were 14 Islamic commercial banks in Indonesia. The sample in this study were 5 Islamic commercial banks in Indonesia. The research method used is multiple linear regression analysis technique. The results show that the ICG and Zakat Performance Index (ZPR) variables have a significant effect on the financial performance of Islamic commercial banks in Indonesia in 2016-2020. While the ICSR and Profit Sharing Ratio (PSR) variables have no significant effect on the financial performance of Islamic commercial banks in Indonesia in 2016-2020. The variables ICG, ICSR, PSR, and ZPR simultaneously affect the financial performance of Islamic commercial banks in Indonesia in 2016-2020.

This study aims to see the effect of disclosure of corporate social responsibility based on Islamic law on financial performance. This study uses a quantitative approach with a sample size of 8 out of 11 Islamic Commercial Banks in Indonesia taken using a purposive sample. The data collection process is carried out by downloading the annual financial statements of Islamic commercial banks from the annual financial statements, information on corporate social responsibility disclosures based on the Islamic Social Reporting (ISR) consists of 38 items, the zakat variable is measured by 2.5% of the profit before taxes, while the financial performance is seen from the value of Return on Assets (ROA) and Return On Equity (ROE) of each company. Path analysis is used to see the direct and indirect relationship of the disclosure of corporate social responsibility based on Islamic Social Reporting to financial performance, where zakat is a mediation. Path analysis shows that the disclosure of corporate social responsibility using ISR has a direct effect on financial performance (P < 0.001; R2 = 0.33), zakat on financial performance also affects financial performance (P < 0.001; R2 = 0.24). So it can be concluded that the disclosure of social responsibility using Islamic Social Reporting and the implementation of zakat in Islamic commercial banks in Indonesia can be used as steps to improve the company's financial performance.

This research aims to determine the level of performance of Islamic Commercial Banks in Indonesia using the Risk Based Bank Rating (RBRR) and Shariahh Conformity and Profitability (SCnP) for the 2017-2019 period. The object of this research is a BUMN Shariah Commercial Bank. The technique used for this research is purposive sampling using descriptive quantitative method. This study describes the performance of Islamic Commercial Banks through two methods, namely the Risk-Based Bank Rating (RBBR) method which is seen from 4 aspects, namely Risk Profile, Good Corporate Governance, Earnings, and Capital. The second method is Shariahh Conformity and Profitability (SCnP) which is seen from the Shariahh Conformity variable with indicators of Islamic Investment Ratio, Islamic Income Ratio, and Profit-Sharing Ratio and Profitability variable with indicators of Return on Assets (ROA), Return on Equity (ROE), and Net Profit Margin Ratio. The results showed that dwith the Risk-Based Bank Rating (RBBR) method, Islamic Commercial Banks are in a “Healthy” or “Good” condition. While the analysis using the Shariahh Conformity and Profitability (SCnP) method, shows that Islamic Commercial Banks are spread in three quadrants, namely URQ, LRQ, and ULQ.

Sharia banks have an important role in supporting the national economy, but the level of sharia financial literacy and inclusion in Indonesia still lags far behind conventional banking. This condition requires improvements in governance quality, profitability, and sharia compliance to strengthen corporate value. This research aims to analyze the influence of profitability, Islamic Corporate Governance (ICG), and the Maqashid Syariah Index (MSI) on corporate value, with Islamic Social Reporting (ISR) as a moderating variable. The research method uses a quantitative explanatory research approach with secondary data in the form of financial statements and GCG reports from eight Islamic Commercial Banks in Indonesia for the period 2018–2023, processed using SmartPLS 4. The results indicate that profitability, ICG, and MSI do not significantly influence firm value, while ISR is found to moderate the influence of ICG and MSI on firm value but does not moderate the relationship between profitability and firm value. These findings emphasize the importance of ISR in strengthening the role of Islamic governance and the achievement of Islamic objectives in increasing company value. Therefore, Islamic banks are advised to expand ISR disclosure as a strategy to build investor confidence, while enhancing competitiveness through strengthening Islamic aspects, product innovation, and governance transparency.

This study aims to examine the effect of board characteristics on the performance of Islamic banks (IBs) in Indonesia and Malaysia in 2016-2020. The sample of this study includes 11 Islamic commercial banks in Indonesia and 7 Islamic commercial banks in Malaysia. The analysis method uses panel data regression which is processed with the help of software Eviews 12. Performance is measured by Return On Assets (ROA), Return On Equity (ROE), and Non-Performing Financing (NPF), Board characteristics are measured by the size of the board of directors, the proportion of directors women, the expertise of the board of directors, the size of the sharia supervisory board (DPS), the proportion of female DPS and the expertise of the DPS. The results of the study show that overall Islamic Corporate Governance and Corporate Governance have a positive effect on the performance of Islamic Banks (IBs). Keywords: Kata kunci: Islamic Banks; Islamic Corporate Governance; Corporate Governance; Performance Islamic Bank

One of the cashless transactions implemented by Islamic Commercial Banks in Indonesia is internet banking or Electronic Banking (e-banking). The purpose This study to examine the impact of the implementation of electronic banking (e-banking) on the financial performance of Islamic Commercial Banks in Indonesia. The population of this study consists of all Islamic Commercial Banks in Indonesia from 2013 to 2023. According to the Islamic Banking Statistical Data from the Financial Services Authority (Otoritas Jasa Keuangan) in 2013, there were 11 Islamic commercial banks in Indonesia. Due to mergers of several Islamic banks, this study obtained data from 6 Islamic commercial banks as samples. The research findings indicate that the implementation of Electronic Banking (EB) has a negative effect on Return on Assets (ROA). This result is suspected to be caused by the costs associated with electronic banking services, such as infrastructure, maintenance, and human resources, which require higher expenses compared to the revenue generated from internet banking services. Moreover, the increasing frequency of updates to electronic banking services could potentially lower the bank's profitability (ROA) due to the significant costs associated with updating devices, which in turn reduces income. Overall, the costs incurred by Islamic banks to provide internet banking services involve various large cost components, ranging from system development and maintenance to transaction costs, security, and Sharia compliance. The variables of SIZE, DEPOSIT, NPF, and OEOI have an impact on the performance of Islamic Commercial Banks in Indonesia.

One of the non-cash transactions implemented in Islamic Commercial Banks in Indonesia is internet banking (e-banking) services. This study aims to determine the impact of Internet Banking (E-Banking) innovation on the financial performance of Islamic Commercial Banks in Indonesia. The population of this study consists of all Islamic Commercial Banks in Indonesia in 2013 to 2023. According to the Financial Services Authority's Islamic Banking Statistics Data in 2013, there were 11 Islamic commercial banks in Indonesia. As a result of the merger of several Islamic banks, this study obtained data from 6 Islamic commercial banks as samples. The results of the study indicate that the Implementation of Internet Banking (IB) has a negative effect on Return on Assets (ROA). This is thought to be due to costs associated with internet banking services, such as infrastructure, maintenance, and human resources, which require higher expenditures compared to the income generated from the internet banking service itself. In addition, the increasing frequency of internet banking service updates has the potential to reduce bank profitability (ROA) due to the high costs associated with device updates, which in turn reduce income. Overall, the costs paid by Islamic banks to provide internet banking services involve various components of quite large costs, ranging from system development and maintenance to transaction costs, security, and sharia compliance. SIZE, DEPOSIT, NPF and BOPO affect the performance of Islamic commercial banks in Indonesia. The empirical findings of this study have significance for the development of e-banking which will bring long-term benefits to the entire banking industry in Indonesia.

This study aims to analyze the effect of Risk-Based Bank Rating (RBBR) conducted by Bank Indonesia in predicting financial distress at islamic commercial banks in Indonesia during the Covid-19 Pandemic crisis. So that both exposures originating from internal and external factors can be analyzed for their influence on the resilience of the financial conditions of islamic commercial banks during the Covid-19 Pandemic crisis. This research is a type of quantitative research with data analysis method used, namely panel data regression analysis.
 This study show the results that Risk-Based Bank Rating (RBBR) which reflect risk exposure to internal and external factors simultaneously influence predicting financial distress in islamic commercial banks in Indonesia during the Covid-19 Pandemic crisis. Besides, individually, variables of Non Performing Financing (NPF), Return on Assets (ROA), RGEC Risk Value, have no effect on financial distress. Meanwhile, if individual testing is carried out on the variables Financing to Deposit Ratio (FDR), Operating Expenses to Operating Income (BOPO), and Capital Adequacy Ratio (CAR) they have an effect on predicting financial distress in islamic commercial banks in Indonesia during the Covid-19 Pandemic crisis.

This research aims to determine the effect of profitability ratios on corporate zakat expenditure in Islamic commercial banks in Indonesia from 2020 to 2023. This quantitative research utilizes secondary data. The dependent variable in this study is corporate zakat, and the independent variables are profitability ratios proxied by Return on Assets (ROA) and Return on Equity (ROE). The data analysis method uses panel data regression. The population in this study consists of Islamic commercial banks in Indonesia registered with the Financial Services Authority. The sampling technique used is purposive sampling, resulting in a sample of 8 Islamic commercial banks. Data processing in this study uses the statistical data analysis tool Eviews version 10. The results of the study can be concluded partially that the Return on Assets variable has a significant negative effect on corporate zakat expenditure, and the Return on Equity variable has a significant positive effect on corporate zakat expenditure. Simultaneously, it also shows that Return on Assets and Return on Equity affect corporate zakat.

The study aims to determine the efficiency level of Islamic Commercial Banks in Indonesia and Malaysia, as well as the effect of Return on Assets (ROA), Bank size and Non-Performing Financing (NPF) on the efficiency of Islamic Commercial Banks in Indonesia and Malaysia for the 2015-2020 period by using Tobit regression test. The type of research carried out is quantitative research with a descriptive approach. Purposive sampling is a sampling method used in this study with a sample of 5 Islamic Commercial Banks in Indonesia and Malaysia. The results of the study indicate that all Islamic Commercial Banks in Indonesia during the study period were efficient as a whole in the research sample as many as 3 Islamic Commercial Banks, while the National Khazanah Bank of Malaysia, there were Islamic banks that were still not efficient as many as one Islamic bank and one other bank the results were efficient. The results of the Tobit regression test state that the ROA and NPF variables have a significant effect on efficiency. In contrast, Bank size has no significant effect on efficiency.

This study aims to develop and analyze a maqosid sharia-based performance improvement model for Islamic banks in Indonesia. First, a comprehensive and relevant literature review is carried out to form a performance improvement model based on maqasid sharia. Furthermore, the model is tested empirically using statistical tests. The results show that Islamic social reporting (ISR) has a positive role in increasing maqasid sharia. Islamic corporate governance (ICG) likewise has a positive function in expanding Islamic social reporting. Islamic social reporting (ISR) does not mediate the relationship between Islamic corporate governance (ICG) and maqasid sharia. Islamic social reporting (ISR) does not mediate the relationship between Islamic corporate governance (ICG) and maqasid sharia. The implication of this result shows that Islamic commercial banks should give more consideration to the level of accomplishment of maqasid sharia, with the application of Islamic corporate governance (ICG) and the better implementation of Islamic social reporting (ISR) under the objectives of sharia banks. Regulators need to make policies in the form of incentives for Islamic banking to carry out their operations optimally and further realize maqasid sharia. The findings of this research have implications for policymakers, the need for a policy on the mandatory implementation of Islamic corporate governance (ICG). This study builds a model that can improve performance based on Islamic maqosid in Islamic banks in Indonesia.

This study aims to analyze whether there is an influence of Islamic Corporate Governance, Islamic Social Responsibility, Intellectual Capital, Sharia Bank Indonesia Certificates and Profit Sharing Levels on the Financial Performance of Islamic Commercial Banks in Indonesia for the 2016-2020 period. The type of data used is secondary data obtained from the financial reports of banks, BI and OJK through published institutional reports which were analyzed using multiple linear regression with the help of the E-Views 10 Program. The results of this study are the variables Islamic corporate governance, Islamic social responsibility, and Islamic corporate governance. intellectual capital, and Bank Indonesia Sharia Certificates partially have no effect on the Financial Performance of Islamic Commercial Banks in Indonesia in 2016-2020. while the Profit Sharing Variable has an effect on the Financial Performance of Islamic Commercial Banks in Indonesia in 2016-2020. Variables Islamic Corporate Governance, Islamic Social Responsibility, Intellectual Capital, Bank Indonesia Sharia Certificates and Profit Sharing Levels Simultaneously on the Financial Performance of Islamic Commercial Banks in Indonesia in 2016-2020.
 Keywords: Islamic Bank, Financial Performance, Quantitative