Abstract
This study focuses on halal reporting in Malaysian companies. Halal reporting is one of the voluntary reports that provide an avenue to stakeholders to obtain halal information relating to companies. This study examined certified halal companies listed on the Bursa Malaysia. Companies’ annual reports for financial year 2016, and their websites were analyzed using content analysis. The study identifies that halal reporting practiced by companies in the sample remains low. Most companies disclosed halal-related information in the Chairman’s Statement and Risk Management sections of their annual reports. In contrast, companies were found to disclose more halal information in ‘other’ sections of their websites. The findings suggest that there is a need for halal-certified companies to enhance their halal reporting, especially in annual reports. This study provides evidence on the status of halal reporting and complements prior research that advocated halal reporting to stakeholders as a basic rule to meet the demands of shariah.
Highlights
Halal is a contemporary topic that is heavily discussed in the Muslim community
According to the latest Global Islamic Economy Report, the halal food sector alone will grow to a valuation of USD 2.537 trillion by 2019, up from USD 795 billion in 2014, which is equivalent to 21.2 percent of global food expenditures
Since the objective of this study is to examine 30 companies listed on consumer products counters at Bursa Malaysia, this study finds that companies in the halal industry must be accountable and efficiently disclose their halal-related information to the stakeholders
Summary
Halal is a contemporary topic that is heavily discussed in the Muslim community. There is no doubt that the halal industry is important for Muslims to ensure that they can obtain halal goods and services. The Quran says in Al-Baqarah, ‚O mankind eat from whatever is on earth [that is] lawful and good and do not follow the footsteps of Satan. Al-Baqarah (2:172) In general, the term ‘halal’ is usually attached to ‘toyyiban’, which refers to cleanliness, safety and goodness. In this case, the permissible goods should be hygienic and safe. MS1500:2009 states that halal food is food and/or beverages that contains only ingredients permitted based on shariah and that complies with the following criteria: a) does not contain any parts or products of animals that are non-halal by shariah or any parts or products of animals that are not slaughtered according to shariah; b) does not contain najs according to shariah; c) is safe for consumption, nonpoisonous, nonintoxicating or nonhazardous to health; d) is not prepared, processed or manufactured using equipment contaminated with najs according to shariah; e) does not contain any human parts or derivatives not permitted by shariah; and f) during its preparation, processing, handling, packaging, storage and distribution, is physically separated from any other food that does not meet the requirements stated in items a), b), c), d) and e) or any other things that have been decreed as najs by shariah law
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