MAQASID SHARIAH BASED PERFORMANCE OF ISLAMIC BANKS, ISLAMIC CORPORATE GOVERNANCE, AND CONTINGENCY THEORY: A THEORETICAL FRAMEWORK

Abstract

This paper is a theoretical framework with a method of literature review aimed at analyzing performance of Islamic bank influenced by the accounting control system, contingency factors and Islamic corporate governance. Islamic banks should measure performance based on the maqasid Shariah in applying Islamic principles. Islamic banks have not yet completely assessed their performance on the basis of the maqasid Shariah in practice, despite having enough data to calculate it. Based on the theory of contingency, the accounting control system used to achieve company performance must be fit (match) with contingency factors (such as environmental uncertainty competitive strategy, organizational structure and human behavior variables). Islamic banks require the convergence of the accounting control system with Islamic corporate governance to affect maqasid Shariah based the performance of Islamic banks. There doesn't seem to be have been any empirical evidence to examine it, therefore this paper suggests a model to be examined for future research