The effect of financial performance on islamic ethical identity disclosure of ASEAN sharia banks

Abstract

This research aims to analyze the influence of Risk Profile, Good Corporate Governance, Earnings and Capital (RGEC) on the disclosure of Islamic ethical identity in Sharia banks in ASEAN. The method used in this analysis is descriptive analysis and regression testing on 23 Islamic banks from 11 ASEAN countries. The research results show that non-performing financing (NPF), which measures risk profile, negatively influences the disclosure of Islamic ethical identity. In contrast, audit committee competency (KAA), as an indicator of good corporate governance, has a positive influence. Likewise, the return on assets (ROA) ratio, which measures earnings, positively influences the disclosure of Islamic ethical identity. However, as a capital indicator, the Capital Adequacy Ratio (CAR) does not have a significant influence. Based on this research, Sharia banks in ASEAN are expected to increase the optimization of their Islamic ethical identity disclosure through risk management, good corporate governance, improving financial performance, and paying attention to capital adequacy. However, this study has limitations, such as a limited sample size and high variability in the dependent variable. Therefore, further research is recommended to expand the sample, add variables, and reduce subjectivity in identifying disclosures of Islamic ethical identity.