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The prime difference between conventional and Islamic financial institutions (IFIs)is the compliance with shari'ah. Hence, shari'ah is a very crucial pillar, rather a main pillar of Islamic finance. In order to ensure shari'ah compliance by the IFIs at all levels, central banks of different countries crafted and implemented shari'ah governance framework. This chapter focusses on the cross-country comparison of shari'ah governance framework. The countries included in this chapter are Malaysia, Pakistan, the United Kingdom and Bahrain. The result shows that Malaysia and Pakistan are leading in terms of comprehensive shari'ah governance framework whereas Bahrain comes next and the United Kingdom is the last in terms of comparison.

The purpose of this paper is to understand current Shari'ah governance practices with the purpose of promoting greater understanding of some of the crucial issues and to provide relevant information in guiding the future development of Shari'ah governance system. The paper illustrates the state of Shari'ah governance practices in Malaysia, GCC countries (Kuwait, Bahrain, United Arab Emirates, Qatar and Saudi Arabia) and the UK by highlighting five main elements of good corporate governance that consist of independence, competency, transparency, disclosure and consistency.

Since the availability of secondary data on Shari'ah governance practices is very limited, a detailed survey questionnaire is generated for sourcing primary data from Islamic Financial Institutions (IFIs). The study utilizes descriptive analysis approach in extracting and analyzing the data and factual input derived from the questionnaire feedback.

The survey findings affirm that there are significant differences and diverse Shari'ah governance practices in the case countries. This position acknowledges that there are shortcomings and weaknesses to the existing governance framework which needs further enhancement and improvement.

The paper is a very useful source of information that may provide relevant guidelines in guiding the future development of Shari'ah governance practices in IFIs.

This paper provides fresh data and recent information on the actual Shari'ah governance practices of IFIs in three jurisdictions.

The most crucial challenge facing Islamic Financial Institutions (IFIs) is the full compliance of their activities with shari'ah principles. The complexity of IFIs requires Otoritas Jasa Keuangan (OJK, Indonesian Financial Services Authority) to adopt a good shari'ah governance framework to address shari'ah risks of Islamic banking and financial institutions (IBFIs). However, the current shari'ah governance structure in Indonesia is far from ideal compared to the international best practice. This chapter proposes a new shari'ah governance framework by involving shari'ah supervisory board authority (Otoritas Dewan Pengawas Syariah) under the commissioners of OJK to oversight, regulate, and supervise the shari'ah matters for IBFIs in Indonesia. The chapter discusses the challenges in adopting this new framework. The chapter concludes that the current shortcomings of the proper shari'ah governance framework for shari'ah supervision and regulation requires a new shari'ah board authority under the commissioners of OJK who has full authority over shari'ah matters.

This paper aims to conduct a detailed analysis of the feasibility of issuing sukuk in China and examine the regulatory issues related to the issuance of sukuk in China.

This study uses SWOT analysis to explore China’s internal and external environments related to the issuance of sukuks and examines the application of sukuks as an alternative financing instrument in China.

As a unique financial instrument, a sukuk can assist in meeting China’s current financing needs. Moreover, it is feasible to issue a sukuk. China should be prepared to modify its legal system and set up a regulatory framework conducive to the issuance of sukuks. Furthermore, blockchain technology can be used to overcome certain limitations of sukuks.

This study provides a detailed analysis of sukuk issuances in China. This study discusses the issue of sukuk issuance in China from the perspective of finance and law.

This purpose of this article is to examine the Shari'ah scholars' perception of the Shari'ah governance system in Islamic financial institutions (IFIs) particularly of its six major areas, namely, issues of Shari'ah governance; internal framework; roles and functions of Shari'ah board; attributes of Shari'ah board members on independence, competency and transparency and confidentiality; operational procedures and assessment of the Shari'ah board's performance.

The study conducted semi-structured interviews with Shari'ah scholars who are members of the Shari'ah boards in various IFIs. All interview questions were generated, structured and arranged in a way that all the data could be analysed easily through a coding and thematic approach.

The study discovers the different points of view demonstrated by the Shari'ah scholars who were interviewed on several issues, and they have also conceded that there are serious gaps and weaknesses prevalent in all the six major areas of Shari'ah governance. This position acknowledges that there are shortcomings and weaknesses to the existing governance framework which need further enhancement and improvement.

The study offers a useful source of information that may provide relevant guidelines to policymakers and practitioners for future development of Shari'ah governance practices in IFIs.

The study provides fresh data and significant information pertaining to the Shari'ah scholars' perspective on the Shari'ah governance system. This analysis of Shari'ah scholars' opinions of the Shari'ah governance system can also serve to enhance the literature on the topic.

Given the relative importance of the Shari’ah supervisory boards (SSBs) in Islamic banks’ (IBs’) performance, this study aims to examine the impact of SSB diversity on IBs’ performance from the stakeholders’ perspective in the context of Pakistan.

Random-effects model and generalized method of moment are used to investigate the impact of SSB diversity on IBs’ performance across a panel data of 22 Islamic banks in Pakistan from 2005 to 2020 inclusive.

The findings of this study show that SSB size, SSB relevant educational background diversity, bank’s size and bank’s stability have a positive impact on IBs’ performance. In contrast, SSB age, nationality and cross-membership diversities have a negative impact on IBs’ performance. Moreover, SSB gender, tenure and general educational diversities have no significant impact on IBs’ performance.

SSB diversity and IBs practices are different across different jurisdictions. This study is conducted on IBs in Pakistan because of data constraints; thus, the results of this study may not be generalizable to other countries' IBs.

In structuring the SSBs’ framework, the regulatory authorities and policymakers should consider mandating an ideal SSB size and hiring relevant qualified members with low cross-membership to improve IBs' performance. Thus, the structure potentially attracts Muslim stakeholders, enhances their satisfaction and improves IBs' performance.

Having diversified members in the SSB, IBs equally benefit both individual and group stakeholders in society. Diversity in SSB members enhances IBs' performance and the social welfare of various stakeholders in society.

To the best of the authors' knowledge, this is the first empirical research that examines comprehensively the impact of SSB structural and demographic diversities on IBs' performance in the context of Pakistan. This paper contributes to the unique Shari’ah governance structure in the context of Pakistan. Additionally, this study may serve to assist IBs’ stakeholders in better comprehending the SSB practices of IBs in Pakistan.

This paper aims to survey the screening practices and regulatory arrangements that can be gleaned from the experience of Islamic financial indices on international stock markets. Such indices can be regarded as experiments in the demarcation of “pockets” of Sharī‘ah-compliant securities exchange, in the context of non-Sharī‘ah-compliant stock markets. They offer valuable regulatory precedent, with a view to the development of a transnational domain of Islamic financial transactions.

The paper leverages the experience of Islamic financial indices for charting the fault lines between the foundational principles of Islamic finance, and those of interest-based investment commonly accepted on international financial markets. It subsequently reviews the most salient regulatory arrangements in place for discriminating between permissible and forbidden securities and modes of trading, as implemented on Islamic financial indices. These include selection criteria for index inclusion, and Sharī‘ah committees with ex ante and ex post supervisory duties.

The paper makes a case for viewing Islamic finance indices on international capital markets as capacity-building experiments for the regulation of transnational Islamic financial flows.

The study rejuvenates the pragmatic approach towards the development of Islamic capital markets, by suggesting that incremental organisational innovations, as developed in connection with Islamic financial indices, can build institutional capacity towards an economy that abides by Islamic values.

This paper aims to systematically review the existing studies on the relationship of Sharī'ah governance (SG), as represented by the Sharī'ah supervisory board (SSB), with firm performance of Islamic banks (IBs), to suggest opportunities for future research in this field.

By adopting a systematic literature review, 21 empirical and theoretical papers published in Scopus concerning the relationship between SSB and performance of IBs were selected for review and analysis.

In light of the existing research studies' limitations, this paper suggests that the effect of SSB on IBs' performance still requires more empirical analyses using alternative analytical methods, alternative measures, and different periods (during crisis and non-crisis). Besides that, these studies should take into account the differences across jurisdictions in their SG models, the degree of agencies' intervention in SG practices, the control over cross-memberships of scholars, and the differences across IBs in the position of SSB in the organization structure.

The analysis undertaken in this paper would address the literature gaps on the effect of SSB on IBs' performance as this study serves as a guide for the researchers, academicians, and interested researchers from Islamic international autonomous non-for-profit organizations, e.g. AAOIFI and IFSB in research related to this important area. Importantly, the findings of this study would support regulators and related authorities across jurisdictions with suggestions on improving the current SG practices.

This paper presents a critical review of the existing research on SSB and IB performance and suggests new variables, measurements, analytical methods, and new issues for researchers in this area. Thus, it identifies the literature gap that still needs further empirical investigation and a suitable way to close it.

The purpose of this study is mainly to comprehensively investigate the current practices of Islamic banks’ Shari’ah supervisory boards in the specific context of Yemen.

The study uses a qualitative approach in the form of in-depth interviews of a number of Shari’ah scholars active within the Yemeni Islamic banks.

The findings support the notion that Islamic banking still lacks regulations and standards, as the Yemeni Islamic banks are still following the minimum requirements and only apply the compulsory standards. Another key finding is that Islamic banks in Yemen apply similar principles in Fatwa issuance and Shari’ah compliance assurance, especially in referring to the different Madzhabs’ and scholars’ opinions because of the sensitivity of Yemeni community with regards to the Shari’ah compliance aspect. Finally, the procedure of Shari’ah review of the Islamic banks’ operations varied from the typical set of procedures to the loose ones in terms of the number of staff in the Shari’ah audit department and the application of a comprehensive survey or sampling to review the banks’ transactions.

This study provides some valuable recommendations to further enhance the Shari’ah supervisory practices not only in Yemen but also in similar settings.