Corporate governance and risk management: An evaluation of board responsibilities in western and Islamic banks
Corporate governance and risk management: An evaluation of board responsibilities in western and Islamic banks

Summary/Abstract: This research aims to explore the role of the board in cor-porate governance (CG) and risk management within thecontext of Islamic banking. Given the global reach of fi-nancial institutions, it is important to compare and evalu-ate the unique position of Shari’ah committees or Shari’ahSupervisory Board (SSB) in addressing the unique risks ofIslamic banks. Using a comparative analysis, this studyevaluated risk management guidelines in the CG codes ofthe United Kingdom, Germany, Saudi Arabia, and Malaysia.It found that board were ultimately responsible for riskmanagement, regardless of the governance structure, andShari’ah-related risks fell under the board’s purview. Aninnovative blend of Western CG frameworks and Islamicprinciples enhanced governance robustness through thestrategic collaboration between board and SSBs.

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