The realization on maqasid al-shariah and maslahah concepts in cooperative governance practices
List of Authors
  • Rose Ruziana Samad , Zurina Shafii

Keyword
  • Maqasid al-Shariah, Maslahah, Cooperatives, Governance

Abstract
  • In today’s communities, low-income groups are often not eligible for financial assistance or loans. This led to the development of cooperatives with the objective to develop mutual help among members of the cooperative. Due to their dual identity, cooperatives have always faced complex governance challenges, and there is a well-established institutional framework to deal with this. Cooperative managers sometimes face difficulty recognising the real goal of the cooperative. Profit and growth missions are in constant negotiation to ensure the welfare of members is maintained. The starting point is shared principles which provide guidelines as to how cooperatives should be owned and governed. The principles of governance in Islam are formulated as early as the formation of Madinah as an Islamic state. These can be referred to in the al-Quran and al-Hadith, maqasid al-shariah, with the emphasis given on maslahah ‘ammah (public benefits) and the prevention of mafsadah (wrongdoing). Although Islam does not elaborate on all the needs of human life, it does not mean that Islam neglects to outline the policies and principles of all rules, especially the systems needed by human life to ensure the survival that will benefit and keep away from harm. The methodology used to prepare this article is based on literature reviews from past researches and sourced from the al-Quran and al-Hadith.

Reference
  • 1. Abu-Tapanjeh, A. M. (2009). Corporate governance from the Islamic perspective: A comparative analysis with OECD principles. Critical Perspectives on accounting, 20(5), 556-567.

    2. ADB (Asia Development Bank). (2000). Corporate Governance and Financial in East Asia: A study of Indonesia, Republic of Korea, Malaysia, Philippines, and Thailand. A Consolidated Report. Manila. ADM. Vol. 1.

    3. Ahmad, K. (2006). Management from the Islamic Perspective. Kuala Lumpur: International Islamic University Malaysia, Reasearch Center.

    4. Al-Harran, S.A.S. (1990). Islamic Finance: The Experience of the Sudanese Islamic Bank in Partnership (Musharakah) Financing as a Tool for Rural Development among Small Farmers in Sudan. PhD diss., Durham University.

    5. Ali, A. (1988). Scaling an Islamic work ethic. The Journal of Social Psychology, 128(5), 575-583.

    6. Ansari, S., Munir, K. & Gregg, T. (2012). Impact at the “Bottom of the Pyramid”: The Role of Social Capital in Capability Development and Community Empowerment’. Journal of Management Studies, 49, 813–42.

    7. Askari, H., Iqbal, Z., & Mirakhor, A. (2010). Globalization and Islamic Finance: Convergence, Prospects and Challenges (Vol. 778). John Wiley & Sons.

    8. Auda, J. (2008). Maqasid Al-Shariah A Beginner's Guide (Vol. 14). International Institute of Islamic Thought (IIIT).

    9. Aziz, Z. A. U. (2014). Advancing Financial Inclusion to its Next Level. The Alliance for Financial Inclusion (AFI) 2014. Global Policy Forum. Port of Spain, Trinidad and Tobago. 10 September 2014.

    10. Bhatti, M., & Bhatti, M. I. (2010). Toward Understanding Islamic Corporate Governance Issues in Islamic Finance. Asian Politics & Policy, 2(1), 25-38.

    11. Bashir, B. A. (1984). Successful development of Islamic banks. Journal of King Abdulaziz University: Islamic Economics, 1(2).

    12. Chapra, M.U. (2000). The Future of Economics: An Islamic Perspective. Leicester: The Islamic Foundation.

    13. Choudury, M, A. & Hoque, M.Z. (2004). An Advanced Exposition of Islamic Economics and Finance. New York, Edward Mellen Press.

    14. Dusuki, A. W. (2008). Banking for the Poor: the Role of Islamic Banking in Microfinance initiatives. Humanomics, Vol.24 No.1, 2008.

    15. Dusuki, A. W. & Abdullah, N. I. (2011). Fundamentals of Islamic Banking. IBFIM.

    16. Dusuki, A. W. & Bouheraoua, S. (2011). The Framework of Maqasid al-Shariah (Objectives of the Shari'ah) and Its Implications for Islamic Finance. ISRA Research Paper, (No: 22/2011).

    17. Haron, S. (1996). Competition and other external determinants of the profitability of Islamic banks. Islamic Economic Studies, 4(1).

    18. Hassan, Z. (2009). Corporate Governance: Western and Islamic Perspectives. International Review of Business Research Papers. Vol.5 No. 1 January 2009 Pp. 277-293.

    19. Iqbal, Z, & Mirakhor, A. (2004). Stakeholders Model of Governance in Islamic Economic System. Islamic Economic Studies, Vol. 11. No. 2, pp. 43-64.

    20. Ismail, I. & Said, M. S. 2012. Pengenalan Koperasi Edisi Bharu. Utusan Publications & Distributors Sdn. Bhd.

    21. Ismail al-Qudsy, S. H. S., Rahman, A. A. & Zain, M. I. M. (2009). Pengukuhan Nilai dan Profesionalisme di Kalangan Penjawat Awam ke Arah Efektif Governan di Malaysia. Shariah Journal, Vol. 17, No. 3 (2009) 559-592

    22. Ismail, M. I., Hasan, R., & Alhabshi, S. M. (2016). Shariah governance framework for Islamic co-operatives as an integral social insitution in Malaysia. Intellectual Discourse, 24.

    23. Kamali, M. H. (2008). Shari'ah Law: An Introduction. Oneworld Publications.

    24. Khan, M. S., & Mirakhor, A. (1989). The financial system and monetary policy in an Islamic economy. Journal of King Abdulaziz University: Islamic Economics, 1(1).

    25. Lahsasna, A. (2013). Maqasid al-Shari'ah in Islamic finance.

    26. Lagan, A. (2006). Ethics at Work. In the Black. Melbourne. Vol. 76 No.2.

    27. Muneeza, A., & Hassan, R. (2011). Legal Obstacles in Shari’ah Corporate Governance of Islamic Financial Institutions in Malaysia. The Journal of King Abdulaziz University (JKAU): Islamic Economics, 24(2), 207-210.

    28. Nik Hassan, N. M. & Shaikh Mohd Salleh, S. M. S. (2002). Corporate Governance from the Islamic Perspective. Intitute of Islamic Understanding Malaysia.

    29. Rafiki, A., & Wahab, K. A. (2014). Islamic Values and Principles in the Organization: A Review of Literature. Asian Social Science, 10(9), 1.

    30. Rivai, V., Nuruddin, A., & Arfa, F. A. (2012). Islamic Business and Economic Ethics. Jakarta: Bumi Aksara.

    31. Samad, R.R. & Shafii, Z. (2015). Islamic Financial Innovations: Shariah Based Co-operatives Initiatives in Malaysia. Paper presented at the International Conference on Islamic Economics, Governance and Social Enterprise (IConIGS). 14-15 December, 2015. Melaka.

    32. Svensson, G. & Wood, G. (2004). "Proactive versus Reactive Business Ethics Performance: A Conceptual Framework of Profile Analysis and Case Illustrations". Corporate Governance, Vol. 4 No.2, pp.18‐33

    33. World Council of Credit Unions (WOCCU). (2014). Statistical Report. World Council of Credit Unions, Washington D.C.