Performance measurement is vital to examine the performance of any institution. Due to the different nature of business operations, processes, and activities in Islamic banks, they have to be measured by a more focused instrument to reflect the Shariah compliance parts and their business nature compared to the conventional banks. Hence, M Score which has been developed by Abdul Rahim, Abdul Rahman and Syed AlHabshi (2016) has been adopted in this study. The findings from the computation will indicate which country gains the higher M Score in performance, and this can be used as a benchmarking exercise. This research aims to analyse and compare the M Score performance of Islamic banks in Malaysia and Indonesia. The content analysis via Annual Reports of Islamic banks has been used for this study. The sampling technique used is purposive sampling. The research was conducted on Islamic banks in Malaysia and Indonesia over a period of two years, from 2020-2021. This comparative research is expected to be an evaluation tool for Malaysian Islamic banks, helping them improve their performance to catch up with their counterparts in Indonesia. Thus, the purpose of this research proposal is to analyse and compare the effect of the soundness of Islamic banks based on the M Score performance of Islamic banks in Malaysia and Indonesia. The results of this study indicate that Islamic banks in Indonesia have a higher M Score ranking than those in Malaysia. There are significant differences in the performance of Islamic banks based on the Need Fulfilment and Equitable Distribution (NFED), Economic Growth (EG), and Economic Stability (ES) in Malaysia and Indonesia.
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