Corporate Social Responsibility of Islamic Banks in Malaysia: Arising Issues

Abstract

Corporate social responsibility (CSR) term has rapidly developed and is no longer a strange concept among business communities. As part of business entities and concurrently guided by Sharī‘ah principles, Islamic banks face even more expectations in performing CSR as Islamic financial institutions. On top of that, although Malaysia is at the vanguard in the development of Islamic finance especially in Islamic banking industry, there is a lack of discussion on issues pertaining CSR applications of Islamic banks. Using interview data with top management executives and supported by observations and document reviews, this study attempts to disclose arising issues regarding CSR applications of Islamic banks in Malaysia. It was found that there are significant issues that need to be addressed in order to ensure the efficiency of Islamic banks CSR applications especially regarding corporate social responsibility disclosure (CSRD), CSR department and CSR fund.

Keywords: Corporate social responsibility, Islamic banks, Malaysia, top management

JEL Classification: G30, P43